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Amended proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE amending Council Directive 89/552/EEC on the coordination of certain provisions laid down by law, regulation or administrative action in Member States concerning the pursuit of television broadcasting activities

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 07. 05. 1996 COM(%) 200 final 95/0074 (COD) Amended proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE amending Council Directive 89/552/EEC on the coordination of certain provisions laid down by law, regulation or administrative action in Member States concerning the pursuit of television broadcasting activities (presented by the Commission pursuant to Article 189 a (2) of the EC-Treaty) EXPLANATORY MEMORANDUM 1. Introduction 1. 1 The 1989 Directive1 The 1989 Directive was adopted in order to create the legal reference framework needed at Community level to ensure the free movement of television broadcasts. This is achieved through the coordination of national rules in the fields where the disparities between them were - or are potentially - such as to create legal barriers to free circulation. The fields concerned are respectively jurisdiction, the promotion of distribution and production of television programmes, advertising and sponsorship, the protection of minors and the right of reply. Member States may not restrict the reception or the retransmission of broadcasts from other Member States for reasons which fall within the coordinated fields. A Member State may only lay down more detailed or stricter rules in these fields as regards broadcasters under its own jurisdiction. The main objective of the Directive is to achieve free circulation. Because it uses the method of the coordination of national rules where necessary to achieve this primary objective, the Directive also espouses the objectives of those national rules. It is the cornerstone of the "European audiovisual space" and has been, or is in the process of being supplemented by complementary legal measures (in particular the cable and satellite copyright Directive2). 1. 2 The History of the Proposal for a Directive amending the 1989 Directive Article 26 of the 1989 Directive requires the Commission to present a report on its application five years after adoption, accompanied if appropriate by proposals to adapt it to developments in the field of television broadcasting. The Commission's services carried out an extensive consultation process in 1994. The Commission presented to Parliament and Council a Communication the introductory statement and the proposal for a Directive amending the 1989 Directive on including the application report, Council Directive 89/552/EEC of 3 October 1989 "on the coordination of certain provisions laid down by law, regulation or administrative action in Member States concerning the pursuit of television broadcasting activities" (OJ L298 p. 23 17. 10. 1989) Council Directive 93/83/EEC (OJ L248, p. 15, 06. 10. 1996). See also the recent "Green Paper on the legal protection of encrypted signals" COM(96)76 •X 31 May 19953. The purpose of the proposal is to adapt and clarify certain provisions of the 1989 text in the light of the experience gained in its implementation and of developments in the sector. The current Directive remains in force until amended (the next report on application is due in October 1996). The Economic and Social Committee adopted its opinion on 13 September 1995 (CES 972/95). On 14 February 1996 Parliament adopted a legislative resolution4 in the first reading under the co-decision procedure (Art. 189 (b) EC Treaty) approving the Commission's proposal subject to the amendments it had made. In parallel, the Council of Ministers was examining the proposal and held a full debate at ministerial level at its meeting on 20 November 1995 pending the adoption of Parliament's opinion in accordance with the co-decision procedure. 2. The amended proposal 2. 1 Parliament's amendments The amended proposal set out here incorporates the amendments accepted by the Commission. A large number of amendments (25) were accepted in part or in spirit and 5 as such i. e. roughly half the amendments actually adopted by Parliament. This memorandum will explain how these have been incorporated into the text and will provide further specific comments on the Commission's reasoning where appropriate. In general terms, the Commission has done its utmost to take the greatest possible account of Parliament's wishes as expressed in the first reading. Where it has not been able to incorporate an amendment, either partially or not at all, this is for one or several of the following categories of reason: the amendment, either on its own or in combination with other amendments, would seriously upset the balance of the Commission's proposal; the amendment includes measures that would be impossible to implement in practical terms, in the Commission's view; the amendment presents, in the Commission's view, serious legal difficulties. 2. 2 Explanation of the amendments incorporated The right-hand column of the attached document constitutes the Commission's amended proposal. The amendments are underlined. The left-hand column represents the Commissions initial proposal and is provided for ease of reference. 3 4 OJC185, p. 4, 19. 07. 1995 EP 196. 583 d cx Recital 5(a) incorporates in part Parliament's amendment no. 35. This is because the Commission considers that while it is acceptable to state that future Community legal measures must be compatible with existing measures in the same field, to go beyond such a statement would prejudge the outcome of future legislative processes. Recital 9 incorporates a change made necessary by Parliament's amendment no. 22 which has been partially incorporated into Article 2(3). Recital 11 incorporates a change made necessary by Parliament's amendment no. 28 the spirit of which has been incorporated into Article 3(2). Recital 15a corresponds to Parliament's amendment no. 88. Recital 17a corresponds to Parliament's amendment no. 10 (and, in part, no. 4). Recitals 21 (a) to (c) correspond to Parliament's amendment no. 35. The Commission considers that while it is useful, for the purposes of the implementation of Article 5, to have a guideline definition of what is meant by the term "independent producer", it would be too prescriptive, given the very diverse nature of the independent production sector in the Member States, to include such a definition in an Article. It is therefore proposed to include the definition in a recital. Moreover, the actual definition must be flexible enough to take account of this diversity. For example, in some smaller Member States there are very few broadcasters (in some cases, such as Austria and Ireland, there is currently only one). It is not possible therefore to stipulate in absolute terms that a producer is only independent if he or she does not supply to the same broadcaster more than 90% of the works he or she produces. A further useful criterion 6f independence to be taken into account is the degree to which the producer retains the right to exploit the work on secondary markets (eg. after first broadcast or after a certain time) as suggested by the amendment. Recital 22a refers to Article 1 new paragraph (d) (definition of television advertising) and Article 18(1) which have been modified to take account of Parliament's Amendment no. 20 (in as far as the matter is not already covered by the current definition). Recital 23 is modified to incorporate partially Parliament's amendment no. 12. Recital 24 takes account, in part, of Parliament's amendment no. 52. It also incorporates changes made necessary by the amendment of Article 22 (2) which itself now takes account of Parliament's amendment no. 76. This is the first of Parliament's amendments to be incorporated into the text of the amended proposal following the order of the recitals. However, it should be noted that Amendment no. 1 is identical to recital no. 16 of the 1989 Directive. This recital remains valid as it is not affected by the Directive amending the 1989 Directive and therefore there is no need (and it is not possible) to incorporate Amendment no. 1 into the Commission's amended proposal (as it is already in the 1989 text). *. ft- Recital 24a is included to take account of Parliament's amendments no. 14, 15, 62 and 55 (the latter being the so-called "V-chip" amendment); it corresponds to new Article 22b included to take account of the same series of amendments. Recital 25 is modified to incorporate Parliament's amendment no. 26 which itself relates to Article 3(1). It should be pointed out that Article 3(1), which states that Member States remain free to require television broadcasters under their jurisdiction to comply with more detailed or stricter rules than those laid down by the Directive, does not as such create any legal obligation for the Member States. It therefore makes no difference, in legal terms, whether the list of areas in which Member States may take such measures and, which is indicative in nature, is included in an Article or in a recital. The Commission has a preference for the latter for reasons of presentation and clarity. Article 1 new paragraph (b). The Commission accepted this part of Parliament's amendment no. 18 because it considers that it is an improvement, in terms of legal security, to include this definition of what is meant by the term "television programme" in Article 1(a) (the weakness of which is due to the fact that television broadcasting is defined by reference to television programmes giving rise to a somewhat circular definition). However, this addition does not change the scope of the definition of television broadcasting, which is circumscribed by the terms "to the public" and "it does not include communication services — on individual demand". The Commission explained in the Explanatory Memorandum to the initial proposal why it considers that it would be inappropriate to extend the scope of this Directive beyond that of the 1989 text (i. e. the point-to-multipoint transmission of television programmes intended for reception by the public). Article 1 new paragraph (c) corresponds to Parliament's amendment no. 19. The Commission considers that it is useful to include a definition of the organisations which have to comply with the national provisions transposing those of the Directive. The definition proposed matches the one proposed by Parliament with the one used in the Council of Europe's Transfrontier Television Convention. It is based on three essential elements: it concerns natural or legal persons (as in the Convention) who have editorial responsibility for the composition of schedules of television programmes (this corresponds to the 2nd and 3rd parts of Parliament's definition and to the 2nd part of the Council of Europe's definition) who transmits, or has transmitted, these programmes (the 3rd part of the Council of Europe's definition). a c Article 1(d). This is paragraph (b) of the 1989 text modified to take account of amendment no. 20. It should be seen in conjunction with recital no. 22a. The purpose is to make it clear that the basic consumer protection rules in Articles 10 to 16 apply to self-promotional forms of advertising (see also amended Article 18). Article 1 (g) is paragraph (e) of the Commission's proposal modified to take account of amendment no. 21 and to align the reference to goods and services with the one in new paragraph (d). Article 2 paragraphs 2. 3 and 4 have been modified to take account of amendments no. 22, 23 and 24 (jurisdiction criteria). The Commission agrees that it is important to provide for detailed criteria making it possible to determine, with a sufficient degree of clarity and by reference to the specific nature of the activities involved, the place of establishment of the broadcaster for the purpose of determining which Member States has jurisdiction. However, this implies an exhaustive hierarchical arrangement of the three specific criteria that have been chosen (head office, place where editorial decisions are taken, and place where a significant part of the workforce is located) in order to take account of all the possible combinations of the criteria. Failure to establish a hierarchical order would give rise to positive conflicts (several States claiming jurisdiction) or negative conflicts (legal vacuum). Moreover, the Commission cannot accept paragraph (c) of amendment 23 for the following reasons: by introducing the criterion of the State for which the programmes are intended it reverses the "home country control principle" of the Directive and would make it unworkable; it is contrary to the logic of the Treaty; it is self-defeating, as the result would be that jurisdiction could not be determined on the basis of the three chosen criteria and therefore would have to be determined on the basis of the purely technical criteria contained in paragraph 4 (frequency, satellite capacity or up-link). Article 2a has been modified to take account partially of amendment 24. However, the Commission cannot accept the part of the amendment that extends to advertising a procedure designed to deal with grave violations of the rules on protection of minors in programmes. It would be wholly inappropriate to confuse these two very different issues. Moreover, it would reverse in one field the "home country control" principle and thereby make the Directive unworkable. Article 3 paragraph 2 has been modified to take account of amendments no. 27 (effective compliance) and 28 (third party redress ). (Amendment no. 35 has been incorporated into recital no. 21a - see above). Article 6 paragraph 1 incorporates a new sub-paragraph (d) which the Commission considers necessary in view of certain recent developments in the broadcasting legislation of some of the European third countries referred to in sub-paragraphs (b) and (c). This d a addition also corresponds in part to what the Commission construes as being the spirit of Parliament's amendment no. 36. Article 7 is modified to incorporate partially amendment no. 37. The wording of the first sentence emphasizes that windows are first and foremost a matter for the contracting is adjusted according to the amendment. parties. The duration of the windows However, the Commission considers that the provision in sub-paragraph (b) referring to works co-produced by the broadcaster renders the last paragraph in the amendment superfluous. Moreover, it is not possible, in the internal market, to take any other date than that of first release in the Community as the starting date for the various windows. Article 9 incorporates a change that corresponds in part to amendment no. 38. Articles 10 and 11 now incorporate references to teleshopping as in amendments no. 39, 40 and 42. Article 11(3) incorporates the part of amendment no. 41 referring to films produced for television. The Commission cannot accept the part of the amendment stating that the basis for the calculation of the number of breaks allowed should be scheduled duration "exclusive of all interruptions". This would impose an unnecessary restriction that would impact very negatively on broadcasters' revenue streams. Articles 12 (c) incorporates amendment no. 43. Article 14 has been modified to incorporate the essence of the 2nd part of Parliament's amendment no. 44 with wording that is compatible with existing Community regulations. The first part of the amendment is not acceptable as it reverses the home country control principle of the directive and is incompatible with Court of Justice case law (notably the "Bond van Adverteeders" judgement, CJCE 352/86 of 24. 04. 1988). However, a wide prohibition on teleshopping for medical products, by reference to existing Community regulations, can be justified on the one hand by public health concerns, and on the other, by the fact that teleshopping differs from advertising and sponsorship in that it entails a much more direct relationship with the final consumer. Article 17 includes a new paragraph 2a that incorporates changes that reflect the development of the debate on sponsorship of programmes by pharmaceutical companies since the Commission's initial proposal. Article 18 incorporates changes deriving in part from amendments 45 and 46. However, the Commission is of the opinion that it is neither desirable nor possible to exclude forms of advertising other than spot advertising. It also incorporates a change relating to announcements made by broadcasters in connection with their own programmes that is made necessary by the amended definition of "television advertising" in Article 1 in order to avoid such announcements having to be counted within the daily advertising limit. Article 18a reflects amendment no. 74 on teleshopping within channels other than teleshopping channels. 4--Û- Article 19 corresponds to Article 18b in the Commission's initial proposal concerning teleshopping channels and other channels devoted exclusively to commercial promotion. The Commission does not consider it appropriate to place quantitative restrictions of the type that apply, by virtue of Article 18, to conventional channels on channels exclusively devoted to forms of commercial promotion or direct selling. The latter have a different purpose and do not compete on the same market segments as the former. Article 20 incorporates a change that brings it into line with the terminology used in Article 9 and incorporates in part amendment no. 51. Article 22 (2) corresponds to amendment no. 76 in particular and to concerns about the protection of minors in general as expressed in amendments nos. 14, 15, 62, 52 and 55 (see also recital no. 24). However, the Commission considers that it could be unnecessarily prescriptive to require a programme that is already encoded to incorporate warning signals. Moreover, one or other of the forms of warning (acoustic or visual) is sufficient to achieve the purpose of alerting the viewers. Article 22 (b) includes a new second paragraph that corresponds in particular to amendments nos. 62 and 55 (see also recital no. 24a). The Commission considers that the "V-chip" is an interesting development that could provide an effective way of ensuring greater parental control. However, this idea requires further investigation before it can be incorporated into binding legal measures at Community level. In particular, the matter of the rating system poses specific problems in the context of transfrontier television in Europe. Furthermore, the inter play between the "V-chip" and existing family viewing policies, including watersheds at specific times, requires in-depth analysis in order to be sure that the new development will complement rather than undermine existing measures. Finally by taking the time needed to analyze all these questions, Europe will also be able to benefit from the experience that will be gained by the United States and Canada in implementing V-chip legislation. Article 26 corresponds partially to amendment no. 58. The Commission agrees that developments in the field of television broadcasting need to be taken into account in the implementation of the Directive, including any future revision, but considers that to limit the scope of the analyses that will be required to services operating solely on individual demand would be to adopt too narrow an approach. This is why the Commission prefers the wider notion of technological developments in general. S Amended proposal for a European Parliament and Council Directive amending Council Directive 89/552/EEC on the coordination of certain provisions laid down by law, regulation or administrative action in Member States concerning the pursuit of television broadcasting activities 9 INITIAL PROPOSAL AMENDED PROPOSAL THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Articles 57(2) and 66 thereof, Having regard to the Treaty establishing the European Community, and in particular Articles 57(2) and 66 thereof, Having regard to the proposal from the Commission1, Having regard to the proposal from the Commission, Having regard Economic and Social Committee2, the opinion of the to Having regard the opinion Economic and Social Committee, to of the Acting in accordance with the procedure referred to in Article 189b of the Treaty3, Acting in accordance with the procedure referred to in Article 189b of the Treaty, 1. Whereas Council Directive 89/552/EEC4 constitutes for legal broadcasting in the internal market; framework the Whereas Council Directive 89/552/EEC constitutes for legal broadcasting in the internal market; framework the 2. Whereas Article 26 of Directive 89/552/EEC states that the Commission shall, no later than the end of the fifth year after the date of adoption of the Directive, submit to the European Parliament and the Economic and Social Committee a report on the application of the Directive and, if necessary, make further proposals to adapt it to developments in the field of television broadcasting; 26 Whereas Article of Directive 89/552/EEC states that the Commission shall, no later than the end of the fifth year after the date of adoption of the Directive, submit to the European Parliament and the Economic and Social Committee a report on the application of the Directive and, if necessary, make further proposals to adapt it to developments in the field of television broadcasting; OJN' OJN* OJN" OJNTL298, 17. 10. 1989, p. 23 3. Whereas the application of Directive 89/552/EEC and its application have revealed the need to clarify certain definitions or obligations on Member States under this Directive; the report on Whereas the application of Directive 89/552/EEC and its application have revealed the need to clarify certain definitions or obligations on Member States under this Directive; the report on in the Commission 4. Whereas its Communication of 19 July 1994 entitled "Europe's way to the information society. An action" underlined the importance of a regulatory framework applying to the content of audiovisual services which would help to safeguard the free movement of such services in the Community and be responsive to the opportunities for growth in sector opened up by new technologies,. while at the same time taking into account in particular the cultural and sociological audiovisual programmes, impact, whatever their mode of transmission; the specific nature, this of in Whereas its the Commission Communication of 19 July 1994 entitled "Europe's way to the information society. An action" underlined the importance of a regulatory framework applying to the content of audiovisual services which would help to safeguard the free movement of such services in the Community and be responsive to the opportunities for growth in sector opened up by new technologies, while at the same time taking into account in particular the cultural and sociological impact, audiovisual programmes, whatever their mode of transmission; the specific nature, this of 5. Whereas the Council welcomed this action plan at its 1787th meeting on 28 September 1994 and stressed the need to. the improve European audiovisual industry; the competitiveness of Whereas the Council welcomed this action plan at its 1787th meeting on 28 September 1994 and stressed the need to improve the the European of competitiveness audiovisual industry; 5a. Whereas the addition of a definition of a "television programme" shall bv no means be interpreted as extending the scope of application of this Directive, to new services such as video-on-demand and on line or internet type services and whereas any legislative framework concerning new audiovisual services must be compatible with the primary objective of this Directive which is to create the legal framework for the free circulation of services: 6. Whereas the Heads of State and Government meeting at the European Council in Essen on 9 and 10 December 1994 called on the Commission to present a for a revision of Directive proposal 89/552/EEC before their next meeting; the Heads of State and Whereas Government meeting at the European Council in Essen on 9 and 10 December 1994 called on the Commission to present a for a revision of Directive proposal 89/552/EEC before their next meeting; to 7. Whereas the application of Directive 89/552/EEC has revealed the need to clarify the concept of jurisdiction as applied the audiovisual sector; specifically whereas, in view of the case law of the Court of the European Communities, the establishment criterion should be made the principal criterion determining the jurisdiction of a particular Member State; Justice of to Whereas the application of Directive 89/552/EEC has revealed the need to clarify the concept of jurisdiction as applied the audiovisual sector; specifically whereas, in view of the case law of the' Court of the European Communities, the establishment criterion should be made the principal criterion determining the jurisdiction of a particular Member State; Justice of 8. Whereas the concept of establishment according to the criteria laid down by the ODUrt of Justice in its judgment of 25 July 1991 in Factortame5. involves the actual pursuit of an economic activity through a fixed establishment for a indefinite period; Whereas the concept of establishment according to the criteria laid down by the Court of Justice in its judgment of 25 July 1991 in Factortame. involves the actual pursuit of an economic activity through a fixed establishment for a indefinite period; 9. Whereas the establishment of a television broadcasting organization, for the purpose of Directive 89/552/EEC, as amended by this Directive, may be determined by a series of practical criteria such as the location of the head office of the provider of services, the place where decisions on programming policy are usually taken, the place where the programme to be broadcast to the public is finally mixed and processed, provided that a significant proportion of the workforce required for the pursuit of the television broadcasting activity is located in the same Member State; Whereas the establishment of a television broadcasting organization, for the purpose of Directive 89/552/EEC, as amended by this Directive, may be determined by a series of practical criteria such as the location of the head office of the provider of services; the place where decisions on programming policy are usually taken, the place where the programme to be broadcast to the public is finally mixed and processed, and the place where a significant proportion of the workforce required for the pursuit of the is television broadcasting activity located: Case C-221/89, Queen v Secretary of State for Transport, ex parte Factortame. [1991] ECR 1-3905, para. 20. 4 9a. Whereas the fixing of a series of material criteria is designed to determine bv an exhaustive procedure that one Member State and one only is competent for a broadcaster in connection with the pursuit of the provision of the services which the directive addresses: nevertheless, taking into account the case law of the Court of Justice and so as to avoid cases where there is a vacuum of competence, if the question as to which Member State has jurisdiction cannot be determined according to these material criteria, the competent Member State is that in which the broadcaster is established within the meaning of Article 52 and the following of the EC Treaty: 10. Whereas the Court of Justice has constantly held6 that a Member State retains the right to take measures against a television broadcasting organization that is established in another Member State but directs all or most of its activity to the territory of the first Member State if the choice of establishment was made with a view to evading the legislation that would have applied to the organization had it been established in the territory of the first Member State; 11. Whereas any interested party in the Community must be able to assert its rights in the competent courts of the Member State with jurisdiction over the television broadcasting organization that is failing to comply with the national provisions arising out of the application of this Directive; take measures against a Whereas the Court of Justice has constantly held that a Member State retains the right to television broadcasting organization that is established in another Member State but directs all or most of its activity to the territory of the first Member State the choice of establishment was made with a view to evading the legislation that would have applied to tHe organization had it been established in the territory of the first Member State; if Whereas directly affected third parties, including nationals of other Member States, must be able to assert their rights in the competent courts or administrative bodies of the Member State with jurisdiction over a television broadcasting organization that may be failing to comply with the national provisions arising out of the application of this Directive; 12. Whereas Member States are free to take whatever measures they deem appropriate with regard to broadcasts coming from third countries, and which do not satisfy the in Article 2 of conditions Directive they comply with Community law and the international obligations of the Community; laid down 89/552/EEC, provided Whereas Member States are free to take whatever measures they deem appropriate with regard to broadcasts coming from third countries, and which do not satisfy the in Article 2 of conditions Directive they comply with Community law and the international obligations of the Community; laid down 89/552/EEC, provided from differences 13. Whereas in order to eliminate the obstacles arising in national legislation on the promotion of European works, Directive 89/552/EEC contains provisions aimed at harmonizing these regulations; whereas those provisions which, in general, permit the liberalization of provisions harmonizing the conditions of competition; trade must contain from differences Whereas in order to eliminate the obstacles arising in national legislation on the promotion of European contains works, Directive 89/552/EEC provisions aimed at harmonizing these those provisions regulations; whereas which, in general, permit the liberalization of provisions harmonizing the conditions of competition; trade must contain See, in particular, the judgments in Case 33/74, Van Binsbergen v Bestuur van de BedrijfsvereniRing. [1974] ECR 1299 and in Case C-23/93. TV 10 SA v Commissariaat voor the Media f 19941 ECR 1-4795 14. Whereas, moreover, Article 128(4) of the Treaty requires the Community to take cultural aspects into account in its action under other provisions of the Treaty; Whereas, moreover, Article 128(4) of the Treaty requires the Community to take cultural aspects into account in its action under other provisions of the Treaty; to strengthen 15. Whereas the Green Paper on "Strategy options the European programme industry in the context of the audiovisual policy of the European Union", adopted by the Commission on 7 April 1994, emphasizes in particular the need to step up measures to promote European works in order to further the development of the sector; 15(a) to for improving in addition the Communication on 16. Whereas, the considerations cited above, it is necessary to create conditions the competitiveness of the programme industry; the whereas application of Articles 4 and 5 of Directive 89/552/EEC , adopted by the Commission on 3 March 1994 pursuant to Article 4(3), shows that the measures to promote European works can contribute to such an improvement, but that they need to be modified to take account of developments in the field of television broadcasting. to strengthen Whereas the Green Paper on "Strategy options the European programme industry in the context of the audiovisual policy of the European Union", adopted by the Commission on 7 April 1994, emphasizes in particular the need to step up measures to promote European works in order to further the development of the sector; broadcasting organizations, Whereas programme makers, producers, authors and other experts should develop more detailed concepts and strategies aimed at developing European audiovisual fiction films that are addressed to a large audience: the Communication on Whereas, in addition to the considerations it is necessary to create cited above, conditions the improving for competitiveness of the programme industry; the whereas application of Articles 4 and 5 of Directive 89/552/EEC , adopted by the Commission on 3 March 1994 pursuant to Article 4(3), shows that the measures to promote European works can contribute to such an improvement, but that they need to be modified to take account of developments in the field of television broadcasting; 17. Whereas, if Article 4 of Directive 89/552/EEC, as amended by this Directive, is effectively implemented over a ten-year period, it should be possible, given the impact of the financial instruments available to the Community and the Member States, to achieve the objective of strengthening the European programme industry; Whereas, if Article 4 of Directive 89/552/EEC, as amended by this Directive, is effectively implemented over a ten-year period, it should be possible, given the impact of the financial instruments available to the Community and the Member States, to achieve the objective of strengthening the European programme industry; 17(a) Whereas the Media II programme, which seeks to promote training and distribution in the audiovisual sector, is also designed to enable the production of European works to be developed: 18. Whereas it is necessary to ensure the effective application of such measures throughout the Community in order to preserve free and fair competition between firms in the same industry; whereas the application of such measures could help to reinforce mutual trust between Member States; Whereas it is necessary to ensure the effective application of such measures throughout the Community in order to preserve free and fair competition between firms in the same industry; whereas the application of such measures could help to reinforce mutual trust between Member States; 19. Whereas, at the end of the ten-year period, any national measures in this field must not interfere with the principle of free circulation of services by restricting the reception or retransmission of television broadcasts from other Member States; Whereas, at the end of the ten-year period, any national measures in this field must not interfere with free circulation of services by restricting the reception or retransmission of television broadcasts from other Member States; the principle of 20. Whereas the proportions of European works must be achieved taking economic realities into account; whereas, therefore, it is necessary to introduce a progressive system for achieving this objective; Whereas the proportions of European works must be achieved taking economic realities into account; whereas, therefore, is necessary to introduce a progressive system for achieving this objective; it 21. Whereas account should be taken of the specific nature of transmissions broadcast only in a language other than those of the Member States; Whereas account should be taken of the specific nature of transmissions broadcast only in a language other than those of the Member States; 21(a) 21(b) 21(c) of for the purposes the Whereas, implementation of the measures designed to promote works created bv producers who are independent of broadcasters, guideline criteria are needed whereby a producer may be deemed to be independent if : = the broadcaster holds no more than 25% of the share capital of the production company than one television broadcaster is involved): if more (50% = over a three-vear period the producer supplies to the same broadcaster no more than 90% of the works produced, the unless, over the same period, producer makes only one programme or only one series: = the producer does not hold a significant number of shares in a broadcaster: shall be Whereas, in applying the above criteria, due specific account characteristics States' audiovisual systems, in particular those of Member States with a lesser audiovisual capacity or a limited language area: taken of of Member Whereas Member States may also take into account the destination and ownership of secondary rights when assessing the criteria of independence: 22. Whereas the question of specific time scales for each type of television showing of cinematographic works is primarily a matter to be settled by individual contracts; whereas, however, the absence of agreements between the interested parties or professionals concerned, a schedule tailored to the needs at each stage in the showing of such works, should be drawn up; in Whereas the question of specific time scales for each type of television showing of cinematographic works is primarily a matter individual contracts; to be settled by whereas, however, the absence of in agreements between the interested parties or professionals concerned, a schedule tailored to the needs at each stage in the showing of such works, should be drawn up; 22(a) 23. Whereas, it is important to facilitate the development of teleshopping, an activity with an economic importance for operators as a whole and a genuine outlet for goods and services within the Community, by modifying the rules on transmission time; whereas, to ensure the full protection of consumer interests, teleshopping should be governed by a number of minimum standards regulating the form and content of broadcasts; 24. Whereas it is necessary to clarify the rules for the protection of the physical, mental and moral development of minors; whereas the establishment of a clear distinction between programmes that are subject to an absolute ban and those that may be authorized subject to appropriate technical means should satisfy concern about the public interest expressed by Member States and the Community; Whereas transmission time allotted to to programme announcements relating schedules and derived products or to public service announcements and charity appeals broadcast free of charge is not to be included in the maximum amounts of daily or hourly transmission time that may be allotted to advertising and teleshopping: Whereas, in view of the development of teleshopping, an activity with an economic importance for operators as a whole and a genuine outlet for goods and services within the Community, it is essential to modify the rules on transmission time and to ensure a high level of consumer protection bv in place appropriate standards putting regulating form and content of broadcasts; the Whereas it is necessary to clarify the rules for the protection of the physical, mental and moral development of minors, in particular with regard to programmes which might disturb them psychologically: whereas the establishment of a clear distinction between programmes that are subject to an absolute ban and those that may be authorized subject to appropriate protective measures of a technical nature or regarding the time of the broadcast should satisfy whereas latter programmes when moreover the broadcast in unencoded form should be identified through optical or acoustic means regardless of the time of the broadcast: legitimate concerns; 10 24(a) 24b. in sensibility it appears possible to Whereas, since harmonize national rules on the protection of minors only to a limited extent owing to differences and moral standards, the potentialities of technical filtering devices and appropriate rating systems at national and Community level, should be studied with a view to enabling filter out to parents and guardians programmes which might a detrimental effect on the mental and physical development of minors: whereas such rating systems should involve as much as possible bodies consisting of experts (educationalists and media specialists') set up in association with the broadcasting and producing organisations themselves with appropriate support from the competent national and European authorities: have Whereas the Commission, in liaison with Member State authorities, should conduct an in-depth analysis of these issues and possible measures involving : - i z i the requirement for new television sets to be equipped with a technical device enabling parents or guardians to filter out certain programmes: the setting up of appropriate rating systems: encouraging family viewing policies: other measures educational awareness and with a view to presenting, if necessary before the deadline laid down in Article 26, the appropriate proposals for legislative or other measures. 11 through transmission 25. Whereas the Court of Justice has constantly held7 that the concept of services, as referred to in Articles 59 and 60 of the EEC Treaty, embraces the broadcasting of the television programmes, including the intermediary of cable operators; whereas in accordance with Article 3b of the Treaty action by the Community should not go beyond what is necessary to achieve its objectives in the sphere of television broadcasting; whereas the principle that Member States are free to lay down stricter or more detailed rules for the broadcasters under should be jurisdiction reaffirmed, their 25a. to the achieve the approach in Directive Whereas 89/552/EEC and this Directive has been adopted essential harmonisation necessary and sufficient to ensure the free circulation of television broadcasts in the Community will not be restricted for reasons which fall within the coordinated fields: whereas Member States remain free to apply to broadcasters under their jurisdiction more detailed or stricter rules in these fields: these rules, which must be compatible with Community law7, may concern, inter alia, the achievement of language policy goals and the taking into account of the public interest in terms of role as a provider of television's information, culture and education, entertainment and the need to safeguard pluralism in the information industry and the media: to ensure Whereas this Directive does not affect Member States' capacity to take measures in the protection of order competition with a view to avoiding the abuse of dominant positions and/or the establishment or strengthening of dominant positions bv mergers, agreements, acquisitions and similar initiatives: 26. Whereas Article B of the Treaty on European Union states that one of the objectives the Union shall set itself is to maintain "acquis full in communautaire", the Whereas Article B of the Treaty on European Union states that one of the objectives the Union shall set itself is to maintain "acquis full in communautaire", the 7 (initial proposal) See, in particular, the judgments in Case 155/73, Sacchi, [1974] ECR 409 and in Case 52/79, Procureur du Roi v Debauve. [1980] ECR 833. 7 (amended proposal) See the judgement in Case C-412/93, Leclerc-Siplec. [1995], ECR 1-179. 12 HAVE ADOPTED THIS DIRECTIVE: HAVE ADOPTED THIS DIRECTIVE: Article 1 Article 1 Directive 89/552/EEC follows: is amended as Directive 89/552/EEC is amended as follows: 1. Article 1 is amended as follows: 1. Article 1 is amended as follows: (a) point (b) is replaced by the following: (a) point (b) is replaced by the following: "(b) "television programme" within the meaning of paragraph (a) means an animated or non-animated sequence of images which may or mav not be accompanied bv sound. " (b) point (c) is replaced by the following : "(c) "broadcaster" means the natural or legal person who has editorial responsibility for the composition of schedules of television programmes within the meaning of paragraph (b) and who transmits them or has them transmitted bv a third party. " 13 (c) point (d) is replaced by the following : "(b) "television advertising" means any form of announcement broadcast in return for payment or for similar consideration by a public or private undertaking in connection with a trade, business, craft or profession in order to promote the supply of goods including services, immovable property, or rights and obligations, in return for payment. It does not include teleshopping;" or "(d) "television advertising" means any form of announcement broadcast, whether in return for payment or for similar consideration or for self- promotional purposes, by a public or private undertaking in connection trade, business, craft or with profession in order to promote the supply of goods or services, including immovable property, or rights and obligations, in return for payment;" (d) point (c) in Article 1 of Directive 89/552/EEC becomes point (e) (e) point (d) in Article 1 of Directive 89/552/EEC becomes point (f) (b) the following point (e) is added: (f) the following point (g) is added : "(e) "(g) "teleshopping" means television programmes and spots containing direct offers to the public with a view to the sale, purchase or rental of products or with a view to the supply of services in return for payment;" "teleshopping" means direct offers broadcast to the public with a view to the supply of goods or services, including immovable property, or rights and obligations, in return for payment". 14 2. Article 2 is replaced by the following: 2. Article 2 is replaced by the following: "Article 2 "Article 2 1. Each Member State shall ensure that all 1. television broadcasts transmitted by broadcasters under jurisdiction comply with the rules of the system of law applicable to broadcasts intended for the public in that Member State. its Each Member State shall ensure that all television broadcasts transmitted by broadcasters under jurisdiction comply with the rules of the system of law applicable to broadcasts intended for the public in that Member State. its 2. The broadcasters under the jurisdiction 2. For the purpose of this directive the broadcasters under the jurisdiction of a Member State are those established in the territory of that Member State according to paragraph 3 as well as those to whom paragraph 4 applies. of a Member State are those established in the territory of that Member State, in which fixed they must have a establishment and actually pursue an economic activity. 3. For the purposes of this directive, a broadcaster is deemed to be established in a Member State in the following cases : (a) the broadcaster has its head office in that Member State and the editorial decisions about programme schedules that Member State's are territory: taken in 15 (b) if a broadcaster has its head office in one Member State but editorial decisions on programme schedules are taken in another Member State, it shall be deemed to be established in the Member State where a significant part of the workforce involved in the pursuit of the television broadcasting activity operates: if a significant part of the workforce involved in the pursuit of the television broadcasting activity operates in each of those Member States, the broadcaster shall be deemed to be established in the Member State where it has its head office: if a significant part of the workforce involved in the pursuit of the television broadcasting activity operates in neither of those Member States, the broadcaster shall be the to be established deemed Member State where it first began broadcasting in accordance with the system of law of that Member State, provided that it maintains a stable and effective link with the economy of that Member State: in (ç) if a broadcaster has its head office in a Member State but decisions on programme schedules are taken in a non-member state, or vice-versa, it shall be deemed to be established in the Member State concerned, provided that a significant part of the workforce involved in the pursuit of the television broadcasting activity operates in that Member State. 4. Broadcasters which are not established in the territory of a Member State according to paragraph 3 are deemed to be under the jurisdiction of a Member State in the following cases : 3. Broadcasters established outside the territory of the Community shall also be under the jurisdiction of a Member the State following conditions: they satisfy one of if 16 (a) they use a frequency granted by that (a) they use a frequency granted by that Member State, Member State, (b) although they do not use a frequency granted by a Member State, they do use a satellite capacity granted by that Member State, (b) although they do not use a frequency granted by a Member State they do use a satellite capacity appertaining to that Member State; (c) although they use neither a frequency nor a satellite capacity granted by a Member State, they do use a satellite up-link situated in that Member State. (c) although they use neither a frequency granted by a Member State nor a satellite capacity appertaining to a Member State they do use a satellite up-link situated in that Member State. intended exclusively to This Directive shall not apply for broadcasts reception in third countries, and which are not received directly or indirectly by the public in one or more Member States. " 5. This Directive shall not apply intended exclusively to for broadcasts reception in third countries, and which are not received directly or indirectly by the public in one or more Member States. " 17 3. The following Article 2a is inserted: 3. The following Article 2a is inserted: "Article 2a "Article 2a not and their Member States shall ensure freedom of restrict reception shall retransmission on territory of television broadcasts from other Member States for reasons which fall within the fields coordinated by this Directive. They take may, appropriate reception and/or measures suspend television broadcasts if the following conditions are fulfilled: to retransmission provisionally, restrict of not and their Member States shall ensure freedom of reception restrict shall retransmission on territory of television broadcasts from other Member States for reasons which fall within the fields coordinated by this Directive. They may, provisionally, derogate from the above if the following conditions are fulfilled: (a) a television broadcast coming from another Member State manifestly, seriously and gravely infringes Article 22 and/or Article 22a; (a) a television broadcast coming from another Member State manifestly, seriously and gravely infringes Articles 22 or 22a; (b) during the previous 12 months, the the same least two prior broadcaster has infringed provision(s) on at occasions; (b) during the previous 12 months, the the same least two prior broadcaster has infringed provisions) on at occasions; the broadcaster and (c) the Member State concerned has notified the Commission in writing of the alleged infringements and of its intention to to restrict reception take measures and/or suspend retransmission should any such infringement occur again; (c) the Member State concerned has notified the the broadcaster Commission in writing of the alleged infringements and of the measures it take should any such intends infringement occur again; and to (d) consultations with the transmitting State and the Commission have not produced an amicable settlement within 15 days of the notification provided for in point (c), and infringement persists. the alleged (d) consultations with the transmitting State and the Commission have not produced an amicable settlement withins 15 days of the notification provided for in point (c), and infringement persists. the alleged 18 The Commission shall, within no more than two months following notification of the measure taken by the Member State, take a decision on whether is law. If it compatible with Community decides that it is not, the Member State will be required to put an end to the measure in question as a matter of urgency. the measure The Commission shall, within no more than two months following notification of the measure taken by the Member State, take a is decision on whether it compatible with Community decides that it is not, the Member State will be required to put an end to the measure in question as a matter of urgency. the measure law. If in the first The provision referred to paragraph is without prejudice to the application of any procedure, remedy or sanction to the infringements in question in the Member State which has jurisdiction over the broadcaster concerned. " is without prejudice in the first The provision referred to paragraph the to application of any procedure, remedy or sanction to the infringements in question in the Member State which has jurisdiction over the broadcaster concerned. " 4. Article 3 is replaced by the following: 4. Article 3 is replaced by the following: "Article 3 "Article 3 1. Member States shall remain free to 1. Member States shall remain free to require television broadcasters under their jurisdiction to comply with more detailed or stricter rules in the areas covered by this Directive. require television broadcasters under their jurisdiction to comply with more detailed or stricter rules in the areas covered by this Directive. These rules, which must be compatible with Community law, may concern, inter alia: the achievement of goals; language policy the taking into account of the public interest in terms of television's role as a information, education, provider of culture and entertainment and the need to the information industry and the media. safeguard pluralism in 19 2. Member States shall, by appropriate means, ensure,. within the framework of that their television legislation, broadcasters under their jurisdiction comply with the provisions of this Directive. legislation, Member States shall, by appropriate means, ensure, within the framework of their television broadcasters under their jurisdiction effectively comply with the provisions of this Directive. that to applicable Each Member State shall determine the television penalties broadcasting organizations under their jurisdiction who do not comply with the adopted provisions implementation of this Directive, which penalties shall be sufficient to enforce compliance. for include The measures the shall appropriate procedures for third parties directly affected, including nationals of other Member States, to apply to the competent judicial or other authorities to seek effective compliance according to national provisions. " 3. Member States shall also provide in their legislation, as regards television broadcasting organizations under their the possibility of jurisdiction, invoking interim measures aimed at remedying an the provisions of this Directive, if necessary broadcasting by licence. " infringement of suspending the for 5. Article 4 is replaced by the following: 5. Article 4 is replaced by the following: "Article 4 "Article 4 1. Member States shall, by appropriate means, ensure that broadcasters reserve for European works, within the meaning of Article 6, a majority proportion of their transmission time, excluding the time appointed to news, sports events, and advertising, games, teleshopping services. teletext 1. Member States shall, by appropriate means, ensure that broadcasters reserve for European works, within the meaning of Article 6, a majority proportion of their transmission time, excluding the time appointed to news, sports events, games, and advertising, teleshopping services. teletext 20 or the and time appointed teleshopping, In the case of channels which devote at least 80% of their transmission time, to excluding to advertising drama, cinematographic works, documentaries animation, Member States shall allow television broadcasting organizations to choose first between complying with paragraph or allocating 25% of their programming budget to European works within the meaning of Article 6. For the this Directive, purposes the "programming budget" means acquiring, accounting cost and commissioning, co-producing all those programmes broadcast by the channel in question in any given year. producing the of of or the and time appointed teleshopping, In the case of channels which devote at least 80% of their transmission time, to excluding advertising to drama, cinematographic works, documentaries animation, Member States shall allow television broadcasting organizations to choose first between complying with paragraph or allocating 25% of their programming budget to European works within the meaning of Article 6. For the this Directive, purposes "programming budget" means the acquiring, accounting cost and commissioning, co-producing all those programmes broadcast by the channel in question in any given year. producing the of of to referred proportions The in paragraphs 1 and 2 shall be attained progressively, in stages, no later than three years after the date of the first broadcast by the channel in question. to referred The proportions in paragraphs 1 and 2 shall be attained progressively, in stages, no later than three years after the date of the first broadcast by the channel in question. Channels broadcasting entirely in a language other the than Member States are not covered by the provisions of this Article or those of Article 5. those of Channels broadcasting entirely in a language other the than Member States are not covered by the provisions of this Article or those of Article 5. those of the Member States shall provide Commission with a report on the application of this Article and Article 5 every two years from the date of adoption of this Directive. the Member States shall provide Commission with a report on the application of this Article and Article 5 every two years from the date of adoption of this Directive. 21 the Member State That report shall in particular include a statistical statement on the achievement of the proportion referred to in this Article and Article 5 for each of the channels falling within the jurisdiction concerned. of Member States the Commission of the reasons for the failure to attain those proportions and the measures they are taking in each case television broadcasting organization does actually attain them. shall notify to ensure that the the Member State That report shall in particular include a statistical statement on the achievement of the proportion referred to in this Article and Article 5 for each of the channels falling within the jurisdiction concerned. of Member States the Commission of the reasons for the failure to attain those proportions and the measures they are taking in each case to ensure television broadcasting organization does actually attain them. shall notify that the t he a nd S t a t es The Commission shall inform the other M e m b er European Parliament of the reports, which shall be accompanied, where appropriate, by an opinion. The Commission shall ensure the application of in this Article and Article 5 accordance with the provisions of the Treaty. The Commission may take account in its opinion, in particular, of to progress achieved previous years, first broadcast works in the programming, the particular circumstances of new television broadcasters and the specific situation of countries with a low audiovisual production capacity or restricted language area. " the share of relation in t he a nd S t a t es The Commission shall inform the other M e m b er European Parliament of the reports, which shall be accompanied, where appropriate, by an opinion. The Commission shall ensure the application of in this Article and Article 5 accordance with the provisions of the Treaty. The Commission may take account in its opinion, in particular, of to progress achieved previous years, first broadcast works in the programming, the particular circumstances of new television broadcasters and the specific situation of countries with a low audiovisual production capacity or restricted language area. " the share of relation in 22 6. Article 5 is replaced by the following: 6. Article 5 is replaced by the following: "Article 5 "Article 5 Member States shall ensure, by appropriate means, that broadcasters reserve at least 10% of their transmission time, excluding the time appointed to news, sports events, and games, teletext services, or alternately, at the discretion of the Member States, at least 10% of their programming budget, for European works created by producers who are independent of broadcasters. teleshopping advertising, Member States shall ensure, by appropriate means, that broadcasters reserve at least 10% of their transmission time, excluding the time appointed to news, sports events, and games, teletext services, or alternately, at the discretion of the Member States, at least 10% of their programming budget, for European works created by producers who are independent of broadcasters. teleshopping advertising, This proportion must be achieved by earmarking at least 50% for recent works, that is to say works transmitted within five years of their production. " This proportion must be achieved by earmarking at least 50% for recent works, that is to say works transmitted within five years of their production. " 7. Article 6 is amended as follows: 7. Article 6 is amended as follows: (a) in paragraph 1, point (a) is replaced by (a) in paragraph 1, point (a) is replaced by the following: the following: "(a) works originating from Member "(a) works originating from Member States" States" and a new point (d) is added: "(d) the application of the provisions of paragraphs (b) and (c) is conditional on works originating from Member States not being the subject of discriminatory measures in the third countries concerned. " 23 (b) paragraph 3 following: is replaced by the (b) paragraph 3 following: is replaced by the '3. The works referred to in point (c) of paragraph 1 are works made exclusively or in co-production with producers established in one or more Member States by producers established in one or more European third countries with which the Community has concluded agreements relating to the audiovisual sector, if those works are mainly made with authors and workers residing in one or more European States. " "3. The works referred to in point (c) of paragraph 1 are works made exclusively or in co-production with producers established in one or more Member States by producers established in one or more European third countries with which the Community has concluded agreements relating to the audiovisual sector, if those works are mainly made with authors and workers residing in one or more European States. " (c) the following paragraph 3a is inserted: (c) the following paragraph 3a is inserted: "3a. Works that are not European works within the meaning of paragraph 1 but that are produced within the framework of bilateral co-production treaties concluded between Member States and third countries shall be to be European works deemed provided that the Community co- producers supply a majority share of the total cost of the production and that the production is not controlled by producers or more established outside the territory of the Member States. " one "3a. Works that are not European works within the meaning of paragraph 1 but that are produced within the framework of bilateral co-production treaties concluded between Member States and third countries shall be to be European works deemed provided that the Community co- producers supply a majority share of the total cost of the production and that the production is not controlled by producers or more established outside the territory of the Member States. " one (d) in paragraph 4, the words "and paragraph 3a" are added after the words "within the meaning of paragraph 1"; (d) in paragraph 4, the words "and paragraph 3 a" are added after the words "within the meaning of paragraph 1"; 24 8. Article 7 is replaced by the following: 8. Article 7 is replaced by the following: "Article 7 "Article 7 limits broadcasting Rightsholders and broadcasters shall agree time for cinematographic works. In the absence of such agreements, television broadcasting organizations shall not broadcast any cinematographic work until the following periods have elapsed since the work was first shown in cinemas in one of the Member States: agreed otherwise between Unless rightholders and broadcasters, the latter shall not broadcast any cinematographic work until eighteen months have elapsed since the work was first shown in cinemas in one of the Member States. This period shall be reduced to twelve months : (a) six months for pay-per-view services; (a) for pav-per-view and pay-television channels; (b) in the case of cinematographic works co-produced bv the broadcaster. " (b) twelve months for pay-television services other than those referred to in (a); (c) eighteen months for services other than those referred to in (a) and (b). Member States shall ensure that the television broadcasting organizations under these jurisdiction comply with their provisions. " 9. Article 8 is deleted. 9. Article 8 is deleted. 9a. Article 9 is replaced by the following : "Article 9 This chapter shall not apply to television broadcasts intended for local audiences and that do not form part of a national network. " 10. The title of Chapter IV is replaced by 10. The title of Chapter IV is replaced by the following: the following: "Television advertising and sponsorship, "Television advertising, sponsorship and and teleshopping" teleshopping" 25 10a. Article 10 is replaced by the following: "Article 10 1. Television advertising and teleshopping shall be readily recognizable as such and kept quite separate from other parts of the programme service by optical and/or acoustic means. 2. Isolated advertising and teleshopping spots shall remain the exception. spots 3. Advertising and teleshopping shall not use subliminal techniques. 4. Surreptitious advertising and teleshopping shall be prohibited. " 11. In Article 11, paragraph 3 is replaced by the following: 11. Article 11 is replaced by the following: "Article 11 advertisements "1. Advertisements and teleshopping shall be inserted between other programmes. Provided the conditions contained in paragraph 2 to 5 of this Article are and fulfilled, teleshopping may also be inserted during programmes in such a way that the the programme, taking into account natural breaks in and the duration and nature of the programme, and the rights of the rightsholders are not prejudiced. " and value of integrity 2. In in consisting of programmes autonomous parts, or sports programmes and similarly structured events and performances comprising and intervals, teleshopping shall only be inserted between the parts or in the intervals. " advertisements 26 "3. The transmission of feature films may be interrupted once for each complete further period of 45 minutes. A if interruption their is allowed least 20 scheduled duration is at minutes longer than two or more complete periods of 45 minutes. " 3. The transmission of audiovisual works such as feature films and films made for television (excluding series, serials, light entertainment programmes and documentaries) provided their scheduled duration is more that 45 minutes, may '-be interrupted once for each period of 45 minutes. A further interruption is allowed if their scheduled duration is at least 20 minutes longer than two or more complete periods of 45 minutes. 4. Where programmes, other than those covered by paragraph 2, are interrupted by advertisements or teleshopping spots, a period of at least 20 minutes should elapse between successive advertising break within the programme. each 5. Advertisements and teleshopping shall not be inserted in any broadcast of a religious service. News and current affairs programmes, documentaries, religious programmes, and children's programmes shall not be interrupted by advertisements or by teleshopping when their scheduled duration is less than 30 minutes. If their scheduled duration is of 30 minutes or longer, the provisions of the paragraphs 1 to 4 shall apply. " 12. In Article 12, the introductory words 12. In Article 12, the introductory words are replaced by the following: are replaced by the following: "Television advertising and teleshopping "Television advertising and teleshopping shall not:" shall not:" and paragraph (c) following : is replaced by the offensive be philosophical or political beliefs;" religious, to "(c) 27 13. Articles 13 and 14 are replaced by the 13. Articles 13 and 14 are replaced by the following: following: "Article 13 "Article 13 All forms of television advertising and All forms of television advertising and teleshopping for cigarettes and other tobacco products shall be prohibited. teleshopping tobacco products shall be prohibited. for cigarettes and other Article 14 "Article 14 Television advertising and teleshopping for 1. Television advertising for medicinal products treatment and medical medicinal products and medical treatment available only on prescription in the available only on prescription the Member State within whose jurisdiction Member State within whose jurisdiction the the broadcaster falls shall be prohibited. broadcaster falls shall be prohibited. " in Teleshopping for medicinal products and medical treatment which are subject to a marketing authorization within the meaning of Directive 65/65/EEC8 as last amended bv Directive 89/343/EEC9 shall be prohibited. " 14. Article 15 is amended as follows: 14. Article 15 is amended as follows: (a) The introductory words are replaced by (a) The introductory words are replaced by the following: the following: "Television advertising and teleshopping for alcoholic beverages shall comply with the following criteria:" "Television advertising and teleshopping for alcoholic beverages shall comply with the following criteria:" OJ no. L22, 9. 2. 1965, p. 369 OJ no. L142, 25. 5. 1989, p. 14 28 (b) Points (a) to (f) are replaced by the (b) Points (a) to (f) are replaced by the following: following: "(a) they may not be aimed specifically at minors or, in particular, depict minors consuming such beverages; "(a) they may not be aimed specifically at minors or, in particular, depict minors consuming such beverages; (b) they shall not link the consumption of enhanced physical to alcohol performance or to driving; (b) they shall not link the consumption of physical enhanced alcohol performance or to driving; to (c) they shall not create the impression that the consumption of alcohol contributes towards social or sexual success; (c) they shall not create the impression that the consumption of alcohol contributes towards social or sexual success; (d) they shall not claim that alcohol has (d) they shall not claim that alcohol has therapeutic qualities or that it is a stimulant, a sedative or a means of resolving personal conflicts; therapeutic qualities or that it is a stimulant, a sedative or a means of resolving personal conflicts; (e) they shall not encourage immoderate consumption of alcohol or present abstinence or moderation in a negative light; (e) they shall not encourage immoderate consumption of alcohol or present abstinence or moderation in a negative light; (f) they shall not place emphasis on high alcoholic content as being a positive quality of the beverages. " (f) they shall not place emphasis on high alcoholic content as being a positive quality of the beverages. " 29 15. Article 16 is amended as follows: 15. Article 16 is amended as follows: (a) The introductory words are replaced by (a) The introductory words are replaced by the following: the following: "Television advertising and teleshopping shall not cause moral or physical detriment to minors and shall therefore comply with the following criteria for their protection:" "Television advertising and teleshopping shall not cause moral or physical detriment to minors and shall therefore comply with the following criteria for their protection:" (b) Points (a) to (d) are replaced by the (b) Points (a) to (d) are replaced by the following: following: "(a) they shall not directly exhort minors to buy a product or a service by exploiting inexperience or credulity; their "(a) they shall not directly exhort minors to buy a product or a service by exploiting inexperience or credulity; their (b) they shall not directly encourage minors to persuade their parents or others to purchase the goods or services being advertised; (b) they shall not directly encourage minors to persuade their parents or others to purchase the goods or services being advertised; (c) they shall not exploit the special trust minors place in parents, teachers or other persons; (c) they shall not exploit the special trust minors place in parents, teachers or other persons; (d) they shall not unreasonably show (d) they shall not unreasonably show minors in dangerous situations. " minors in dangerous situations. " 30 16. Article 17(2) following: is replaced by the 16. Article 17(2) is replaced by the following: "2. Television programmes may not be "2. Television programmes may not be sponsored by undertakings whose principal activity is the manufacture or sale of cigarettes and other tobacco products. Television programmes may not be sponsored by natural or legal persons whose principal the manufacture or sale of products, or the provision of services, the advertising of which is prohibited by Article 13. " activity is 2a. Sponsorship of television programmes by undertakings whose activities include the manufacture or sale of medical products and medical treatment may promote the name or the image of the undertaking and may not promote specific medical products or medical treatments on prescription. " available only 17. Article 18 is replaced by the following: 17. Article 18 is replaced by the following: "Article 18 "Article 18 1. The amount of advertising shall not 1. exceed 15% of the daily transmission time. However, this percentage may be increased to 20% if it includes forms of advertising other than advertising spots and/or teleshopping spots inserted in a service that is not exclusively devoted to teleshopping, on condition that the amount of spot advertising does not exceed 15%. The amount of transmission time of teleshopping spots, advertising spots and other means of advertising, with the exception of teleshopping windows in the sense of article 18a shall not exceed 20% of the daily transmission time. The transmission time for advertising spots shall not exceed 15% of the daily transmission time. 2. The amount of spot advertising within a 2 given clock hour shall not exceed 20%. " The amount of advertising spots and teleshopping spots within a given clock hour shall not exceed 20%. 3. For does the purposes of this article, advertising include announcements made bv the broadcaster in own programmes. " connection with not its 31 18. The following Articles 18a and 18b are 18. The following Article 18a is inserted : inserted: "Article 18a "Article 18a to Windows devoted teleshopping broadcast bv a channel not exclusively devoted to teleshopping shall be of a minimum uninterrupted duration of 15 minutes. Their overall duration shall not exceed three hours per day. They must as teleshopping windows by optical and/or acoustic means. " identified clearly be Teleshopping programmes and spots must be easily identifiable as such and if they are inserted in a service that is not exclusively devoted to this activity they must be clearly distinguished from that service's other broadcasts, including advertising broadcasts, by optical or acoustic means. 2. Teleshopping programmes and spots must comply with the provisions of Council Directive [concerning consumer to distance protection with regard selling]10, and in particular with those provisions that relate to information on contractual obligations. Article 18b 1. Windows devoted to teleshopping and inserted in a service not exclusively devoted to this activity shall not exceed three hours in any twenty-four-hour period. 2. Services devoted exclusively to teleshopping shall not be subject to any scheduling restrictions as regards time- limits. " 19. Article 19 is deleted. 19. Article 19 is replaced by the following: "Article 19 Articles 18 and 18a shall not apply to channels exclusively devoted to advertising and/or teleshopping. " O J N oL 32 20. Article 20 is replaced by the following: 20. Article 20 is replaced by the following: "Article 20 "Article 20 Without prejudice to Article 3, Member States may, with due regard for Community law, lay down conditions other than those laid down in Article 11(2) to (5) and Articles 18 and 18b in respect of broadcasts intended solely for the national territory which cannot be received, directly or indirectly, in one or more other Member States. " Without prejudice to Article 3, Member States may, with due regard for Community law, lay down conditions other than those laid down in Article 11(2) to (5) and Articles 18 and 18a in respect of broadcasts intended for local audiences which cannot be received, directly or indirectly by the public, in one or more other Member States. " 21. Article 21 is deleted. 21. Article 21 is deleted. 22. The title of Chapter V is replaced by 22. The title of Chapter V is replaced by the following: the following: "Protection of minors and public morality" "Protection of minors and public order" 23. Article 22 is replaced by the following: "Article 22 "Article 22 1. Member States shall take appropriate 1, that to ensure television measures broadcasts, trailers, by including broadcasters under their jurisdiction do not include programmes which might seriously impair the physical, mental or in moral development of minors, particular involve those pornography or gratuitous violence. that that to ensure Member States shall take appropriate measures television broadcasts by broadcasters under their jurisdiction do not any programmes, which might seriously impair the physical, mental or moral development of minors, in particular those involve pornography or that gratuitous violence. include 33 The measures provided for in paragraph 1 shall also extend to other programmes which are likely to impair the physical, mental or moral development of minors, except where it is ensured, by selecting the time of the broadcast or by any technical measure, that minors in the area of transmission will not normally hear or see such broadcasts. " 2. The measures provided for in paragraph 1 shall also extend to other programmes which are likely to impair the physical, mental or moral development of minors, except where it is ensured, by selecting the time of the broadcast or by any technical measure, that minors in the area of transmission will not normally broadcasts. hear Furthermore, when such programmes are broadcast form Member States shall ensure that thev are preceded bv an acoustic warning or are identified bv the presence of a visual symbol throughout their duration. in unencoded such see or 24. The following Articles 22a and 22b are inserted: The following Articles 22a and 22b are inserted: "Article 22a "Article 22a Member States shall ensure that broadcasts do not contain any incitement to hatred on grounds of race, sex, religion or nationality. Member States shall ensure that broadcasts do not contain any incitement to hatred on grounds of race, sex, religion or nationality. Article 22b Article 22b The Commission shall attach particular importance to application of this chapter in the report provided for in Article 26. " 1. The Commission shall attach particular importance to application of this chapter in the report provided for in Article 26. investigation of 2. The Commission shall, in liaison with the competent Member State authorities, carry out an the possible advantages and drawbacks of further measures with a view to exercised by facilitating the control parents the or programmes that minors may watch. guardians over 34 24a. In Article 23, paragraph 1 is replaced by the following: "1. Without prejudice to other provisions adopted by the Member States under civil, administrative or criminal law, any natural or legal person, regardless of nationality, whose legitimate interests, in particular reputation and good name, have been damaged by an incorrect assertion in a television programme must have a right of reply or equivalent remedies. Member States shall ensure that the actual exercise of the right of reply is not hindered by the imposition of unreasonable terms or conditions. The reply shall be transmitted within a reasonable time subsequent to the request, in conditions as similar as possible to those of the broadcast the request refers to. 25. Article 25 is deleted. 26. Article 26 is replaced by the following: "Article 26 thereafter, two years Not later than the end of the third year after the date of the adoption of this Directive and every the Commission shall submit to the European Parliament, the Council and the Economic and Social Committee a report on the application of if necessary, make further proposals to adapt it to developments in the field of television in particular in the light of broadcasting, technological its developments adoption. " this Directive and, since 35 Article 2 Article 2 1. Member States shall bring into force 1. the laws, regulations and administrative provisions necessary to comply with this Directive not later than one year after the date of its adoption. They the immediately shall Commission thereof. inform Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive not later than one year after the date of its adoption. They the immediately shall Commission thereof. inform these When Member States adopt these shall contain a provisions, reference to this Directive or shall be accompanied by such reference at the time of their official publication. The procedure for such reference shall be adopted by Member States. these When Member States adopt these shall contain a provisions, reference to this Directive or shall be accompanied by such reference at the time of their official publication. The procedure for such reference shall be adopted by Member States. 2. Member States shall communicate to the Commission the text of the main provisions of national law which they adopt in the field covered by this Directive. Member States shall communicate to the Commission the text of the main provisions of national law which they adopt in the field covered by this Directive. Article 3 Article 3 This Directive shall enter into force on the its following twentieth day publication in the Official Journal of the European Communities. that of This Directive shall enter into force on the its following twentieth day publication in the Official Journal of the European Communities. that of Article 1 point 5 shall be effectively applied for a period of ten years from the date of entry into force of this Directive. Article 1 point 5 shall be effectively applied for a period of ten years from the date of entry into force of this Directive. Article 4 Article 4 This Directive is addressed to the Member States. This Directive is addressed to the Member States. 36 ISSN 0254-1475 COM(96) 200 final DOCUMENTS EN 16 Catalogue number : CB-CO-96-210-EN-C ISBN 92-78-03593-9 Office for Official Publications of the European Communities L-2985 Luxembourg "3 }

Amendment to the Proposal for a COUNCIL REGULATION (EC) setting out the cases where relief from import duties or export duties shall be granted

http://publications.europa.eu/resource/cellar/1c4bc484-455c-4819-9888-7933d0abb821

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COMMISSION OF THE EUROPEAN COMMUNITIES -rV ^ W "A A' A A Brussels, 06. 05. 19% COM(96) 165 final 94/0140 (CNS) Amendment to the Proposal for a COUNCIL REGULATION (EC) setting out the cases where relief from import duties or export duties shall be granted (presented by the Commission pursuant to Article 189 a (2) of the EC-Treaty) EXPLANATORY MEMORANDUM Following the opinion expressed by the European Parliament during the June 1995 session on the proposal for a Regulation setting out the cases where relief from import duties or export duties shall be granted^), the Commission considers it appropriate to amend its proposal in accordance with Article 189a of the Treaty. The reasons for the changes proposed are as follows: • Points 1 and 4: It is important to combat fraud and evasion. The review will evaluate the cost of reliefs and help to ensure that the reliefs are not being abused. • Points 2. 5 and 6: These are intended to clarify the presentation of the Regulation without changing its content. On the one hand, some of the provisions of the Annex are incorporated into the body of the Regulation; and on the other hand, TARIC codes are introduced into the Annex. • Point 3: In the Single Market, persons claiming relief must be able to declare goods for free circulation at whatever external border post in the Community they wish and not have to take them under customs supervision to the Member State of final destination to be declared there. However, at the same time it is also essential to ensure a proper flow of information between the customs authorities where the goods are declared and those of the Member Slate where the goods are to be used, which will be responsible for ensuring that the terms of the relief are complied with. The amendments proposed by Parliament concerning perfumes and sparkling wines have not been taken into account. The proposed amendment concerning perfumes was not accepted because there are now no exciseable products used in the manufacture of perfumes. The proposed amendment concerning sparkling wines was not accepted because they are treated differently to still wines for excise purposes in a number of Member States and in existing Community excise law, notably Council Directive 92/83/EEC. 0) COM (94) 232 final. OJNoC 197, 19. 7. 1994, p. 1. Amendment to the Proposal for a Council Regulation (EO setting out the cases where relief from- import duties or e\pmt duties shaft be granftnl*1* The Commrssibifs proposal is amended as follows: 1. After the seventh "whereas*, a new "whereas" is inserted: "Whereas vigorous action must be taken against irregularities and fraud on the system of reliefs on the basis of the rules currently in force;" 2. Article 42 is replaced by: " 1. Collectors' pieces and works of art, not intended for sale imported by galleries, museums and other institutions approved by the customs authorities of the Member States shall be admitted free of import duties. 2. (a) (b) Holograms for laser projection, multi-media kits and materials for programmed instructions (including materials in kit form with the corresponding printed materials) which are of an educational, scientific or cultural nature as well as the educational, scientific and cultural articles listed in Annex II shall be admitted free of import duties provided: they are produced by the United Nations or any of its specialized agencies, whoever the consignee and whatever the intended use of such materials may be, or they are intended: (i) for public educational, scientific or cultural establishments or organizations or for any organization television organizations), institution or association approved by the customs authorities of the Member State to receive such articles duty-free. " (including broadcasting and (ii) 0) COM(94) 232 final. OJ No. C 197, 19. 7. 1994, p. 1. 3> 3. Article 116 is replaced by: " 1. Where relief from import duties is dependent upon the goods being put to a particular use, the customs authorities shall notify the customs authorities of the Member State where the goods are to be used so as to enable them to check that the goods are put to the stated use. 2. Those authorities shall take all the appropriate measures to ensure that these goods are not to be used for other purposes without the appropriate import duties being paid, unless such alternative use is in conformity with the conditions laid down by this Regulation. 3. The necessary provisions for implementing paragraph 1 shall be adopted under the procedure laid down in Article 249 of the Code. " A new Article 118a is inserted: "Within three years of the date of entry into force of this Regulation, the Commission shall forward to Parliament and the Council a report including an estimate of the cost of the reliefs covered by the Regulation. The report shall also include an appraisal of the control systems established by the Member States and, possibly, recommendations in this area. " Annex I is replaced by Annex I hereto. Annex II is replaced by Annex II hereto. <i ANNEX 1 Educational, scientific and cultural articles referred to in Article 41 CN code TARIC code Description 3705 3705 10 00 3705 20 00 10 10 10 10 3705 90 10 3705 90 90 4903 4911 4911 10 4911 10 10 4911 10 90 10 10 4911 10 10 4911 10 90 491110 10 4911 10 90 20 20 30 30 Photographic plates and film, exposed and developed, other than cinematograph film: Reproduction films for the production of books Microfilms of books, children's picture books and drawing or painting books, school exercise books (workbooks), crossword-puzzle books, newspapers and periodicals, printed documents or reports of a non-commercial character, and of loose illustrations, printed pages and reproduction proofs for the production of books Reproduction films for the production of books Reproduction films for the production of books Children's picture, drawing or colouring books Other printed matter, including printed pictures and photographs: Trade advertising material, commercial catalogues and the like: Catalogues of books and publications, being books and publications offered for sale by publishers or booksellers established outside the customs territory of the Community Catalogues of films, recording or other visual and auditory materials of an educational, scientific or cultural nature Posters for the promotion of tourism and tourist publications, (brochures, guidebooks, timetables, pamphlets and like publications), whether or not illustrated, including those published by private concerns, designed to encourage the public to travel outside the customs territory of the Community, including microcopies of such articles^) (!) The exemption shall not, however, apply to articles in which the advertising covers more than 25 % of the surface. In the case of publications and posters for the promotion of tourism, this percentage applies only to commercial publicity. <T 4911 10 10 4911 10 90 40 40 Bibliographical information material for distribution free of charge*1) 491199 00 Other; 491199 00 10 4911 99 00 20 4911 99 00 30 4911 99 00 9023 40 Loose illustrations, printed pages and reproduction proofs to be used for the production of books, including microcopies of such articles*1) Microcopies of books, children's picture books and drawing or painting books, school exercise books (workbooks), crossword puzzle books, newspapers and periodicals and of documents or reports of a non commercial character*1) Publications designed to. encourage the public to study outside the customs territory of the Community, including microcopies of such publications*1) Meteorological and geophysical diagrams Instruments, apparatus and models, designed for demontration purposes (for example, in education or exhibitions), unsuitable for other uses: 9023 00 80 Other: 9023 00 80 11 Maps and charts in relief of interest in scientific fields such as geology, zoology, botany, mineralogy, paleontology, archaeology, ethnology, meteorology, I climatology and geophysics (1) The exemption shall not, however, apply to articles in which the advertising covers more than 25 % of the surface. In the case of publications and posters for the promotion of tourism, this percentage applies only to commercial publicity. £ ANNEX II Educational, scientific and cultural articles referred to in Article 42(2) CN code TARICcode Description 3705 Photographic plates and film, exposed and developed, other than cinematograph film: 3705 10 00 For offset reproduction 3705 10 00 11 Of an educational, scientific or cultural nature*1) 3705 20 00 Microfilms 3705 20 00 11 Of an educational, scientific or cultural nature*1) 3705 90 3705 90 10 Other: For the graphic arts: 3705 90 10 11 Of an educational, scientific or cultural nature*1) 3705 90 90 3705 90 90 3706 U Other Of an educational, scientific or cultural nature*1) Cinematographic film, exposed and developed, whether or not incorporating sound track or consisting only of sound track: 3706 10 3706 10 99 Of a width of 35 mm or more Other positives 3706 10 99 10 Of an educational, scientific or cultural nature*1) 0) Entry under this subheading is subject to conditions laid down in the relevant Community provisions. * 3706 90 3706 90 51 Other: Newsreels 3706 90 51 10 Of an educational, scientific or cultural nature*1) 3 706 90 91 Less than 10 mm Other with a width of: 3706 90 91 10 Of an educational, scientific or cultural nature*1) 3706 90 99 3706 90 99 4911 10 10 mm or more Of an educational, scientific or cultural nature*1) Other printed matter, including printed pictures 491199 00 491199 00 50 4911 99 00 60 8524 and photographs: Other: Other: in information computerized Microcards and other information storage media and required documentation services of an educational, scientific or cultural nature*1) Wall charts designed solely for demonstration and education*1) Records, tapes and other recorded media. for sound or other similarly recorded phenomena, the including matrices production of records, but excluding products of Chapter 37: and masters for 8524 10 00 Gramophone records 8524 10 00 10 Of an educational, scientific or cultural nature*1) 0) Entry under this subheading is subject to conditions laid down in the relevant Community provisions. ff 8524 31 00 8524 31 00 8524 32 00 8524 32 00 8524 39 00 8524 39 00 8524 40 8524 40 10 8524 40 91 8524 40 99 8524 51 00 8524 51 00 8524 52 00 8524 52 00 8524 53 00 8524 53 00 8524 60 00 8524 60 00 Discs for laser reading systems For reproducing phenomena other than sound or image Of an educational, scientific or cultural nature*1) For reproducing sound only Of an educational, scientific or cultural nature*1) Other Of an educational, scientific or cultural nature*1) Magnetic tapes for reproducing phenomena other than sound or image: Of an educational, scientific or cultural nature*') Other magnetic tapes: Of a width not exceeding 4 mm Of an educational, scientific or cultural nature*1) Of a width exceeding 4 mm but not exceeding 6. 5 mm Of an educational, scientific or cultural nature*1) Of a width exceeding 6. 5 mm Of an educational, scientific or cultural nature*1 > Cards incorporating a magnetic stripe Of an educational, scientific or cultural nature*1) *') Entry under this subheading is subject to conditions laid down in the relevant Community provisions 3 ! 8524 91 Toi her: For reproducing phenomena other than sound or image 8524 91 10 Bearing data or instructions of a kind used in 8524 9110 10 Of an educational, scientific or cultural nature*1) automatic data-processing machines 8524 9190 Other 8524 91 90 10 Of an educational, scientific or cultural nature*') 8524 99 00 Other 8524 99 00 10 Of an educational, scientific or cultural nature*') 9023 9023 00 10 9023 00 10 10 9023 00 10 20 Instruments, apparatus and models, designed for demonstrational purposes (for example, in education or exhibitions), unsuitable for other uses: Of a type used for teaching physics, chemistry or technical subjects Patterns, models and wall charts of an educational, scientific or cultural nature, designed solely for demonstration and education*') Mock-ups or visualizations of abstract concepts such as molecular structures or mathematical formulae*') 9023 00 80 Other 9023 00 80 10 9023 00 80 20 Patterns, models and wall charts of an educational, scientific or cultural nature, designed solely for demonstration and education*1) Mock-ups or visualizations of abstract concepts such as molecular structures or mathematical formulae*1) *') Entry under this subheading is subject to conditions laid down in the relevant Community provisions. Ac ISSN 0254-1475 COM(96) 165 final DOCUMENTS EN 02 Catalogue number : CB-CO-96-176-EN-C ISBN 92-78-02691-3 Office for Official Publications of the European Communities L-2985 Luxembourg ~AA

Amended proposal for a COUNCIL REGULATION (EC) adopting a multiannual programme to promote international cooperation in the energy sector - Synergy programme

http://publications.europa.eu/resource/cellar/12410654-9f7e-4ffa-9fb7-aeca8d2dd2cf

eng

COMMISSION OF THE EUROPEAN COMMUNITIES it •K '•* \* Brussels,06. 05. 1996 COM(%) 194 final 95/0126 (CNS) Amended proposal tor a COUNCIL REGULATION ŒO adopting a muitiannual programme to promote international cooperation in the energy sector - Synergy programme (presented by the Commission pursuant to Article 189 a (2) of the EC-Treaty) EXPLANATORY MEMORANDUM The Commission presented on 6 September 1995 a proposal for a Regulation adopting a mentionnai programme to promote international co-operation in the energy sector. The Parliament delivered its opinion on 15 April 1996. The Parliament's main concerns meet those of the Commission and amendments adopted reinforcing the initial proposal. Therefore they have been accepted by the Commission. Only two amendments which question the competence of the delegation to the Commission have been rejected. The Commission presents the attached modified proposal which takes into consideration most of the amendments adopted by the Parliament. ^1 Modified programme to promote programme (COM(95)0197 proposal for international a Council Regulation cooperation - 95-0126 - C4-0432/95 (EC) adopting a muitiannual in the energy sector - Synergy (CNS)) The modifications (references of approved to recitals the previous Commission's proposal as presented hereafter and articles are those of the previous proposal) are Commission text Modifications Recital -1 (new) for the Whereas, supply. environment. sustainable competitiveness industries. important international reasons protection the development of of security of the of the the Community's objective and of energy matters must be an element the Union's in activities; Recital 1a (new) guidelines the the Whereas Council and Cooperation on with the clean and efficient stressed of developing implementation policies: energy that of Ministers conclusions the of of Development of 18 November 1992 developing countries for cooperation energy an essential cooperation countries of effective for technology objective with was all the energy Recital to by the the the owing due the Green Paper energy to to Commission is in of Whereas according 'For a European Union energy policy' presented international essential pollution consumption countries, stability consumer or producer increasing Community and markets d i s t r i b u t i on technologies; cooperation increase growth developing in whether the in role of energy society, energy dependence of the in the the of world transport, consunrpt i on production, and the growth countries, the of in the Green in a European Union energy by the Commission^ is cooperation in increase growth of developing in whether the in role of energy society, energy to to the the countries, 'For as stressed presented owing due Whereas, Paper policy' international essential pollution consumption countries, stability consumer or producer increasing Community and markets d i s t r i b u t i on technologies; the of in energy dependence of the growth production, and transport, consunrpt i on the in the the of world Recital 2a (new) Whereas international various ensure complementary. coordinated energy member countries; policy the Community is engaged energy activities programmes and whereas. that activities these in under to are be they should within a programme cooperation with for non- Recital international for can be satisfied need cooperation this Whereas energy by the creation assistance formulation energy countries; Community's and, has activities instrument to taken in particular, policy and programme of a cooperation on_ implementation and the of non-member the of area it these should be based on a legal capable view in this the steps 1980, whereas experience of adjusting since them in in of the various Community policies; this need energy cooperation by creation the taking of an overall towards into problems for can of a in view of in of this the pilot since 1980. renewable the programme the Madrid plan of March of and Athens and the the at Conference. this all allow of in accordance with the Alfener such as Declaration Conferences submitted the part initiatives the them. development in particular, as energy of strategy countries. variety Whereas, Community non-mêmber account facing international be satisfied such a programme; whereas experience the Community's area and, schemes it has undertaken in energy sources of objectives and Declaration 1994, January Euromediterranean MEDA programme November 1995 Barcelona the legal programme international particularly renewable efficiency a consistent. adjusted policies; objective methods of make use of whenever possible; long-term the whereas would rational renewable and action Souse the Tunis 1995, the to on which instrument is based should energy in sources to be incorporated activities the energy those fields of and energy into strategy and Community principal establish various the to energy energy sources use and be Recital 3a this programme coordinates the in there must with Whereas other measures the Community's whereas energy sector; therefore be no duplication other Community programmes such as PHARE!" TACIS. MEDA. INCO-COPERNICUS. ALURE or Framework whereas programmes of the Member States, Member States organizations must also be avoided; programme ail international duplication research; with non- (later 5th) and the 4th for Recital Whereas programme attained, ranging Community the objectives envisaged reason of other by nature, level; of cannot their than the be wide- at a the principal objectives particularly the of international of the various measures the development by reason of of an overall their can be attained manner at a nature, possible programme. Whereas the coordination programmes of and energy wide-ranging in the Community best strategy. level; Recital 5a (new) "For political Whereas according Green Paper policy" are essential policy. Community's cooperation integrated external a whole. policy and to the Commission's a European energy and trade relations of energy the energy components accordingly international measures more effectively in and energy policy should be its as Recital 6a (new) Whereas international should interdependence partners. stress the Community's energy the with policy cooperation for element of its third Recital 10 is necessary Whereas it this programme with other of the Community, Member States, member countries institutions; and to coordinate activities international non- is necessary to coordinate the international in Whereas it the Union part i cul a rl y renewable efficiency States, international energy - with non-member institutions; activities energy field of the t hose concerm ng and energy sources those of the Member and countries Recital 10a (new) this Whereas subject assessment carried experts provisions in programme must be to a mid-term final and a out bv independent accordance with the of Article 10; Article 1 cooperation A Community programme of assistance and countries formulation energy 'Synergy', field implementation non-member the of is hereby adopted. hereinafter policy, called with and the of in A Community programme of cooperation with field called non-member of energy 'Synergy', in hereinafter is hereby adopted. countries policy, the SYNERGY shall non-member countries be addressed to all Article to all be addressed countries those countries in SYNERGY shall non-member foremost included Community's terms of energy supply and economic the external political. priorities its and and first and regions the of in of security relations interests. Article 4(1) The purpose assistance the definition, 1. provide with implementation non-member mutual interest. of Synergy is to and cooperation formulation of energy policy and for of countries in areas The purpose assistance the definition, 1. provide with implementation non-member mutual interest. of Synergy is to and cooperation formulation of energy policy and for of countries in areas It shall make a contribution formulation and coordination strategy energy Community's non-member countries. to the the of towards Article 4(2) The objectives in accordance with out set 2. be rules particular: of Synergy shall the detailed in Article 6, in -to promote sustainable notably by greenhouse linked reducing to energy consumption^ gases and of pollutants development, emissions of The objectives in accordance with out set in of Synergy shall the detailed Article 6, in 2. be rules particular: gases and of pollutants development, emissions of reducing -to promote sustainable notably by greenhouse linked to encouraging rational combustion energy sources. production industry; energy in fossil of use of energy. particular consumption by the the clean renewable combined energy/heat fuels, and use of waste heat from devise -to involving implementation the to energy regions demonstrate improving integrated the selection initiatives and development technologies and of projects of in in locations how effective the gualitv of relating renewable specific order to they are in life; create -to the development renewable energy networks specializing and implementation technologies; in of to enhance supplies, the security and of energy to improve energy efficiency, To that end, maintain international energy sector. the Community shall relations with intensive organizations in the - - - to enhance supplies, and the security of energy improve energy efficiency. , to the safety of power generation plant. To that end, maintain international energy sector. the Community may relations with organizations in the Article 4(3) to In order referred 3. objectives 2, the Community shall the particular, concerning: activities to to achieve the in paragraph in of contribute, financing order referred to to In 3. objectives 2, particular, activities the Community shall the concerning: to achieve the in paragraph in of contribute, financing -technical assistance and training, -energy planning, -energy planning, -the organization seminars. -the creation the energy centres, of institutions such as of conferences and -technical assistance and training, -the creation the energy centres. of institutions such as -the organization seminars. of conferences and also the shall Funding to related implementation, evaluation well as costs and its dissemination. purchase and property shall the of these concerning cover preparation, costs monitoring operations, and as information Taxes, duties immovable of not be funded. shall Funding to related implementation, evaluation well as costs and its and property shall the of also the cover preparation, costs monitoring operations, and as these concerning information Taxes, duties immovable of not be funded. dissemination purchase No funding r e s e a r c h, demonstration be granted and demonstration to may be d e v e l o p m e nt projects. No research, projects. granted to a nd funding may development The programme's used operation European Energy Charter Treaty. resources may also be the support the to the Secretariat temporarily of of The programme's used operation European Energy Charter Treaty. resources may also be the support the to the Secretariat temporarily of of Article 6(1) shall 1. An indicative the period 3(1) accordance down bei ng commitment. in Article with referred programme covering in Article to be established the procedure MZL without nul t i annual in laid this budget 1. the 3(1) An indicative period is established, referred programme covering in Article the Annex. to in programme shall objectives, of Community assistance define guidelines indicative 4(2). areas referred to It shall considered indicate to the and in in the have This principal -priorities the Article objectives priority. The programme may be modified accordance during the with the period of in same procedure its application. shall define guidelines objectives, of Community assistance areas It referred to provide the and in in for programme This principal priorities indicative the 4(2). Article the possibility emergency operations t he commitments. Communi t v 's shall for as conducting called for by p o l i t i c al Article 6(4) Contracts may also be concluded of study international to order research these of the the centres contribution the achievement networks in described the to of in 4. with and define networks objectives indicative programme. the annex, with Contracts the 4. within muitiannual out in networks centres contribution achievement described programme. of in indicative framework may also be concluded the of programme set international and study define to order of these networks the the of in objectives indicative research the the to Article 7(2), third subparagraph contracts may be awarded Negotiated for operations an amount of involving up to ECU 50 000. This amount may be revised of a Commission being similar on the basis account in taken of experience by the Council proposal. gained cases. Negotiated for operations up to ECU 50 000. contracts involving may be awarded an amount of Article 7(2), fifth subparagraph Participation persons authorized case-by-case or specific specifically countries, being granted projects from other by by natural countries and legal may be on a the programmes the Commission basis if forms concerned of available require assistance in these subject to by those countries. reciprocity operations Participation persons authorized case-by-case of resources measures projects forms available in to reciprocity countries. of by natural and from other by countries the Commission legal may be on a basis for financed the duration by_ earmarked the concerned if for programmes require specific assistance these countries, specifically subject being granted by those the these or Article 9(3) the ways examine co-financing The Commission shall in which the SYNERGYprogramme, assistance 3. various the involving bilateral the Member States and other community programmes in might particular, any duplication and avoided. between SYNERGY programmes of effort other be promoted. ensure these shall, that of is It of the the ways be promoted. examine co-financing The Commission shall in which the SYNERGYprogramme, assistance 3. various involving bilateral the Member States and other community programmes might in particular, and complementarity for assistance member countries and for energy duplication provided the other Community international field It ensure both coordination in to avoid the beneficiary by SYNERGY instruments cooperation in order of effort. the non- between the any shall, Article 10 the 1. Each year inform regarding SYNERGYprogramme the preceding the Commission European implementation the in year. with shall Parliament of course a view the of to the implementation shall, a progress The Commission 1998. present the in report shall European Parliament, the Economic and Social Committee. by 30 June report on the programme years. This the to and the Council be addressed the previous financial of what progress pursuit the determining made in comprehensive what degree of coordination achieved with measures States, has been a and has been programmes and the Community. Member and non-member countries. strategy energy other of of shall an by 31 December 1999 present report on thé the previous impact The Commission interim and, by 31 December 2001. report implementation programme in years and the member countries the accompanied assessment by independent which is based. This be Parliament, the Economic and Social Committee. the Council addressed by to it report a final of financial the thereof in non- and Member States. external experts on shall European the and interim account report by The into authority continuation the annual budgetary when of the shall the evaluating funding procedure. be taken budgetary the within ANNEX (new) INDICATIVE ACTION PROGRAMME implementation the In programme and the annual following into account. in action guidelines of the drawing the Synergy up of the taken programmes, be all the tasks of Synergy The achieve objectives Commission's European Union Energy Policy': are Community's out Paper White set as to help energy the a in 'For • global • • security the environment. competitiveness, of supply, of Each sizeable made clear Synergy will according has to international being Community. these external in implement its to objectives component, a is the Green Paper. energy policy has as own logic. complementary It also with be cooperation conducted elsewhere activities in the The Synergy guidelines have been drawn up on that basis. for 1996-2000 I. AREAS OF COOPERATION LINKED TO THE COMMUNITY'S ENERGYSTRATEGY (a) Activities objectives: pursuant to the three • • • • • • • devising enlarged Union; an energy policy for an encouraging non-Community energy efficiency countries; in developing particular, sources; encouraging integration; local renewable and, in energy regional energy action the programmes (e. g. the Mediterranean, to promote consistency in of Community implementation in specific Black the Gulf); Sea, regions the action respect trade. to encourage of energy and South-South dialogue in (b) Global competitiveness: support and undertakings markets particular America. in for European technology to penetrate the energy sector Asia and key in Latin (c) Security of supply: • • • • with e x p o r t i ng dialogue and Arabian/Persian producer Asia and Africa; countries energy producing c o u n t r i e s: Russia, in America, Gulf, between countries encouraging the dialogue European Community and the energy transit and particular, the provisions the European Energy Charter; by helping of in implement and the countries the Treaty producer transit on participation the work of in sector: this producer/consumer International in and support international ministerial for bodies and conferences, Energy Agency; and execution investment for of needed the the in the production support financing is countries transit by helping on the European Energy Charter; that non-Community in particular the Treaty of energy, implement in and • • • • • • • for support and opening sector, Community policies in the up of liberalization the helping draw countries' this new situation. energy up non- energy (d) The environment: Training staff non-Community environmental in decision-makers the energy industry countries awareness; and of in transfer the and experience of European energy environmental techniques, and information; clean encouraging particular coal China, for energy policy in major taking for technology, the combustion consumers like the implications account; into in of strengthening to efforts taken aspects non-Community policy and planning; and have into supporting environmental account countries' in energy improve nuclear helping existing Eastern Europe and in plant in Central safety the CIS. in and encouraging Community sustainable policies supply each situation. and countries national helping to non- plan energy energy devising in keeping with environmental and concepts different II. GEOGRAPHICAL PRIORITIES W TH COMPLEMENTARI TY COMMUNI TY" S COOPERATIOrPROGRAMMES AND THE I NTERNATI ONAL (a) Role and objectives: has Synergy international field. a leading relations in role in the energy will thus in It cooperation Community countries energy objectives in the activities Community programmes external carried promote relations and will taken into with energy non- have its account cooperation out by (Objective other 1). Synergy will countries consumers of energy policies Community's also help non-Community or who are major producers energy to compatible and strengthen implement with the dialogue 10 and cooperation 2). (Objective with those countries w i th cooperation complementarity corrpet e also Synergy will projects finances it its energy objectives or international Synergy's Community cooperation reflected will preparation financed cooperation allow the the of in ensure the that in pursuance of do not conflict Corrrrunity activities. to instruments fact that emergence other is Synergy and energy by other instruments(Objective projects Community 3). (b) Geographical Priority areas these objectives, Synergy concentrate on the geographical in relations the and will the priorities Community's help in of To obtain will priorities external achieve those certain relations. The priority are listed objective brackets): areas below, with of for Synergy action related the (in action that Central cooperation accession c o u n t r i e s, approximation frameworks t he (Objective (Objective and Eastern to prepare of the Europe, the for associate t he i n c l u d i ng of the for energy policy of legislative and networks 3); Former Yugoslavia 1); l i n k i ng Former Soviet Union and 3); (Objectives 2 Mediterranean conjunction G u lf (Objectives territories countries, with Arabian/Persian in p r o d u c er c o u n t r i es 2 and 3); Palestinian (Objective 1); countries, (Objectives Latin America: Mercosur member Mexico Venezuela preferential respect (Objective partner energy of 2); also will and its and Chile 2 and 3); be but strategy a in Asia: (Objectives China, 2 and 3); India and ASEAN Africa: with, developing o t h er (Objective specifically in particular, its A f r i c an 1). relations South Africa for support the with c o u n t r i es • • • • • • 11 (c) Emergency action Synergy may also required the international initiate by sudden developments any action in situation. III. FUNDING SYNERGY (a) Reference amount The reference attached duration ECU 50 m. of amount for setting the for table entire the the programme shall be This powers of amount shall the budgetary not affect authority. the (b) Apportionment of funds follows translates (percentage) according the to the the to down by is It and broken areas. priority and does not constitute respect funds. Some activities of the corresponding set which table financial terms described The into guidelines activities objectives geographical for guidance a allocation may relate efficiency thus local development both the involve European undertakings. commitment of to more energy of in than one area: the. and resources may of promotion This the entire apportionment duration shall of for apply the programme. 12 Indicative apportionment of appropriations (%) by type of action and implementation regions (Amendment 26 (continued) Type of activity or General inter regional and Central Eastern European countries Former Soviet countries Prioritv regions Mediterranean, Arab/Gulf countries, Palestinian territories Asia Latin America Africa Total Producer- consumer dialogue Increasing energy efficiency use of renewables Developing resources concepts i Preparing adhesion and local and 4 1. Integration Promoting technologies undertaking and 3 and Training advice decision-makers for Nuclear safety Other evaluation Total 3 11 5 4 6 3 2 20 5 8 1 4 3 3 5 10 1 1 3 2 2 1 2 2 2 1 1 1 1 1 1 3 1 2 2 4 20 29 6 8 10 14 6 3 24 20 7 9 9 100 13 - ISSN 0254-1475 COM(96) 194 final UMENTS EN 12 11 Catalogue number : CB-CO-96-203-EN-C ISBN 92-78-03505-X Office for Official Publications of the European Communities L-2985 Luxembourg M

Amended proposal for a EUROPEAN PARLIAMENT AND COUNCIL DECISION on the maintenance of national laws prohibiting the use of certain additives in the production of certain foodstuffs

http://publications.europa.eu/resource/cellar/24cfcdda-502b-4bf9-ab25-7b7605c1df0a

eng

COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 06. 05. 19% COM(96) 50 final 95/0085 (COD) Amended proposal for a EUROPEAN PARLIAMENT AND COUNCIL DECISION on the maintenance of national laws prohibiting the use of certain additives in the production of certain foodstuffs (presented by the Commission pursuant to Article 189 a (2) of the EC-Treaty) Explanatory memorandum In response to the opinion of the European Parliament1 delivered on 16 January 1996 on the proposal for a European Parliament and Council Decision on the maintenance of national laws prohibiting the use of certain additives in the production of certain foodstuffs COM(95)0126 - 95/0085 (COD)2 and in accordance with the second paragraph of Article 189A of the Treaty establishing the European Economic Community, the Commission has decided to amend the above mentioned proposal. The Commission accepts the amendment concerning: The modification of the definitions of the foodstuffs mentioned in the Annex for which Member States may maintain their prohibition of use of a certain additives The Commission does not accept amendments concerning: Provisions requiring the labelling of the traditional method of production. The Commission considers that the need for such labelling should be determined by the manufacturer. The addition of two Danish foodstuffs and one Swedish foodstuff. The Commission cannot accept these foodstuffs since the original notifications evoked only reasons of public health, given that all public health issues are covered by the specific additives directives. ! not yet published 2 Oj CI 34 1. 0. 95 p 20 2 In response to the opinion of the European Parliament3 delivered on 16 January 1996 on the proposal for a European Parliament and Council Decision on the maintenance of national laws prohibiting the use of certain additives in the production of certain foodstuffs COM(95)0126 - 95/0085 (COD)" and in accordance with the second paragraph of Article 189A of the Treaty establishing the European Economic Community, the Commission has decided to amend the above mentioned proposal as follows: The table in the annex is replaced by the following table : Member State Germany Foodstuffs Categories of additives for which a prohibition may be maintained beer brewed following German tradition all except propellant gases Greece "feta" following Greek tradition France "traditional French bread" France preserved truffles following French tradition France France preserved snails following French tradition goose, duck and turkey preserves ("confit")following French tradition all all all all { all except preservatives Austria "Bergkase" following Austrian tradition all except preservatives Finland "Mammi" following Finnish tradition all except preservatives i 3 not yet published 4 OJC134 1. 6. 95 p 20 3 ISSN 0254-1475 COM(96) 50 final DOCUMENTS EN 10 15 Catalogue number : CB-CO-96-061-EN-C ISBN 92-78-00456-1 Office for Officiai Publications of the European Communities :L~2925 Luxembourg

Amended proposal for a COUNCIL DECISION concerning a multi-annual programme for the promotion of energy efficiency in the Community - SAVE II

http://publications.europa.eu/resource/cellar/1dc16460-9a54-46ee-adf3-58fcfc0f375c

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 06. 05. 19% COM(96) 195 final 95/0131 (SYN) Amended proposal for a COUNCIL DECISION concerning a multi-annual programme for the promotion of energy efficiency in the Community SAVE II (presented by the Commission pursuant to Article 189 a (2) of the EC-Treaty) EXPLANATORY MEMORANDUM The Commission presented on 31 May 1995 a proposal for a Council Decision concerning a multi-annual programme for the promotion of energy efficiency in the Community - SAVE II. The Parliament delivered its opinion on 16 April 1996. The Parliament's main concerns meet those of the Commission and from the 35 proposed amendments the Commission accepted without reservation 5 (no 2,3,6,7 and 8) and after reformulation 13 (no 1,11,12,13,14,15,19,22,28,29,32,33 and 34). Seventeen (17) amendments were not accepted by the Commission for the following reasons. Am. no 5,10 and 16 because the Commission can propose legislative measures at any time independent of the adoption of the SAVE programme. Am 17,18,20,21,23,24, and 25 because they concern activities out o( the scope of the programme or are included already in the Commission proposal Am 26 and 27 because the respect of the Treaties and balanced repartition of the budget is self-evident. Am 30 and 35 because they reduce the programme's flexibility. Am. 31 because the Commission believes in the complementarity between SAVE II and the national programmes. Am 4 because SAVE was evaluated as having contributed to the improvement of energy efficiency in the Community. Am 9 because is not relevant to this proposal. The Commission presents consideration 18 amendments adopted by the Parliament. the attached modified proposal which takes into Amended proposal for a COUNCIL DECISION concerning a multi-annual programme for the promotion of energy efficiency in the Community - SAVE II Initial Commission proposal COM (95) 225 final Amended text taking into account the amendments of the European Parliament, accepted by the Commission THE COUNCIL OF THE EUROPEAN UNION THE COUNCIL OF THE EUROPEAN UNION, regard the Having European Union, and in particular Article 130s(l) thereof, the Treaty establishing to regard the Having European Union, and in particular Article 130s(I) thereof, the Treaty establishing to Having Commission(1), regard to the proposal from the Having Commission,(1) regard to the proposal from the In cooperation with the European Parliament^, In cooperation with the European Parliament,(2) Having regard to the opinion of the Economic and Social Committee(3), Having regard to the opinion of the Economic and Social Committee,(3) Having regard to the opinion of the Committee of the Regions(4), < Having regard to the opinion of the Committee of the Regions,(4) Whereas Article 130r of the Treaty states that one objective of the action of the Community relating to the environment shall be to ensure a prudent and rational utilization of natural resources; Whereas Article 130r of the Treaty states that one objective of the action of the Community relating to the environment shall be to ensure a prudent and rational utilization of natural resources; Whereas the Council of Environment and Energy Ministers at their meeting on 29 October 1990 set an objective of the stabilizing total C02 emissions by the year 2000 at the 1990 level in the Community as a whole; Whereas the Council of Environment and Energy Ministers at their meeting on 29 October 1990 set an objective of the stabilizing total C02 emissions by the year 2000 at the 1990 level in the Community as a whole; (i) (2) 0) (4) COM 225, 31. 05. 1995 PE216 441, 25. 03. 1996 CES 1450/95 CdR 21/96 initial text amended text Whereas Council Decision 93/389/EEC(5) established a monitoring mechanism for C02 emissions and other greenhouse gases; Whereas Council Decision 93/389/EEC(5) established a monitoring mechanism for C02 emissions and other greenhouse gases; Whereas nonetheless, despite efforts made, the C02 emissions in the Community generated by energy to increase by 5 to 8% consumption are expected between normal 1995 economical growth; assuming 2000, and Whereas nonetheless, despite efforts made, the C02 emissions in the Community generated by energy to increase by 5 to 8% consumption are expected between normal 2000, 1995 economical growth; whereas therefore additional measures at European level and at the level of the Member States are indispensable: assuming and Whereas the Commission in its communication of 8 February 1990 on energy and the environment highlighted energy efficiency as the cornerstone of future efforts to reduce the negative impact of energy on the environment; Whereas the Commission in its communication of 8 the environment February 1990 on energy and highlighted energy efficiency as the cornerstone of future efforts to reduce the negative impact of energy on the environment; Whereas the improvement in the management of energy will have a positive effect on the environment, the security of energy supply and sustainable development; Whereas the improvement in the management of contribute to energy is urgently needed in order to to a better the protection security of energy sustainable development; of the environment to supply and Whereas the Commission has communicated to the Council by means of the Green Paper of 11 January 1995 its views on the future of energy policy in the Community, and the role of energy-saving and energy efficiency measures; Whereas the Commission has communicated to the Council and the European Parliament by means of the Green Paper of 11 January 1995 and the White Paper of 13 December 1995 its views on the future of energy policy in the Community, and the role of energy-saving and energy efficiency measures; Whereas Article 130a of the Treaty provides that the Community should develop and pursue its actions leading to the strengthening of its economic and social cohesion, and that it should, in particular, reduce disparities between the various regions and the backwardness of the least- favoured regions; whereas energy should be integrated into that effort; Whereas Article 130a of the Treaty provides that the Community should develop and pursue its actions leading to the strengthening of its economic and social cohesion, and that it should, in particular, reduce disparities between the various regions and the backwardness of the least- favoured regions; whereas energy should be integrated into that effort; (5) O J N oL 167, 9. 7. 1993, p. 31. initial text amended text Whereas by Council Decision 91/565/EEC(6) a Community energy efficiency programme (SAVE), aimed efficiency infrastructures within the Community, was adopted; that programme will expire on 31 whereas December 1995; strengthening energy at Whereas by Council Decision 91/565/EEC(6) a Community energy efficiency programme (SAVE), aimed efficiency infrastructures within the Community, was adopted; whereas that programme expired on 31 December 1995; strengthening energy at important element of Whereas the Community recognized the SAVE the programme as an Community's C02 reduction strategy; whereas the communication of the Commission of 8 May 1991 on the European Community's energy programming activities at regional level, the conclusion of the Energy Council on this communication, and the Resolution of the European Parliament of 16 July 1993(7) stated that those actions should be pursued, amplified and utilized as a support to the energy strategy of the Community; whereas this initiative for totally incorporated into a new SAVE II programme; should now be regional actions as an important recognized element of the Community Whereas the SAVE the programme Community's C02 reduction strategy; whereas the communication of the Commission of 8 May 1991 on the European Community's energy programming activities at regional level, the conclusion of the Energy Council on this communication, and the Resolution of the European Parliament of 16 July 1993(7) stated that those actions should be pursued, amplified and utilized as a support to the energy strategy of the Community; whereas this initiative for regional actions should now be totally incorporated into a new SAVE II programme; Whereas by Decision No 1110/94/EC of the European Parliament and of the Council(8) a Fourth Framework Programme for actions in technological research, development and demonstration was established; whereas energy efficiency policy constitutes an important instrument for the use and promotion of the new energy technologies that the Framework Programme will establish; and whereas the SAVE represents a policy instrument which complements this programme, II programme Whereas by Decision No 1110/94/EC of the European Parliament and of the Council(8) a Fourth Framework Programme for actions in technological and demonstration was research, development established; whereas energy efficiency policy constitutes an important instrument for the use and promotion of the new energy technologies that the Framework Programme will establish; and whereas the SAVE represents a policy instrument which complements this programme, II programme (6) (7) (8) O J N oL 307, 8. 11. 1991, p. 34. OJ No C 255, 20. 9. 1993, p. 252. O J N oL 126, 18. 5. 1994, p. 1. initial text amended text Whereas the Council of Environment Ministers at their meeting of 15 and 16 December 1994 stated that the target of stabilizing C02 emissions can only be achieved by a coordinated package of measures to improve energy efficiency and the rational use of energy which are based on supply and demand at all levels of energy production, conversion, transport and consumption and to exploit renewable energies, and that a local energy management programme could be one of these measures; Whereas the Council of Environment Ministers at their meeting of 15 and 16 December 1994 stated that the target of stabilizing C02 emissions can only be achieved by a coordinated package of measures to improve energy efficiency and the rational use of energy which are based on supply and demand at all levels of energy production, conversion, transport and consumption and to exploit renewable energies, and that local energy management programmes are amongst these measures; Whereas in its opinion on the Commission's Green Paper on energy policy (10). on 10 October 1995 the European Parliament called for the formulation of objectives and a common programme for energy efficiency and savings compatible with the objectiyes concerning the emission of greenhouse gases, as agreed in Rio de Janeiro (1992) and Berlin (1995); is called considerably better I and funded demanded that the Commission clarify the role which it intends to play in energy savings and efficiency bv creating practical projects: II programme which than SAVE for a SAVE Whereas improved energy efficiency will have a positive impact on both the environment and the security of energy supplies which are global in nature; whereas a high international cooperation is desirable to produce the most positive results; level of Whereas improved energy efficiency will have a positive impact on both the environment and the security of energy supplies which are global in nature; whereas a high international cooperation is needed to produce the most positive results; level of Whereas all the elements of the Community action programme for improving the efficiency of electricity use set out in Council Decision 89/364/EEC(9) should be the SAVE II programme; whereas therefore that Decision should be repealed; incorporated into Whereas all the elements of the Community action programme for improving the efficiency of electricity use set out in Council Decision 89/364/EEC(9) should be the SAVE II programme; whereas therefore that Decision should be repealed; incorporated into (9) OJ N° L 157, 9. 6. 1989 p. 32- 34 (10) OJ N° C287, 30. 10. 1995, p. 34 initial text amended text Whereas between 180 and 200 MT of C02 emissions could be avoided by the year 2000 by an improvement of 5% in the energy intensity of final demand additional to the conventional expectations; Whereas between 180 and 200 MT of C02 emissions the year 2000 by an could be avoided by improvement of 5% in the energy intensity of final demand additional to the conventional expectations; Whereas a strengthened SAVE II programme is an important and necessary instrument for promoting increased energy efficiency; Whereas a strengthened SAVE II programme is _. an important and necessary instrument for promoting increased energy efficiency; synergy Whereas in order to prevent duplication and to achieve in implementing to ensure close coordination with other Community programmes linked directly with energy efficiency promotion; care the programme should taken be Whereas it is politically desirable to open the SAVE II programme to the associated Central and Eastern European Countries (CEECs) in accordance with the conclusions of the European Council meeting in Copenhagen in June 1994, and as outlined on the Commission communication to the Council on the subject in May 1994; Whereas it is politically and economically desirable to open the SAVE II programme to the associated Central and Eastern European Countries (CEECs) in accordance with the conclusions of the European Council meeting in Copenhagen in June 1994, and as outlined in the Commission communication to the Council on the subject in May 1994, as well as the associated Mediterranean Countries Cyprus and Malta; for the SAVE the budget Whereas, since II programme is reserved only for participants from the Member States, the appropriations required for the participation of the associated CEECs in the programme will be made available from other Community resources, for the SAVE the budget Whereas, since II programme is reserved only for participants from the Member States, the appropriations required for the participation of the associated Mediterranean Countries Cyprus and Malta in the programme will be made available in from other Community other ways, resources; the associated CEECs and inter alia HAS ADOPTED THIS DECISION: initial text Article 1 amended text Article 1 stimulate energy The Community shall support a 1. five-year programme of measures and actions in order to promote energy efficiency within the Community. The general overall objectives of this programme are to and increased levels of investment for energy saving, and to contribute to improving the energy intensity of final demand by a further percentage point per annum over that which would have been otherwise attained. efficiency measures support a to stimulate energy efficiency measures in all 1. The Community five-year shall programme for the preparation and implementation of measures and actions, also of normative character, in order to promote energy efficiency within the Community. The general overall objectives_of this programme are: a) sectors, transport sector included. b) to encourage investments in energy conservation by private and public consumers and bv industry. c) to create the conditions for improving the energy intensity of further percentage point per annum over that which would have been otherwise attained. consumption final by a 2. Community financing will be given under the "SAVE II programme to promote energy efficiency in the Community" hereafter referred to as "the programme", the objectives of this Decision. for actions which fall within 2. Community financing will be given under the "SAVE II programme to promote energy efficiency to as "the in the Community" hereafter referred programme", the objectives of this Decision. for actions which fall within Article 2 Article 2 Under the programme, the following categories of actions and measures on energy efficiency policy shall be financed: (a) studies and other actions and implementation legislation Community standards governing energy efficiency; leading completion and the of performance to Under the programme, the following categories of actions and measures on energy efficiency policy, which are described in Annex. shall be financed: (a) studies and other actions the implementation and completion of Community energy efficiency legislation and performance standards governing energy efficiency; leading to initial text amended text (b) sectoral pilot actions aimed at accelerating energy efficiency investment and/or improving consumer energy use patterns, to be carried out essentially by Community- wide networks; at aimed targeted sectoral investment and accelerating energy efficiency improving consumer energy use patterns, to be carried out essentially by public and private enterprises; actions pilot (c) (d) measures proposed by the Commission to foster the exchange of experience, mainly through information networks, aimed at promoting better coordination between Community, international, national, regional and local activities through the establishment for exchanging information; appropriate means of (e) measures proposed otherwise better than by coordination the Commission to foster the exchange of experience, mainly through information networks, aimed at promoting between Community, international, national, regional and local activities the establishment of appropriate means for exchanging information; sectoral to monitoring of energy efficiency progress in the Community, in individual Member States and including the programme itself; the detailed through relating (f) an action (b) (c) sectoral pilot actions aimed at accelerating energy efficiency investment and/or improving consumer energy use patterns, to be carried out essentially by Community- wide networks; aimed at targeted investment and accelerating energy efficiency improving consumer energy use patterns, to be carried out essentially by public and private enterprises; sectoral pilot actions (d) measures proposed by the Commission to foster the exchange of experience, mainly through information networks, aimed at promoting better coordination between Community, international, national, regional and local activities through the establishment for exchanging information; (e) measures proposed otherwise of appropriate means than by better coordination the Commission to foster the exchange of experience, mainly through information networks, aimed at promoting between Community, international, national, regional and local activities through the establishment of appropriate means for exchanging information; an action to the detailed sectoral monitoring of energy efficiency progress in the Community, in individual Member States and including the programme itself; relating (f) initial text amended text policies efficiency g) specific actions in favour of greater cohesion between Member States and regions in the field of energy efficiency through support for the creation of energy efficiency infrastructures in those Member States and regions where are not yet energy sufficiently developed; in management at the regional and urban level; (i) studies and other actions in support of energy efficiency initiatives within other programmes, with a view to establishing energy efficiency as a criterion within Community strategic programmes; (h) specific actions energy favour of (j) evaluation and monitoring of the actions and measures undertaken under points (a) to (i). actions policies efficiency (h) specific (g) specific actions in favour of greater cohesion between Member States and regions in the field of energy efficiency through support for the creation of energy efficiency infrastructures in those Member States and regions where are not yet energy sufficiently developed; in management at the regional and urban level; studies and other actions in support of energy efficiency initiatives within other programmes, with a view to establishing energy efficiency as a criterion within Community strategic the taking programmes environmental impact of the different energy sources. ; evaluation and monitoring of the actions and measures undertaken under points(a) to (i). account of energy favour and (i) (j) of Article 3 Article 3 1. All the costs relating the actions and measures referred to in Article 2(a), (d), (f), (i) and (j) shall be borne by the budget of the Community. to 1. All the costs relating the actions and measures referred to in Article 2(a), (d), (f), (i) and (j) shall be borne by the budget of the Community. to 2. The level of funding for the actions and measures referred to in Article 2(b), (c), (e), (g) and (h) shall be set at a maximum of 50% of their total cost. 2. The level of funding for the actions and measures referred to in Article 2(b), (c), (e), (g) and (h) shall be set at a maximum of 50% of their total cost. 3. The balance of the funding of the actions and measures referred to in Article 2(b), (c), (e), (g) and (h) may be made up from either public or private sources or from a combination of the two. 3. The balance of the funding of the actions and measures referred to in Article 2(b), (c), (e), (g) and (h) may be made up from either public or private sources or from a combination of the two. initial text amended text Article 4 1. The Commission will be responsible for the financial execution and implementation of the programme at Community level. Article 4 1. The Commission will be responsible for the financial execution and implementation of the programme at Community level. 2. The conditions and guidelines to be applied for the support of all actions and measures referred to in Article 2 shall be defined each year in accordance with cost effectiveness criteria, the list of priorities referred to in the second paragraph of Article 6, the trends in energy efficiency identified by the action described in Article 2(f) and according to the procedure laid down in Article 5. 2. The conditions and guidelines to be applied for the support of all actions and measures referred to in Article 2 shall be defined each year taking into account : the cost effectiveness criteria, the savings potential and environment impact. the list of priorities referred to in the second paragraph of Article 6, the objectives of cohesion between Member States in the field of energy efficiency and the trends in energy efficiency development indentified by the action described in Article 2(f). The committee described in Article 5. assists the Commission in defining these conditions and guidelines. Article 5 Article 5 The Commission shall be assisted by a committee of an advisory character composed of the representatives of the Member States and chaired by the representative of the Commission. The Commission shall be assisted by a committee of an advisory character composed of the representatives of the Member States and chaired by the representative of the Commission. The representative of the Commission shall submit to the committee a draft of the measures to be taken. The committee shall deliver its opinion on the draft within a time-limit which the chairman may lay down according to the urgency of the matter, if necessary by taking a vote. The representative of the Commission shall submit to the committee a draft of the measures to be taken. The committee shall deliver its opinion on the draft within a time-limit which the chairman may lay down according to the urgency of the matter, if necessary by taking a vote. The opinion shall be recorded in the minutes; in addition, each Member State shall have the right to have its position recorded in the minutes. The opinion shall be recorded in the minutes; in addition, each Member State shall have the right to have its position recorded in the minutes. initial text amended version The Commission shall take the utmost account of the opinion delivered by the committee. It shall inform the committee of the manner in which its opinion has been taken into account. The Commission shall take the utmost account of the opinion delivered by the committee. It shall inform the committee of the manner in which its opinion has been taken into account. Article 6 Article 6 The Member States shall report to the Commission annually on national energy efficiency programmes in to assisting with a view formulating appropriate flanking measures. the Commission The Member States shall report to the Commission annually on national energy efficiency programmes in to assisting with a view formulating appropriate flanking measures. the Commission The Commission shall formulate on an annual basis a list of priorities for funding under the programme which shall reflect an examination of the reports submitted under the first paragraph. This the complementarity between SAVE II programme and the national programmes. Priority shall be given to those complementarity is greatest. areas where account shall such take into list The Commission shall formulate on an annual basis a list of priorities for funding under the programme which shall reflect an examination of the reports submitted under the first paragraph. This the take complementarity between SAVE II programme and the national programmes. Priority shall be given to those complementarity is greatest. areas where account shall such into list Article 7 Article 7 to L. After every year of presents the programme the Commission the European Parliament and to the Council a progress report together with proposals concerning the the guidelines, adopted modifications of according to Article 4. paragraph 2. which may be necessary in the light of the results of the previous year. 10 initial text amended text 1. After the third year of the programme, the Commission shall present a report to the European Parliament and to the Council on the energy efficiency measures undertaken at Community and Member State level and on the results achieved, with particular reference to the objective outlined under Article 1. The report shall be accompanied by proposals for any amendments which may be necessary to the programme in the light of these results. 2,. After the third year of the programme, the Commission shall present a report to the European Parliament and to the Council on the energy efficiency measures undertaken at Community and Member State level and on the results achieved, with particular reference to the objectivesLputlined under Article 1. The report shall be accompanied by proposals for any amendments which may be necessary to the programme in the light of these results. through the application of 2. On expiry of the programme, the Commission shall make an overall assessment of the results obtained this Decision, and of the consistency of national and Community actions. It shall present a report thereon to the European Parliament, the Council, the Economic and Social Committee and the Committee of the Regions, stating, in particular, how far the objective outlined under Article 1 has been achieved. through the application of 3^ On expiry of the programme, the Commission shall make an overall assessment of the results obtained this Decision, and of the consistency of national and Community actions. It shall present a report thereon to the European Parliament, the Council, the Economic and Social Committee and the Committee of the Regions, stating, in particular, how far the objectives outlined under Article 1 have been achieved. Article 8 Article 8 Decision 89/364/EEC is hereby repealed. Decision 89/364/EEC is hereby repealed. 11 initial text Article 9 amended vereion Article 9 The programme shall be open to the associated Central and Eastern European countries (CEECs) in accordance with the conditions contained in the additional protocols to the association agreements in Community concerning programmes. their participation The programme shall be open to the associated Central and Eastern European countries (CEECs) in accordance with including financial arrangements, contained in the additional protocols to the association agreements concerning their participation in Community programmes. the conditions, be open the The programme shall also the associated Mediterranean participation of Countries Cyprus and Malta on the basis of additional appropriations in accordance with the same rules as apply to the EFTA Countries. to Article 10 Article 10 This Decision shall apply from 1 January 1996 to 31 December 2000. This Decision shall apply from 1 January 1996 to 31 December 2000. Article 11 Article 11 This Decision is addressed to the Member States. This Decision is addressed to the Member States. Done at Brussels, Encl. For the Council The President 12 initia] text amended text Annex Description of the actions listed in Article 2. Article 2(a): These shall include, in particular, studies concerning the introduction of EC measures in the following areas: - building energy certification. - insulation for new buildings. - the promotion of third-partv funding of energy-saving investments. - regular checks on boilers. - minimum standards for electrically- operated office machinery (in particular computers/monitors) and household appliances. co generation. minimum standards for motor vehicles. Furthermore, plans will be drawn up. inter alia, for assessing the effects of EC energy legislation and other measures, for the commissioning of CEN/CENELEC in respect of standards for energy consumption applications and for studies for the development of voluntary agreements on energy efficiency objectives and the monitoring thereof and involvement in internationally coordinated activities. 13 initial text amended text Article 2(b): These concern in particular ad hoc actions through closer cooperation between the kev players bv means of Communitv-wide networks; for example, projects by associations instance, the building sector associations of architects), bv undertakings /associations in the electricity and/or gas sectors (for example. integrated resource planning) and bv municipal associations (for example, projects to increase energy efficiency in urban transport). (for in Article 2(c): is particularly aimed at promoting projects This addressing the relevant problems on the basis of one particular theme, for example obstacles to cogeneration or problems involving municipal transport systems. electricity Furthermore, projects consumption more widespread use of new financial mechanisms and in this training and education could be promoted context- the development concerned with and and the dissemination of Article 2(d) and (e): information via As regards networks, specific groups and addressees, or consumers in general, should be reached bv all the available media (publications, videos, workshops, conferences and seminars and databases). Article 2(f): A group of experts should be set up in this context to monitor the utilization of the instruments developed under SAVE I and to assess progress as regards energy efficiency. 14 initial text amended text Article 2(g): This action is designed to promote ties between the various Member States or the regions of various Member States with a view to exchanging information. Furthermore, information the requisite sources of (including databases) should be established to al 1 ow access to information via local initiatives. Finalj v^ regional centres of excellence should be set up to act_as centres for local energy management research and training activities and to contribute to the development of solutions as regards the use of regional sources of energy. in local the emphasis being on Article 2(h): This concerns actions to complement the actions listed under Article 2(g). the establishment of regional and local energy management agencies. These could play a major role for example. in the establishment of educational programmes for end energy the development of users or management initiatives- Article 2(i): The purpose here is. bv using SAVE as a catalyst in other Community programmes such as the European Regional Development Fund, identify potential energy efficiency projects which can be supported by these programmes- Article 2(j): It is important that all the actions taken under SAVE should be fully evaluated and that the contribution of each action to the improvement of energy efficiency should be continually assessed. Projects with a high identified and dissemination potential transmitted the to programme so comprehensive dissemination strategies can be developed. the promotional activities of that should be to 15 ISSN 0254-1475 COM(96) 195 final DOCUMENTS EN 12 Catalogue number : CB-CO-96-204-EN-C ISBN 92-78-03516-5 Office for Official Publications of the European Communities L-2985 Luxembourg 4

Council Regulation (EC) No 847/96 of 6 May 1996 introducing additional conditions for year-to-year management of TACs and quotas

http://publications.europa.eu/resource/cellar/5292b476-4eae-4815-8024-7f4ec0e2b005

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L_1996115EN. 01000301. xml 9. 5. 1996    EN Official Journal of the European Communities L 115/3 COUNCIL REGULATION (EC) No 847/96 of 6 May 1996 introducing additional conditions for year-to-year management of TACs and quotas THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 43 thereof, Having regard to the proposal from the Commission (1), Having regard to the opinion of the European Parliament (2), Whereas, in addition to the provisions listed in Article 4 (2) of Council Regulation (EEC) No 3760/92 of 20 December 1992 establishing a Community system for fisheries and aquaculture (3), it is necessary to lay down conditions for the pursuit of exploitation activities which would improve the mechanisms at present available by the introduction of the appropriate year-to-year flexibility in the management of total allowable catches (TACs) and quotas which, within certain limits, is compatible with conservation policies; Whereas, pursuant to Article 8 of Regulation (EEC) No 3760/92, it is for the Council to establish the fishing availabilities to be allocated to Member States and to determine the conditions for adjusting these availabilities from one year to the next; Whereas stocks subject to precautionary or analytical TACs need to be defined; Whereas permitted landings from a stock, for the purpose of this Regulation, need to be defined; Whereas, under certain conditions, precautionary TACs and quotas for certain stocks may be revised upwards during the year with negligible danger of undermining the principle of rational and responsible exploitation of marine resources; Whereas it is appropriate to encourage Member States to transfer part of their quotas of stocks subject to analytical TAC from one year to another within certain limits; Whereas other stocks subject to either an analytical or a precautionary TAC may be known to be in a state of exploitation such that any increase in the TAC is undesirable; Whereas overfishing of quotas should be penalized; whereas this can be achieved by imposing appropriate reductions in the following year's quota on the Member States responsible for the overfishing; whereas, in accordance with Article 23 of Council Regulation (EEC) No 2847/93 of 12 October 1993 establishing a control system applicable to the common fisheries policy (4), the Council is to adopt rules by which the Commission may operate deductions from the quotas when overfishing has taken place, taking into account the degree of the overfishing, any cases of overfishing in the previous year and the biological status of the resources concerned, HAS ADOPTED THIS REGULATION: Article 1 1. Precautionary TACs shall apply to stocks for which no scientifically-based evaluation of fishing possibilities is available specifically for the year in which the TACs are to be set; analytical TACs shall apply otherwise. 2. For the purpose of this Regulation, permitted landings from a stock shall consist, for a given Member State, of the quota allocated by the Council on the basis of Article 8 (4) of Regulation (EEC) No 3760/92, as modified by: — the exchanges made on the basis of Article 9 of Regulation (EEC) No 3760/92, — the compensation envisaged by Article 21 (4) of Regulation (EEC) No 2847/93, — the quantities withheld on the basis of Article 4 (2) of this Regulation, and — the deductions envisaged by Article 5 of this Regulation. Article 2 When fixing TACs in accordance with Article 8 of Regulation (EEC) No 3760/92, the Council shall decide: — which stocks are subject to a precautionary TAC and which stocks are subject to an analytical TAC, on the basis of scientific advice available on the stocks, — the stocks to which Articles 3 or 4 shall not apply, on the basis of the biological status of the stocks and of commitments reached with third countries, — the stocks to which the deductions envisaged in Article 5 (2) shall apply, on the basis of their biological status. Article 3 1. When more than 75 % of a precautionary TAC has been utilized before 31 October of the year of its application, a Member State with a quota for the stock for which that TAC has been fixed may request an increase in the TAC. Such a request, accompanied by relevant supporting biological information and an indication of the magnitude of the revision, shall be addressed to the Commission. The Commission, within 20 working days, shall examine all the elements of the request with a view to presenting to the Council a proposal for an amendment of the Regulation fixing TACs and quotas if it is found justified. The Member State shall be informed of the results of the examination. 2. Member States may take catches up to 5 % in excess of permitted landings. However, these catches shall be considered as exceeding permitted landings as regards the deductions envisaged in Article 5. 3. When more than 75 % of a quota for a stock subject to a precautionary TAC has been utilized before 31 October of the year of its application, the Member State to which such a quota has been allocated may request the Commission's permission to land additional quantities of fish of the same stock indicating the additional quantity required, this quantity not to exceed 10 % of the appropriate quota. The Commission shall decide on such requests within 20 workings days in accordance with the procedure laid down in Article 36 of Regulation (EEC) No 2847/93. The additional quantity granted under this procedure shall be considered as exceeding permitted landings for the purposes of the deductions envisaged in Article 5 of this Regulation. Article 4 1. Article 3 (2) and (3) shall apply to stocks subject to an analytical TAC. 2. For stocks subject to analytical TAC, except those referred to in Article 5 (2), a Member State to which a relevant quota has been allocated may ask the Commission, before 31 October of the year of application of the quota, to withhold a maximum of 10 % of its quota to be transferred to the following year. The Commission, in accordance with the procedure laid down in Article 36 of Regulation (EEC) No 2847/93, shall add to the relevant quota the quantity withheld. Article 5 1. Except for the stocks referred to in paragraph 2, all landings in excess of the respective permitted landings shall be deducted from the quotas of the same stock in the following year. 2. For the stocks referred to in the third indent of Article 2, overfishing of permitted landings shall lead to deduction from the corresponding quota in the following year according to the following table: Extent of the overfishing relative to the permitted landings Deduction The first 10 % Overfishing x 1,00 The next 10 % up to 20 % in total Overfishing x 1,10 The next 20 % up to 40 % in total Overfishing x 1,20 Any further overfishing greater than 40 % Overfishing x 1,40 However, a deduction equal to the overfishing x 1,00 shall apply in all cases of overfishing relative to permitted landings equal to, or less than, 100 tonnes. An additional 3 % of the quantity fished in excess of permitted landings shall be deducted for each successive year in which permitted landings are overfished by more than 10 %. 3. Deductions shall be without prejudice to Article 21 (4) of Regulation (EEC) No 2847/93. Article 6 This Regulation shall enter into force on 1 January 1997. However, Article 5 shall apply from 1 January 1998. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Brussels, 6 May 1996. For the Council The President G. LOMBARDI (1)  OJ No C 382, 31. 12. 1994, p. 4. (2)  OJ No C 249, 25. 9. 1995, p. 84. (3)  OJ No L 389, 31. 12. 1992, p. 1. Regulation as last amended by the 1994 Act of Accession. (4)  OJ No L 261, 20. 10. 1993, p. 1. Regulation as last amended by Regulation (EC) No 2870/95 (OJ No L 301, 14. 12. 1995, p. 1)

Commission Regulation (EC) No 823/96 of 3 May 1996 amending Regulation (EC) No 1466/95 laying down special detailed rules of application for export refunds on milk and milk products, repealing Regulation (EEC) No 1953/82 and amending Regulation (EEC) No 3846/87

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L_1996111EN. 01000901. xml 4. 5. 1996    EN Official Journal of the European Communities L 111/9 COMMISSION REGULATION (EC) No 823/96 of 3 May 1996 amending Regulation (EC) No 1466/95 laying down special detailed rules of application for export refunds on milk and milk products, repealing Regulation (EEC) No 1953/82 and amending Regulation (EEC) No 3846/87 THE COMMISSION OF THE EUROPEAN COMMUNITIES, Having regard to the Treaty establishing the European Community, Having regard to Council Regulation (EEC) No 804/68 of 27 June 1968 on the common organization of the market in milk and milk products (1), as last amended by Commission Regulation (EC) No 2931/95 (2), and in particular Articles 13 (3) and 17 (14) thereof, Whereas Commission Regulation (EC) No 1466/95 (3), as last amended by Regulation (EC) No 592/96 (4), lays down special detailed rules of application for export refunds on milk and milk products; Whereas experience gained shows it is necessary to clarify the arrangements introduced by Article la and the provisions on tolerance set out in Article 10 of Regulation (EC) No 1466/95; Whereas, in the framework of the consultations with Switzerland on the implementation of the results of the Uruguay Round, it was agreed to apply a set of measures providing in particular for a reduction in the customs duties on certain Community cheeses imported into Switzerland; whereas the Community origin of such products should be guaranteed; whereas, to that end, export licences should be compulsory for all cheese exported under the arrangements, including cheese on which export refunds are not payable; whereas licences should be issued subject to presentation by the exporter of a declaration certifying the Community origin of the product; whereas this system replaces that provided for in Commission Regulation (EEC) No 1953/82 of 6 July 1982 laying down special conditions for the export of certain cheeses to certain third countries (5), as last amended by Regulation (EC) No 3337/94 (6), which may accordingly be repealed; Whereas footnote 6 in Sector 9 of the Annex to Commission Regulation (EEC) No 3846/87 of 17 December 1987 establishing an agricultural product nomenclature for export refunds (7), as last amended by Regulation (EC) No 310/96 (8), fixes the minimum value of certain cheeses qualifying under the export refund arrangements; whereas, for the sake of consistency and clarity, those provisions should be incorporated into Regulation (EC) No 1466/95; whereas, given the trend in market prices and in order for the refund arrangements to achieve their full economic impact, that minimum value should be increased and it should apply to all cheeses; Whereas the Management Committee for Milk and Milk Products has not delivered an opinion within the time limit set by its chairman, HAS ADOPTED THIS REGULATION: Article 1 Regulation (EC) No 1466/95 is hereby amended as follows: 1. Article la is amended as follows: (a) in paragraph 4 (a), ‘Section 19’ is replaced by ‘Section 22’; (b) the following paragraph is added: ‘5. At the request of the party concerned, a certified copy of the licence shall be issued. ’ 2. The following Article is inserted: ‘Article lb 1. This Article lays down special detailed rules governing exports to Switzerland of the cheeses listed in the Annex. 2. Export licences shall be presented for all exports covered by paragraph 1 from 1 July 1996. 3. Section 20 of licence applications and of licences shall show a reference to this Article. 4. Licence applications shall be admissible only where the applicant: — declares in writing that all material falling within Chapter 4 of the combined nomenclature and used in the manufacture of products covered by his application has been produced entirely within the European Union, — undertakes in writing to provide, at the request of the competent authorities, any further substantiation which the latter consider necessary for the issuing of licences and to accept, where applicable, any checks by those authorities of the accounts and of the conditions under which the products concerned are manufactured. 5. The following provisions shall apply to exports not covered by refund applications: (a) Section 22 of licence applications and of licences shall show the words “To be exported without a refund”; (b) licences shall be issued as soon as possible after applications are lodged; (c) licences shall be valid from their date of issue within the meaning of Article 21 (1) of Regulation (EEC) No 3719/88 to 30 June thereafter, (d) the other provisions of this Regulation shall not apply, with the exception of the first subparagraph of Article 3 (1); (e) Regulation (EEC) No 3719/88 shall apply. 6. On application by the party concerned, a certified copy of the licence shall be issued. ’ 3. The following Article is inserted: ‘Article 2a No refund shall be granted on exports of cheese where the free-at-frontier price prior to application of the refund in the Member State of export is less than ECU 230 per 100 kilograms. ’ 4. Article 10 (2) is replaced by the following: ‘2. The provisions of Regulation (EEC) No 3719/88 on tolerances for quantities exported shall apply as follows: (a) the rate of 5 % laid down in Article 8 (5) shall be replaced by 2 %; (b) the rates of 95 % and 5 % laid down in Article 33 (2) shall be replaced by 98 % and 2 % respectively, (c) the rate of 5 % laid down in Article 44 (9) (c) shall be replaced by 2 %. ’ 5. The Annex hereto is added as an Annex. Article 2 Regulation (EEC) No 1953/82 is hereby repealed. However, certificates of origin issued pursuant to that Regulation before the entry into force of this Regulation shall remain valid for exports under licences issued prior to that date. Article 3 Footnote 6 and the relevant reference in the first line opposite code ex 0406 in Sector 9 of the Annex to Regulation (EEC) No 3846/87 are hereby deleted. Article 4 This Regulation shall enter into force on the day following its publication in the Official Journal of the European Communities. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Brussels, 3 May 1996. For the Commission Franz FISCHLER Member of the Commission (1)  OJ No L 148, 28. 6. 1968, p. 13. (2)  OJ No L 307, 20. 12. 1995, p. 10. (3)  OJ No L 144, 28. 6. 1995, p. 22. (4)  OJ No L 84, 3. 4. 1996, p. 31. (5)  OJ No L 212, 21. 7. 1982, p. 5. (6)  OJ No L 350, 31. 12. 1994, p. 66. (7)  OJ No L 366, 24. 12. 1987, p. 1. (8)  OJ No L 46, 23. 2. 1996, p. 1. ANNEX List of cheeses referred to in Article 1b (1) CN code Description (agricultural product nomenclature for export refunds) 0406 Cheese and curd: ex 0406 10 20 – – – – – Ricotta, salted 0406 20 – Grated or powdered cheese, of all kinds: 0406 40 – Blue-veined cheese ex 0406 90 – Other cheese: 0406 90 61 – – – – – – – Grana Padano, Parmigiano Reggiano 0406 90 63 – – – – – – – Fiore Sardo, Pecorino 0406 90 69 – – – – – – – Other: 0406 90 73 – – – – – – – Provolone ex 0406 90 75 – – – – – – – Caciocavallo ex 0406 90 76 – – – – – – – Fontina della Valle d'Aosta: ex 0406 90 87 – – – – – – – – – – – – – Idiazabal, Manchego, Roncal, manufactured exclusively from sheep's milk

Proposal for a COUNCIL REGULATION (EC) amending Council Regulation (EEC) n° 3922/91, on the harmonisation of technical requirements and administrative procedures in the field of civil aviation

http://publications.europa.eu/resource/cellar/771cde16-f379-4a12-9c2f-35c2ef14f2d2

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels OU)S |<)96 (X)M(9()) 186 final 96/0119 (SYN) Proposal for a COUNCIL REGULATION (EC) amending Council Regulation (EEC) n'3922/91, on the hannonisation of technical requirements and administrative procedures in the field of civil aviation. (presented by the Commission) Explanatory Memorandum Introduction Pursuant to Article 4 of Council Regulation 3922/911 on hannonisation of technical requirements and administrative procedures in the field of civil aviation,the Commission has committed itself to propose, where appropriate, further measures to harmonise techni cal requirements and procedures in the field of civil aviation. It was agreed at the same time that the basis for these proposals should be found in the cooperative work of the member States in developing "Joint Aviation Rules" within the framework of their association called Joint Aviation Authorities (JAA). The present Annex II of Regulation 3922/91 covers the common requirements for type certification of sailplanes and powered sailplanes, large aeroplanes, engines, propellers, auxiliary power units and very light aeroplanes. As well as approval of maintenance organisations, All Weather operations and certification of equipment intended to be fitted into an aeroplanes. The JAA has now elaborated common requirements for the type certification of small aircraft (JAR 23) in the category normal, utility, aerobatic and commuter aircraft and small and large rotorcraft (JAR 27 and JAR 29). These fields were not covered in present Annex II of Regulation 3922/91. Including these harmonised requirements into Annex II of regulation 3922/91 will ensure a common level of safety for the operation of these aircraft and will facilitate the free movement of small commercial aircraft and of small and large rotorcraft and free access within the Community market through automatic recognition of type certificates under art. 6 par 1 of the Regulation. Our manufacturing Industry has cooperated in the work of JAA and is fully supporting incorporation of the JARs 23, 27 and 29 in Community law as they stand. OJ L 3 73 of 3 1. 1 2. 9 1 , P. 4 2 Proposal for a COUNCIL REGULATION (EC) amending Council Regulation (EEC) n" 3922/91 on the hannonisation of technical requirements and administrative procedures in field of civil aviation. THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community and in particular Article 84(2) thereof; Having regard to the proposal of the Commission1 in cooperation with the European Parliament2, Having regard to the opinion of the Economic and Social Committee 3; Whereas common airworthiness standards for large aircraft are harmonised in the European Community under Annex II of Regulation (EEC) No 3922/914, Whereas the present Annex II of Regulation (EEC) No 3922/91 covers the common requirements for type certification ol sailplanes and powered sailplanes, large aeroplanes, approved maintenance organisations, all weather operations, engines, propellers, auxiliary power units, very light aeroplanes as well as technical standards for the approval of equipment and apparatus to be fitted on board aeroplanes. Whereas Council Regulation 3922/91, shall be completed by adoption of new technical requirements and administrative procedures in the fields covered by this Regulation 4 OJ L 3 7 3 o f 3 1. l 2. 9 1. p. 4 Whereas the JAA have elaborated common requirements for type certification of small commercial aircraft (JAR 23) and small and large rotorcraft (JAR 27 and JAR 29) Whereas the Member States , associated in the JAA, have notified the Commission, in conformity with Article 10 of Regulation 3922/91, of: the development and adoption of new technical requirements for the issue of type certificates and changes to those certificates lor aeroplanes in the normal, utility and aerobatic category and for propeller driven twin-engined aeroplanes in the commuter category (JAR 23), the development and adoption of new technical requirements for the issue of airworthiness type certificates and changes to airworthiness type certificates for small rotorcraft (JAR 27) and the development and adoption of new technical requirements for the issue of airworthiness type certificates and changes to airworthiness type certificates for large rotorcraft (JAR 29), HAS ADOPTED THIS REGULATION : Sole Article Point 2 of Annex II of Regulation No: 3922/91 on hannonisation of technical requirements and administrative procedures in the field of civil aviation is extended by the addition of; JAR 23 Normal, Utility, Aerobatic and Commuter Category Aeroplanes JAR 27 Small Rotorcraft JAR 29 Large Rotorcraft This Regulation shall enter into force on the 20th day following its publication in the Official Journal of the European Communities This Regulation shall be binding in its entirety and directly applicable in all Member States. Done in For the Council H Assessment form for the impact on competitivity and employment. Proposal for a Council Regulation amending Annex II of Council Regulation 3922/91 on harmonisation of technical requirements and administrative procedures in the field of civil aviation by including airworthiness Requirements for small commercial aeroplanes and small and large rotorcraft. 1. What is the main justification for this measure? ensuring a true single Market for aircraft and aviation products while maintaining a high level of safety in civil aviation in Europe 2. Characteristics of the enterprises concerned: Aircraft Manufacturers, Manufacturers of aircraft products and parts, Aircraft operators and rotorcraft operators. In particular are a great number of SME's concerned ? Yes are there concentrations in certain regions ? No eligibility for regional aids in Member Sates ? No No eligible for ERDF ? 3. What constraints are imposed on the enterprises? None extra. These common requirements will have a cost advantage, since there will be only one certification process, instead of multiple national processes which are more time-consuming and more costly. 4. What constraints are likely to be imposed directly on the enterprises by way if local authorities ? None. 5. Are there special measures of SME's ? NO 6. What is the foreseeable impact on : The competitivity of the enterprises? They will be diminishing their certification cost and achieving more flexibility for their aircraft fleet and for their products, employment ? No foreseeable impact. 7. Have the Social partners been consulted ? No, it was not considered necessary. Support for these proposals from Industry Yes, strong support. ^ ISSN 0254-1475 COM(96) 186 final DOCUMENTS EN 07 Catalogue number : CB-CO-96-195-EN-C ISBN 92-78-03153-4 Office for Official Publications of the European Communities L-2985 Luxembourg &

OPINION OF THE COMMISSION pursuant to Article 189 b (2) (d) of the EC Treaty, on the European Parliament' s amendments to the Council' s common position regarding the proposal for a EUROPEAN PARLIAMENT AND COUNCIL REGULATION (EC) concerning the creation of a supplementary protection certificate for plant protection products

http://publications.europa.eu/resource/cellar/47597950-b943-4a00-8e16-d68eda723c30

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COMMISSION OF THE EUROPEAN COMMUNITIES •k •A- -k * Brusseis,02. 05 1996 COM(%) 185fuial 94/0285(COD) OPINION OF THE COMMISSION pursuant to Article 189 b (2) (d) of the EC Treaty, oil the European Parliament's amendments to the Council's common position regarding the proposal for a EUROPEAN PARLIAMENT AND COUNCIL REGULATION (EC) concerning the creation of a supplementary protection certificate for plant protection products AMENDING IHE PROPOSAL OF IHE COMMISSION pursuant to Article 189 a (2) of the EC Treaty 1. BACKGROUND a) b) c) d) e) f) g) On 12 December 1994, the Commission sent to the Council a proposal for a regulation concerning the creation of a supplementary protection certificate for plant protection products (COM (94) 579 final)1. On 27 April 1995, the Economic and Social Committee delivered its opinion2. On 15 June 1995, the Parliament adopted in first reading a favourable resolution containing 4 amendments to the proposal of the Commission3. On 6 October 1995, the Commission adopted, pursuant to Article 189A (2) of the EC Treaty, an amended proposal which fully incorporated these 4 amendments (COM (95) 456 final)4. On 27 November 1995, the Council adopted a common position5. On 7 December 1995, the Commission accepted this common position and communicated its opinion to the European Parliament (SEC(95) 1841 final). On 12 March 1996, the European Parliament voted in second reading for one amendment to the common position. 2. THE REGULATION'S OBJECTIVE The proposal has as its objective the harmonisation and the prolongation of the duration of protection for patents for inventions in the plant protection products sector (insecticides, fungicides, herbicides and growth regulators) in the Union. Equally, it also strives for the objective of the industrial policy which favours research in the plant protection product sector. These objectives are achieved by the creation of a new form of industrial property, the supplementary protection certificate This will take effect upon the expiration of the basic patent and can last up to a maximum of 5 years It will operate so as to provide a supplementary protection to that which is obtained by a patent 3. OPINION OF THE COMMISSION TOWARDS THE AMENDMENT OF THEEP The European Parliament adopted, during its second reading, a single amendment to the Council's common position. This amendment seeks to change into a "recital" a declaration that the Council and the Commission wanted to include in an annex to 1 JOn°C 390 oH 1. 12. 1994, p. 21. 2 JO n° C 155 of 21. 06. 1995. p. 14. 3 JO n° C 166 of 03. 07. 1995. p. 89. 4 JO n° C 335 of 13. 12. 1995. p. 15 5 JO n° C 353 of 30. 12. 1995, p;36. y* the minutes of the meeting of the Council which will adopt the legislation in its final form. The objective of the European Parliament (which is shared by the Council and the Commission) is to ensure a uniform application and interpretation of the two regulations which create supplementary protection certificates, namely the present regulation establishing a supplementary protection certificate for plant protection products and the Council's regulation N° 1768/92 of 18 June 1995 concerning the creation of a supplementary protection certificates for medicines. There are two advantages obtained by changing the declaration in the minutes of the Council to a "recital": 1) 2) greater transparency since the declaration will be made public in this manner; greater legal security and, if the case arises, the possibility of intervention by the Court of justice However, the formulation of the amendment as adopted by the European Parliament could give the impression that it seeks to modify certain clauses of a regulation - regulation N° 1768/92 of the Council - for which a proposal for modification has not been presented by the Commission. Consequently, in order to meet the chosen objectives of the three institutions, together with ensuring that there is adequate legal coherence between the two regulations, the Commission accepts the spirit and the aim of the amendment adopted by the European Parliament but proposes a slightly different formulation. £ Amended Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND COUNCIL concerning the creation of a supplementary protection certificate for plant protection products (presented by the Commission pursuant to Article 189 A, paragraph 2 of the EC Treaty) 3 common position of the Council- - Modified Text Preamble 16A (new) (16A) whereas the present regulation, in particular recitals 12. 13 and 14 and Articles 3(2). 4. 8(l)(c) and 17(2). and the regulation of the Council N° 1768/92 of 18 June 1992 concerning the creation of supplementary protection certificates for medicinal products, in particular recital 9 and Articles 3. 4. 8(1 )(c) and 17. must be interpreted and applied in a uniform way; ISSN 0254-1475 COM(96) 185 final DOCUMENTS EN 05 Catalogue number : CB-CO-96-194-EN-C ISBN 92-78-03142-9 Office for Official Publications of the European Communities L-2985 Luxembourg

Amended Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND COUNCIL concerning the creation of a supplementary protection certificate for plant protection products

http://publications.europa.eu/resource/cellar/2d1f3d24-87bc-46a1-8ea8-abb6da05d844

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COMMISSION OF THE EUROPEAN COMMUNITIES •k •A- -k * Brusseis,02. 05 1996 COM(%) 185fuial 94/0285(COD) OPINION OF THE COMMISSION pursuant to Article 189 b (2) (d) of the EC Treaty, oil the European Parliament's amendments to the Council's common position regarding the proposal for a EUROPEAN PARLIAMENT AND COUNCIL REGULATION (EC) concerning the creation of a supplementary protection certificate for plant protection products AMENDING IHE PROPOSAL OF IHE COMMISSION pursuant to Article 189 a (2) of the EC Treaty 1. BACKGROUND a) b) c) d) e) f) g) On 12 December 1994, the Commission sent to the Council a proposal for a regulation concerning the creation of a supplementary protection certificate for plant protection products (COM (94) 579 final)1. On 27 April 1995, the Economic and Social Committee delivered its opinion2. On 15 June 1995, the Parliament adopted in first reading a favourable resolution containing 4 amendments to the proposal of the Commission3. On 6 October 1995, the Commission adopted, pursuant to Article 189A (2) of the EC Treaty, an amended proposal which fully incorporated these 4 amendments (COM (95) 456 final)4. On 27 November 1995, the Council adopted a common position5. On 7 December 1995, the Commission accepted this common position and communicated its opinion to the European Parliament (SEC(95) 1841 final). On 12 March 1996, the European Parliament voted in second reading for one amendment to the common position. 2. THE REGULATION'S OBJECTIVE The proposal has as its objective the harmonisation and the prolongation of the duration of protection for patents for inventions in the plant protection products sector (insecticides, fungicides, herbicides and growth regulators) in the Union. Equally, it also strives for the objective of the industrial policy which favours research in the plant protection product sector. These objectives are achieved by the creation of a new form of industrial property, the supplementary protection certificate This will take effect upon the expiration of the basic patent and can last up to a maximum of 5 years It will operate so as to provide a supplementary protection to that which is obtained by a patent 3. OPINION OF THE COMMISSION TOWARDS THE AMENDMENT OF THEEP The European Parliament adopted, during its second reading, a single amendment to the Council's common position. This amendment seeks to change into a "recital" a declaration that the Council and the Commission wanted to include in an annex to 1 JOn°C 390 oH 1. 12. 1994, p. 21. 2 JO n° C 155 of 21. 06. 1995. p. 14. 3 JO n° C 166 of 03. 07. 1995. p. 89. 4 JO n° C 335 of 13. 12. 1995. p. 15 5 JO n° C 353 of 30. 12. 1995, p;36. y* the minutes of the meeting of the Council which will adopt the legislation in its final form. The objective of the European Parliament (which is shared by the Council and the Commission) is to ensure a uniform application and interpretation of the two regulations which create supplementary protection certificates, namely the present regulation establishing a supplementary protection certificate for plant protection products and the Council's regulation N° 1768/92 of 18 June 1995 concerning the creation of a supplementary protection certificates for medicines. There are two advantages obtained by changing the declaration in the minutes of the Council to a "recital": 1) 2) greater transparency since the declaration will be made public in this manner; greater legal security and, if the case arises, the possibility of intervention by the Court of justice However, the formulation of the amendment as adopted by the European Parliament could give the impression that it seeks to modify certain clauses of a regulation - regulation N° 1768/92 of the Council - for which a proposal for modification has not been presented by the Commission. Consequently, in order to meet the chosen objectives of the three institutions, together with ensuring that there is adequate legal coherence between the two regulations, the Commission accepts the spirit and the aim of the amendment adopted by the European Parliament but proposes a slightly different formulation. £ Amended Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND COUNCIL concerning the creation of a supplementary protection certificate for plant protection products (presented by the Commission pursuant to Article 189 A, paragraph 2 of the EC Treaty) 3 common position of the Council- - Modified Text Preamble 16A (new) (16A) whereas the present regulation, in particular recitals 12. 13 and 14 and Articles 3(2). 4. 8(l)(c) and 17(2). and the regulation of the Council N° 1768/92 of 18 June 1992 concerning the creation of supplementary protection certificates for medicinal products, in particular recital 9 and Articles 3. 4. 8(1 )(c) and 17. must be interpreted and applied in a uniform way; ISSN 0254-1475 COM(96) 185 final DOCUMENTS EN 05 Catalogue number : CB-CO-96-194-EN-C ISBN 92-78-03142-9 Office for Official Publications of the European Communities L-2985 Luxembourg

COMMISSION REPORT TO THE COUNCIL AND PARLIAMENT ON THE IMPLEMENTATION OF FINANCIAL AND TECHNICAL COOPERATION WITH MEDITERRANEAN NON-MEMBER COUNTRIES - 1994

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 02. 05. 1996 COM(96) 151 final COMMISSION REPORT TO THE COUNCIL AND PARLIAMENT ON THE IMPLEMENTATION OF FINANCIAL AND TECHNICAL COOPERATION WITH MEDITERRANEAN NON-MEMBER COUNTRIES 1994 1. report second is financial The 1994 annual the t he cooperation with and of implementation Mediterranean non-member countries, and covers both bilateral and the so-called "horizontal" cooperation. Compared with last year's, the report provides additional information on operations launched in 1994 and assesses their implementation, in response to the wish expressed by the Council and Parliament. report on technical such 2. As regards the implementation, particular importance was attached to proper completion of all the various stages in a project's life cycle, and In addition, special attention will be given to project evaluation. in coordination with particular the World Bank, should ensure improved effectiveness of Community-funded operations. the Member States and other donors, an 3. taking longer. As described in more detail in Implementation of bilateral cooperation with the MNC in 1994 was satisfactory with commitments being made comparatively earlier but disbursement the sections looking at specific countries, the long delays are mainly due to the political situation (events in Algeria, new government in Morocco). As for horizontal cooperation, the decentralized programmes, which are local authorities, to meet actual needs expressed by designed universities and the media, had far-reaching effects. 4. However, 1994 will be remembered as the year of great changes in EU's policy vis-à-vis the Mediterranean. Since the Corfu European Council and the Commission communication of 19 October 1994 on strengthening the EU's Mediterranean policy - "Establishing a Euro- Mediterranean partnership" - whose main guidelines were adopted by the Essen European Council, awareness of the importance for the EU of achieving genuine partnership with region h as grown considerably,' especially in consideration of the many challenges it will be confronted with in forthcoming years. t h at COOPERATION WITH THE MNC I. NORTH MEDITERRANEAN1 1. Generalities 1. Financial and technical cooperation with north Mediterranean countries continued in 1994 when funds for the last operations under the third financial protocols with Malta and Cyprus were committed. The fourth protocol with Turkey, adopted in 1980, was suspended in 1994. 2. In the case of Cyprus, it was decided to allocate available funds from the third protocol to the Greek community for the financing of a "European Institute", the preliminary work on which is now completed. 3. As for Malta, efforts focused on monitoring, and wherever possible speeding up implementation of approved projects. 4. The negotiation of fourth protocols with Malta and Cyprus was the year's key event; the instruments were initialled by the parties in December 1994. 2. Evaluation bv country 21 CYPRUS 1- The first two protocols Budget funds under the first two protocols (ECU 26 million) were committed in full and 96% was disbursed. EIB's own resources (ECU 48 million) were committed and disbursed in full. 2. The third protocol ECU 18 million was available from budget funds. New commitments for 1994 from budget resources amounted to ECU 2. 2 million and went to the following projects: Cyprus, Malta and Turkey. Sector (a) Rural sector (b) Public sector (c) Industry (d) Environment Project Description Support for agricultural research (ECU 265 000) Administrative cooperation (ECU 100 000) Survey of customs procedures (ECU 102 260) Cartography and land register (ECU 800 000) Boosting vegetal pathology research within the Agricultural Research Institute Visits and seminars for officials in the fields covered by Community law Training in EU procedures for central government officials Support for the computerization of Cyprus' land register Training of government personnel Introduction of modern Teacher training (ECU 68 000) Automation of production procedures in SMEs (ECU production methods, computerization and 99 700) productivity boosting in SMEs Support for Cyprus' institute for quality control and standardization Standardization, certification and quality control (ECU 474 000) Industrial pollution control Survey of industrial waste, (ECU 350 000) assistance with new legislation. In addition, ECU 3. 05 million was set aside to cover interest rate subsidies on EIB loans. By the end of 1994 70% of budget funds had been committed, of which 88% actually disbursed. Remaining EIB resources (i. e. ECU 29 million out of ECU 44 million) were committed, with the opening of lines of credit for operations in the water supply and industrial sectors. Disbursement had reached 34% of the total as at 31 December 1994. The text of the fourth financial protocol (1995-1998) was initialled in December 1994. 3. Evaluation Implementation of financial and technical cooperation continued in 1994 according to plan. The government authorities agreed to improve certain administrative procedures which should come on stream in 1995 and make for speedier project implementation. Conversely, little progress was made in the commitment of funds earmarked for initiatives bringing together the two communities, with the exception of the launch of feasibility studies for the treatment of waste waters in Nicosia. 2. 2. MALTA Funds available under the three financial protocols (1979-1993) concluded with Malta were committed in full (ECU 93. 5 million) by 1 January 1994. 57% of budget funds (ECU 38. 5 million) and 78% of EIB own resources (ECU 55 million) was disbursed. Budget funds mostly went to infrastructure projects, training initiatives and to promote local business, particularly in the tourist sector. EIB own resources were mainly spent on infrastructure (40%), telecommunications (20%), the environment and drinking-water supply projects. The new financial protocol (1995-98) was initialled in December 1994. n. SOUTHERN AND EASTERN MEDITERRANEAN2 1. Generalities 1. In 1994 new financial commitments under the fourth financial protocol with SEM countries totalled ECU 574 million, of which ECU 250 million from budget funds and ECU 324 million from EIB own resources. 2. The sectoral breakdown of financial cooperation under the last generation of protocols has changed somewhat. The first three protocols had granted priority to infrastructure, agriculture, rural development and vocational training. They were funded mostly from budget resources. Under the fourth protocol these were rounded off by ancillary measures and economic reforms launched by a number of SEM countries. 3. Of the funds put at the disposal of SEM countries by the New Mediterranean Policy The Southern and Eastern Mediterranean region covers the Maghreb (Algeria, Morocco and Tunisia) and the Mashreq (Egypt, Israel, Jordan, Lebanon and Syria). to back up economic reform, ECU 300 million was allotted to structural adjustment programmes. Additional funds from the 4th financial protocol rounded up the amount. In addition, ECU 80 million from budget funds under the 4th protocol was earmarked as risk capital3 (only ECU 31 million under the 3rd protocol). Morocco, Egypt and Jordan began to draw funds from their shares in 1994 for a total of ECU 28 million. Tunisia had already drawn ECU 7 million in 1993, whereas Algeria, Lebanon and Syria have not yet availed themselves of the facility. At the end of 1994 the picture was as follows: the overall commitment rate for funds under the first three protocols (budget and EIB own resources) was 96. 5%; for the fourth protocol it was 60%, with commitments for Morocco, Tunisia and Jordan taking the lead. Only Syria was lagging behind with a commitment rate of 3% on fourth protocol funds, but the delay can be explained by the late start of the third and fourth protocols. 2. Evaluation bv country 2. 1. ALGERIA 1. The first three protocols MA G H REB Of the budget funds allocated under the first three protocols (ECLT 144 million), 88% was committed and 49% disbursed. EIB own resources (ECU 360 million) were committed in full and 58% actually disbursed. 2. The fourth protocol Budget funds allocated under the fourth protocol (ECU 70 million) were concentrated on a small number of operations and sectors, namely rural development, housing and economic infrastructure. Owing to the economic and political situation, commitments from budget funds in 1994 were very limited: ECU 0. 75 million was committed for a preliminary study for a World Bank agricultural programme (ASAL - agricultural sector adjustment loan). In addition to risk capital, MNC have qualified for ECIP funds and a total of ECU 8. 75 million from that instrument has been committed in 1994. No operation could be launched using risk capital (amount earmarked : ECU 18 million). At the end of 1994 64% (of the ECU 280 million total) of EIB own resources had been committed, in accordance with programming guidelines, to fund transport infrastructure and water supply operations. By the same date 66% of budget funds had been committed, and 33% actually disbursed. 64% of EIB own resources had been committed and 8% disbursed. 3. Commentary The political situation in Algeria has prevented any substantial progress in Community cooperation during the past year. Delays accumulated in implementing the protocols have resulted in some projects due to be funded under the first three protocols being abandoned and other projects being retargeted. Similarly, in view of the difficulties encountered in implementing projects already approved and assessing new projects, utilisation of the balance from the fourth protocol (ECU 124 million out of a total ECU 350 million) could prove problematic in the short term. 2. 2 MOROCCO 1. The first three protocols Over 99% of budget funds (ECU 356 million) was committed and 84% paid out. Loans from EIB own resources (ECU 297 million) were committed in full and 78% actually disbursed. 2. The fourth protocol Out of a total of ECU 218 million in budget funds, ECU 112 million was allocated to the following projects: Sector (a) Infrastructure (b) Rural development Description Project Drinking water supply and The project will bring sanitation (ECU 11 million) Improvements to farmland Construction of irrigation in Haouz (ECU 21. 5 million) drinking water to 19 rural centres Support to local agricultural credit funds (ECU 16,4 million) Support for the Agricultural Development Fund (ECU 50 million) (c) Scientific cooperation Development of remote sensing (ECU 4 million) (d) Health Support for mother and newborn child health (ECU 9 million) systems and technical assistance for the Office Mise en Valeur Agricole of the Haouz region The project will strengthen local credit funds enabling them to grant loans to smallholders The project will put at the Fund's disposal budget credits enabling it to grant subsidies to smallholders implementing improved techniques The project comprises: - an operation to monitor vegetation on land, sea and forest conditions - specialized TA, training, supply of equipment The project seeks to improve mother and child welfare services through training programmes, improved facilities and more effective management In addition, 80% of risk capital (ECU 20 million) was committed to fund projects undertaken by Moroccan small and medium-sized undertakings, preferably in partnership with European business. Loans from EIB own resources (ECU 220 million) were allocated to agricultural initiatives (improvements and credit) and infrastructure (electricity and water). Projects currently being considered should lead to funds being committed in full in 1995, with 14% earmarked for a line of credit to assist the industrial sector. By the end of 1994, 72% of budget funds had been committed and 16% actually disbursed. 68% of EIB own resources had been committed and 12% paid out. 3. Commentary By and large, implementation of the financial protocols produced good results in 1994. While the rate of commitment was good, the payment level was low. In the main, delays can be put down to successive changes of government which have resulted in three different Finance ministers (acting as national authorizing officer) occupying the post over the 16-month period between November 1993 and February 1995. In addition, the low level of payments reflects the fact that certain invitations to tender produced no results (Faculty of Science and Technology, Scientific Research). 2. 3. TUNISIA 1. The first three financial protocols Budget funds granted under the first three financial protocols (ECU 208 million) were committed in full and 89% was disbursed. EIB own-resources loans (ECU 251 million) were also committed in full and 87% was actually disbursed. 2. The fourth protocol Budget funds granted in 1994 amounted to ECU 13 million out of a total of ECU 116 million, and went to fund the following projects: Sector (a) Rural development Project Rural development of Sejnane-Stage 2 (ECU 5 million) Hill-side dams (ECU 3 million) Description The aim is to stabilize stock farmers' income, strengthen the existing stock farmers' organization and teach them sustainable land management techniques to ensure that pastures and semi-intensive stock farming are preserved Construction of water reservoirs (three dams) for various purposes: irrigation, replenishment of ground water tables and protection against floods (b) Industry T. A. for promoting quality The project seeks to assurance (ECU 5 million) implement a number of initiatives to train workers and raise their awareness in Tunisian administrations and institutions, and provide training and technical assistance for implementing a quality assurance and infrastructure development scheme Of the risk capital (ECU 15 million) administered by the EIB, 47% had been committed, and the balance should be taken up in 1995. The funds will strengthen the capital base of Tunisian undertakings and will be channelled through a number of local financial institutions. As regards loans granted by the EIB from own resources, amounting to ECU 168 million, 94% had been committed (23% in 1994) as follows: - 49% for infrastructure of economic significance (availability of water resources and means of communication); 10 - 41% for industry (lines of credit and establishment of business parks) and tourism (lines of credit). By the end of 1994, 65% of budget funds had been committed, and 61% disbursed. 94% of EIB own resources had been committed with 16% disbursed. 3. Commentary Overall, implementation of the financial protocols concluded with Tunisia is working well in terms of both commitments and payments. The Tunisian administration and the agencies entrusted with implementation of the projects funded under the protocols have all shown remarkable technical and financial capacities. Likewise, the new projects are usually backed by excellent supporting documentation. Projects being prepared at the end of 1994 in agriculture and economic development will enable funds under the fourth protocol to be committed virtually in full by the end of 1995. MASHREQ 2. 4. EGYPT 1. The first three protocols Of the available budget funds (ECU 403 million), 98% was committed and 71% disbursed. EIB own resources were committed almost in full (99%) and 81% was disbursed. 2. The fourth protocol ECU 72. 7 million of budget funds totalling ECU 258 million was allocated in 1994 to the following projects: ii Sector (a) Agricultural development Project Veterinary services programme (ECU 20 million) (b) Environment, population issues Development project for the Protectorate of St. Catherine (ECU 6 million) (c) Economic reform Support for a family planning programme in Upper Egypt (ECU 10 million) Reform of the banking sector. Assistance to the Central Bank of Egypt (ECU 11. 7 million) Description Assistance to the Egyptian government (credit programme, training, drafting new legislation) Programme to protect the environment and tourist sites in the region of the Monastery of St. Catherine Supply of contraceptives, technical assistance and training The project offers technical assistance and training to improve the efficiency of Egypt's Central Bank Programme to develop the Quality improvement, marketing techniques, private sector investment promotion (ECU 25 million) In addition, ECU 8. 8 million in budget funds were spent on interest rate subsidy on two EIB projects: the ANSDK Steel Plant and a CIB package loan. Of the ECU 16 million risk capital managed by the EIB, 38% was committed. EIB own resources (ECU 310 million) went to projects in the power generation (electricity transmission), industry and SME sectors. By the end of 1994 58% of budget funds had been committed with 4% paid out. 55% of EIB own resources had been committed and 20% actually disbursed. 3. Commentary In 1994 financial and technical cooperation with Egypt was very positive. A good number of new projects, launched in 1994, were to become operational in the first half of 1995. Payments levels improved during the year as a result of lines of credit being opened (food industry, loan funds for agriculture). 12 All projects were carefully selected to boost the country's economic reform programme, bearing in mind the proposals made under the new partnership agreement currently being negotiated. The Community undertook to back economic reform during the transitional period, and to provide support for initiatives intended to lighten the social and economic burden of the reform programme, especially among the underprivileged. 2. 5. ISRAEL4 1. The first three protocols EIB funds (ECU 133 million) were committed in full and 95% was actually paid out. 2. The fourth protocol Out of a total of ECU 82 million, ECU 32 million had already been committed in 1993 as package loans to the Israeli development bank to promote small and medium-sized businesses, and in 1994 ECU 25 million was allocated to the building of a sewage treatment plant in Sorek. 3. Commentary In view of its level of development, Israel only qualifies for EIB loans from own resources. Although successful, their impact on the Israeli economy as a whole is obviously limited. 2. 6. JORDAN 1. The first three protocols ECU 85 million in budget funds was committed in full and 80% disbursed. EIB loans totalled ECU 128 million, of which ECU 118 million from own resources and ECU 10 million as special loans. The amount was committed and disbursed in full. 2. The fourth protocol ECU 4. 1 million ECU 46 million, and went to fund the following projects: in budget funds was committed in 1994, out of a total of EIB loans only. 13 Sector (a) Infrastructure (b) Training Project Description Study for Aqaba Railway Study on modernization of C o r p o r a t i on (ECU 0. 25 million) Teacher training (ECU 3. 9 million) Jordan's railways The project seeks to improve teaching quality, especially in primary education In addition, ECU 2. 01 million in budget funds went to fund interest rate subsidies on an EIB loan for a water supply project. Risk capital (ECU 2 million) was committed in full to finance projects launched by SMEs. Funds were committed in the form of a line of credit opened with the Industrial Development Bank. At the end of 1994 the EIB had committed 58% of own resources, out of a total of ECU 80 million earmarked under the protocol, on transport infrastructure and water supply operations and a line of credit for industry and the tourist sector. At the end of 1994, 85% of fourth protocol budget funds had been committed with 38% disbursed. Of EIB own resources 58% had been committed but no payment had been made. 3. Commentary Community cooperation made good progress in 1994, against a background dominated by the peace process and exploratory discussions for the negotiation of the EU-Jordan partnership agreement. Financial cooperation worked well, with the usual delays due to the Jordanian authorities' lack of familiarity with Community procedures. 2. 7. LEBANON 1. The first three protocols Of the ECU 46 million in budget funds, 98% had been committed and 51% disbursed, whereas EIB own resources (ECU 107 million) had been committed in full and 46% disbursed. 14 2. The fourth protocol As large amounts from budget funds had already been committed by the end of 1993, no further funds were committed in 1994. Instead projects concerning in particular the assessment of war damage and technical assistance for the Lebanese administration were launched. EIB own resources (ECU 45 million) were allocated to projects concerning the rehabilitation of power generation plants, the port of Beirut and water sanitation. By the end of 1994, 71% of budget funds (ECU 24 million) had been committed with 12% disbursed, and 42% of EIB own resources had been committed but no funds had been paid out. 3. Commentary Lebanon, which is entering a crucial stage of its economic and social recovery after 17 years of war, has shown a remarkable capacity for using the aid granted to it. The European Community was the first to assist Lebanon in the reconstruction process and is now the largest contributor to the National Reconstruction Plan. The main problem encountered when implementing aid (especially in the case of EIB- funded infrastructure projects) is how to rebuild the country's administration and strengthen its ability to manage reconstruction programmes. Accordingly, the project providing technical assistance to the Lebanese authorities, which runs for the three years during which vital infrastructure will be rehabilitated, is of the outmost importance for the Lebanese government. 2. 8. SYRIA 1. The first two financial protocols (1977-1991) Budget funds under the first two protocols (ECU 59 million) were committed in full, with 80% actually disbursed. Own-resources EIB loans (ECU 98 million) were committed in full with 81% disbursed. 2. The third and fourth financial protocols These (totalling ECU 304 million) were adopted with some delay by Parliament (entry into force was January 1993 and April 1994 respectively). 15 Under the protocols, ECU 17. 5 million in budget funds out of a total of ECU 79 million was committed in 1994 to fund the following projects: Sector Project Description (a) Infrastructure Development of energy production (ECU 11 million) (b) Economic reform Banking sector support programme (ECU 4. 5 million) (c) Population Population issues and family planning (ECU 2 million) The project aims to: - improve management of the Electricity Board - train personnel - conduct a study for a national transmission centre - prepare a master plan The project aims to: - modernize the Syrian Bank of Commerce - modernize the Syrian Central Bank In the light of the population census, this project, cofunded with UNFPA - the UN Fund for Population Activities - aims at strengthening the Central Statistical Office and conduct family planning activities In addition, ECU 12. 9 million had been committed as interest rate subsidies (PEE Transmission). EIB loans under the third and fourth protocols (ECU 225 million) had not yet been taken up. They were essentially meant to fund improvements to the power supply and road systems and the rural telephone network. At the end of 1994 94% of budget funds under the third protocol (ECU 36 million) had been committed with 2% disbursed; and 12% had been committed under the fourth protocol (ECU 43 million). 3. Commentary 1994 was a very productive year from the point of view of EU-Syria cooperation. Following the adoption of the fourth protocol in December 1993, the Syrian authorities and the delegation have launched a number of preparatory studies, all of which have been completed, enabling budget funds under the third and fourth protocols to be committed almost in full (water supply, banking system reform, development of energy 16 sector, population issues) and the remaining funds to be earmarked for 1995 (tourism, business centre, management school). These excellent results (notwithstanding the rigidity of the local authorities) are the product of Syria's eagerness to open up and modernize its economy and the Union's resolve to show its interest in resuming cooperation with Syria, after a long interruption, together with its support for the peace process. Even though there is still scope for improvement in terms of speed of implementation, there is evidence t h at close and sustained contacts between the partners (local government and the Commission) are essential for effective cooperation. III. STRUCTURAL ADJUSTMENT The special ECU 300 million package to support economic reforms in SEM countries an a innovation of the fourth generation of financial protocols. adjustment programme implementing structural is A limited share of the means allocated under fourth financial protocols concluded with those countries may be added to the funds provided under the package. Community aid takes the form of funding for general or sectoral import programmes and of technical assistance for macro-economic and sectoral support programmes. The counterpart funds generated by the programmes are used to fund initiatives to palliate the adverse effects of structural adjustment on the population. Funds were allocated measuring structural imbalance and long-term development needs. to eligible countries on the basis of parameters By the end of 1994 ECU 220 million out of the ECU 300 million package had been committed (cf. table below) EU SUPPORT 1 FOR STRUCTURAL ADJUSTMENT IN SEM COUNTRIES CO MMITMENTS AS AT END 1 9 94 ALGERIA MOROCCO TUNISIA JORDAN RESERVE TOTAL Special package funds 55 60 40 65 80 300 Protocol funds TOTAL 15 20 - 15 - 50 70 80 40 80 - 350 1? It would be premature to attempt an evaluation of the full effects of the programmes, however it could be said that they have facilitated the implementation of economic reforms, reduced the need for external funding and boosted expenditure on the most disadvantaged groups of population. Algeria was granted a contribution of ECU 70 million to support its reform programme in the low-cost housing sector. Aid has taken the form of a sectoral programme to import building materials needed to complete council dwellings; counterpart funds are used to fund operations to provide the dwellings with basic infrastructure. In February 1994 the first ECU 35 million instalment was paid out. The programme could be said to be on track even though implementation has been delayed mainly owing to Algeria's political situation. Morocco was granted ECU 80 million in Community aid for its structural adjustment programme. Counterpart funds are used to boost budget expenditure on health and education. The first ECU 50 million instalment was released in December 1993. Results have been more than satisfactory, both from the point of view of the economic reforms and in terms of budget support (loans made available from counterpart funds have all been taken up and economic indicators for the target sectors have shown sustained growth for the period concerned). The second instalment was released at the end of 1994. Tunisia was the first country to receive Community aid for its structural adjustment programme. The contribution was fully paid out by 31 December 1993. Counterpart funds go to finance job creation schemes, which thanks to support from the Community have been kept going. Economic reforms have been implemented according to plan and social indicators have shown a positive trend during the same period. As for Jordan. ECU 50 million (of which ECU 40 million under the adjustment package) have gone to support the 1992-93 economic reform programme. For the period 1994-95 (of which the Community disbursed ECU 25 million as part of the adjustment package) to support the economic reform programme. Counterpart funds are spent on education and health. (as at December 1994) ECU 30 million 18 COOPERATION WITH SEM COUNTRIES AS A WHOLE In accordance with the New Mediterranean Policy (NMP), the relevant Council Regulation (EEC 1763/92 of 24/6/92) and the priority sectors selected for cooperation with SEM countries as a whole, operations already under way were pursued in 1994 and new programmes, funded from both budget funds and EIB own resources, were launched. I. BUDGET FUNDS : Budget funds for the past year totalled ECU 65 million in commitment appropriations and ECU 44. 66 million in payment appropriations. Since the launch of the NMP in July 1992 ECU 165. 05 million have been committed and ECU 65. 47 million disbursed, i. e. 40% of the amount committed. As at 31 December 1994 the projects, programmes and activities funded from Commission budget funds (see annexed list) could be grouped by priority area as show below: Environment Decentralized cooperation Population issues Culture - Communication Training - Education Peace process Risk capital Microprojects 22% 48% 6% 2% 5% 3% 5% 9% Between 1 January and 31 December 1994 funds were allocated as follows: Environment ECU 6. 36 million in interest rate subsidies for the second stage of the EIB project "Sanitation for coastal towns in Tunisia". Decentralized cooperation5 Following the successful completion of the pilot phase, the following activities were confirmed and expanded: Activities launched in 1993 under the "Med Invest" programme (ECU 10 million^ continued in 1994. Med Invest supports cooperation between small and medium-sized enterprises and the EC. 19 Med Urbs Med Campus Med Media (ECU 8. 9 million) support for cooperation between local authorities in SEM countries and the EC (ECU 8. 9 million) support for cooperation between universities in SEM countries and the EC (ECU 6. 1 million) support for the media in SEM countries in the EC Med Avicenne (ECU 7. 39 million) support for research institutes in SEM countries and the EC All these programmes essentially aim, through the establishment of cooperation networks between development agents, to create or strengthen civil society links not only between the Community and its Southern and Eastern Mediterranean partners, but also between the partners themselves. Regional cooperation The Commission approved a project to establish a Euro-Arab Management School (ECU 8. 3 million) which will be the first institute jointly set up as part of official Euro- Arab relations. The School, based in Granada, will offer a comprehensive management training programme in Arab countries and at the same time will train high-level Arab and European managers in Europe. In addition, a large number of ad-hoc initiatives (totalling ECU 4. 5 million) have been launched with a view to encouraging the peace process, notably an economic development programme based on partnership between Europe and the Middle East and particularly aimed at SMEs. Mention should be made of some 60 micro-projects (ECU 3. 7 million) comprising technical assistance, surveys, trade promotion and training (including seminars, debates, meetings and publications). II. EIB OWN RESOURCES As at end of December 1994 nine non-protocol operations had been approved totalling ECU 612 million out of the total ECU 1800 million made available. The following initiatives were added to the four already approved in 1992 and 1993. Environment: three loans (qualifying for a 3% interest-rate subsidy): (a) "Sorek Sewage Treatment" (ECU 10 million) - construction of a sewage treatment plant eight km. west of Jerusalem and connections to sewers; 20 (b) "Antalya Sewerage" (ECU 35 million) - construction of a sewage system and sewage treatment plant in Antalya; (c) "Sanitation for coastal towns in Tunisia" (ECU 25 million, stage II) - funding for the extension and construction of two sewage treatment plants (Greater Tunis and Médénine) and upgrading of sewage systems in the towns of Menzel Bourguiba, Sousse, Monastir, Kelibia, M'Saken and Médénine. A i rpo it i nfras true hire : ECU 80 million was granted for the construction/enlargement of two new runways, a passenger terminal and annexed public and technical facilities at Beirut international airport (Lebanon). Lastly, an ECU 80 million loan went to fund electricity transfer between the EC and Morocco. The project consists in the extension of the European grid to Morocco via cables 30 km. long across the Straits of Gibraltar and the improvement of the Moroccan national grid system. 21 CONCLUSION Overall financial and technical cooperation with Mediterranean non-member countries in 1994 gave positive results, despite the political uncertainties which continued to affect cooperation adversely, particularly in A Igeria. Most encouraging programmes. various partners in civil society as agents of cooperation with the MNC. cooperation that they fulfil a need and point at the importance of the is the success encountered by several decentralized It is evident 22 List of Annexes 1. Financial implementation of protocols 2. Sectoral implementation of protocols North Mediterranean Souther and Eastern Mediterranean 3. Cooperation with MNC as a whole Budget funds EIB 23 TOTAL FINANCIAL IMPLEMENTATION OF THE FIRST THREE PROTOCOLS BUDGET EIB TOTAL PROTOCOL 1978-1991 TOTAL Commitments Payments TOTAL Commitments Payments TOTAL Payments Commitments Amount 130,6 93,5 705 929,1 % Amount 99,1 96% 65 100% 100% 705 99% 869,1 486 651 458 1595 96% 100% 100% 99% 269 529 403 1201 885 203 152 191 1431 133 1564 3159 4088,1 99% 100% 99% 63% 92% 100% 674 186 72 127 1059 127 1186 2387 96% 96% 3256,1 % 76% 70% 100% 94% 55% 81% 88% 75% 76% 92% 47% 66% 74% 95% 76% 80% Cyprus Malta Turkey s/t Northern Med. Algeria Morocco Tunisia s/t Maghreb Egypt Jordan Lebanon Syria s/t Mashreq Israel s/t Mashreq & Isr. s/t Maghr. & Mash. s/t Med % Amount Amount 38,6 38,5 590 672,5 667,1 44 38,5 590 144 356 208 708 403 85 46 95 629 126 354 208 688 393 85 45 93 616 88% 100% 100% 99% 88% 99% 100% 97% 98% 100% 98% 98% 98% 36,1 22 590 648,1 62 297 186 545 % 94% 57% 100% 97% 49% 84% 89% 79% 280 71% 68 80% 23 51% 52% 48 68% 419 1337 1304 2009,5 4579,1 98% 228% 964 3540,1 74% 77% Amount 100% 92 100% 55 115 100% 262 100% % %Amoun1 68% 63 43 78% 115 100% 84% 221 92 55 115 262 360 297 250 907 492 118 107 208 925 133 1058 1965 2227 360 100% 297 100% 250 100% 100% 907 207 232 217 656 394 492 100% 118 118 100% 49 107 100% 79 47% 98 640 815 88% 127 133 100% 90% 948 767 94% 1423 1855 298% 5130 6642 58% 78% 87% 72% 80% 100% 46% 81% 79% 95% 81% 77% 77% 136 93,5 705 934,5 504 653 458 1615 895 203 153 303 1554 133 1687 3302 4236,5 -C 1) Commitments/total. 2) Payments/commitments inci. ongoing commitments. FINANCIAL IMPLEMENTATION OF THE FOURTH PROTOCOL 1991-1996 TOTAL Commitments Payments TOTAL Commitments Payments TOTAL Commitments Payments BUDGET EIB TOTAL PROTOCOL Algeria Morocco Tunisia s/t Maghreb Egypt Jordan Lebanon Syria s/t Mashreq Israel s/t Mashreq & Isr. Amount 46 157 75 278 70 218 116 404 % Amount 15 25 46 86 66% 72%. 65% 69% % 33% 16% 61% 31% Amount 180 150 158 488 280 220 168 668 % Amounl 15 18 25 58 64% 68% 94% 73% 258 46 24 43 371 150 39 17 5 211 58% 85% 71% 12% 57% 6 15 2 4% 38% 12% 23 11% 371 211 57% 23 11% 310 80 45 115 550 82 632 172 46 19 237 34 271 55% 58% 42% 0% 43% 41% 43% 35 35 30 65 % 8% 12% 16% 12% 20% 0% 0% 15% 88% 24% Amount 226 307 233 766 350 438 284 1072 % Amount 30 43 71 144 65% 70% 82% 71% 568 126 69 158 921 82 1003 322 85 36 5 448 34 482 57% 67% 52% 3% 49% 41%. 41 15 2 0 58 30 88 % 13% 14% 30% 19% 13% 18% 6% 0% 13% 88% 18% s/t Med. 775 489 63% 109 22% 1300 759 58% 123 16%| 2075 1248 60% 232 19% N 1) Commitments/total. 2) Payments/commitments inci. ongoing commitments. IMPLEMENTATION OF THE MEDITERRANEAN PROTOCOLS (NORTHERN MED) BY SECTOR EEC/NORTHERN MEDITERRANEAN (1978 - 1993) SECTOR OF ACTIVITY PROTOCOL 1 PROTOCOL 2 PROTOCOL 3 TOTAL ECU mill. % ECU mill. % ECU mill. % ECU mill. % (1965/1993) 1, INFRASTRUCTURE, WATER 105,2 53,9% 68,9 30,0% 127,0 50,2% 301,1 44,4% (Collection and supply) 2, SANITATION, ENVIRONMENT 8,5 4,4% 10,7 4,7% 4,6 3, ENERGY (Thermal power stations, 7,6 3,9% 77,0 33,6% 89,0 gas and electricity supply) 4, AGRICULTURE, FISHERIES, FORESTRY 10,5 4,2% 19,0 2,8% 5, TRADE, INDUSTRY, SERVICES 62,9 274% 15,0 5,9% 151,6 22,4% 6, SCIENTIFIC COOPERATION 5,0 2,2% 7, EDUCATION 73,7 37,8% 5,0 2,2% 5,0 0,7% 5,6 0,8% 0,0 0,0% 0,6 0,2% 00 8, HEALTH CARE, HOUSING 9, STRUCTURAL ADJUSTMENT (bilateral component) 10 COMMITMENT REMAINING 11, TOTAL 195,0 100% 229,5 100% 6,3 253,0 2,5% 100% 677,5 100% 0,0 0,0% 31. 12. 94 0,0 0,0% 6,3 0,9% IMPLEMENTATION OF THE MEDITERRANEAN PROTOCOLS (NORTHERN MED) BY SECTOR EIB-ALL COUNTRIES (1978 - 1994) SECTOR OF ACTIVITY PROTOCOL 1 (1965/1983) PROTOCOL 2 (1973/1988) PROTOCOL 3 (1979/1993) TOTAL (1965/1993) ECU mill. % ECU mill. % ECU mill. % ECU mill. % 1. INFRASTRUCTURE, SANITATION, WATER (Collection and supply) 2. ENERGY (Thermal power stations, gas and electricity supply) 3. AGRICULTURE, FISHERIES, FORESTRY 4. TRADE, INDUSTRY, SERVICES 5. GLOBAL LOANS (to industry or mixed) 6. COMMITMENT REMAINING 7. TOTAL 36 100% 44 64% 25 36% (D 40 10 27 80 2 5% 6% 17% 5 1% 120 10 4 6% 4% 27 105 10% 4 0% 36 100% 69 100% 157 100% 262 100% P*3 (1) incl. environment - ECU 7 million. December 1994 IMPLEMENTATION OF THE MEDITERRANEAN PROTOCOLS (SEM) BY SECTOR EEC-ALL COUNTRIES (1978-1994) SECTOR OF ACTIVITY PROTOCOL 1 (1978/1981) % ECU mill. PROTOCOL 2 (1981/1986) % ECU mill. PROTOCOL 3 (1986/1991) % ECU mill. PROTOCOL 4 (1991/1996) % ECU mill. TOTAL (1978/1996) ECU mill. % 1. INFRASTRUCTURE, WATER (Collection and supply) 2. SANITATION, ENVIRONMENT 3. ENERGY (Thermal power stations, gas and electricity supply) 4. AGRICULTURE, FISHERIES, FORESTRY 5. TRADE, INDUSTRY, SERVICES 6. SCIENTIFIC COOPERATION 7. EDUCATION (1) 8. HEALTH CARE, HOUSING 9. STRUCTURAL ADJUSTMENT (2) (Bilateral component) 10. COMMITMENT REMAINING 85 0 60 5 0 35 34 20 61 1 0 0 6 28% 0% 20% 2% 0% 11% 11% 7% 20% 0% 0% 0% 2% 34 0 27 23 0 8% 0% 7% 6% 0% 44 0 56 39 0 7% 0% 9% 6% 0% 23 0 61 15 0 3% 0% 8% 2% 0% 186 0 9% 0% 204 10% 82 0 4% 0% 145 35% 260 42% 136 18% 576 27% 75 26 41 22 0 0 22 18% 143 23% 169 22% 421 20% 6% 10% 5% 0% 0% 5% 18 44 6 0 0 5 3% 7% 1% 0% 0% 1% 4 12 19 50 0 1% 2% 2% 6% 0% 68 158 48 50 0 3% 7% 2% 2% 0% 286 37% 319 15% 11. TOTAL 307 100% 415 100% 615 100% 775 100% 2112 100% (1) Targeted projects, programmes and training initiatives are included under the relevant sector. (2) Structural adjustment sector - ECU 300 million, incl. ECU 220 million already committed. IMPLEMENTATION OF THE MEDITERRANEAN PROTOCOLS (SEM) BY SECTOR EIB-ALL COUNTRIES (1978-1994) SECTOR OF ACTIVITY PROTOCOL 1 (1978/1981) PROTOCOL 2 (1981/1986) PROTOCOL 3 (1986/1991) ECU mill. % ECU mill. % ECU mill. % PROTOCOL 4 (1991/1996) % ECU mill. TOTAL (1978/1996) ECU mill. % 1. INFRASTRUCTURE, WATER (Collection and supply) 2. SANITATION - ENVIRONMENT 3. ENERGY (Thermal power stations, gas and electricity supply) 166,5 46% 136,5 23% 97,5 10% 337 26% 738 23% 0 97 0% 10 2% 27% 201,5 34% 129 188 13% 12 1% 151 5% 19% 127 10% 614 19% 4. AGRICULTURE, FISHERIES, FORESTRY 20,5 6% 132 22% 284 28% 59 5% 496 15% 5. TRADE, INDUSTRY, SERVICES 6. COMMITMENT REMAINING 78 0 22% 120 20% 187,5 19% 224 17% 610 19% 0% 0 0% 117 12% 541 42% 658 20% 7. TOTAL 362 100% 600 100% 1003 100% 1300 100% 3265 100% SOURCE: EIB quarterly statistics COOPERATION WITH MNC AS A WHOLE Budget funds (December 1994) Sector of activity /. Environment Commitment (ECU million) Interest rate subsidies (EIB loans) IMPHOS - cadmium removal (phosphate) 1. 1 1. 2. 1. 3. EIW training 1. 4. Gaza - sanitation project 19. 95 1. 10 0. 53 15. 00 Total 1 36. 58 (22%) Decentralized cooperation 2. 1. CIHEAM 2. 2. MED-URBS 2. 3. MED-CAMPUS 2. 4. MED-INVEST 2. 5. MED-MEDIA 2. 6. MED-AVICENNE 3. 00 22. 32 23. 30 10. 00 11. 04 8. 82 Total 2 78. 48 (48%) 3. Regional cooperation 3. 1 Framework contract 3. 2 Population 3. 3 EURONEWS 3. 4 Risk capital 3. 5 EURO-ARAB Management 3. 6 3. 7 Microprojects * "Peace process" projects 0. 5 10. 50 3. 00 9. 00 8. 30 4. 45 14. 24 Total 3 49. 99 (30%) GRAND TOTAL 165. 05(100%) 'Microprojects Technical assistance Studies Trade promotion Training, seminars 3. 18(22. 3%) 3. 81 (26. 8%) 0. 33 (2. 3%) 6. 92 (48. 6%) ^>o COOPERATION WITH MNC AS A WHOLE EIB own resources (December 1994) Sector of activity /. Environment Commitment (ECU million) 1. 1 Effluent treatment and associated infrastructure (Coastal towns of Tortus and Latakia (Syria)) 40. 0 42. 0 1. 2. Waste water disposal - coastal towns in Tunisia 1. 3. Sewage treatment plant at Soreq (Israel) 10. 0 1. 4. Sewerage system and treatment plant at Antalya 35. 0 Total 1. Other 127. 0(21%) 2. 1. Telecommunications/international network Jordan 45. 0 80. 0 2. 2. Beirut airport (Lebanon) 200. 0 2. 3. Maghreb-Spain gas pipeline (Algerian section) 2. 4. Telecommunications/international network Morocc 80. 0 80. 0 2. 5. EU-Morocco electricity supply link Total 2 485. 0 (79%) GRAND TOTAL 612. 0 (100%) ' 3 >1 ISSN 0254-1475 COM(96) 151 final DOCUMENTS EN 11 Catalogue number : CB-CO-96-161-EN-C ISBN 92-78-02414-7 Office for Official Publications of the European Communities L-298S Luxembourg ^

Decision of the EEA Joint Committee No 41/96 of 28 June 1996 amending Annex XI (Telecommunications) to the EEA Agreement

http://publications.europa.eu/resource/cellar/76f58791-8689-429b-91d7-3b4373a68623

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L_1996291EN. 01003001. xml 14. 11. 1996    EN Official Journal of the European Communities L 291/30 DECISION OF THE EEA JOINT COMMITTEE No 41/96 of 28 June 1996 amending Annex XI (Telecommunications) to the EEA Agreement THE EEA JOINT COMMITTEE, Having regard to the Agreement on the European Economic Area, as adjusted by the Protocol Adjusting the Agreement on the European Economic Area, hereinafter referred to as ‘the Agreement’, and in particular Article 98 thereof, Whereas Annex XI to the Agreement was amended by Decision of the EEA Joint Committee No 7/96 of 29 February 1996 (1); Whereas Council resolution 95/C 341/03 of 27 November 1995 on the industrial aspects for the European Union in the development of the information society (2) is to be incorporated into the Agreement, HAS DECIDED AS FOLLOWS: Article 1 The following point shall be inserted after point 26d (Council resolution 95/C 258/01) in Annex XI to the Agreement: ‘26e. 395 Y 1219(03): Council resolution 95/C 341/03 of 27 November 1995 on the industrial aspects for the European Union in the development of the information society (OJ No C 341, 19. 12. 1995, p. 5). ’ Article 2 The texts of resolution 95/C 341/03 in the Icelandic and Norwegian languages, which are annexed to the respective language versions of this Decision, are authentic. Article 3 This Decision shall enter into force on 1 July 1996, provided that all the notifications pursuant to Article 103 (1) of the Agreement have been made to the EEA Joint Committee. Article 4 This Decision shall be published in the EEA Section of, and in the EEA Supplement to, the Official Journal of the European Communities. Done at Brussels, 28 June 1996. For the EEA Joint Committee The President P. BENAVIDES (1)  OJ No L 102, 25. 4. 1996, p. 50. (2)  OJ No C 341, 19. 12. 1995, p. 5

Decision of the EEA Joint Committee No 42/96 of 28 June 1996 amending Annex XVIII (Health and safety at work, labour law, and equal treatment for men and women) to the EEA Agreement

http://publications.europa.eu/resource/cellar/e50de811-2354-4f74-8f4b-a32979c4000f

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L_1996291EN. 01003201. xml 14. 11. 1996    EN Official Journal of the European Communities L 291/32 DECISION OF THE EEA JOINT COMMITTEE No 42/96 of 28 June 1996 amending Annex XVIII (Health and safety at work, labour law, and equal treatment for men and women) to the EEA Agreement THE EEA JOINT COMMITTEE, Having regard to the Agreement on the European Economic Area, as adjusted by the Protocol Adjusting the Agreement on the European Economic Area, hereinafter referred to as ‘the Agreement’, and in particular Article 98 thereof, Whereas Annex XVIII to the Agreement was amended by Decision of the EEA Joint Committee No 29/96 of 26 April 1996 (1); Whereas Council Directive 93/104/EC of 23 November 1993 concerning certain aspects of the organization of working time (2) is to be incorporated into the Agreement, HAS DECIDED AS FOLLOWS: Article 1 The following point shall be inserted after point 27 (Council Directive 94/45/EC) in Annex XVIII to the Agreement: ‘28. 393 L 0104: Council Directive 93/104/EC of 23 November 1993 concerning certain aspects of the organization of working time (OJ No L 307, 13. 12. 1993, p. 18). ’ Article 2 The texts of Directive 93/104/EC in the Icelandic and Norwegian languages, which are annexed to the respective language versions of this Decision, are authentic. Article 3 This Decision shall enter into force on 1 December 1996, provided that all the notifications pursuant to Article 103(1) of the Agreement have been made to the EEA Joint Committee. Article 4 This Decision shall be published in the EEA Section of, and in the EEA Supplement to, the Official Journal of the European Communities. Done at Brussels, 28 June 1996. For the EEA Joint Committee The President P. BENAVIDES (1)  OJ No L 186, 25. 7. 1996, p. 82. (2)  OJ No L 307, 13. 12. 1993, p. 18

Decision of the EEA Joint Committee No 43/96 of 28 June 1996 amending Annex XVIII (Health and safety at work, labour law, and equal treatment for men and women) to the EEA Agreement

http://publications.europa.eu/resource/cellar/9743938a-3932-44ca-8d8d-dd14cfb07b68

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L_1996291EN. 01003301. xml 14. 11. 1996    EN Official Journal of the European Communities L 291/33 DECISION OF THE EEA JOINT COMMITTEE No 43/96 of 28 June 1996 amending Annex XVIII (Health and safety at work, labour law, and equal treatment for men and women) to the EEA Agreement THE EEA JOINT COMMITTEE, Having regard to the Agreement on the European Economic Area, as adjusted by the Protocol Adjusting the Agreement on the European Economic Area, hereinafter referred to as ‘the Agreement’, and in particular Article 98 thereof, Whereas Annex XVIII to the Agreement was amended by Decision of the EEA Joint Committee No 29/96 of 26 April 1996 (1); Whereas Council Directive 94/33/EC of 22 June 1994 on the protection of young people at work (2) is to be incorporated into the Agreement, HAS DECIDED AS FOLLOWS: Article 1 The following point shall be inserted after point 28 (Council Directive 93/104/EC) in Annex XVIII to the Agreement: ‘29. 394 L 0033: Council Directive 94/33/EC of 22 June 1994 on the protection of young people at work (OJ No L 216, 20. 8. 1994, p. 12). ’ Article 2 The texts of Directive 94/33/EC in the Icelandic and Norwegian languages, which are annexed to the respective language versions of this Decision, are authentic. Article 3 This Decision shall enter into force on 1 December 1996, provided that all the notifications pursuant to Article 103(1) of the Agreement have been made to the EEA Joint Committee. Article 4 This Decision shall be published in the EEA Section of, and in the EEA Supplement to, the Official Journal of the European Communities. Done at Brussels, 28 June 1996. For the EEA Joint Committee The President P. BENAVIDES (1)  OJ No L 186, 25. 7. 1996, p. 82. (2)  OJ No L 216, 20. 8. 1994, p. 12

Decision of the EEA Joint Committee No 44/96 of 28 June 1996 amending Annex XX (Environment) to the EEA Agreement

http://publications.europa.eu/resource/cellar/2c1b4ccc-410e-4fd1-a3ca-8fbfe28bf692

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L_1996291EN. 01003401. xml 14. 11. 1996    EN Official Journal of the European Communities L 291/34 DECISION OF THE EEA JOINT COMMITTEE No 44/96 of 28 June 1996 amending Annex XX (Environment) to the EEA Agreement THE EEA JOINT COMMITTEE, Having regard to the Agreement on the European Economic Area, as adjusted by the Protocol Adjusting the Agreement on the European Economic Area, hereinafter referred to as ‘the Agreement’, and in particular Article 98 thereof, Whereas Annex XX to the Agreement was amended by Decision of the EEA Joint Committee No 37/96 of 5 June 1996 (1); Whereas Commission Decision 95/337/EC of 25 July 1995 amending Decision 92/446/EEC concerning questionnaires relating to directives in the water sector (2) is to be incorporated into the Agreement, HAS DECIDED AS FOLLOWS: Article 1 The following shall be added in point 13 b (Commission Decision 92/446/EEC) in Chapter II of Annex XX to the Agreement: ‘, as amended by: — 395 D 0337: Commission Decision 95/337/EC of 25 July 1995 (OJ No L 200, 24. 8. 1995, p. 1). ’ Article 2 The texts of Decision 95/337/EC in the Icelandic and Norwegian languages, which are annexed to the respective language versions of this Decision, are authentic. Article 3 This Decision shall enter into force on 1 July 1996, provided that all the notifications pursuant to Article 103(1) of the Agreement have been made to the EEA Joint Committee. Article 4 This Decision shall be published in the EEA Section of, and in the EEA Supplement to, the Official Journal of the European Communities. Done at Brussels, 28 June 1996. For the EEA Joint Committee The President P. BENAVIDES (1)  OJ No L 237, 19. 9. 1996, p. 46. (2)  OJ No L 200, 24. 8. 1995, p. 1

Proposal for a COUNCIL DECISION on a joint action introducing a programme of training, exchanges and cooperation in the field of identity documents

http://publications.europa.eu/resource/cellar/e6e0b0e4-1506-49f4-b228-0233200290a4

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 26. 06. 1996 COM(96) 297 final Proposal for a COUNCIL DECISION on a joint action introducing a programme of training, exchanges and cooperation in the field of identity documents (presented by the Commission) I Explanatoiy Mémorandum CONTENTS A. B. C. Background to proposal Scope of proposal Comments on individual articles II Draft decision A. B. C. Recitals Operative provisions Financial statement. 3 3 4 4 8 8 9 13 A 1. EXPLANATORY MEMORANDUM Background to proposal Security in matters of identity documents and measures to combat forgery were seen as matters of priority for improving the effectiveness of identity checks at the external borders even before the Treaty on European Union came into force. The cooperation provided for by Title VI of the Union Treaty has œnfirmed that priority. The effectiveness of control work depends not only on information channels such as the Fraud Bulletin and the Authentic Documents Manual but above all on the training of those officials whose responsibility it is to perform the actual checks. That will result not only in greater mutual acquaintance between officials but also in an enrichment of the techniques and procedures applied. The joint action proposed here will also be a vital weapon in the fight against trafficking in human beings generally and clandestine immigration in particular. Article K. 1(2) of the Treaty on European Union defines "the exercise of controls" on the crossing by persons of the external borders of the Member States as a matter of common interest. 2. At their meeting in Lisbon in June 1992, the ministers responsible for immigration decided to organize training seminars to this effect, two examples of which, intended for specialists to impart their own experience, have already taken place. The second, held in 1995, was charged to the Community budget under Article K. 8oftheTEU Both the participants and the relevant Council working party made a positive assessment of the latter seminar, stressing that these experiments deserved to be explored further and made a regular feature in the form of carefully planned programmes. Pragmatic cooperation of this type has therefore shown itself to be a valuable complement to the Council's legislative activity. It must not be ignored that Article K. 3 explicitly provides for collaboration between the relevant national administrative departments. 3. These initial experiments have highlighted particularly pressing needs in specific respects - training for trainers and for specialists. The former has a multiplier effect, as the results of training conceived and dispensed at Union level are disseminated throughout the Union. With the latter, experts' know-how can be constantly adapted to the ongoing process of technological development without unwarranted delay, and the quality of the training given to those responsible for controls can be maintained. Success in these areas will depend on durability of the measures undertaken and on a coherent concept and organization. B. 4. Scope of the proposal The aim of the joint action is: as to substance, to devise a programme which is consistent, encompasses the various components of a training policy and comprises both tuition proper and periods of training and exchanges in other States in such a way as to consolidate existing links between the departments responsible for identity control; as to timing, to establish multiannual practical cooperation between the authorities responsible for checking identity documents, resulting in greater familiarity with the methods used in other Member States and more effective ways of combating the use of forged documents. 5. 6. The lessons learnt at the initial stages need to be explored in greater depth. Particular thought should be given to the idea of exchanges between officials while the study and research aspect needs to be examined further so that the effects of activities can filter through more easily to those who have not actually taken part in training. The structure of this programme is therefore one of annual training sessions hinging on seminars, accompanied by exchanges between officials and involving study and research activities. This structure reflects the needs revealed by the evaluation of the seminars already held and confirmed by Council working parties of experts from the Member States. This structure does not prevent other measures from being devised as and when new technology for the production of non- forgeable documents and the detection of forgeries is introduced. The complementarity of this approach allows a certain measure of flexibility in the management of the multiannual programme whilst respecting its fundamental priorities. Such flexibility is needed in order to adapt as quickly as possible to technological developments and counteract new ways of using forged documents. The programme is designed to meet these objectives by underpinning initiatives taken in the field of continuing training by public or private institutions in order to increase familiarity with the techniques by which identity documents are produced and to heighten awareness of the need to combat the use of forged documents. Furthermore, thanks to the potential economies of scale afforded by this programme, it may eventually be possible to incorporate it into a broader programme relating to border checks, to be implemented experimentally in 1996. C Comments on individual articles Article 1 Article 1 sets out the general principle and objectives of the programme and stipulates that it is to qualify for Community support. The attached financial statement allows a total package of ECU 5 million for the first five years, with the proviso that an initial appropriation of ECU 400 000 will be allocated to the programme in 1996. The objectives are set with the emphasis on the dual aspects of the programme's perennial nature and the need for further exploration of the measures involved. Particular stress is laid on the importance of clearly defined priorities as prerequisites for ensuring the overall consistency of the programme. In this respect, the adoption of a long-term approach seems to be the most effective way of exploring both the means of action and the possibility of tackling the problem from the angles of both prevention and prosecution (technical, legal or even cultural and sociological dimensions). Article 2 Article 2 provides the basic definitions needed to understand the exact features of this joint action, with particular reference to identity documents and the main types of measure making up the programme. Article 3 Article 3 deals with the first component of the annual programmes, i. e. the seminars. There are to be two types of seminars: "general seminars" for the instructors whose responsibility it will subsequently be to relay the information onward in the Member States, and "specialist seminars" to enable recognized specialists to study specific aspects identified as meriting particular attention. These seminars are to be held at regular (annual) intervals so as to produce a knock-on effect, culminating, at the end of the exercise, in a genuine reference source. They will share the characteristics of being designed for the purpose of studying the theoretical and practical aspects of document security, providing an opportunity to update existing knowhow and developing teaching methods for instructors. Obviously, this must not involve any encroachment on the powers of the Community, for example as regards the standard format for visas or the Union citizen residence card. In view of the special links with the associated countries (Central and Eastern Europe, Cyprus and Malta) and given the need to devise ways of combating the use of forged documents beyond the purely European Union context, provision has been made for holding a number of seminars for representatives from the associated countries. Experts from these countries will be invited to attend specially organized broader-purpose seminars, i. e. seminars where those aspects of most direct concern to them can be addressed. Article 4 Article 4 deals with the aspect designed to supplement the seminars, i. e. exchanges between officials. These may take the form, for instance, of unilateral or reciprocal placements in the national departments responsible for control so as to enable officials to gain first-hand experience of the problems encountered in other Member States and of the most up-to-date methods of designing and producing identity documents. Since these exchanges will also be open to representatives of non-member countries and not merely those of associated countries, participants will also be able to learn from the experience gained by countries pursuing similar aims. Article 5 The third component of the annual programmes relates to studies, the main purpose of which will be to devise and disseminate teaching materials (teaching kits, back-up software etc). Research might focus more on the design of equipment for the checking of documents and technology for the rapid dissemination of data on forged documents and their use. Article 6 The overriding criterion which determines whether or not a measure qualifies for Community support is its value to the Union. To be certain as to this fact, the principle is laid down that in the case of measures involving only Member States, there must be at least three of them. In the case of measures involving associated countries, these should involve at least two Member States and three associated States. This avoids any danger of duplication with bilateral initiatives taken by the Member States. Article 7 These provisions relating to the jurisdiction of the Commission and the Court of Justice are conventional for an instrument of this type. Article 8 This article sets out the general terms of financing under the Community budget. Paragraph 2 lays down an overall limit embodying the principle that the contribution made by the national authorities must be less than the contribution from the Community budget. However, in order to remain flexible enough to adapt to individual programmes, this ceiling may be raised to take account of the particular circumstances described in paragraph 3. Paragraph 4 lays down the principle that the Community contribution is confined to certain categories of expenditure, thus emphasising the operational rather than administrative nature of the budget item. Here too, a certain measure of flexibility is allowed in order to be able to adapt to particular circumstances. Article 9 The rules of procedure set out in this article are conventional for an instrument of this type. Article 10 This article lays down the principle of the responsibility of the Commission for managing and monitoring the programmes and, in particular, for drawing up annual programmes. The Commission has a central role to play in the conduct of these programmes. In devising the annual programmes, the Commission will have to process the various applications submitted to it. To this end, it will also process the proposals submitted by the Member States, thus enabling them to contribute to the design of the programmes. Suggestions will be considered in the light of three criteria set out in the second subparagraph of paragraph 2. In its processing work, the Commission will, where necessary, draw on the advice of experts well versed in the methods of combating forged identity documents. Article 11 This article deals with the decision-making procedure for the adoption of the annual programme. A committee has been set up to operate on the basis of Procedure Ha of Council Decision No 87/373 of 13 July 1987 laying down the procedures for the exercise of implementing powers conferred on the Commission (OJ L 197, 18. 7. 1987, p. 33). The draft annual programme will be submitted to a committee chaired by the Commission, which will decide by a majority of votes as provided for in the second subparagraph of Article K. 4(3) of the TEU. Should the Commission reject the opinion of the Committee, it will be up to the Council itself to decide. This procedure presents the two-fold advantage of consultations with the Member States within the Committee and effectiveness of the decision-making procedure where there is agreement. The advantages of this procedure, which has proved itself in other contexts, will also become apparent in relation to this programme. Article 12 This article provides for evaluation and monitoring. This task is incumbent primarily on the Commission, which has to ensure that Parliament and the Council are kept appropriately informed so as to maintain concordance with work in progress or planned in the field of external borders, asylum and immigration. Article 13 The provisions relating to the entry into force of the common action set out in this article are conventional for an instrument of this type. DRAFT DECISION OF THE COUNCIL OF THE EUROPEAN UNION OF. on a common action introducing a programme of training, exchanges and cooperation in the field of identify documents THE COUNCIL OF THE EUROPEAN UNION Having regard to the Treaty on European Union, and in particular Articles K3(2)(b) and K. 8(2) thereof, Having regard to the Commission proposal of , Whereas the Member States consider identity checks on persons crossing the external borders of the Union and the security of identity documents to be a matter of common interest; Whereas the establishment of a framework for training, information, study and exchange activities will serve to improve officials' familiarity with the techniques applied in the production and checking of identity documents in other Member States and consequently lend greater effectiveness to the efforts made to combat forgery; Whereas, thanks to the economies of scale and cumulative effects implicit in the intended measures, these objectives can be achieved more effectively at Union level than at the level of the individual Member States; Whereas this joint action will not prejudice the powers of the Community, especially in the field of vocational training and will therefore not detract from the Community measures taken in implementation of this policy, in particular the Leonardo da Vinci programme, HAS DECIDED AS FOUUOWS: SECTION!- GENERAL Article 1 Principle and objectives 1. A programme (hereinafter referred to as the Sherlock programme) of training, exchange and cooperation in the field of the security of identity documents within the meaning of the definitions in Article 2, which shall qualify for Community financial support, is hereby established for the period from 1996 to 2000. 2. Without prejudice to the powers of the Community, the general objective of the programme shall be to extend existing cooperation in the matter of identity documents thanks to its multiannual organization. The definition of clear priorities will serve to rationalize this cooperation in the long term. Article 2 Definitions The following definitions shall apply for the purposes of the Sherlock programme: Identity documents: documents issued by Member States and non-member countries enabling their holders to prove their identity and cross external borders; Training: organization of seminars focusing on theoretical and practical understanding of the security of identity documents; Exchange: period spent by an official in a Member State other than his own for the purpose of improving his knowledge of control techniques through first-hand experience; Studies: design and dissemination of teaching material for combating of forged identity documents. SECTION H: STRUCTURE Article 3 Training 1. The main component of the Sherlock programme shall be following annual programmes: basic training seminar for instructors, further training seminar for recognized specialists on the production of documents. 2. The seminars are intended for officials of the Member States. However, seminars specifically open to officials of non-member countries may also be held. Article 4 Exchanges The Sherlock programme shall also comprise exchanges of officials both of the Member States and of non-member countries. Exchanges shall take the form in particular of work placements of limited duration within the national administrative departments responsible for checking identity documents. Article 5 Study and research 1. The Sherlock programme shall œmprise the design, production and dissemination of teaching material in the Member States and the associated States. 2. Ways of improving the circulation of information œncerning the fraudulent use of forged identity documents may also be a matter for study and research. SECTION Hfc FINANCIAL PROVISIONS Article 6 Financing criteria To qualify for Community finance, projects must be of demonstrable interest to the European Union and involve at least three Member States. Projects designed to increase cooperation with the associated States must involve at least two Member States and three associated States. Article 7 Financial control The financing decisions and the contracts arising therefrom shall provide for monitoring and financial control by the Commission and audits by the Court of Auditors. Article 8 Level of Community finance 1. 2. 3. All types of expenditure which are directly chargeable to the implementation of the measure and have been incurred over a specific, contractually defined period shall be eligible. The proportion of financial support from the Community shall not exceed 60% of the total cost of the programme save in exceptional cases where, subject to the procedures laid down in Section 4 of this joint action, it shall not exceed 80%. Translation and interpreting costs, confuting costs and expenditure on durables or consumables shall not be considered unless they are essential for the realization of the project and shall be financed only up to a limit of 50% of the grant, or 80% in cases where the nature of the project makes them indispensable. 10 4. Expenditure relating to premises, collective facilities and the salaries of officials of the State and public bodies shall be eligible only if it corresponds to irregular postings and tasks, specifically connected with the implementation of the project. Article 9 Rules of procedure 1. Measures incorporated in the programme and financed by the budget of the Communities shall be managed by the Commission in conformity with the Financial Regulation of 21 December 1977 applicable to the general budget of the European Communities, as last amended by Regulation No 2335/95 of 18 September 1995. 2. When presenting the financing proposals, the Commission shall take account of the principles of sound financial management and in particular of economy and cost-effectiveness as required by Article 2 of the Financial Regulation. MANAGEMENT AND MONITORING Article 10 Devising of programme 1. 2. 1. The Commission shall be responsible for managing and monitoring the programme and shall take such measures as are necessary to this effect. The Commission shall draw up a draft annual programme comprising a breakdown of the appropriations available and based on thematic priorities corresponding to the structure and objectives of the Sherlock programme. To this effect, the Commission shall scrutinize the projects submitted to it in the light of the following criteria lirrht rvf thf* iriWnwnna r r i t f r ï îv the innovative character of the proposed measure; the urgency of the need for the initiative as a way of improving the security of documents; the overall consistency of the programme. Article 11 Implementation The Commission shall be assisted by a committee consisting of a representative of each Member State and chaired by a representative of the Commission. The latter shall submit to the Committee the draft annual programme referred to in Article 10 of this joint action. The Committee shall deliver its opinion within a time limit set by the Chairman according to the level of urgency. The opinion shall be delivered by qualified majority as laid down in the second subparagraph of Article K. 4(3) of the Treaty on European Union. The Chairman shall not vote. 11 The Commission shall adopt measures, which shall be immediately applicable. However, should these measures not be consistent with the opinion delivered by the committee, they shall be communicated by the Commission to the Council forthwith. In such an event, the Commission may defer the application of the measures it has adopted for a period of not more than one month from the date of its communication to the Council. The Council, acting by a qualified majority, may then take an alternative decision within the period referred to in the foregoing subparagraph. SECTION V: FINAL PROVISIONS Article 12 Evaluation Each year, the Commission shall undertake an assessment of the measures taken during the previous year and shall address a report to Parliament and the Council. Article 13 This Joint Action shall enter into force on the day of its publication in the Official Journal. Done at Brussels, 12 Financial statement Item B5-800: Cooperation in the fields of justice and home affairs. The commitment appropriations have been entered in Chapter BO-40. 1. TITLE OF OPERATION Joint action on a programme of training, exchanges and cooperation in the field of the security of identity documents (to be known as the "Sherlock programme"). 2. BUDGET HEADING INVOLVED B5-800: Cooperation in the fields of justice and home affairs, more especially fields covered by Article KT(2) and (3) of the TEU. 3. LEGAL BASIS Article K3(2) of the Treaty on European Union. 4. DESCRIPTION OF OPERATION 4. 1 General objective Greater security of identity documents can be seen as a priority area for the type of cooperation provided for in Title VI of the TEU, and more especially for enhancing the effectiveness of checks at the Union's external borders. The effectiveness of control work depends not only on information channels such as the Fraud Bulletin, the Authentic Documents Manual and the Encoded Document Reference System but above all on the training of officials working in this area, especially where it involves an increases in exchanges between Member States and greater familiarity with the techniques, procedures and implements used. Two seminars intended for specialists to share their own experience have already taken place. The second, held in 1995, was charged to the Community budget under Article K. 8 of the TEU. The general aim of the action, based as it is on the implementation of a multiannual programme, is to extend cooperation in this field, rationalize initiatives by coordinating them around clear priorities and, by making this an ongoing process, ensure that the results have an enduring impact. 4. 2 Period covered The action covers a period of five years from 1996. 5. CLASSIFICATION OF EXPENDITURE NCE/DA 13 6. TYPE OF EXPENDITURE Grants (of up to 80%) for co-financing with other public or private sector sources. 7. FINANCIAL IMPACT 7. 1 Method of calculating total cost of operation The grants will cover the following: training; exchange and work placement programme; studies and research, dissemination of information It is anticipated that, subject to the annual budgetary procedure, an indicative financial package of ECU 5 million will be set aside for this programme for the period 1996-2000, in accordance with the timetable set out at 7. 2. The annual amounts, calculated on the basis of similar actions already carried out (including the Karolus and Mattheus programmes) or actions in progress, are as follows: - 1996: - training: *seminar for the training of instructors: 30 participants (2 x 15 Member States), duration 15 days (cost per trainee: ECU 6300): ECU 190 000 •basic training seminar for Central and Eastern European associated countries (7 States) in conjunction with 3 Member States: 20 participants (2 per State), duration 10 days (cost per trainee: ECU 4200): ECU 84 000 rounded up to: ECU 90 000 - studies and research, dissemination of information (design of teaching material, production of documents): ECU 120 000 - per year for the period 1997-98: - training: *seminar for the training of instructors: 30 participants (2 x 15 Member States), duration 15 days (cost per trainee: ECU 6300): ECU 190 000 •further training seminar (15 days, 1 participant per Member State, cost ECU 6300): ECU 94 500 rounded up to: ECU 95 000 •basic training seminar for Central and Eastern European associated countries (7 States) in conjunction with 3 Member 14 States: 20 participants (2 per State), duration 10 days (cost per trainee: ECU 4200): ECU 84 000 rounded up to: ECU 90 000 •seminar for the training of instructors from Central and Eastern European associated countries (7 States) in conjunction with 3 Member States: 20 participants (2 per State), duration 10 days (cost per trainee: ECU 4200): ECU 84 000 rounded up to: ECU 90 000 - exchanges: •S-day exchanges (cost per trainee ECU 2000) for 150 officials from Member States: ECU 300 000 •5-day exchanges (cost per trainee ECU 2000) for 50 officials from associated non-member countries: ECU 100 000 •other exchanges (visits to production workshops, research laboratories etc): ECU 60 000 (lump sum) - studies and research, dissemination of information: ECU 75 000 - per year for me period 1999/2000: - training: •seminar for the training of instructors: 30 participants ( 2 x 15 Member States), duration 15 days (cost per trainee: ECU 6300): ECU 190 000 •further training seminar (15 days, 1 participant per Member State, cost ECU 6300): ECU 94 500 rounded up to: ECU 95 000 •basic training seminar for Central and Eastern European associated countries (7 States) in conjunction with 3 Member States: 20 participants (2 per State), duration 10 days (cost per trainee: ECU 4200): ECU 84 000 rounded up to: ECU 90 000 •seminar for the training of instructors from Central and Eastern European associated countries (7 States) in conjunction with 3 Member States: 20 participants (2 per State), duration 10 days (cost per trainee: ECU 4200): ECU 84 000 rounded up to: ECU 90 000 - exchanges: •S-day exchanges (cost per trainee ECU 2000) for 150 officials from Member States: ECU 300 000 15 •5-day exchanges (cost per trainee ECU 2000) for 100 officials from associated non-member countries: ECU 200 000 •other exchanges (visits to production workshops, research laboratories etc): ECU 100 000 (lump sum) - studies and research, dissemination of information: ECU 235 000 7. 2 Itemized breakdown of cost AC in ECU millions (at current prices) Breakdown Training (seminars) Training (exchanges) 1996 0. 28 1997 1998 1999 2000 Total 0. 465 0. 4 0. 465 0. 4 0. 465 0. 5 0. 465 0. 5 2. 14 1. 8 Other exchanges Studies, research, dissemination of information TOTAL 0. 12 0. 06 0. 075 0. 06 0. 075 0. 1 0. 235 0. 1 0. 235 0. 32 0. 74 0. 4 1 1 1. 3 1. 3 5 7. 3 Indicative schedule of appropriations AC in ECU millions 1996 1997 1998 1999 2000 2001 Total 0. 4 1 1 1. 3 1. 3 5 0. 1 0. 3 0. 7 0. 3 0. 7 0. 3 1 0. 1 1 1 1. 3 0. 4 1 1 1. 3 1. 3 5 0. 3 1 1. 3 0. 3 0. 3 Appropriations for commitment Appropriations for payment 1996 1997 1998 1999 2000 Total Indicative financial package for the period 1996-2000: ECU 5 million. The programme is scheduled to take place in three phases. 16 For 1996, since initial expenditure cannot be committed before the last third of the year, the annual amount has been calculated on the basis of what, given the necessary preparatory work, could actually be organized. For 1997-98: an initial phase designed to have an appreciable knock-on effect on the national training programmes of the Member States, which will have instructors trained at Union level and jointly devised teaching material at their disposal. For 1999-2000: the expected results of the knock-on effect on the national programmes will generate new requirements at Union level, making it possible to amplify and expand the operation on the basis of a mid-way assessment (end 1998) of a more detailed nature than the annual report. 8. FRAUD PREVENTION MEASURES; RESULTS OF MEASURES TAKEN Verification of grants or receipt of payments and preparatory, feasibility and assessment studies is carried out by the Commission before payment is made, taking into account contractual obligations, economic principles and principles of sound financial or general management. Anti-fraud provisions (checks, delivery of reports, etc. ) are included in all the agreements or contracts concluded between the Commission and the recipients of the payments. 9. EIJEMENTS OF <X)ST-EFFEOTVENESS ANALYSIS 9. 1 Specific and quantifiable objectives; target population - Specific objectives: Under the general objective referred to at 4. 1, the Commission will devote special attention to the following: * Ongoing training seminars in the field of document security in three areas - mstnictor-tmining - further training for recognized specialists - basic training for officials from certain Central and Eastern European countries The underlying aim here is to harmonize the training of the officials concerned by focusing on specific levels: Union level for the training of instructors and advanced training and Member-State level for the relaying of training to the greatest possible number of national officials. Likewise in a spirit of harmonization and in anticipation of their possible accession, training will also be organized at Union level for officials from Central and Eastern European countries. * In conjunction with the foregoing objective, teaching material will be developed which can subsequently be used in training programmes in the Member States, thereby capitalizing on the training provided at Union level, producing economies of scale and adding a further element of harmony to the training provided at Member State level. 17 * Research to improve ways and means of disseminating information relating to the recognition of documents and forgeries The latter objective will help to avoid duplication of research efforts in a field where the exchange of information between Member States is of primordial importance to the establishment of complete freedom of movement. - Target population: Officials responsible for designing, issuing or checking documents. Officials responsible for training, especially devising and implementing training schemes in the departments concerned and in particular for devising instmctor-tmining. 9. 2 Justification for action Cooperation between the Member States as defined by Title VI of the TEU, with which the Commission is fully associated, covers matters which the Member States regard as being of common interest. Document security is one such matter, being particularly important as regards immigration control at the external borders. Cooperation between government departments of the Member States at Union level therefore supplements the efforts made by those departments in their own field of competence. The high-speed exchange of information and the need to work in real time therefore require officials to have an increasingly detailed knowledge of procedures in other Member States. The Sherlock programme, which, as shown in the above presentation of the specific objectives of the programme, complies totally with the principle of subsidiarity as regards the level at which the measures are located, is thus a reflection of this need. Two principles will underlie the selection of projects: adherence to the structure of the programme as defined in Section II of the joint action, which requires measures to be repeated regularly as a way of ensuring long-term effectiveness and producing a knock-on effect in the Member States; compliance with the criteria set out in Article 10 of the joint action which, in addition to the consistency of the programme, concern innovation (e. g. technological developments) or need for urgent action (new types of documents, emergence of new sources of forgeries). 9. 3 Monitoring and evaluation Two types of indicators will be used to measure the attainment of objectives: number of trainee days recorded at Union level as regards both seminars and exchanges; number of trainee days at Member State level using instructors trained under the Sherlock programme and teaching material produced under the programme. These quantitative indicators will be supplemented by more qualitative evaluations measuring the impact of the training on trained officials (panel with evaluation at successive intervals after training). 18 The annual reports will be supplemented by a more detailed instruction report after the first three years of the programme's implementation. 10. ADMINISTRATIVE EXPENDITURE (Part A of Section HI of me General Budget) The effective mobilization of the necessary human resources will be determined by the Commission's annual decision on allocation of resources, taking account of the staff numbers and additional amounts agreed by the budget authority. It should be stressed that this joint action aims to manage commitment appropriations of around ECU 5 million per year and that, in order to ensure "sound financial management" of the operating appropriations, it will be necessary to make available administrative appropriations corresponding to the additional work flowing from implementation of the joint action over the period in question. Supplementary resources have been estimated on the basis of human resource costs observed for Title VI pilot training projects run under the 1995 budget. 10. 1 Effect on number of posts Types of work Staff required to manage the project Of which Period Permanent Temporary use of resources existing within DG or Service concerned to be financed from additional funds Officials or temporary staff A B C 1 1/2 1/2 Other resources Total 2 5 years from September 1996 1 1/2 1/2 2 19 10. 2 Overall financial effect of additional human resources Officials Temporary staff Other resources Amount Method of calculation 765 000 (ECU 92 000 + 33 000 + 28 000) x 5 years NB: ace. scales supplied by DG IX 1 The amounts express the total cost of additional posts jor the total duration oj the action. [765 000 Total == | | 10. 3 Increase of other expenditure resulting from the project Budget item (Number and title) A 2510 Amount Method of calculation 12 000 50 000 156 375 80 400 Missions: 20 days/official: 20 x ECU 120 x 5 years Journeys: 10 annual journeys x ECU 1000 x 5 years Committee provided for in Article 11: 15 people x ECU 695 x 3 meetings x 5 years Experts: 20 days/experts/year x ECU 804 x 5 years T 0 t al "298775 The amounts correspond to the toted expenditure oj the action The purpose of the missions is to evaluate and coordinate measures taken to implement the programme and to monitor the project at first hand. The cost of these missions is calculated at ECU 62 000. 20 ISSN 0254-1475 COM(96) 297 final DOCUMENTS EN 06 11 Catalogue number : CB-CO-96-306-EN-C ISBN 92-78-05743-6 Office for Official Publications of the European Communities L-2985 Luxembourg <2i

COMMUNICATION FROM THE COMMISSION - EU-India Enhanced Partnership

http://publications.europa.eu/resource/cellar/d5c30879-6fa7-4a4a-9c4d-d15190d40730

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 26. 06. 1996 COM(96) 275 final COiyDVlUNICATION FROM THE COMMISSION EU-India Enhanced Partnership Table ôf Contrats s " 1. The setting for current relations 1. 1 India: economy, society and domestic politics 1. 1. 1 An overview of India 1. 1. 2 Economic reforms and their impact 1. 1. 3 Democracy in a multi-cultural society 1. 2 India in Asia and the world 1. 2. 1 India's global position 1. 2. 2 India, Asia and South Asia 2. EU-India mutual interests 2. 1 International political issues 2. 1. 1 Global issues 2. 1. 2 Regional stability and security 2. 2 Trade and economic issues 2. 2. 1 Liberalisation for growth, trade and investment 2. 2. 2 Removing additional barriers and improving the framework for trade and investment 2. 2. 3 Increasing awareness and information 2. 2. 4 Sectors of specific interest 2. 3 Building a human dimension 2. 3. 1 Supporting social development and basic services 2. 3. 2 Opportunity creation 2. 3. 3 Reinforcing democracy in diversity 2. 3. 4 Encouraging sustainable development 3. Reinforcing partnership 3. 1 Points of focus 3. 1. 1 Intensifying the political dialogue 3. 1. 2 Trade and investment facilitation 3. 1. 3 Helping India face structural adjustment 3. 2 Steps in the new partnership 3. 2. 1 Laying the groundwork 3. 2. 2 Working through the priorities 3. 2. 3 Increasing cultural understanding 3. 2. 4 Institutional framework 4. Conclusions Annexes 1. Past EU-India relations 2. The Indian economy 3. Population 4. Evolution of Indian external trade 5. Evolution of foreign investment in India 6. Evolution of EU-India trade relations 7. India: international development assistance for 1995-96 (indicative) 2 3 3 5 6 6 7 10 12 12 13 15 16 16 20 22 23 24 25 27 I 1. 1 India: economy, society and domestic politics 1. 1. 1 An overview of India India catches the attention with its cultural diversity, democratic tradition, and recently renewed economic dynamism. A long-standing partner1 of the European Union (EU)2, India is a rising force, with the eleventh largest economy in the world3, a Gross Domestic Product (GDP) of 212 billion ECU4 (1995) and the second largest population in the world with at least 900 million inhabitants5 (the EU has 370 million) living on a land area of 3. 3 million km2 (the EU is 3. 2 million km2). 1. 1. 2 Economic reforms and their impact The substantial policy changes undertaken since 1991, have promoted an expanding export-oriented economy, as well as increased private sector confidence. From 1994 to 1995 alone, external commerce grew by 20%6, and approved foreign investments rose to an annual figure of 3. 5 billion ECU in 1994, compared to just 129 million ECU in 19917 In 1994, Indian economic growth reached 5. 5%8 and there is optimistic talk of forthcoming economic take-off. Industrial production for fiscal year 1994-5 increased faster at 8. 6%, and industry now represents some 30% of total GDP9. Services account for approximately 42% of GDP, with the fastest growth being recorded in transport, commerce and the financial sectors. India already has developed a considerable high-technology capacity in certain sectors such as space and computer software, which holds out the prospect of growth in these high value-added niches. Indeed, it is also increasing exports to the EU10 in a number of advanced sectors eg chemicals, engineering and electronic products as well as machinery and transport materials11. However, the economy is not yet reaching the growth rates of nearly 10% recorded in several parts of East and South-East Asia. Also, trade and foreign investments are growing from a low base and in 1994 exports represented just 9. 5% of total GDP, and India's foreign direct investments were only slightly higher than Malaysia's (population: 19 million). The domestic savings and investment rates (both around 21%) are also not yet strong enough to support a major boom, and public sector reforms have been slow with a public budget deficit equivalent to 6. 7% of GDP in 1994. This has also contributed to the external debt of some 73 billion ECU12. Hence a number of macroeconomic challenges are still on the agenda. 1 See Annexe 1 2 Please note that for the sake of transparency to the wider public, the term EU is systematically used. In some cases the term "European Community" would be legally more exact. I Sec Annexe 2, Table 1 4 In all cases where the original statistics are in US dollars, the exchange rate used is 1 ECU= $ 1. 3. Sec Annexe 2, Table 2 for past Indian GDP 5 See Annexe 3, Table 1 6 See Annexe 4, Table 1 for the overall trend 7 See Annexe 5 8 See Annexe 2, Table 3 9 See Annexe 2 Table 4 10 For trade balance, see Annexe 6 Table 1 II See Annexe 6 Table 2 12 See Annexe 2 Table 5 3 1. 1. 3 Democracy in a multi-cultural society India has earned ils title of the world's largest democracy, holding regular elections since 1947, having a free press, a firmly apolitical army and a well-established rule of law, backed by an independent judiciary that defends the rights of citizens and business. As a result it has enjoyed considerable domestic political vitality for a country of its size and diversity, as was again proven with the general elections this year. This is no mean feat, given that India, a secular society, is a cultural cauldron with considerable regional and religious variety. Indeed, India is the birth place of numerous religions, notably the Hindu and Sikh faiths as well as Buddhism and Jainism, and is also home to an estimated 130 million Muslims and 20 million Christians. However, this diversity produces social tensions and (ethnic, caste and gender) barriers, which the Government of India (Gol) has tried to diffuse by a long-standing policy of positive discrimination measures, backed up in the constitution and a process of decentralisation. Economic growth, if widely spread, could help to reduce such tension. However, India's 2% annual demographic growth reduces the impact of economic growth and places a major strain on provision of many basic public services. This challenge is being met in some Indian states, where female education is higher and family planning has effectively decreased birth rates. Nevertheless, the challenge remains elsewhere, as even if India is home to over 10 million university graduates - a tremendous achievement by any accounts - average literacy is 64% for males and 39% for females, the latter being the priority targets in family planning. India is thus a country of great contrast. The reforms have bolstered the creation of a 'consumer class' (some 150 million13), but average annual per capita income is just 235 ECU, and poverty is still a problem (touching some 210 million people14). India therefore faces a major development challenge, with malnutrition, child labour (estimated as affecting 17 million children15), and relatively low life expectancy (61 years16). Indeed, India's rural society (over 70% of its population) faces upheaval as population growth places a strain on the many monsoon-dependent subsistence holdings (average land-holding is under 1 ha. per farm family). The renewed Indian dynamism therefore still has to overcome a number of challenges to fulfil its full potential. 13 Not on a par with Europe's middle class, this group of people has nevertheless created a consumer goods market according to the National Council of Applied Economic Research, India 14 Source: the National Council of Applied Economic Research, India 15 Source: the International Labour Organisation (ILO) 16 See Annexe 3 Table 2 for further population-related data 4 1. 2 India in Asia and the world 1. 2. 1 India's global position India has long played an important international role in the Non-Aligned Movement. This stance has been complemented since 1991 India by a multiplication of links with the developed world, including the EU. Military co-operation with Russia continues, but trade has decreased substantially. Political relations with Washington remain subject to American concerns over the possible development of nuclear weapons in the South Asia region. This is fed by India's explosion of a nuclear device in 1974, its development of long-range missiles capable of carrying nuclear warheads, and non-signature of the Non- Proliferation Treaty (NPT). Japan has gained in importance, and is currently the largest foreign aid donor to India, (20% of total17), although almost all its aid is in the form of loans, mainly for infrastructure projects. Its regular participation in United Nations (UN) Peace-Keeping Operations, role in establishing the World Trade Organisation (WTO), and high-profile positions in UN conferences such as Beijing, Cairo, Copenhagen and Rio have been further signs of reinforced international commitment. 1. 2. 2 India, Asia and South Asia India has been keen to build up its political and economic links with the rest of Asia, recognising that the changing economic power in the region is having an impact on geopolitical relations and that its own economic growth depends on regional political stability as well as vice-versa. The recent decision by the Association of South-East Asian Nations (ASEAN) to make India a full dialogue partner is therefore an important step in India's move towards Asia allowing it to participate in the economic and political discussions of the ASEAN Post-Ministerial Conference, and now also in the Asia Regional Forum. In South Asia, India's relations with neighbouring states have not always been easy, as seen by its three wars with Pakistan (1947-9, 1965, 1971). Skirmishes have continued with Pakistan, even recently (February 1996). On the other hand, the border conflicts with China have calmed following the Indo-Chinese agreement on recognition of existing frontiers, Indo-Nepalese relations have taken a step forward with agreement on water sharing, and India enjoys easier relations with Sri Lanka following increased Indian surveillance of the Palk Strait. Relations with Bangladesh have also improved, although some problems, mainly linked to water and refugees, still remain. In contrast to many other parts of the world, there is a relatively low degree of economic and political co-operation in the South Asia region, which both explains and is explained by the tension. Although the South Asian Association for Regional Co-operation (SAARC) has been in existence for 10 years, total official trade among SAARC countries is only equivalent to 3. 4% of their total world trade compared to 24% for intra-regional trade among ASEAN countries. However, the entry into force of the SAARC Preferential Trading Arrangement (SAPTA) in December 1995 should help trade by reducing tariffs on 226 items including commodities. If fully applied, this will constitute a considerable change in intra-regional trading practices. 17 For aid breakdown, see Annexe 7. Tables 1, 2 and 3 5 2. EIMndïfl mutml interests Tiie ( 'o-operation Agreement between the European Community and the Republic of India on Partnership and Development as well as the accompanying EU-India Joint Statement on Political Dialogue outline a number of areas where it is possible to act together. Within this framework, the following areas are considered particularly important in economic or political terms for both partners. 2. 1 International political issues 2. 1. 1 Global issues Europe and India both face the challenge of maintaining a peaceful and secure international environment. Given the evolution towards greater inter-dependency any decision taken by one party is likely to have a direct or indirect effect on the other. Furthermore, the number of local or regional issues that are recognised as having an international impact are much larger today than before. A deeper EU-India dialogue as a part of the global process can therefore help to establish the mechanisms needed to meet these challenges. Arms' control is naturally one issue of interest. Joint examination of conventional arms limitations, and control, non-proliferation and disarmament of weapons of mass destruction (nuclear, chemical, biological, ballistic missiles) would be a first step. After all, there are plenty of old and new items on the international agenda with the Non-Proliferation Treaty (NPT), the Comprehensive Test-Ban Treaty, the Cut-off Treaty, the reinforcement of international nuclear safeguards, the Chemical Weapons Convention, the Biological Weapons Convention, ban on anti-personnel mines, transparency in armaments, as well as the control of sensitive dual-use goods and technologies. In all these issues there is much to be gained from a closer EU-India understanding, with the aim of promoting a safer global security environment. There is also a need for co-operation in meeting the environmental challenges outlined by the 1992 Rio Earth Summit. A strengthened EU-India partnership stands to enhance mutual appreciation of the manner in which issues such as climate change, conservation of biodiversity, pollution prevention, environmental aspects of trade and other important topics are approached, and need to be included in an enlarged concept of world security. The key position of large countries like India in helping to bring about a substantial reduction on global C02 emissions in order to stabilise and subsequently reverse changes in climate will become more evident in the future. Intimately linked to this is the wider issue of energy resources and security of supply in which both the EU and India have a direct interest. If India follows traditional patterns, then rapid GDP growth will result in much greater total energy consumption (eg the EU consumes 14 times more energy per capita than India). Simultaneously with other emerging economies and many Western countries, India will face a substantial increase in demand for non-renewable imported energies, and risks producing ever more CO2 emissions, raising geopolitical and global environmental issues, requiring a concerted search for renewable alternatives. Both the EU and India also face the threats posed by international crime, terrorism, and drugs trafficking. Given that these illicit activities benefit from their ability to change countries rapidly, reinforced co-operation is appropriate here. The same is true for the control of illegal immigration flows. The EU is thus ready to be a partner in India's integration into appropriate international bodies, so long as India accepts the international responsibilities and Treaties that befit a major world power. 2. 1. 2 Regional stability and security In addition to building globally reassuring structures to promote peace and security there is a need for similar action on the regional and local level. Even a perceived risk can for instance harm investment by creating an impression of uncertainty and may divert resources from more productive uses. Furthermore, conflict (especially when combined with the fear of escalation) may have repercussions on the world economy, as witnessed during the Gulf War. Hence, the EU has a very direct interest not only in what happens on its own borders but also in the situation in South Asia - and vice versa. Also, although there is no desire for European-style regional integration, India is interested in participating in the wider Asian co-operation process, and the EU can support this, drawing on its own experience of using economic integration to secure political stability. Furthermore, both Europe and India need to explore ways of reducing tensions with their own neighbours, tensions that are sometimes fed by false images of cultural and religious differences. Each therefore can learn from the other, and help to defuse issues that may otherwise disrupt good relations and world security. 2. 2 Trade and economic issues 2. 2. 1 Liberalisation for growth, trade and investment The world economy is not a zero sum game. Hence it is in the EU's interest to see high rates of growth in India and vice-versa. For each to benefit fully from the other's growth, it is important to tackle outstanding barriers to trade and investment within the WTO. As India presently accounts for just 1. 3% of EU external trade - much of this in low added- value products - there is substantial room for expansion. Following dialogue with the Gol, the Commission has thus identified issues in trade and investment, where action could be beneficial. Seen from Europe, and despite recent changes, India's tariffs remain high. Furthermore, many of the recent reductions have not been bound with the WTO. India has also been using the Balance of Payments protection clause to retain extra protection for certain sectors, especially consumer goods, where taxes substantially increase import prices. Even major export sectors like textiles and clothing are still protected. Naturally, the EU is keen for these barriers to be tackled in a multilateral context. India itself would benefit given that increased competition would force domestic producers to increase productivity and efficiency, thus enabling greater export capacity. There is also a question of direct public sector intervention in many industries. Where this involves public subsidies to companies, the market may be distorted, discouraging efficient competition (both foreign and domestic). This is important, as India wishes to attract and secure long term investors, especially in basic infrastructure, such as energy, water, transport and communications. Europe has undergone a process of liberalisation in many 7 of these sectors and would be willing to exchange its experiences with India, and may also be able to give practical support to Indian liberalisation and public service restructuring. Furthermore, the EU can provide complementary expertise, eg as regards renewable energies. Liberalisation needs to touch all industrial sectors and even government procurement habits 'Buy national' policies are costly to the public if India is to reap the full gains of growth. purse, do not guarantee the best possible public service, and limit competition-induced productivity gains in key sectors. On this, the Commission would be happy to discuss a wide reciprocal opening either in the context of the WTO Agreement on Government Procurement, or on a bilateral basis. As efficient financial, telecommunications and transport services are the mainstay of growing economies, liberalisation of these sectors can also be used to spur rapid growth. The EU is naturally prepared to collaborate in this process, as well changes in specific sub- sectors such as insurance and maritime transport. Collaboration on these issues could then stimulate new opportunities in, for instance, information technology. In a similar vein, the understandable Indian sensitivity on the implications for internal stability of restructuring agriculture, although justified, must not prevent a progressive policy change. The existing agricultural system, even with technological improvements, will be incapable of keeping up with demographic growth and rising living standards, especially if some Indian farmers are to take advantage of export opportunities. Naturally the EU is prepared to work with India on promoting and diversifying commerce in agriculture, as well as on aligning sanitary and phytosanitary standards. 2. 2. 2 Removing additional barriers and improving the framework for trade and investment There are still a number of horizontal trade impediments raised by both sides such as those arising from application of customs, investment and consumer protection rules. Many of these issues can be handled by bilateral co-operation, for example the reduction of technical barriers or the mutual recognition of conformity assessment and of testing and certification procedures. But more substantial issues clearly need to be tackled in the framework of the WTO This being so, it is worth jointly considering common interests on a large number of issues that may at some time figure on the WTO's agenda, and the Commission considers that co operation with India should be reinforced on WTO objectives. Indeed, building on successful past experience with India, there is clear room for further intensifying this collaboration by allowing ad hoc consultations when necessary on substantial issues. As regards past multilateral commitments, under the Uruguay Round, India has promised important measures in improving the protection of Intellectual Property Rights (IPR). The sooner that India adopts the necessary legislation (not just the establishment of a 'black box', but full application to all sectors), the sooner investors will feel assured. Indeed, India should also consider adhering to other, stricter, existing international IPR codes to further reinforce the sense of security. Most importantly, when legislation does come into force, it must be backed up by effective implementation and on the ground control. A joint EU- India programme is already envisaged to reinforce the intellectual property system and its alignment with international standards. Similar work has already started in institution building (eg with standards and quality, and can be awards/campaigns). Help could also be given in the regulation of utilities. advanced further for 2. 2. 3 Increasing awareness and information Barriers to trade and investment are not only the result of market structure. There are also important cultural and information barriers which need to be overcome for partnerships to flourish and business opportunities to multiply. Hence the Commission will seek to use all the necessary means, including information technologies, to improve business awareness and information flows, also for small and medium sized enterprises. Indeed, the Commission encourages all forms of links between civil society, educational establishments and the media, precisely to build up a pool of mutual understanding. Exchanges of experience and joint activities on substantive issues such as vocational training are naturally part of this. To provide a common backdrop for these efforts, it would be useful to hold a regular of exchange views on economic developments in the EU and India. This could include discussions on the regulatory framework, investment promotion, and industrial policy. 2. 2. 4 Sectors of specific interest Europe and India can work together to mutual benefit in a number of sectors. One clear example is co-operation on science, technology and technology transfer, as co operation here promotes an enabling environment for co-operation in general, as well as helping the search for scientific solutions to global problems. Science and technology (S&T) co-operation will therefore be actively encouraged under the Research and Technological Development Framework Programmes. This co-operation should mobilise complementary skills from across Europe and India, supporting innovative research and promoting the development of human and institutional capital. This reflects the way that the EU is taking a new look at means of enhancing S&T co-operation given India's status as an emerging economy. In another example, both Europe and India have an active interest in ensuring that all groups and countries have access to the 'Global Information Society'. India and the EU are interested in taking advantage of, and developing these advanced technologies, and each can be a valuable source and partner for the other. Bodies such as the Software Services Support and Education Centre (3 SE) can be used to improve co-operation in this market of the near future, and help ensure full participation in the global efforts to implement the information society. Similarly existing work in other areas can be built upon by establishing a closer bilateral dialogue to overcome problems identified by the business community, and encourage industrial co-operation, trade and investment facilitation. The list of sectors should be determined in function of EU and Indian interest, and could include: financial services (especially insurance); transport services and equipment; infrastructure, energy (renewable, clean technologies and nuclear safety); capital goods and heavy machinery; the automotive sector (including parts and production); space technologies (including the Global Navigation Satellite System); agriculture; textiles. 2. 3 Building a human dimension 2. 3. 1 Supporting social development and basic services The European Union firmly believes that social development must be a parallel objective to economic development, and that it is not possible to ensure sustainable economic growth without taking into account the social dimension. Furthermore, Europe has a fundamental interest in India making a success of its structural adjustment process. Hence the need to support the process by focusing resources on basic services where the Gol itself has already established a firm policy orientation. In terms of education, without widespread basic literacy skills, the poor will have difficulty in obtaining better paid work, and the country as a whole will have struggle to meet the demand for skilled labour, and hence higher growth rates. Thus the recognised need to place great emphasis on education and practical skills, as well as to focus in particular on primary and female education and training. Indeed, greater female education will release the potential of 50% of India's population to contribute in all spheres of life. Similarly, a healthy work force contributes to an increase in the quality and motivation of the work force. Hence the need for better basic health services as well as health education. Improved education and health will then contribute to cutting the continued and unsustainably high birth rate. There is a growing understanding of a socially-just economy, and that the respect of fundamental social rights is a positive factor for economic well-being. India and Europe can work together to ensure the respect of freedom of association, non-discrimination and elimination of forced and child labour. These issues, which are closely linked to poverty, can only be progressively tackled by a multifaceted approach. Both sides have experience of these problems and a dialogue can be used to build positive programmes of action to help tackle the problems at their root. In all these areas the EU and India can exchange experiences, and work together. 2. 3. 2 Opportunity creation As a complement so as to help meet the challenges posed by the modernisation of industry and to develop the resource base of the country in line with Gol policy, another area for co-operation could be employment generation activities and related social issues including the elaboration of an appropriate social safety net. This may also link in to rural poverty alleviation projects, and self-help projects generated by local groups. The EU already has experience of the problems produced by liberalisation, and recognises that without this human dimension being added, India will have difficulty in opening its markets at fast enough pace to attract large-scale investment and rapid growth 2JL2 Reinforcing democracy in diversity Given the extent of shared European and Indian values, any solid relationship cannot be built without fully taking account of the human dimension. 10 One of the cornerstones of these shared values is a belief in democracy, where the EU and India face similar issues such as building democracy in multi-lingual, multi-religious, multi cultural environments and have been examining how to improve co-operation between different levels of decision-making. Europe and India also have much to learn from each other when it comes to empowerment and development of dynamic local democracy. Indeed empowerment is also important when it comes to developing the economy, dispensing basic services and wisely using international assistance funding. 2. 3. 4 Encouraging sustainable development Environment and development are closely linked. However, the domain has broadened in recent years as the need to link human and economic aspects has become more apparent if sustainable development is to be achieved. Pursuit of an equilibrium between economic growth, social stability and environmental conservation will become more important and discussion on the path to follow should be encouraged. Sustainable development as a concept affects not only natural resources, but entails a continuing reappraisal of the manner in which environmental criteria are taken into account in all other areas relevant to the EU-India partnership. An enhanced partnership with India to consider loss of biological diversity, sustainable management of natural resources, clean energy production, pollution of air, water and soil, the urban environment, waste management, clean water supply, the application of clean production technologies and various other issues of mutual interest will be pursued. For example, in the WTO's Committee on Trade and Environment India and the EU could usefully hold a constructive dialogue. On the bilateral level this implies a continued exchange of information on environmental policies, with particular regard to environmental measures likely to have an impact on trade relations. 11 3. 1 Points of focus 3. 1. 1 Intensifying the political dialogue Clearly we must continue the dialogue on global and regional issues of concern Nevertheless, there is a need to go beyond the formal exchange of speeches, and to create a series of working groups in which detailed dialogue can be held. These working groups can then lead to some form of substantive action or decision, or agreement. In this case the dialogue will not be on purely political issues, but may well spill over into technical assistance and trade. With this in mind, the Commission considers that sector arrangements and agreements could usefully be explored on, for instance: dual-use products; drug precursors; money laundering. All are commercial issues, but which are closely linked to political questions. Furthermore, and given that some form of co-operation may be possible, it would be worth looking more closely at: climate change; the cultural dimension. 3. 1. 2 Trade and investment facilitation Our aim must be to increase two way flows of trade and investment substantially. This implies considerable trade and investment facilitation work, and promotion of business to business contacts, which again implies that our relations need to go beyond the formal periodic meetings. Indeed, there are many sectors which could benefit from an integrated sector approach that set out to examine all the barriers that exist, negotiate their elimination on a Most Favoured Nation basis, perhaps focus technical assistance, and maybe conclude some sector agreements or arrangements. Trade and investment promotion could be dealt with in one group, whilst a number of industry-focused groups could be established in function of the interests expressed by the Member States, business and the Gol. Such sectors may include: transport (especially maritime transport); telecommunications; energy; agriculture. 3. 1. 3 Helping India face structural adjustment As India has to make considerable efforts to meet structural adjustment, so it is only right to help limit the impact of this on the poorest part of the Indian population. As such the Commission will continue to support health and education, especially for women However, European development co-operation must fit into an overall concerted policy framework if it is to be effective. For this reason a detailed sector dialogue on the policy lines, linked to the co-operation, needs to be maintained. 12 3. 2 Steps in the new partnership 3. 2. 1 Laying the groundwork In the framework of the co-operation agreement and Communication seeks to build on this basis by stimulating a wide discussion, in order to: the joint statement, this take stock of current activities; establish priority areas for action. The Commission invites a wide participation in this discussion and the suggestions made by the European institutions on this Communication will clearly be a first major input. Furthermore, the Commission proposes the possibility of joint reflections with the Member States to look at future challenges in EU-India relations so as to ensure that the EU as a whole can draw a maximum synergy from current activities and future developments. Business will have a number of chances to make its views known, not least at the planned Forum on investment in trade and co-operation foreseen for November 1996. The Joint Commission (planned for December 1996) can then endorse a set of priorities for action and establish a detailed programme of activities. The Joint Commission will in subsequent years be able to review the progress made. 3. 2. 2 Working through the priorities As soon as priority areas for action have been jointly established on the basis of proposals outlined above, it will be possible for the working groups to start their activities. With the information collected in the discussions outlined above, each group will be able to establish its targets. These targets may include the: need to build a better understanding each others position; possibility of focusing financial resources to help eliminate a problem; utility of negotiating some kind of sector agreement or arrangement. The exact number and membership of the groups, as well as the substance of the discussions would be fixed jointly by the EU and India. This stage of activity will therefore involve considerable trade facilitation, and give greater impetus to the dialogue on detailed issues and providing substantive results. 3. 2. 3 Increasing cultural understanding In parallel with the establishment of working groups, the Commission is keen to help extend the EU-India dialogue to civil society (including trade unions and NGOs), the media and the academic community. Without this spread of dialogue, the conduct of business and politics will always be hampered by a lack of broader understanding. This, as was noted in the Commission's proposals of July 1994 for a New Asia Strategy, implies a strengthening of Europe's economic presence in Asia requires a heightened European profile in Asia. It is not enough simply to do things, the EU must be seen to be doing them. Hence, particular attention will be paid to improving the visibility of European 13 activities in India, where the sheer size and diversity of the country calls for a special effort in strengthening profile. The same is true in the opposite direction, where India's profile, and European awareness of the sub-continent, need to be increased. In this context the Commission intends to: facilitate cross-cultural co-operation initiatives; encourage the establishment a network of organisations interested in Europe-India relations; promote an increased flow of press and media information on Europe in India and vice-versa. This phase of activity could be usefully complemented by activities launched in the European Parliament, Economic and Social Committee and the Committee of the Regions, if these institutions find it appropriate. 3. 2. 4 Institutional framework The resulting series of sector agreements and arrangements are likely to push the existing institutional framework to its limit. If and when a clear need to prepare the ground for a new Framework Agreement emerges, the Commission will then return to the Council. 14 India is an effective, functioning democracy increasingly open to the world. Structural reforms are continuously strengthening the Indian economy's ability to face opportunities and challenges in an international framework. However, there is no room for complacency on either side A number of challenges need to be tackled and opportunities seized. This Communication therefore underlines the need and means to reinforce relations between the EU and India, expanding on the experience gained to date, taking account of the need to adapt to changes in India and the EU, and inviting an intensified and more targeted dialogue. Indeed, on many points, notably those of an international political nature, the EU and India have a shared interest in tackling the challenges together, as both must face the same issues, and the growth of inter-dependency means that neither can ignore the choices made the other. The scope for increased growth through trade and investment also presents an opportunity for each side, and requires assiduous work in tackling obstacles, and promoting awareness of the possibilities available. Furthermore, the shared values of India and Europe, vitality of cultures, and need for greater mutual understanding, create opportunities for cross-learning, imposing an important human dimension on relations. In all these ways, the challenges which are of joint interest can become tremendous opportunities for joint benefit. Bearing all this in mind, the Commission suggests a number of steps to reinforce the relationship using the Co-operation Agreement between the European Community and the Republic of India on Partnership and Development, as well as the accompanying EU-India Joint Statement on Political Dialogue to their fullest. Council and Parliament are therefore invited to comment on the analysis and proposals outlined in this text, and the Commission will subsequently move forward in the framework of the existing agreement and political declaration on the basis of these comments and in light of dialogue with the Gol. 15 Annexe L l*ast Ell-India relations 1. The institutional framework In addition to the historical and cultural links between the sub-continent and Europe, India was, in 1962, one of the first countries to establish relations with the European institutions. These links were formalised by agreements, the first one in 1973 aiming to improve trade relations, and the two following including economic and development co-operation, as well as trade. The current Co-operation Agreement between the European Community and the Republic of India on Partnership and Development, in force since August 1994, is a third generation co-operation agreement and is particularly broad in scope, covering: respect for human rights and democratic principles as an essential element; development and diversification of trade and investment in mutual interest; encouragement of understanding and strengthening of ties between the two regions in respect of technical, economic and cultural matters; building up India's economic capability to interact more effectively with the EU, promotion of exchanges and communication between business communities; acceleration of India's development in particular to support new Indian policies in key areas fostering sustainable social progress and poverty alleviation; support for environmental protection and sustainable use of natural resources. 2. Political relations Political relations have been established with Troika ministerial meetings since 1982. More recently these contacts have been put under the EU-India Joint Statement on Political Dialogue, adopted at the same time as the co-operation agreement in 1994, and which commits both sides to: - defending democracy, human rights, peace and a stable, just, international order in line with the UN Charter; - reinforced co-operation to promote prosperity, economic reform, liberalisation, free- trade and economic stability as well as social progress and cultural links; - allowing each others' interests to be taken into account in decision-making procedures, - a better mutual understanding to increase co-operation on international questions such as non-proliferation, the fight against terrorism, drug trafficking, money laundering and issues linked to international peace and stability. Some positive discussions have already taken place in this new framework, although India has been cautious towards European criticism on its human rights record at the UN. Also past discussions on non-proliferation have made little progress, as India affirms that the Non-Proliferation Treaty would reinforce the privileges of those who have recognised nuclear arms' stocks, without actually tackling the need for elimination of the stocks. Although the EU has always recognised the need for disarmament, it insists that separate fora exist for this issue, and that there is an urgent need to prevent further proliferation. For similar reasons the EU has also urged India to facilitate adoption of the planned Comprehensive Test-Ban Treaty which is under negotiation, as well as the negotiation of a Cut-off Treaty (prohibiting production of fissile materials for weapon purposes). 16 3. Trading relations In trade terms the whole of the EU is India's largest external trading partner, being the destination for 26% of its exports and the origin of 30% of its imports. Nevertheless this must be put into perspective, as, looked at from the EU, trade with India is only 1. 3% of total external commerce. This reflects the relatively modest level value of the commerce, which at 14 billion ECU is less than EU trade with Singapore (16 billion ECU) In terms of investments, Europe slipped behind the USA from 1991-94 (in 1995: EU 18. 4%, USA 22. 1%), with some 1322. 4 million ECU of investments in India in 1995 (August 1994- November 1995). The main priority for dialogue and the largest achievement in recent years has been the conclusion of the Uruguay Round and the establishment of the WTO. Europe and India played an important part, and established a close and successful collaboration in Geneva on a bilateral and multi-lateral level. On a bilateral level, a Memorandum of Understanding concerning the export of Indian textiles to the EU was agreed in December 1994. This increases the flexibility of the quotas applied to certain textile imports in the phase-out period agreed under the Uruguay Round's Agreement on Textiles and Clothing. India has committed itself to some liberalisation of its domestic textile markets, although the quota system currently in place seems less than adequate. Furthermore, in Maritime Transport, a bilateral agreement is being considered with India. The EU has also recently revised its Generalised Schema of Preferences (GSP) and under the new regime India is likely to lose some of the benefits it held in the textile and leather goods, but will gain market opportunities in a number of other sectors, as more developed countries, such as South Korea, are excluded, and other countries like China lose benefits on a wider range of export sectors. This is all the more important given that India is the second largest user of the EU's GSP facility (after China and before Brazil), having an overall utilisation rate of about 62%. 4. Economic co-operation There have been active efforts to foster mutual understanding and to facilitate trade and investment using economic co-operation. In 1995, 30. 5 million ECUs were committed to economic co-operation with India, and India also had access to part of several regional programmes worth more than 70 million ECU. The commitments made in 1995 doubled in a single year the amount that has been spent on economic co-operation with India since 1976, demonstrating that this has become a very dynamic part of the EU's relations. The 1994 agreement provides for a very broad-based co-operation in various economic sectors. The European Community-India co-operation strategy up to the year 2000, agreed at the Joint Commission in November 1994, focuses support on reinforcing the Gol's efforts at economic reforms and on strengthening the interaction between European and Indian economic operators. Areas particularly singled out (with emphasis on the private sector) include energy, telecommunications, electronics, information and satellite technologies, standards, intellectual property, investment, agriculture and fisheries, tourism, science and technology, information and culture. 17 The newly launched EU-India Economic Cross-Cultural Programme will lay the basis for a much greater mutual understanding with media, academic and business aspects Furthermore the Commission has initiated a new programme to build co-operation between EU and Asian local authorities, called Asia-Urbs. The pan-regional Asia Invest programme combined with the recently opened European Business Information Centre in Bombay are major steps to raising business awareness and promoting private sector linkages. These efforts are also backed by the business community using the Council of EU Chambers of Commerce (established in 1982), which provides a forum for the European and Indian private sector to review issues and initiatives of common interest, as well as the Joint Business Forum. On institution building, focus has been given to work on standards and quality improvements in industry. This has just led to the establishment of an Indian Quality Control Council, and co-operation on property right protection is starting. On business to business co-operation, the Commission has promoted technology transfers in different sectors including agri-business, transport, energy and environment. The Commission and Gol have also set up the 3SE, which in particular aims at economic co operation in information technology projects. These economic co-operation measures have been backed by assistance from the European Community Investment Partners scheme, which since 1990 has provided some 10. 6 million ECU to assist 77 joint venture activities in India, initiated primarily by European small and medium sized enterprises. The first steps have also been taken to support regional co-operation in South Asia, with a number of projects. A further step is now being taken to establish inter-institutional collaboration with SAARC through the establishment of a Memorandum of Understanding on Administrative Co-operation between the EU and SAARC, focusing on exchange of information, staff training and technical assistance. 5. Development co-operation The EU is the second largest bilateral aid donor to India (16% of total), and the largest grant donor (60% grants). The main part of EU aid (about 800 million ECU annually) is by the member states directly with Germany, the UK, and the Netherlands in the lead. Funds from the European Community budget represent 10-15% of EU assistance, almost on a level with Dutch funding. This Commission co-ordinated development co-operation with India in 1976 and since then well over 1. 6 billion ECU have been committed. This action is added to by the European Investment Bank which, from 1993 to 1995, agreed to lend 55 million ECU for projects in the power generation sector. This makes India the largest recipient of European Community aid in the developing world. In the past, funding particularly aimed at increasing and diversifying agricultural production. Projects included development and rehabilitation of irrigation, improved sustainable use of natural resources, and support to the agri-food industry and markets. In addition, reforestation has been financed as a priority in its own right. One lesson drawn from these projects has been that agricultural pricing, trade and markets must be freed if 18 real progress is to be made. It is not enough simply to improve access to funding and technology, the key signal must come from a change in policy. Hence, since 1993 there has been a change of track, and human resource development has become top priority, funding a primary education programme which gives special attention to female education. This is the biggest Commission-run programme of its kind, and is a model of policy reform support. This new co-operation strategy has been confirmed since then in a Joint Commission with the Gol, which established that up to the year 2000 co operation should be focused on: access of the most deprived to productive resources basic social services. In addition, the Commission has sought to multiply the impact of its own support by: concentrating efforts on a limited number of programmes of a certain critical mass; encouraging private sector participation. It is also of note that this strategy is in line with that undertaken by the Bretton Woods organisations. Finally, there has also been an increasing trend in recent times to develop projects, integrally involving local groups in participate mechanisms. Experience shows that local support is essential to establishing sustainable development projects. One means to reach such participation has been the use of Non-Governmental Organisations, particularly local, which have shown to he the most effective partners in fighting poverty alleviation at grass root, and in helping to improve social and human rights. AttïtexeX Itlie tïïdia» ec&nomy 1. International GNP league table, 1993 Billion US$ USA Japan China Canada tlraill Kuiila Korea Mndco Aurtralia India Swlii Argentina Indoneita Turkey Source: World Bank Atlas 1995 2. Evolution of Indian Gross Domestic Product 1980-94 8000 H7000 6000 5000 Billion Rupees lit current prices -4000 H3000 2000 1000 0 Year 1980-81 1985-86 1990-91 1993-94 Source: World Bank, India Country Economic Memorandum, 1995 3. Annual % GDP Growth in India 1989-1995 1991 1990 1989 Year Source: Asian Development Bank, Asian Development Outlook 1995 and 1996 20 I. Breakdown of employment and GDP by type of nctivify isi 1993-94 % of total «DP or Labour Force 13 Afcràulture • industry E& Services Labour Force GDP Source: World Bank, India Country Economic Memorandum, 1995 5. India's External Debt, 1990-94 1990-91 1991-92 1992-93 1993-94 1994-95 Year Source: World Bank, India Country Economic Memorandum, 1995 21 Aa»e*eX Population * s \ « ^\ ; VÇ î ^ % S î 5 P ^ f K J M J ^ G^ ^ v f ^ ; lt 1. Estimated Indian population 1960-2000 Million people 1960 1965 1970 1975 1980 1985 1990 1995 2000 est. Year Source: World Bank, India: Trends, Issues and Options, 1990 2. Other population features 1970-93 Indicators unit 1970-751 1980-85' I988-932 density inhab/km2 188. 8 232. 1 267. 7 annual growth % fertility index births/woman infant mortality per 000 life expectancy year 2. 2 5. 4 132 50 2. 0 4. 5 106 55 2. 0 3. 7 80 61 Source: World Bank, India Country Economic Memorandum, 1995 1 Latest single year Most recent estimate 22 1. Evolution of India's Trade with the World Imports' Exports1 Deficit3 1980-81 1990-91 1985-86 1993-94 Year Source: World Bank, India Country Economic Memorandum, 1995 Imports^ Imports of goods and non-factor services Exports^- Exports of goods and non-factor services Deficit Deficit on resource balance 2. Destinations of Exports and origins of Imports for India, 1994 30 25 20 % of total 15 exports or imports 10 Japan Economic Survey, Ool. Source. Ex Export destination Inv- Import origin The EU (as well as OPEC) was still beneficiary in its trade balance with India for 1994. The situation was the opposite for the US and in a lesser extent for Japan. 23 Anaexe & Evolution of foreign Investmeat i& ïadïa Direct foreign investments approved by Indian authorities 1991-1995 (in million ECU & %/total) 1990-91 1991-92 1992-93 1993-94 1994-95 i ECU 43. 6 % 33. 8 ECU 119. 9 % ECU 12. 6 399. 1 % 18. 0 ECU % 656. 4 18. 5 ECU 1322. 4 % 18. 4 EU USA 43. 7 33. 9 284. 6 29. 9 868. 2 39. 2 872. 0 24. 6 1585. 9 22. 1 Japan 13. 0 10. 1 152. 6 16. 0 64. 4 2. 9 100. 2 2. 8 374. 8 5. 2 NIU* 4. 9 3. 8 109. 8 11. 6 258. 1 11. 6 122. 7 3. 5 173. 1 2. 4 950. 4 129. 2 Total invest the 4 as% of tot. Source: SIA Newsletter, Ministry of Industry, Gol 79. 6 69. 1 2215. 4 3546. 8 7180. 8 71. 7 49. 4 48. 1 + All years are from August to July of year indicated, except 1995 which is August to November (ie 16 months) *Non-Resident Indians 24 1. EU-India Trade Flows 1990-1994 1994 1993 Year 1992 1991 1990 • EU trade surplus with India E3EU imports from India • EU exports to India 0 1000 2000 3000 4000 5000 6000 7000 8000 Million ECUs Source: Note: total EU external trade grew by approximately 20 % from 1990 to 1994, compared with 32% growth for trade with India. Eurostat 2. Recent trends in EU imports from India, 1990-1994 Products or product groups 1990 in Million ECU 1994 in Million ECU %/1990 Textiles / clothes 1,434 2,206 Leather articles / skins Precious stones Agri / marine products Engineering / electronics Carpets Food products and live animals Chemical products Machines/transport material 713 604 594 376 204 452 182 171 1,001 707 889 766 262 712 416 427 Manufacturedproducts/raw material 1,723 2,362 Different manufactured articles 1,514 2,481 Source: Eurostat 25 54 40 17 50 104 28 57 127 148 37 64 3. Recent trends EU exports to India, 1990-1994 Product groups b ood products/li ve animals Oils, animal fats/vegetables Chemical products 1990 in Million ECU 1994 in Million ECU % rise on 1990 9 3 554 60 5. 5 746 Jewellery (pearls, precious stones,. ) 1,540 2037 Manufactured goods 2,220 2843 Machines and transport material 1,965 2552 Source: Eurostat. 560 84 35 32 28 30 4. Principal European Partners for India -1994 Exports (destinations) Germany Million ECU % 25 1760 Imports (origins) Germany Million ECU % 26 1738 United Kingdom 1649 24 United Kingdom 1687 25 Belgium-Luxembourg 862 12 Belgium-Luxembourg 1610 24 Italy France Source: Eurostat. 848 12 France 743 11 Italy 763 11 594 9 26 Aa»e*e V i H^ Jaifcrtittj^^ 189M6 (\mimth'^ 1. International Financial Assistance to India in 1995 (indicative figures) UN system 4% Source: World Bank Total indicative assistance $ 6. 7-6. 9 billion 2. Breakdown of total EU aid to India in 1995 (indicative figures) Other inc. EIB 25% Source: European Commission 27 3. Cumulative European Community assistance to India 1976-1995 (in million ECU) Years Econ. Coop. Food Aid Development Assistance Fin. & Tec. NGO Human. Total Sub-total Assist. 1976-1980 2. 10 89. 07 3. 93 93. 50 186. 50 0. 51 189. 11 1981-1985 8. 48 286. 83 11. 04 221. 30 519. 17 17. 51 545. 16 1986-1990 14. 48 161. 77 25. 90 363. 42 551. 09 29. 58 595. 15 1991 1992 1993 1994 4. 98 3. 73 5. 00 72. 33 81. 06 86. 04 5. 28 35. 16 3. 14 13. 17 51. 47 0. 32 57. 07 9. 42 2. 42 0. 01 4. 81 164. 00 168. 82 2. 04 180. 28 6. 54 10. 95 17. 49 7. 57 27. 48 1995 est. 30. 50 7. 15 72. 85 80. 00 0. 30 110. 80 Total 77. 66 576. 57 67. 51 1,011. 52 1,655. 60 57. 83 1,791. 09 Source: European Commission 28 ISSN 0254-1475 COM(96) 275 final DOCUMENTS EN 11 Catalogue number : CB-CO-96-322-EN-C ISBN 92-78-05919-6 Office for Officiai Publications of the European Communities L-2985 Luxembourg 21

REPORT FROM THE COMMISSION ON THE OPERATION OF DIRECTIVE 83/189/EEC IN 1992,1993 AND 1994

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COMMISSION OF THE EUROPEAN COMMUNITIES * •k it -fc- Brussels, 26. 06. 1996 COM(96) 286 final REPORT FROM THE COMMISSION ON THE OPERATION OF DIRECTIVE 83/189/1 EC IN 1992,1993 AND 1994 SUMMARY The present report, which relates to the application of Directive 83/189/EEC in 1992, 1993 and 1994, provides background information for the European Parliament as provided by Article 11. 2 of Directive 83/189/EEC, amended by Directive 88/182/EEC. Directive 83/189/EEC, which was aimed at preventing the appearance of barriers to the operation of the Internal Market, proved to be a basic instrument for the realization of the Internal Market through the promotion of co-operation between the Member States and through the detection of fields in which joint action was revealed to be necessary. The report upon the operation of this instrument in 1992, 1993 and 1994 is divided into three chapters: 1. The information procedure for standards : This chapter relates to the information procedure for standards, as provided by Articles 2 to 7 of Directive 83/189/EEC. After a brief description of the procedure, its operation during the years from 1992 to 1994 is explained, together with an analysis of the statistics. The report also discusses the quality of the notifications, the use of the information at various levels and the issue of authorizations to the European standards institutes, namely the European Committee for Standardization (CEN), the European Committee for Electro-technical Standardization for Telecommunications the European Standardization (ETSI). The short and medium-term improvement connected with the revised procedure is also analyzed. (CENELEC), and Institute 2. Information procedure in the field of technical regulations : This chapter outlines the development of the procedure provided by Directive 83/189/EEC in the field of national technical regulations. It examines the flow of exchanged information, particularly problems of application and the various reactions by the Commission and the Member States, in addition to the various responses to the procedure. 3. The exchange of information on technical regulations between the EEC and the EFTA countries. This chapter analyzes the exchange of information provided by the Agreement between the Member States of EFTA and the European Economic Community, which set up a procedure for the exchange of information in the field of technical regulations (Council Decision 90/518/EEC), an Agreement which was concluded for a period of two years. This Agreement expired on 1st November 1992. It was extended for the period from November 1992 to December 1993 by bilateral agreements in the form of an exchange of letters. In 1994, the EEA Agreement came into force. This Agreement contains the provisions of Directive 83/189/EEC, adapted in Section XIX of Annex II. As far as the Swiss Confederation is concerned, although not part of the EEA Agreement it continues to take part in exchanges of information with the Community,, 2 REPORT BY THE COMMISSION ON THE OPERATION OF DIRECTIVE 83/189/EEC IN 1992,1993 AND 1994 Introduction 1. This report on the operation of Directive 83/189/EEC in 1992, 1993 and 1994 contains the information for Parliament called for by Article 11(2) of Directive 83/189/EEC, as amended by Directive 88/182/EEC. The free movement of goods is a cornerstone of the Internal Market and the elimination of technical barriers to trade is a major condition for its proper operation. Only transparency can enable barriers to the free movement of goods to be dealt with swiftly. A notable example of an instrument which enables the Community to avoid - a'fter the realization of the Internal Market per 1. 1. 1993 and the coming into force of the European Economic Area - the introduction of new barriers by means of a procedure which ensures transparency, is Directive 83/189/EEC which requires the notification of technical legislation or standards which could have implications for the free movement of goods. A proposal to amend the Directive in order to fill gaps in its coverage was put before the Council and the European Parliament at the end of 1992, which has been adopted unanimously after long and intensive debates on 23rd March 1994 (Directive 94/10/EC amending for a second time Directive 83/189/EEC). It will enter into force on 1st July 1995. This report on the operation of this mechanism in 1992, 1993 and 1994 is divided into the following chapters : the information procedure for standards (Chapter I); the information procedure in the field of technical regulations (Chapter II); the Agreement on the exchange of information in the field of technical regulations between the EEC and the EFTA countries (Chapter III). CHAPTER 1 THE INFORMATION PROCEDURE FOR STANDARDS Introduction 5. The present chapter relates to the information procedure for standards as provided by Articles 2 to 7 of Directive 83/189/EEC. After a brief description of the procedure, its operation during the years from 1992 to 1994 is explained, together with an analysis of the statistics. The report also discusses the quality of the notifications, the use of information at various levels and the issue of authorizations to the European standards institutes, namely the European Committee for Standardization (CEN), the European Committee for Electro-technical Standardization (CENELEC), and the European Institute for Telecommunications Standardization (ETSI). This Chapter ends with an analysis of the short and medium-term improvement connected with the revised procedure. A Brief Description of the Procedure 6. In practice, the information procedure for standards began on 1st January 1985. Since then the national standards institutes, members of the CEN and of the CENELEC (including those of the EFTA countries) have notified the necessary information to the Central Unit of the CEN/CENELEC (a unit which is responsible to the Central Secretariats of the CEN and the CENELEC). The notifications relate to amendments made to the national standardization programmes, namely : new projects undertaken (cf. Article 2 of the Directive), projects for public screening (cf. Article 4 of the Directive), the adoption of national standards (cf. Article 2 of the Directive). The information gathered is sent periodically to all the members of the CEN and the CENELEC, who are responsible for distributing them to the sectors concerned in order to gain reactions. The information is also examined by the competent authorities within the CEN and the CENELEC (Central Secretariats, Planning Committees, etc) as well as by the Commission departments. Following the Commission's proposal of 28th November 19921 regarding the amendment of Directive 83/189/EEC, aimed at making the information procedure more efficient, the CEN and the CENELEC have, since the beginning of 1993, already introduced some of the measures set out in this proposal. As a result, notifications made since 1st January 1993 have been limited to new projects undertaken on a national level. O. J. E. C. C 340 of 23. 12. 1992 Appropriate annual contracts were concluded between the European Commission and the CEN and CENELEC in order to cover the technical operation of the information procedure for standards. It being given that the European Institute for Telecommunications Standardization (ETSI) was included in the Annex to Directive 83/189/EEC, though a Decision by the Commission of 15th July 19922, this institute should automatically take part in the information procedure for standards. In practice, this participation is limited to receiving and examining information sent by the members of the CEN and CENELEC, which is forwarded by the Central Secretariats of these two institutes. In fact, the ETSI is not comprised of national standards institutes, under the terms of the definition in Article 1 of Directive 83/189/EEC. relating to drawing up technical specifications Infomiation in the field of telecommunications on a national level is conveyed, in principle, either via the information procedure in the field of technical regulations in the case of legislation, or via the members of the CEN and the CENELEC with regard to the voluntary sector. Despite the fact that there is no procedure within the ETSI for notifying new national standardization projects, it can be assumed that these projects should be limited, since the ETSI programmes cover a wide range of subjects, and the internal standstill rule applies to each one of them. The present chapter of the report is therefore solely concerned ith operations notified by the members of the CEN and the CENELEC, these institute; ^eing indexed in I st 2 of the Annex to Directive 83/189/EEC. The operation of the information procedure in 1992,1993 and 1994 In 1992, the method of operating the information procedure for standards remained unchanged in comparison with preceding years. It is à matter of collecting and examining the notifications received, processing them, storing them in a databank and distributing the results on a monthly basis. The information procedure has also been supplemented this year by entering new initiatives taken on a European and international level. in the Commission's proposal Beginning from January 1993, the CEN introduced the simplified procedure laid down for amending Directive 83/189/EEC. Notifications were limited in principle to new national initiatives at the time they entered the working programme. Notifications of these initiatives entering the public screening stage in addition to the stage of adoption have thus been discarded. Despite a relatively difficult transition period during the first months of 1993, this simplification has enabled the CEN Central Secretariat to control the flow of information more effectively and to examine certain notifications in more detail, with 2 O. J. E. C. L 221 of 6th August 1992 regard both to their presentation and their content. Since 1993, this simplification has also made it possible to obtain full and realistic statistics relating to the new national initiatives launched. The exchange of draft standards for public screening has been carried out since the beginning of 1993, case by case, by mutual agreement between the institutes concerned and with a view to the participation specified in Article 3 of Directive 83/189/EEC. 10. As for the CENELEC, it has strengthened its internal procedure, known as the "Vilamoura" procedure, by allowing it to conform with the information procedure provided by Directive 83/189/EEC. In effect, the "Vilamoura" procedure requires each member of the CENELEC to notify, as soon as possible, even in the early stages, every wish for and/or intention of a standardization initiative. A reaction emanating from any one of the other members, within a period of three months, is sufficient to activate a standstill period. This can only be lifted by the highest technical authority within the CENELEC, namely the Technical Board. It is only in circumstances where this authority ascertains that it is not appropriate to work on a European level that it authorizes the development of the notified initiative upon a national level and this then becomes a national initiative under the terms of Directive 83/189/EEC. Notifications relating to these initiatives are then distributed every quarter to the larger circle of participants named in Directive 83/189/EEC. 11. The statistics given by the CEN and the CENELEC in their annual report supply an overall view of the standardization initiatives which were notified to the Central Unit in the years from 1992 to 1994. Amongst these statistics, those which relate to new projects3 reflect the most recent trends in standardization initiatives. These latter statistics can be examined from three complementary angles : a breakdown by level (national, European or international), as well as the trends in the initiatives at each level; a breakdown by country; a breakdown by sector and sub-sector of activity. 12. As indicated in previous reports, the statistics must be interpreted with some caution for the following reasons : the statistics for 1992 and previous years do not take into account the relatively high number of new initiatives which were directly notified at the public screening stage, without prior notification, which was contrary to the "New project" is understood to mean any new standardization initiative which is entered into the standardization programme on a national, European or international level. regulations stipulated in the past by the CEN/CENELEC; a new initiative launched upon a European level may cover a much wider field than an initiative upon a national level; the stage at which a new standardization project is notified is not the same for - all the members of the CEN and the CENELEC, as a result of different working methods. With the change in the system since 1993, it is no longer easy to make a simple comparison between the number of national notifications received in 1993 and the number of these notifications received in previous years. Trends in standardization initiatives 13. Taking these reservations into account, a certain number of observations upon the trends in European and national standardization can be made on the basis of Tables I, II, III and IV which are appended to this report. a. The total level of new projects launched stabilized in 1992 after four years of rapid growth. The number then fell considerably in 1993, principally as a result of the significant reduction in new European initiatives and, to a lesser extent, international initiatives. On the national level, the number of new initiatives in 1992 and 1993 was maintained at the stable level of previous years, being on average 2150 units. In 1994, this number fell to 1630, following the implementation, after the period of transition in 1993, of the simplified system introduced by Directive 94/10/EC. The proportion of very specific projects within this number increased, however, from 76% in 1992 to approximately 93% in 1994. c. The number of new initiatives upon a European level fell sharply in 1992 in comparison with the two previous years, both in the electrical sector and in the non-electrical sector. This reduction was principally due to the new standardization policy by the European institutes of concentrating upon feasible programmes, after several years of problems resulting from the sudden increase in the number of new subjects in the working programme. d. Upon an international level, a negative trend was also observed in 1993 after continuing growth in 1992. As far as the breakdown of new national projects between the Community States is concerned, Tables Ilia and Illb show significant differences between 7 In 1992, approximately one the countries. third of new national standardization initiatives in the Union came from Spain, with approximately another third from France. In 1993 and 1994, Germany and France alone produced approximately 20% of the notifications. The significant increase in notifications from the EFTA countries in 1993, principally from Austria, should also be noted. f. The ten principal sub-sectors for national initiatives in the years 1992 to 1994 are given in Table IV. A high level of initiatives in 1992 can be noted in the field of aerospace, building and chemical products. In 1993 and 1994, national initiatives are in the main observed in the field of food products, the quality of water conveyance and, once again, building. A high level of national activity should also be noted in the field of rail construction in 1993 and in the small mechanized tools sector in 1994. The quality of the notifications issued by national standards institutes 14. The previous report of 1990/1991 indicated that, for the period under consideration, there were still problems both with regard to compliance with the notification periods and the intrinsic quality of notifications. In this report, the Commission had insisted upon additional efforts being made on a national and European level with a view to remedying this unsatisfactory situation. This was to be achieved by a critical examination of the the information system upon a national implementation of a quality assurance system by the Central Secretariat. level and by 15. Beginning from 1992, the Commission introduced two clauses relating to the quality of information into its annual contracts with the CEN and the CENELEC. Firstly, the European institute concerned undertook to define clearly the internal rules necessary in order to ensure that notifications were accurate, clear and reliable. Secondly, the European institute had to provide, within its Central Secretariat, the necessary resources for monitoring the quality of the received notifications. 16. In April 1992, the CEN/CENELEC Work Group, namely the JWG-ESD (Joint Work Group - European Standards Databank), adopted certain basic principles relating to the new system of notification. In addition, in 1993 the CEN Central Secretariat initiated the production of a detailed guide to the system. In September 1993, the CENELEC, for its part, updated its manual relating to the "Vilamoura" system. 17. With regard to the quality of the notifications received, the CEN Central Secretariat, in spite of the difficult transition period in 1993, had already initiated during this 8 period a systematic examination, the detailed results of which were set out in its 1993 report. Amongst the most important conclusions, which were confirmed by the CEN's 1994 report, the following points should be mentioned : b. c. d. With regard to respect for the notification obligation, sampling tests have shown that members have not avoided this obligation. Early notification by members seems to be a significant problem. As it stands, in 1993 approximately 28% of national initiatives (namely 674 cases) were notified only when they had already reached the public screening stage (641 cases) or even the publication stage (33 cases). An analysis between countries showed that approximately half of the German and British initiatives were only notified at the public screening stage. Moreover, amongst the 641 late notifications which were already at the public screening stage, it was possible to observe that approximately 33% did not allow time for any reaction, as a result of the fact that they were only sent one or two weeks, or even a few days, before the date of closure of the public screening period. This seemed to be the case in particular with regard to late notifications from the United late notifications from Germany still allowed time for reaction Kingdom; within the public screening period. A detailed analysis of 417 late notifications in 1994 (being 23% of all national initiatives) revealed a similar situation. As indicated by the CEN in its report, these cases of late notification, which arc aggravated by being sent at the end of the public screening period, are in complete contradiction with the principles of the infomiation procedure provided by the Directive. In spite of the fact that the analysis also showed that during the years 1993 and 1994 the proportion of these late notifications had fallen, this proportion must be considered to be too high. Measures are therefore necessary in this connection. Moreover, this problem was raised in the previous report in which this proportion was estimated to be approximately one third for the years 1990 and 1991. Another problem lies in the vague description given of the new projects. The CEN Central Secretariat observed that, in several cases, either the notified title of the new project was very vague, or the statement explaining the title was simply a precise copy of the title. It is obvious that in these circumstances, an assessment of the field of application of the notified initiative is made very difficult and that, once again, the objective of the information procedure cannot be attained. The CEN considers that this problem can be solved by the introduction of the detailed guide already mentioned above. It has also been observed that sometimes the poor quality of certain 9 notifications is due to the complete absence or the erroneous nature of certain basic information, such as the sub-sector code, the stage of the draft and even its identification number. Despite the fact that greater discipline was introduced in 1994 by the CEN Central Secretariat, this kind of problem seems to have persisted during this year. 18. With regard to the CENELEC, a detailed analysis similar to that carried out by the CEN is not available for 1993. However, taking into account the existence of the internal "Vilamoura" procedure, which contains relatively strict rules of notification, and the lower volumes involved, it can be considered that the quality of the notifications made by members of the CENELEC is satisfactory. This should certainly be the case from January 1993, as confirmed by the CENELEC Central Secretariat in its 1994 report. Moreover, this Secretariat drew up, in April 1994, a detailed description of the procedure in order to ensure the quality of the information. The use of the information received through the procedure 19. With regard to distribution on a national level of the information resulting from the procedure, the Commission has not received recent information from the CEN or the CENELEC. An analysis upon this level would seem to be useful now that the notification system has been simplified since the beginning of 1993 and, as a consequence, the reduced volumes should enable the information to be processed by the sectors which are directly concerned. 20. The application of Article 3 of the Directive, namely the association with national initiatives and requests for the development of European standards, still remains peripheral. Table V confirms the observations made in previous reports, and in particular the fact that within the context of the Directive : \ - despite the twofold increase in 1994 in comparison with 1993, the number of comments made by the standards institutes remains very low in comparison with the number of notifications received; requests for participation within the projects of other members remain equally minimal; requests for the development of European standards are, with the exception of a single isolated case submitted by France in 1994, non-existent. It can thus once again be concluded from these statistics that the mechanisms provided by Article 3 of the Directive are not being used. 10 21. In the electro-technics sector, it is nevertheless necessary to take into account the application of the "Vilamoura" procedure, as explained in Paragraph 10 above. As it stands, this procedure provides, for each new initiative launched by a member, at least the same type of participation as that provided by Article 3 of Directive 83/189/EEC. In 1994, this procedure enabled 17 and 4 operations, notified over several years, to be respectively transferred to the European and international level. 22. Monitoring of the application of the standstill rule provided by Article 7 of Directive 83/189/EEC has been carried out on two levels, these being the CEN/CENELEC and the Commission. Within the CEN Central Secretariat, notifications have formed the subject of a periodic examination by technical experts. In 1993 and 1994 respectively, 30 and 60 cases were examined in detail by the relevant member of the CEN. Since the beginning of 1993, the Commission departments have also intensified their examination of the notifications received, both in order to monitor the standstill rule in comparison with the authorizations sent to the European standards institutes, and in order to examine whether it would be appropriate to transfer the notified initiative to the European level. Approximately 30 and 76 cases were respectively returned to the CEN Central Secretariat in 1993 and 1994. It can be observed that in the majority of cases detected by the CEN and the Commission departments, responses made by the notifying members seemed to be equivocal, to say the least. These responses either indicated that the national initiative notified was in fact a draft European standard for public screening upon a national level, or that it concerned a preliminary analysis on a national level, which was designed as a contribution to European projects currently in progress. It. can be observed that, in the first case, there is no obligation to notify and even that In these notification on this subject is excluded under Directive 83/189/EEC. circumstances, there are definitely other methods of consulting the sectors concerned on a national level with regard to initiatives which are in progress upon a European level, for example by distributing documents from the technical committees of the CEN. In the second case, it must be possible to indicate clearly, from the outset, the planned initiative's envisaged objective. In future, a systematic monitoring of the application of the standstill rules is thus necessary, in addition to a detailed examination of responses made by notifying members. 23. In closing this paragraph relating to the use made of the information received, the following points of view may be put forward : 11 a. b. According to the CEN, 1993 should be considered to be a year of transition, following the introduction of the new procedure, which encountered some difficulties. This institute considers that the experience gained this year does not yet enable definite conclusions to be drawn, but it has expressed some optimism for the future, as a result of the simplifications which have been introduced. As far as the Commission is concerned, additional conditions must be fulfilled in order to ensure a more efficient use of the information received. In the first place this relates to a considerable improvement in the information notified and the establishment of other organizational measures as stipulated in the amended Directive 94/10/EC. Information on standardization initiatives in general 24. Information relating to new standardization initiatives, as provided by the information procedure in the field of standards by Directive 83/189/EEC, is only a limited part of the information on standardization initiatives. There is the general problem relating to information on adopted national standards and on all the standardization initiatives, whether in progress or adopted, on the European and international levels. As indicated in its second Communication4, the Commission considers it to be necessary to have, on all standardization initiatives, information tools which are accessible to all the sectors concerned, at reasonable terms. Accessibility and transparency regarding standardization initiatives should be one of the basic characteristics of the standardization system. Continuous effort should be made on a national and European level with a view to satisfying the information requirements of all the interested parties. A judicial review of the satisfaction of these requirements would appear to be useful. 25. Upon the European level, the CEN, the CENELEC and the ETSI have issued several publications explaining their present initiatives and their adopted standards and listing transpositions at national level. In addition, in 1993 the CENELEC established a database which included all its initiatives. This database can at present be directly accessed by the Central Secretariat personnel, certain members of the CENELEC, the Commission departments and the EFTA Secretariat. It is anticipated that in future this database will be open to the general public. For its part, the CEN has also planned the establishment of a similar database, which will firstly be made accessible to its direct contacts. This project is at present under research by the CEN Central Secretariat. 4 COM (92) 491 of 27th November 1992 12 There is also a database in existence at the ETSI which is at present accessible to a limited number of people. 26. The PERINORM information service, which is distributed monthly on a CD-ROM compact disk, initially containing British, French and German standardization initiatives, has been extended on several levels : the standardization initiatives of other national institutes, of the European CEN and CENELEC institutes, and of the international ISO and CEI institutes. This commercial service includes bibliographic references for adopted standards as well as for standards which are at the public screening stage. This service is permanently distributed through several national standards institutes and some private companies, and has approximately one thousand subscribers. Despite the fact that there is no research in existence relating to the users' satisfaction, it can be considered that this product genuinely responds to market needs. The Commission finances subscriptions to this service for thirty Euro Information Centres, considered to be those most concerned with this field, covering a wide geographical area. This should enable some response to be made, taking into account the Commission's limited financial resources, to the requirements of the small and medium sized enterprises. Additional CD-ROM products, containing the full texts of standards and draft standards, have recently been placed on the market. There are, amongst others, approximately 80 sets of standards published by the private firm IHS-Information Handling Services, and distributed by several national standards institutes. Planning and standardization authorizations 27. Pursuant to Article 6, Paragraph 3 of the Directive, the Standing Committee delivered in the years from 1992 to 1994, assent in favour of 32, 22 and 46 authorizations respectively (see Table Via, b, c in appendix). Some of these authorizations relate to implementation of Directives of the "New Approach" type, adopted for realizing the Internal Market. Other authorizations have been issued, principally in support of other Community policies : authorizations in the field of information technology and some authorizations in the field of telecommunications come within the context of the implementation of industrial policy and the correct operation of the Internal Market. Authorizations which relate to methods used in measuring toxic substances are principally issued in support of the environmental Directives. The planning authorization, which relates to air traffic control equipment and systems, comes within the context of the implementation of Council Directive 93/65/EEC5. Several the to support in order in 1994 • standardization authorizations were issued implementation of the energy policy. O. J. C. L 187 of 29. 07. 93 13 Actions to improve the present system and implement the revised procedure provided by the amended Directive 94/10/EC. 28. The previous report of 1990/1991 had emphasized the importance of revising the technical operation of the information procedure for standards provided by Directive 83/189/EEC. With this in mind, the Commission proposed an amendment to this Directive on 27th November 1992, which was adopted on 23rd March 1994 by the European Parliament and the Council, but which did not come into force until 1 st July 1995. The Commission is pleased that the CEN and the CENELEC have, within their sphere of competence, already implemented several of the basic principles stipulated in the amended Directive 94/10/EC since the beginning of 1993. In particular, the CENELEC's "Vilamoura" procedure, in association with the procedure outlined in Directive 83/189/EEC, must be considered now to be effective. 29. The analysis of the quality of the notifications made in 1993 and 1994 by the CEN, as well as the assessment of the use made of the information collected during this period, shows however that it is necessary to implement several more application measures in the short term, on both a European and national level, in order to attain the objectives of the amended Directive in the non-electrical sector. 30. On a European level, action can be envisaged by the Commission and the European standards institutes. a. b. For its part, the Commission has, from the beginning of 1993, inserted into the annual contracts with the CEN and the CENELEC, amongst others, two measures to facilitate the implementation of the revised procedure. Firstly, this relates to the obligation to define the new notification regulations within a determined period. The second clause requires the Central Secretariats of these institutes to set up the necessary resources for monitoring the quality of notifications. Whilst respecting the principle that it is a matter for the European standards institutes to define operating methods, the Commission is minded to co operate directly with these institutes on this planning, as well to facilitate the introduction of other measures. It is, moreover, in this context that the Commission has supported the CENELEC in establishing its new databank by becoming connected with it as one of the first external paying users. 31. The Commission considers that in addition to the first action taken by the CEN, * namely a detailed examination of the quality of notifications, other actions are necessary in order to attain a significant improvement in this quality as well as in the speed of notification. 14 a. b. Firstly, it is necessary to publish a detailed guide for CEN members, which should include strict and clear notification rules. Additionally, information involved could, for example, be and training days for those directly considered. It is also essential to maintain and even strengthen the resources within the CEN Central Secretariat, in order to monitor the quality of the information in direct association with those making the notifications, and in order to introduce a genuine system of quality assurance. A more frequent report than at present upon aspects of quality and timing would additionally appear to be very useful. 32. With the entry into force of the amended Directive half way through 1995, the Commission considers that necessary measures should also be taken on a national level and that initiatives should be launched with a view to ensuring from the outset the efficient operation of the revised procedure. a. b. At a national level, it is firstly a matter for the Member States to take measures connected with transposing the amended Directive 94/10/EC. This should create a legal framework which will enable their standards institutes to comply with the obligations specified in the new regulations specified in this Directive, and with the regulations established within the European standards institutes. the transposition of Directive 94/10/EC, as well as Monitoring the establishment of agreements between the governments and the national standards institutes can only encourage the implementation of the revised procedure. The national institutes, for their part, should examine the need for revising and adapting their systems of notification, particularly with regard to quality and to forwarding notifications within the required periods. In effect, the analysis carried out in 1993 and again in 1994 once again confirms that there are permanent weaknesses on this level. With regard to the use made of the information, it also appears necessary to re-examine the present system of distribution and to promote the interest of the relevant sectors in the information provided by the new procedure. Conclusions 33. ' Up until 1993, the number of new national standardization initiatives remained stable, at the level already attained during previous years. With the introduction of the simplified procedure in 1994, as stipulated by Directive 94/10/EC, this number was reduced to around 75% of this level. At the present time, however, it is impossible to 15 say whether this improvement is due to this rationalization or to an actual reduction in national initiatives. It is therefore necessary' to view this situation with caution. As indicated previously, it is necessary for the economic sectors concerned to assess whether this level is acceptable and whether it will prevent disruptions to the operation of the Internal Market. A vigilant and continuous monitoring remains nevertheless necessary, in view of the high proportion of specific initiatives and in view of the latent risks involved in allocating resources as a priority upon a national rather than a European level, thus risking transgressing European stability. Upon a European level, the Commission has observed a significant reduction in new initiatives, particularly since 1993. This is principally due to the adaptation of planning policy by the European standards institutes. It relates, amongst other things, to the decision to respect commitments already undertaken in the past, to place more emphasis upon the application of co-operation agreements with the international standards institutes, and to becoming limited to a genuinely feasible working programme, taking account of the fact that resources are increasingly limited. 34. With regard to the operation of the procedure, the Commission considers that the experience of 1993 and 1994 has shown that several measures should be taken in the short term on a European and national level in order to make the revised procedures under the amended Directive 94/10/EC genuinely efficient. It is a matter for all the parties concerned to take, from now on, responsibility for attaining the objectives of the amended Directive 94/10/EC. In fact, these objectives, in addition to the revised resources for attaining them, have been laid down and defined in direct co-operation and by mutual agreement with all the parties. 16 CHAPTER II THE NOTIFICATION PROCEDURE IN THE FIELD OF TECHNICAL REGULATIONS Introduction 35. The present chapter describes the development of the procedure provided by Directive 83/189/EEC in the field of technical regulations. It examines the flow of information exchanged, particularly with regard to problems of application and the various reactions by the Commission and the Member States, in addition to the various responses to the procedure. Brief description of the procedure applicable to technical regulations 36. 37. Under the terms of Article 8, Paragraph 1 of Directive 83/189/EEC, the Member States are obliged to send all draft technical regulations to the Commission, unless these relate simply to a full transposition of an international or European standard. Beginning from the date of notification to the Commission, a standstill period of three months begins, during which the Member State which has made the notification cannot adopt the technical regulation in question. This standstill period is provided in order to enable the other Member States and the Commission to react to the notification. The following stage of the procedure will be dependent upon the content of this reaction : a. b. c. If the Member States and/or the Commission do not wish to issue a reaction, the Member State which has made the notification can adopt the draft regulation upon the expiry of the three months standstill period. If the Member States and/or the Commission make comments pursuant to Article 8, Paragraph 2 of the Directive, the Member State which has made the notification must then, in as far as possible, take these comments into account in the subsequent work of developing the technical regulation. In accordance with Article 9, Paragraph 1 of the Directive, the Member States and/or the Commission can issue a detailed opinion if they consider that the draft regulations could risk creating barriers to the free movement of goods. In this case, the Member State concerned will put back the adoption of its draft regulation by six months from the date of the notification and will inform the Commission of the ways in which it intends to respond to this detailed opinion. • d. The Commission can also react to the notification in two other ways : 17 it can make known its intention of proposing or deciding upon a Directive which is applicable to the same field as the notified draft (Article 9, Paragraph 2 of the Directive). The Member State concerned must then put back the adoption of the technical regulation by twelve months from the date of notification; it can observe that a proposal for a Directive relating to the same subject as the notified draft has already been submitted to the Council (Article 9, Paragraph 2 a). In this case, the Member State concerned will suspend the adoption of the technical regulations for a period of twelve months from the date upon which the proposal for the Directive was submitted to the Council. 38. 39. 40. Article 9, Paragraph 3 of the Directive makes provision for an urgent procedure, in certain circumstances, for the immediate adoption of national draft regulations. If a Member State wishes to adopt a technical regulation for urgent reasons which relate to the protection of public health, safety, or the protection of the health and life of animals and plants, it can request the application of this procedure without being obliged to respect the standstill period. The notification must state the reasons which justify the urgency of the measures, the Commission then giving a decision regarding the justification for the urgent procedure. Article 8, Paragraph 3 provides that the final text of the notified regulation should be sent to the Commission, at the request of other Member States or the Commission. The Commission plays a deciding role in the progress of the procedure. It is responsible for distributing notified drafts to the Member States, as well as other messages which pass between the Commission and the Member States, in addition to having these texts translated in order to facilitate the correct operation of the procedure. The Standing Committee, which is composed of representatives of the Member States (provided by Article 5 of the Directive) is a consultative body which meets approximately six times each year and plays an important role in supervising the progress of the procedure and in examining policy questions raised by the notifications. Application of the procedure A. The volume of notifications Breakdown by country 41. The statistics in Table VII of the Annex show that the Commission received 362 draft technical regulations in 1992, 385 in 1993 and 389 in 1994. The total number of notifications received each successive year is relatively stable. As can be seen in Chart 1, most of the notified draft regulations in 1992, 1993 and 1994 came, as in the years before, from Germany, France and the United Kingdom. But whereas France shows a more or less constant pattern in the number of notified draft regulations, both Germany and the United Kingdom show a fluctuation in the number of notified draft regulations. In 1994, Germany signed responsible for a quarter of the total number of notifications received, followed by the United Kingdom with 16% and France with 15%>. In 1993, it was the United Kingdom who signed for more than a quarter of the total number of notifications received, followed by Germany with 21% and France with 17%. In 1992, all three countries signed for about 20%) each of the total notifications received. Chart 1 120 T Number of Notifications per Member State 1992-1994 Member States Breakdown by sector 42. A breakdown by sector (Tables VIII to X of the Annex) shows that 85% of the notifications received over the three year period concerned the same five sectors : " Telecommunications, Agriculture and Food Products, Mechanical Engineering, In 1992, the four largest sectors were Building and Construction and Transport. Telecommunications (24. 6%), Agriculture and Food Products (21. 3%>), Building and Construction (15. 2%) and Transport (10%). The four largest sectors in 1993 were 19 Telecommunications (34%), Transport (13. 5%o), Agriculture and Food Products (13%o) and Mechanical Engineering (9. 6%). In 1994, the four largest sectors were Telecommunications (28%), Mechanical Engineering (19%o), Agriculture and Food Products (16. 7%) and Building and Construction (15. 2%). The most striking development which can be seen the telecommunications sector in 1993 and 1994. In 1993 more than a third of the notified drafts concerned Telecommunications, whereby the United Kingdom signed for almost 50% of all notifications in this sector. In 1994, telecommunications notifications accounted for almost a third of all the notifications in the sector whereby the United Kingdom and Germany together signed for almost half of the notifications. the dominance of in Chart 2 is Number of Notifications per Sector 1992-1994 Chart 2 140 E 3 Sector Application problems 43. Numerous notifications relating to national regulations for proprietary names and registered designations of origin relating to certain agricultural products were made the subject of application of the procedure under Directive 89/189/EEC in 1992 and 1993 in the agricultural sector. The desire to protect the geographical origin of identifiable agricultural or food products has led some Member States to establish "certified designations of origin". These national practices, often disparate, led the Commission to propose to the Council that a Community approach be adopted in order to provide a system of protection to guarantee equivalent conditions of competition between the producers. Regulation 2081/92 was adopted by the Council on 14th July 1992 and laid down an obligation from 24th July 1993, for Member States wishing to obtain Community protection, of informing the Commission of designations of origin and geographical ascriptions relating to agricultural or food products. 20 44. 45. 46. Consequently, as a result of Article 1, Paragraph 3 of the Regulation concerned, which stipulates that Directive 83/189/EEC does not apply either to designations of origin or geographical ascriptions, technical regulations covering provisions relating to these designations of origin no longer form the subject of a notification under Directive 83/189/EEC. The same principle applies within the context of Regulation 2083/92, relating to certificates of identity of agricultural and food products (Article 1, Paragraph 3). This situation may in part explain the fall in the number of notifications from the agricultural sector during the years 1993 and 1994. The Commission has also examined, within the context of Directive 83/189, some national drafts which were adopted partly with the objective of codifying legislation which was already in existence but which was made up of several legislative instruments and partly in order to add new provisions to those already in existence. Concerns expressed by the Member States that these codifying provisions should not lead to decisions by the Commission which may result, amongst other things, in extending the standstill period beyond the three months stipulated in the Directive, led the Commission to adopt the practice of discriminating amongst these drafts, principally for adoption in the field of agricultural and food products, between those sections actually under proposal and those which related to codification, so that examination could be limited to the former. Finally, the Commission has observed, regarding the management of the procedure, the need to ensure that the Member States observe the obligation stipulated in Article 8, Paragraph 3 of the Directive, which states "upon the express request of a Member State or of the Commission, the final text of a technical regulation must be sent immediately". Along with this obligation, as the Commission is aware, there must be a systematic monitoring of acceptance of the definitive text and a detailed examination of the final text for the purpose of the correct application of Directive 83/189 (adoption of the text of the notified draft with due regard for the procedure concerned, without modification calling for a new notification) and for Community law as a whole (adoption of the text having taken into consideration any possible objections expressed by the Commission departments to the draft concerned). The Commission, transparency implemented by Directive 83/189, undertakes to ensure that the tasks necessary for such monitoring are carried out as mentioned above. through concern for respect for the principle of B) Use of the urgent adoption procedure 47,. In 1992, 1993 and 1994, the Member States made 44 requests for application of the urgent adoption procedure. These represented only about 4% of the technical regulations notified in those three years, a similar order of magnitude to the 5%> of all notifications in 1990 and 1991. The Commission found only one fourth (11) of these requests justified; seven related to Agriculture and Food Products, one to Chemical Products, two to Transport and one to Health and Medical Equipment. 21 C) Reactions by the Commission 48. In 1992, the Commission reacted upon 62%) of the total number of notifications. In 1993, the Commission reacted upon 55% and in 1994 the Commission reacted upon 69%) of the notifications. These reactions were made in the form of comments, detailed opinions or the announcement of the intention to propose a directive. It is also quite common that a notification is subject to a combination of more than one reaction from the Commission. Chart 3 250 Number of Reactions per Type 1992-1994 11992 11993 11994 8. 2 MS 8. 2 EC 8. 2 EFTA 9. 1 MS 9. 1 EC 9. 2 9. 2a Type of Reaction Comments i) Statistics 49. In the period 1992 until 1994, the Commission made comments on 46% of the total number of notifications. This percentage has slightly increased compared with the years 1990 and 1991, where the Commission made comments on 42%> of the total number of notifications. 50. 51. ii) Reasons Generally, the comments made by the Commission seek the clarification needed to allow its relevant departments to examine the drafts, express the Commission's position or remind the Member State concerned of commitments given in an infringement procedure or in an earlier notification. The Commission also opted for this response where the other possibilities were no longer open, particularly where proposals for Community measures had been before the Council for over one year, thus precluding recourse to Article 9(2(a)) of the Directive. 22 52. 53. 54. 55. It is also important to indicate the practice developed, during the years 1992, 1993 and 1994, by which the Commission uses comments in order to raise objections to existing texts which the notified draft refers to or uses as its legal basis. As it stands, the notification procedure gives the Commission departments the opportunity of learning of these texts and assessing their impact upon Community law. The Commission has also adopted the practice, in these comments, of laying down response deadlines for the Member States concerned in order to obtain an efficient and rapid method of resolving situations which, as a result of former legislation, restrict the correct application of drafts notified under Directive 83/189/EEC. Part of the comments made by the Commission departments is also constituted by having observed a standardization initiative, within the European standards institutes, in the field to which the notified draft relates. The Commission departments must limit their reaction to comments since this type of "European harmonization" does not prevent the Member States from adopting technical regulations which relate to the same subject but which inevitably hinder the work of these institutes. In this way, national regulations deflect the standstill which exists, on the other hand, for drafts of national standardization, within the national standards institutes. Since October 1993 and subsequent to the conclusion of the Agreement on the European Economic Area between the twelve Member States of the European Union and four members of EFTA, the Commission has sent comments to the Member States drawing their attention to the entry into force of this Agreement on 1 st January 1994. These comments sought in particular to act as a reminder that the principle of mutual recognition arising from Article 30 of the EC Treaty, as interpreted by the Court of Justice, should also be applied to the movement of goods between the Member States of the Union and the Member States of EFTA who had signed this Agreement. As it stands, under the terms of Article 6 of the Agreement, the existing case law of the Court of Justice interpreting Article 30 of the EC Treaty upon the date of entry into force of the Agreement, is extended to the provisions of the latter with regard to the free movement of goods (Articles 11 to 13). These comments have had positive results. In fact, in the large and even leading sectors (for example Telecommunications Equipment or Building Products), clauses of mutual recognition which take account of the system introduced by the European Economic Area Agreement are automatically inserted into drafts notified by the Member States, as well as into the basic regulations within the context of which some of the notified drafts will enter. This development took place quite quickly in practice. In effect, most of the Member States have had to extend a system which was in most cases already stipulated in their regulations for Community products or those freely moving within the Community, to products originating from the Member States of EFTA which signed the agreement. 23 Detailed Opinion i) Statistics 56. In 1992, 1993 and 1994, the Commission delivered 357 detailed opinions (i. e. on 31%) of the draft technical regulations; in 1990 and 1991 the figure was 37%). The Commission delivers detailed opinions if the draft regulations notified might create barriers to the free movement of goods (Article 9. 1. of the Directive). ii) a) Reasons The principle of mutual recognition 57. The absence of provisions ensuring respect for the principle of mutual recognition continued to be the point most frequently raised by the Commission in the detailed opinions which it delivered against drafts notified by the Member States during 1992 and 1993 (59% and 53%) respectively). During 1994, absence of respect for this principle represented 37% of the detailed opinions delivered by the Commission. In fact there has been some change in the handling of this issue recently. Years of practice in the notification procedure have enabled the Member States to develop a good understanding of the principle of mutual recognition. - The Commission departments thus now try to draw the Member States' attention to the need for ensuring that the necessary clauses are present at the highest possible level in the structure of applicable regulations. the other Member States, As it stands, the Member States most often notify draft technical specifications relating to products for which application exists within the framework of more general regulations governing the approval or inspection of product conformity. In so far as these general regulations stipulate the acceptance of products which are lawfully manufactured and/or marketed within technical specifications which are notified at the draft stage already benefit from the system of mutual recognition provided by the basic regulations. Through concern for clarity and legal certainty, the Commission requests the Member States if necessary to state, in the notified drafts, the provisions of the basic regulations which relate to mutual recognition, in order to ensure that economic operators, who search through technical specifications for the requirements which must be fulfilled in order to gain access to the markets of the various Member States, are correctly informed. On the other hand, the principle of mutual recognition also operates in relation to certificates proving conformity of products to national regulations and in relation to the national bodies designated to issue new certificates. 58. The Commission has also had the opportunity of deciding against other requirements likely to create barriers to the movement of goods which are not directly linked with mutual recognition. These requirements relate in particular to markings, to the use of languages in labelling, to specifications relating to the ingredients or materials used in 24 product manufacture, to limits upon the use of dangerous substances, and also requirements relating to the arrangements for certain approval procedures (for example, the establishment of marketing arrangements in the Member State in order to gain access to the approval procedure). As it stands, the Commission requests the Member States not only to ensure the mutual recognition of products from other Member States in response to a level of protection of the legitimate interests concerned, which is equivalent to that provided by the notified drafts, but also that material requirements relating to the products which are considered to be excessive with regard to these same interests should be eliminated or reduced to a reasonable level. It is not sufficient for the Member States to accept products from other Member States which are "equivalent" to theirs. In so far as this acceptance is based on a statement of equivalence with national requirements, it is important to ensure that these are not themselves excessive, failing which products which respond satisfactorily to the legitimate objectives envisaged by the regulations (health and safety, etc. ) may encounter unjustified difficulties in entering the market of the recipient Member State. b) Other provisions of secondary legislation 59. Amongst the other reasons leading to the delivery of a detailed opinion are the non conformity of the draft with a directive or a community regulation relating to the same issues. During the years 1992, 1993 and 1994, the number of detailed opinions based upon objections other than that of breach of the principle of mutual recognition increased considerably : in 1992, 41%> of total detailed opinions, in 1993, 47% and in 1994, 63%). (In 1990 and 1991 these detailed opinions represented only 12% of the total). It should also be observed that whereas in 1992 a third of this 41%) related to infringements of Directive 79/112/EEC relating to the labelling and presentation of food products destined for the final consumer in addition to the advertising of these products, in 1993 the percentage relating to this directive fell to 9%. In fact in 1993, 41% of the detailed opinions delivered by the Commission were based upon infringements of Directive 89/336/EEC relating to electromagnetic compatibility and 34%) upon infringements of Directive 73/23/EEC relating to electrical equipment designed to be used within certain voltage limits ("low voltage" directive"). In 1994, 41% of these detailed opinions were based upon infringements of Directive 89/336/EEC relating to electromagnetic compatibility. 60. It is also important to indicate that 8%> of the detailed opinions delivered by the Commission in 1993 consisted of breaches of the transitional periods of certain Community directives (89/336/EEC mentioned above, 90/396/EEC on gas appliances, and 89/392/EEC on machinery). The Commission departments place emphasis on reminding the Member States of the obligation to respect the transitional periods of Community instruments determined by the legislature; as it stands these are adopted in order to provide an adequate period during which the marketing of products 25 in accordance with national manufactured the implementation of the direction concerned is authorized. Thus the Commission departments consider that the Member States do not have the right to legislate in the fields covered by the directives in question, in the absence of reasons which are duly justified. in force before regulations iii) Responses 61. 62. 63. Article 9. 1 (2), of the Directive stipulates an obligation for the Member State which receives a detailed opinion to "report to the Commission upon the response which it intends to give to this detailed opinion. The Commission will comment upon this response". On the basis of this Article, a dialogue is set up between the Member States and the Commission departments such that an appropriate response is made to decisions made by the Commission which are delivered with a formal request to the Member State concerned to amend or adapt the notified draft as a result of an infringement of Community law. It is important also to indicate in this respect that the Commission organizes a systematic monitoring of the responses from Member States through the Directive's Committee by entering upon its agenda a list of notifications regarding which the Member States have not supplied a response and requesting them to provide explanations for this. (See Point 6. 1. below "Committee Meetings 83/189). Intention to propose a directive In the period 1992 - 1994, the Commission announced that it intended to propose a Directive covering the same subject as the notified draft in 32 cases. In 1992, the Commission announced that it intended to propose a Directive covering the same subject as the notified draft in 18 cases, in 1993 in 5 cases and in 1994 in 9 cases. Most of these notifications in 1992 related to Agriculture and Food Products (6), Health and Medical Equipment (4), Transport and Packaging (3) and Chemistry (3). In 1993, one notification related to Agriculture and Food Products, one to Chemistry, one to Mechanical Engineering, one to Transport and one to Telecommunications. In 1994, two notifications related to Agriculture and Food Products and six to Telecommunications. Submission of a proposal to the Council 64. • In 1992, the Commission applied Article 9. 2 (a) in 25 cases and in 1993 in five cases. In 1994 the Commission did not apply this Article. Most of these notifications in 1992 related to Agriculture and Food Products (13), Mechanical Engineering (3) and Transport and Packaging (3). In 1993, one notification related to Agriculture and 26 Food Products and four to Mechanical Engineering. 65. The application of Article 9. 2 (a) implies that the Member States cannot adopt the draft in question within a period of one year from the date of submission of the proposal of the Community instrument to the Council. The objective is to defer the application of a regulation covering the same field of application as a harmonization proposal upon a Community level. The figures show, however, that this period has not proved to be long enough for the Council to adopt the proposed instrument. With regard to 1992 cases, only six of the twenty-five decisions made by the Commission led to the adoption of the proposal in question by the Council in the standstill period. The other sixteen decisions led to the adoption of Community instruments after the proposal had been before the Council for more than a year, with the exception of four cases where the proposals were not adopted at all. With regard to cases in 1994, none of the five applications of Article 9. 2. (a) led to the adoption by the Council of the Community instrument within the standstill period. D. Reactions by the Member States 66. In 1992, 50%) of the notified drafts were made the subject of comments by the other Member States, whereas in 1993 this percentage was only 34% and in 1994, 31%. With regard to detailed opinions, the delivery of such a decision by the other Member States on notifications amounted to 18%o in 1992, 19% in 1993 and 16% in 1994. It often happens that several Member States make comments or deliver detailed opinions on the same notification. In 1992 nearly 50% and in 1993 nearly 60% of the notifications which caused a reaction from more than two Member States related to Agriculture and Food Products. 30%> in 1992 and 23% in 1993 related to notifications relating to environmental problems. In 1994, the sector most concerned was again Agriculture and Food Products, with 35%, followed by Domestic Appliances with 24%. E. Dealing with infringements 67. At the end of 1992, the Commission entered into a contract with a new private organization with a view to carrying out the task of detecting national technical regulations which are adopted in infringement of Directive 89/189/EEC. • The reports drawn up by the contractor for the years 1993 and 1994 made it possible for the first time to gain some idea of all the Member States initiatives in the sphere of technical regulations. Thus, as shown in Diagram 4 below, in 1993 and 1994 a total of some 4340 national laws were revealed. Approximately 45% were transpositions of Community Directives, 13%) were technical regulations notified at draft stage within the context of Directive 83/189/EEC, 10% were designations of origin and 27 geographical ascriptions6 , and approximately 32% of the technical laws were not notified under the Directive or were outside its field of application. This last 32% (being approximately 1400 texts) were analyzed to find whether they should have been notified under Directive 83/189/EEC. Following this examination, it appeared that the vast majority of these texts did not come within the field of application of the Directive. 85 technical laws, being 2% of the texts discovered, were made the subject of infringement proceedings. 36 infringement proceedings were instigated in 1992. In accordance with the Commission's position on this subject, which has been expressed on several occasions at meetings of the Committee (see Point 6. 1. below), and bilaterally in the meetings between the Commission and the Central Units of the Member States responsible for application of the 83/189 procedure (see Point 6. 3. below), the majority of the Member States proposed to repeal the disputed law andVor notify a new draft if necessary. Some Member States did, however, refuse to suspend the texts in question. Thus, for the period 1992-1994, nine cases were referred before the Court of Justice. The Court's first ruling was given on 2nd August 1993 (Case C-139/92, Commission V. Italy). The ruling established precisely and clearly the binding nature of Articles 8 and 9 of Directive 83/189/EEC and gave the Commission the opportunity in the future of specifying the relationship which exists between the obligation of prior notification provided by Article 8 and the standstill clause of Article 9. Meanwhile, three rulings on five cases sentenced the Member States concerned for non-respect for the obligations contained in the Directive. Chart 4 Breakdown of national laws adopted in 1993 and 1994 68. 69. • Infringement proceedings 2% • Justified non notifications Transposition of Directives 45% Q Designations of Origin 10% Notifcations* 13% * Of 4340 items of legislation adopted, 580 related to notified texts Following the entry into force in July 1993 of Regulations 2081/92 and 2082/92 relating to designations of origin and geographical ascriptions which exclude the application of Directive 89/189/EEC from drafts under these regulations, examination of these texts under the Directive was terminated. 28 F. Responses to the procedure 83/189 Committee Meetings : 70. The Committee Meetings provided in Article 5 of Directive 83/189 (composed of representatives appointed by the Member States) have enabled the Commission departments and the Member States to hold discussions and exchanges of views on points of general interest or upon specific points concerning certain parties. In 1992, 1993 and 1994, the Committee met on sixteen occasions (six in 1992, five in 1993 and five in 1994). It is in principle anticipated that the meetings will be held every two months. With regard to the technical regulations section, the Committee has had the opportunity of discussing several topics of general significance. It was particularly concerned with the draft amendment of Directive 83/189 (Directive 94/10/EC of 23rd March 1994) which the Commission submitted to the Committee well before submitting the definitive text of the proposal. This draft formed the subject of three meetings (24th January, 27th February and 8th April 1992) with a detailed examination, article by article, of the Commission's working document. 71. 72. 73. Other general subjects were discussed: exchanges by electronic mail (X 400); the problem of the overlap between Procedure 83/189 and other notification procedures (Article 100B of the Treaty, "designations of origin" and "contaminants"); practical solutions for settling infringement proceedings for non-notification under Directive 83/189; a list of notifications for which the Member States have not supplied the Commission with a response to a detailed opinion. A special mention should be made of the entry into force of the European Economic Area Agreement. Several meetings dealt with this subject, during the course of which the Commission departments informed the representatives of the Member States of the legal and practical consequences of this Agreement coming into force. In 1994 the Committee also adopted a list of national authorities, other than the central governments, whose technical regulations enter within the field of application of Directive 83/189/EEC, as amended by Directive 94/10/EC. As it stands, this new Directive provides in Article 1. 9. that this list will be drawn up by the Committee stipulated by the Directive. In addition, the Committee also had the opportunity of discussing specific notified drafts and problems which have arisen in application of these drafts. During these discussions, the representatives of the Member States together tried, with the active assistance of the Commission departments, to find concrete solutions or to request other delegations to give explanations regarding the implementation of certain regulations. 29 "Group " Meetings 74. The practice of holding "group" meetings, which has been established for a number of years, has enabled the Commission departments to continue their direct contacts with the national authorities responsible for drawing up technical regulations. Also, a direct discussion between the representatives of the national government departments concerned and the Commission departments responsible for examining notified draft regulations, can if necessary be added to the exchange of views which takes place within the context of the information procedure. These contacts also enable an appropriate co-ordination of the search for solutions which are in accordance with Community law in cases of complaint or infringement regarding the free movement of goods which the Commission departments have to deal with, and regarding the notification procedure, in as much as the adoption of new technical regulations by the Member States is often necessary in order to settle assumed or observed infringements of national regulations. 75. In 1992, 1993 and 1994, "group" meetings were held with the German, Spanish, French, Portuguese, Greek, Dutch and Italian authorities. The sectors which were most frequently discussed at these meetings were particularly food products and telecommunications equipment. Meetings with the Central Governments of the Member States : 76. the national governments responsible for The Commission made an effort during 1992, 1993 and 1994 to establish a dialogue with the application of Directive 83/189/EEC. These meetings took place within the context of meetings of the Directive Committee or within that of the group meetings organized in the Member States. They also enabled numerous infringement proceedings to be undertaken, brought by the Commission for non-notification under the Directive, from the first stages to the case being closed. They also provide an opportunity for dealing with the practical problems which can arise in the application of the procedure and enable the Central Governments to meet the Commission officials who are responsible for administering Directive 83/189. Ad Hoc Meetings : 77. The Commission's departments continue to monitor certain cases which may give rise to disputes between the Member States and economic operators, between one Member State and another, or between the Member States and the Commission departments. The ad hoc meetings which have been organized by the Commission have assisted the parties concerned to reach agreement upon points of dispute. Meetings therefore took 30 place in 1992, 1993 and 1994 concerning fields such as low voltage (plugs and sockets, microwave ovens), electromagnetic compatibility (the application of European standards covering aspects of Directive 89/336/EEC) or the environment (paint standards, fuel emissions). 31 Conclusions and prospects 78. 79. The assessment of the years 1992, 1993 and 1994 is characterized by a slight fall in the number of notifications recorded in comparison with former years and confirms the significance of the telecommunications sector, particularly in the 1993 and 1994 figures. This increase in the telecommunications sector over the agriculture and food products sector had already appeared in previous years, particularly in 1991. It is also important to indicate that, even through the content has undoubtedly changed in comparison with former years (see Paragraph 3. 2. 1. above), the total number of detailed opinions did not fall in 1992, 1993 and 1994 (33% of notifications in 1992, 35% of notifications in 1993 and 25% in 1994, compared with 32. 5% in 1991). The Commission's main concern is still the application of the principle of mutual recognition, but the application of certain Community instruments (Directives on "electromagnetic compatibility", "labelling" and "low voltage") have constituted the legal basis for a continually increasing number of detailed opinions. 80. The application of the 83/189/EEC procedure in the coming years will take place amongst significant change. The membership of certain of the EFTA countries from January 1995 will drastically change the total volume of applications of this procedure - under the Directive. Similarly, the entry into force on 1st July 1995 of the Directive containing the second amendment to Directive 83/189/EEC (Directive 94/10/EC of 23rd March 1994) will bring about substantial revisions to the application of the Directive's rules and procedures. 32 CHAPTER HI EXCHANGE OF INFORMATION ON TECHNICAL REGULATIONS BETWEEN THE EEC AND THE EFTA COUNTRIES Introduction 81. The Agreement between the EFTA countries and the EEC laying down a Procedure for the Exchange of Information in the field of Technical Regulations entered into force in November 1990 (Council Decision 90/518/EEC) for an initial period of two years. Consequently, the Agreement expired on 1st November 1992. The EEA Agreement, which lays down a system similar to that of the Agreement, did not enter into force until 1st January 1994. The Agreement concluded by Council Decision 90/518/EEC was extended for the period from November 1992 until December 1993 by means of bilateral agreements in the form of an exchange of letters. With a view to avoiding possible barriers to trade between the Member States of both associations, the Agreement links the information procedure based on Directive 83/189/EEC with the comparable procedure between the EFTA countries. 82. In 1994, the EEA Agreement contained the 83/189/EEC Directive in Annex II Part XIX with the necessary adaptations. From the entry into force of the EEA Agreement, although the Swiss Confederation is not a contracting part of this Agreement, both parts, the Community and the Swiss, continue to apply the exchange of information procedure. The operation of the procedure 83. All the messages relating to the information procedure between the EEC Member States and the EFTA countries were exchanged in the years 1992 and 1993 between the Commission of the European Communities and the EFTA Council. From 1994, the procedure operated between the Commission and the EFTA Surveillance Authority of the EEA Agreement. From the date of receipt of a draft regulation by the EFTA Council (in the case of notifications from EFTA countries) or the Commission (for notifications from the EEC Member States), a standstill period of three months begins during which the notifying State may not adopt the text. The EFTA Council and the Community may comment upon the draft technical regulations notified under this procedure. The Commission formulates the Community's comments in consultation with the Member States and communicates them to the EFTA Council, which forwards them to the EFTA countries. 84. The Agreement makes no provision for the extension of the standstill period. The one 33 possibility for taking the procedure beyond comments is laid down in Article 13 of the Agreement which provides for regular consultations on the comments made by any Contracting Party or additional ad hoc meetings to deal with specific cases. Urgent Adoption Procedure 85. The Agreement between EFTA and the EEC on the Exchange of Information in the field of technical regulations and the EEA Agreement also contains a clause which provides for the immediate adoption of a draft for urgent reasons such as the protection of public health or safety or the health of animals and plants. One difference from the information procedure in Directive 83/189/EEC is that EFTA Member States which wish to adopt a draft for an urgent reason can do so without prior approval by the EFTA Council, the Commission or the EFTA Surveillance Authority. They simply announce that they intend to adopt the text without the three- month delay and add an explanation for the reasons for the urgency. 86. The Commission forwards to the EFTA Secretariat the requests for urgent adoption made by the Member States under the procedure introduced by Directive 83/189/EEC, together with its decision to accept or reject the request. In 1992, the EFTA countries adopted four technical regulations for urgent reasons, immediately after notification. One of them related to Food Products, one to Mechanical Engineering, one to the Environment and Packaging and one to other products. In 1993, the EFTA countries adopted two technical regulations for urgent reasons, immediately after notification. Both of them related to food products. In 1994, the EFTA countries adopted four technical regulations for urgent reasons, two related to Mechanical Engineering, one to Transport and one to Products for Household and Leisure use. Application of the Procedure 87. The statistics in Table XI of the Annex show that the Commission received 131 draft technical regulations from the EFTA countries in 1992, 110 in 1993 and 103 in 1994. As can be seen in Chart 5, most of the notified draft regulations in 1992 came from Sweden, who accounted for over a third of the notifications, whilst Austria and Finland each notified almost a fourth of the total number of notifications. In 1993, the number of notifications from the EFTA States was more evenly distributed, Norway and Switzerland each notifying a fourth and the remaining EFTA States each notifying around 16% of the total number of notifications, except for Iceland who notified in the three years only one draft technical regulation. In 1994, almost three quarters of all notifications came from Sweden and Switzerland. 34 Chart 5 Number of Notifications per EFTA State 1992-1994 A breakdown by sector (in Chart 6 and Table XII of the Annex) shows that the largest sector in all three years has been the Telecommunications sector. In 1992, 29% of all notifications received related to the Telecommunications sector. In 1993, this figure was 42% and in 1994 it was 33%. Sweden signed responsible for 66% of all notifications in the Telecommunications Sector in 1992. In 1993, it was Norway and Switzerland, who together notified more than two thirds of all notifications received in that sector. In 1994 Sweden notified 68% and Switzerland 26% of all notifications received in that sector. The second and third largest sectors in 1992 were the Mechanical Engineering and Environment Packaging sectors, each with 14% of all notifications. In 1993, the second and third largest sectors were Chemical Products with 15% of all notifications and Mechanical Engineering with 10% of all notifications. In 1994, the second and third largest sectors were Agriculture and Food Products with 16% and Mechanical Engineering with 13%. Chart 6 EFTA Notifications per Sector 1992-1994 Sectors 35 Comments A. Comments from the Community on EFTA Notifications 89. In the years 1992-1994, the Community commented on 227 (66%) of the EFTA notifications, which represented a slight increase compared with the figures for 1990 and 1991, when the Community commented upon 55% of all EFTA notifications. These comments were subject to a consultation procedure with the EEC Member States and consequently they often included comments from them. Notifications received from Austria, Sweden and Finland in 1994 and whose deadline expired after 1st January 1995, after these States had joined the European Union, were treated as notifications from Member States. This meant that these notifications in principle could also be the subject of a detailed opinion from either the Commission or other Member States. The Commission delivered fifteen detailed opinions at the beginning of 1995 against notifications from the "new" Member States. Notifications from the "new" Member States also received one detailed opinion and six comments from the "old" Member States. The comments sent by the Community related in particular to problems of compatibility with existing Community law (74% of notifications in 1992 and 76% in 1993. ) Community law related to environmental problems in 30% of cases in 1992 and 23% of cases in 1993, and to infringements of Directives 73/23/EEC ("Low Voltage") and 89/336/EEC ("Electromagnetic Compatibility") in 32% of cases in 1992 and in 56% of cases in 1993. In 1994, all the reactions by the Commission related to problems of incompatibility with Community law. 48% of reactions related to non-compliance with the articles of the EEC Agreement on the free movement of goods in accordance with Articles 30 et seq of the EC Treaty. 41% related to infringements of the provisions of Directive 89/336/EEC on electromagnetic compatibility. Similarly, the Community issued comments with regard to drafts notified by the EFTA Member States which were signatories of the European Economic Area Agreement, drawing the attention of these States to the necessity of providing in their technical regulations the clauses of mutual recognition required for compliance with Articles 11 to 13 of the Agreement. The development towards a system of mutual recognition has proved to be quite slow. As it stands, the EFTA States concerned have had to introduce into their regulations a principle which does not necessarily form part of their traditional judicial experience. 90. 91. 92. • The Community also made reference in comments upon projects in progress upon a Community level in the European standards institutes and upon the international agreements upon subjects such as the environment (Montreal Protocol) and safety at sea (OMI, SOLAS). B. Comments from the EFTA on EEC notifications 93. Nine notifications by the Community in 1992, ten in 1993 and six in 1994 gave rise to comments from EFTA. The new Member States made five comments at the beginning of 1995. The EFTA comments consist for the most part of references to the standardization work of the European organizations. These comments also contain references to current legislation in certain EFTA countries and to the possible barriers which the drafts in question could create with regard to products manufactured in accordance with this legislation. Conclusions and Prospects 94. The assessment of the years 1992, 1993 and 1994 is characterized by a slight fall in the total number of notifications recorded in comparison with 1991 and confirms the significance of the telecommunications sector. The number of comments made by the Community with regard to drafts from the EFTA Member States remained unchanged. The Community is still motivated towards monitoring the EFTA countries' compliance with the provisions of Community law. 37 Table I - Distribution of the number of new standardization projects undertaken each year between 1987 and 1994 Members of the CEN/CENELEC belonging to the EU. 1987 1988 1989 1990 1991 1992 1993 1994 No. % No. % No. % No. % No. % No. % No. % No % 187 5. 2 244 6. 9 225 4. 2 154 2. 3 241 2. 4 542 5. 2 109 1. 7 119 23. 5 2537 70. 6 1876 53. 4 2096 39. 2 1785 26. 9 1952 19. 1 1744 16. 5 2019 31. 3 1511 29. 8 2724 75. 8 2120 60. 3 2321 43. 4 1939 29. 2 2193 21. 4 2286 21. 4 2128 33. 0 1630 32. 2 289 8. 0 556 15. 8 1816 33. 9 2457 37. 0 ,5887 57. 6 5014 47. 5 2466 38. 2 1985 39. 8 579 16. 1 1838 23. 8 1215 22. 7 2243 33. 8 2130 20. 9 3252 30. 8 1860 28. 8 1454 28. 6 3592 100 3514 100 5352 100 6639 100 10210 100 10552 100 6454 100 5069 100 Year Level a. National projects a. l. Connected with European or International projects i a. 2. Specific (*) a. 3. Total(a. l. + a. 2) b. European projects c. International projects djTotal(a + b + c) Source : notifications to the CEN/CENELEC (*) It should be noted that these figures may be overestimated as a result of the fact that some members of the CEN/CENELEC do not automatically communicate the existence of a relationship with European or International projects. 38 Table Ha - Distribution of the number of new standardization projects undertaken in 1992 Members of the CEN/CENELEC belonging to the EU. Field Level a. projects National Connected a. 1. with European or International projects a. 2. Specific7 a. 3. Total (a. l. + a. 2) b. projects European Non-Electrical No. % Electrical No. % Total No. % (1) (2) (3) = (l) + (2) Non-Electrical Section (l) x 100 (3) % 535 7. 6 7 0. 2 542 5. 2 98. 7 1673 24. 0 2208 31. 6 71 78 2. 0 2. 2 1744 16. 5 2286 21. 7 95. 9 96. 6 4042 57. 9 972 27. 2 5014 47. 5 80. 6 International c. projects d. Total (a + b + c) 2518 70. 6 100 3568 Source : Notifications to the CEN/CENELEC 7348 10. 5 6984 100 3252 30. 8 10552 100 22. 6 66. 2 It is to be noted that these figures may be overestimated as a result of the fact that some members of the CEN/CENELEC do not automatically communicate the existence < a relationship between their projects and European or International projects. This figure has been supplied by the ISO departments. 39 Table lib - Distribution of the number of new standardization projects undertaken in 1993 Members of the CEN/CENELEC belonging to the EU. Field Level a. projects National Connected a. 1. with European or International projects a. 2. Specific9 a. 3. Total (a. l. + a. 2) b. European projects International c. projects d. Total (a + b + c) Non-Electrical % No. Electrical Total No. % No. % (1) (2) (3) = (1) + (2) Non-Electrical Section m x ioo (3) % 105 2. 0 4 0. 3 109 1. 7 96. 3 1989 37. 7 2094 39. 7 30 34 2. 6 2. 9 2019 31. 3 2128 33. 0 2094 39. 7 3723 1. 4 2466 38. 2 108310 20. 5 5271 100. 0 7776 5. 7 1183 100. 0 1860 28. 8 6454 100. 0 98. 5 98. 4 84. 9 58. 2 81. 7 Source : Notifications to CEN/CENELEC It is to be noted that these figures may be overestimated as a result of the fact that some members of the CEN/CENELEC do not automatically communicate the existence of a relationship between their projects and European or International projects. 10 This figure has been supplied by the ISO departments. 40 Table Ile - Distribution of the number of new standardization projects undertaken in 1994 Members of the CEN/CENELEC belonging to the EU. Field Level a. projects National a. 1. Connected with European or International projects a. 2. Specific11 a. 3. Total (a. l. + a. 2) b. European projects International c. projects d. Total (a + b + c) Non-Electrical % No. Electrical Total No. % No. % (1) (2) (3) = (l) + (2) Non-Electrical Section (imoo (3) % 113 2. 8 6 0. 6 119 23. 5 95. 0 1510 37. 2 1623 40. 0 1 0 1511 29. 8 7 0. 6 1630 32. 2 1500 36. 9 , 485 48. 2 1985 39. 2 94112 23. 1 513 51. 2 1454 28. 6 4064 100 1005 100 5069 100 99. 9 99. 6 75. 6 64. 7 80. 2 Source : Notifications to the CEN/CENELEC 11 12 It is to be noted that these figures may be overestimated as a result of the fact that some members of the CEN/CENELEC do not automatically communicate the existence of a relationship between their projects and European or International projects. This figure has been supplied by the ISO departments. 41 Table Ilia - Distribution per country of the number of n notified at national level in 1992 Field Non-Electrical Electrical Total Country a. GE b. FR c. UK d. IT e. SP f. Other EC countries g. Total EC h. EFTA countries i. General total (g + h) No. 322. 690 162 288 711 35 2208 103 2311 % 13. 9 29. 9 7. 0 12. 5 30. 7 1. 5 95. 6 4. 4 100 No. 19 7 16 36 78 12 90 % 21. 1 7. 8. 17. 8 40. 0 86. 7 13. 3 100 No. 341 697 178 288 747 35 2286 115 2401 % 14. 2 29. 0 7. 4 12. 0 31. 1 1. 5 95. 2 4. 8 100 Sources : Notifications to the CEN/CENELEC Comments Comparisons between the various countries should be made with some caution, it being given that the exact stage of preparation at which a new dr notified by the INFOPRO system is not harmonized. These figures reflect the number of notifications managed by the Central Unit. Any questions relating to the exact number of new projects underl upon a national level should be sent to the relevant National Standards Institute. 42 Table Illb - Distribution per country of the number of new standardization projects notified at national level in 1993 Field Non-Electrical Electrical Total Country a. GE b. FR c. UK d. IT e. SP f. Other EC countries g. Total EC h. EFTA countries i. General total (g + h) No. 480 504 283 355 214 258 2094 307 2401 % 20. 0 21. 0 11. 8 14. 8 8. 9 10. 7 87. 2 12. 8 100 No. 16 6 5 5 2 34 7 41 % 39. 0 14. 6 12. 2 12. 2 4. 9 83. 0 17. 0 100 No. 496 510 288 360 214 260 2128 314 2442. % 20. 3 20. 9 11. 8 14. 7 8. 8 10. 6, 87. 1 12. 9 100 Sources : Notifications to the CEN/CENELEC Comments 1. 2. Comparisons between the various countries should be made with some caution, it being given that the exact stage of preparation at which a new d notified by the INFOPRO system is not harmonized. These figures reflect the number of notifications managed by the Central Unit. Any questions relating to the exact number of new projects undei upon a national level should be sent to the relevant National Standards Institute. 43 Table IIIc - Distribution per country of the number of new standardization projects notified at national level in 1994 Field Non-Electrical Electrical Total Country a. GE b. FR c. UK d. IT e. SP f. Other EC countries g. Total EC h. EFTA countries i. General total (g + h) No. 423 353 230 331 163 123 1623 213 1836 % 23. 0 27. 5 12. 5 18. 0 8. 9 6. 7 88. 4 11. 6 100 No. 6 0 0 1 0 0 7 1 8 % 75. 0 12. 5 87. 5 12. 5 100 No. 429 353 230 332 163 123 1630 214 1844 % 23. 3 19. 1 12. 5 18. 0 8. 8 6. 3 88. 4 11. 6 100 Sources : Notifications to the CEN/CENELEC Comments Comparisons between the various countries should be made with some caution, it. being given that the exact stage of preparation at which a new draft is notified by the INFOPRO system is not harmonized. 2. These figures reflect the number of notifications managed by the Central Unit. Any questions relating to the exact number of new projects undertaken upon a national level should be sent to the relevant National Standards Institute. 44 Table IVa - The ten principal sub-sectors of new national standardization projects in 1992 SUB-SECTORS Number of new projects (EU + EFTA) Code T02 B02 102 N09 N03 N01 109 B03 C01 M05 Total Name Aeronautics Construction Fixing components Plastics Oil products Paper and card Small mechanical tools Concrete Food products Welding 134 99 92 90 78 70 56 51 43 42 755 Source : Notifications to the CEN/CENELEC Comments In 1992, the two principal sub-sectors of the electro-technics sector were : - coiling wire (Code W23) : 11 new projects - electric cables (Code W08) : 8 new projects In the absence of more detailed figures, the totals indicated relate to the EU plus the EFTA countries. 45 Table IVb - The ten principal sub-sectors of new national standardization projects in 1993 SUB-SECTORS Number of new projects (EU + EFTA) Code C01 T20 S09 H28 B99 B02 B03 T02 109 N05 Total Name Food products Rail construction (train and tram) Water quality and conveyance Hunting Building - miscellaneous aspects Construction Concrete Aeronautics Small mechanical tools Textiles 90 82 77 61 59 53 51 49 48 46 616 Source : Notifications to the CEN/CENELEC Comments : In 1993, the two principal sub-sectors of the electro-technics sector were : - electric traction equipment (Code 03) : 6 new projects - electrical installations in buildings (Code WO8) : 4 new projects In the absence of more detailed figures, the totals given relate to the EU plus the EFTA countries. 46 Table IVc - The ten principal sub-sectors of new national standardization projects in 1994 SUB-SECTORS Number of new projects (EU + EFTA) Code C01 109 S09 B99 102 C20 B02 T02 N03 T03 Total Name Food products Small mechanical tools Water quality and conveyance Building - miscellaneous aspects Fixing components Explosives and fireworks Construction Aeronautics Oil products Road vehicles 85 80 79 51 49 47 44 44 40 40 559 Source : Notifications to the CEN/CENELEC Comment : In the absence of more detailed figures, the totals given relate to the EU plus the EFTA countries. 47 Table V - Application of Article 3 (Request for association with national standardization projects and request for the development of a European* standard. Comments request 14 16 74 67 52 78 83 52 34 74 Year 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 Information request 5 8 5 0 0 20 0 0 0 5 Source : CEN/CENELEC Comments : Participation Request for request European Standard 5 10 5 15 16 7 16 5 7 7 1. 2. 3. 4. In the absence of detailed figures, the totals given are for the EU plus the EFTA. countries. Some requests for information or for participation and comments have not been notified to the CEN Central Secretariat. Following a reminder by the CEN/CENELEC, some comments dating from the years 1985/1986 were entered in 1987. Beginning from 1989, the figures relate for the most part to the CEN, as a result of the introduction of the Vilamoura system in the CENELEC. 48 Table IVa - Standardization work entrusted to European standardization bodies in 1992 1. 2. 3. Mandates in connection with the New Approach Directives Directive 89/106/EEC construction products: provisional mandate to the standardization bodies CEN and CENELEC. Directive 89/336/EEC mandate to CENELEC relating to electromagnetic compatibility. Directive concerning protective equipment and systems intended for use in explosive atmospheres: planning mandate and standardization mandate to CEN and CENELEC. Mandates in connection with the Public Contracts Directives Mandate to CEN concerning certification of conformance with Community regulations on public contracts. Mandate to CEN and CENELEC in the field of electricity production concerning the implementation of European standards used as buyers' guides in public contracts and concerning the drawing up of an auxiliary standards programme. Mandate the drawing up of a standardization programme in the field of machinery and equipment for the petroleum industry (exploration, production, refining and transport by pipeline) and natural gas (exploration, production). to CEN and CENELEC concerning for ISDN (Integrated Services Digital Network) Mandates in connection with Community policy in the field of IT and telecommunications Test specifications for DECT (Digital European Cordless Telephone). Test specifications for ISUP (ISDN User Part) protocols. Test specifications videophone. Test specifications for very small aperture aerials (VAST). Test specifications for the ISDN PCI (Programme Communication Interface). High-level ONP (Open Network Provision) leased lines. Automatic message accounting on the fixed public telephone network. Coder-decoder for TETRA (Trans-European Trunked Radio). Library-related and documentary applications. Definition of a database taxonomy. Functional standards in the field of information systems security. Harmonization of sockets and plugs on the PSTN (Public Switched Telephone Network). ONP (Open Network Provision) study relating to the interconnection of PSDNs (Packet-Switched Data Networks). Establishment of a work programme relating to satellites with a low earth orbit. ' 49 4. Identification of the calling line on the fixed public telephone network. Specifications in the field of equipment for satellite ground stations. The implications of ageing of the population for the design of telephone terminals. Establishment of a work programme concerning readaptation technology. Mandates in connection with other Community policies Standardization mandate to CEN concerning the analysis and liberation of nickel. Mandate to CEN concerning biotechnology. Mandate to CEN concerning reference methods for doses of hazardous substances in water. Mandate to CEN concerning a standard for a reference method allowing the calibration of automatic measuring equipment for gaseous total organic carbon and the principal performance characteristics for automatic measuring equipment. Mandate to CEN concerning a European standard for a reference method allowing low- concentration total dust and the principal performance characteristics for automatic measuring equipment. Mandate to CEN concerning a test procedure allowing the demonstration in real conditions of the equivalence of sampling methods for fine particles (up to 10 pm) in suspension in ambient air in accordance with Community directives. the calibration of automatic measuring equipment for 50 Table VIb - Standardization work entrusted to European standardization bodies in 1993 | ! j 1. - - 2. 3. ' - Mandates in connection with the New Approach Directives Directive 89/392/EEC - machine safety: mandate addressed to CEN and CENELEC concerning the drawing up of a standardization programme in connection with standards published in the context of the "Low Voltage" Directive with regard to the machinery sector. Standardization mandate to CEN/CENELEC concerning lifts. Draft directive concerning objects made from precious metals: planning mandate to CEN/CENELEC. Directive 93/42/EEC concerning medical equipment: standardization mandate to CEN/CENELEC. Directive standardization mandate to CEN/CENELEC. 89/686/EEC equipment: concerning individual protective in the field of Mandates in connection with the Public Contracts Directives Standardization mandate addressed to CEN/CENELEC equipment and installations for the transmission and distribution of gas. Planning and standardization mandate to CEN/CENELEC/ETSI in the field of railway equipment. Research mandate to CEN/CENELEC/ETSI cone rning the qualification of public contracts companies. ior the drawing up of a Mandate addressed to CEN/CENELEC/ETSI programme of standards in the field of acquisition and computer-assisted logistic support (CALS). concerning standardization mandate Mandates in connection with Community policy in the field of IT and telecommunications Mandate to CEN covering the guarantee of quality in the development of test specifications for open systems. Planning mandate for character technology. Supplementary compatibility. Standardization mandate in the field of geographical information. Mandate relating to safety requirements for mobile communication equipment: thermal aspects of electromagnetic radiation. Planning mandate relating to safety requirements concerning the athermanous effects of radiation during use of mobile communications equipment. IT of transport and road traffic. Specification of manufacturing messages. Open Document Architecture: image and document processing applications. Medical IT. Planning mandate addressed to CEN/CENELEC/ETSI in the field of the exchange of computerized data. electromagnetic 51 4. Mandates in connection with other Community policies Standardization mandate in the field of iron and steel-making. Mandate in the field of air traffic management systems. 52 Table VIc - Standardization work entrusted to European standardization bodies in 1994 1. 2. ' - Mandates in connection with the New Approach Directives Directive 93/15/EC relating to explosives for civilian use: standardization mandate to CEN. Directive 92/42/EC relating to requirements placed on boiler efficiency: mandate to CEN. Directive 94/25/EC relating to pleasure craft: mandate to CEN. Directive 89/392/EEC - 91/368/EEC - 93/44/EC in the field of machinery: standardization mandate to CEN and CENELEC. Directive 73/23/EEC 93/68/EEC - 89/392/EEC - 91/398/EEC - 93/44/EC concerning Low Voltage and Machinery: one mandate entrusted to CEN and CENELEC concerning the revision of CEN/CENELEC standards in order to guarantee their complete coherence with regard to the Low Voltage and Machinery Directives. Draft directive in the field of cable installations for the transport of people: planning and standardization mandate to CEN, CENELEC and ETSI. Draft directive concerning pressurized equipment: mandate to CEN and CENELEC. Draft directive concerning precious metals: standardization mandate to CEN. to CEN, CENELEC and ETSI concerning requirements for Mandates in connection with Community policy in the field of IT and telecommunications Mandate to CEN, CENELEC and ETSI relating to computer systems engineering. Mandate to CEN, CENELEC and ETSI concerning aircraft-ground telephone systems equipment. Mandate to CEN, CENELEC and ETSI concerning low earth orbit (LEO) satellite stations. Mandate to CEN, CENELEC and ETSI concerning Trans-European Trunked Radio (TETRA). Mandate connection to terminal equipment intended for the Euro-ISDN. Mandate to CEN, CENELEC and ETSI concerning terminals connected to the DCS 1800 networks. Mandate to CEN, CENELEC and ETSI concerning the DECT generic access profile. Mandate to CEN, CENELEC and ETSI concerning the general access of non- voice terminals to the analogue telephone network. Mandate to CEN, CENELEC and ETSI concerning new types of specialized links. Mandate to CEN, CENELEC and ETSI concerning "Local Loop" ONP access. Mandate to CEN, CENELEC and ETSI concerning "multiple B channels" on ISDN. Mandate to CEN, CENELEC and ETSI concerning ONP "Intelligent Networks IN". 53 3. Mandate to CEN, CENELEC and ETSI concerning specification of the harmonized characteristics of a set of telephone tones generated by the public telephone networks. Mandate to CEN, CENELEC and ETSI concerning the test specifications for DECT applications. Mandate to CEN, CENELEC and ETSI concerning social alarm systems. Mandate to CEN, CENELEC and ETSI concerning the interface for the readaptation environment. Mandate to CEN, CENELEC and ETSI concerning the connections for switching interfaces. Mandate to CEN, CENELEC and ETSI concerning the audio description of television broadcasts for the partially sighted and the elderly. Mandate Broadcasting". Mandate Broadcasting". Mandate to CEN, CENELEC and ETSI concerning access to the SDH system. Mandate to CEN, CENELEC and ETSI concerning the EWOS (European Workshop for Open Systems) 1995 work programme. Mandate to CEN, CENELEC and ETSI concerning the interface for the readaptation environment. Mandate to CEN, CENELEC and ETSI concerning the connections for switching interfaces. to CEN, CENELEC and ETSI concerning "Digital Video to CEN, CENELEC and ETSI concerning "Digital Audio Mandates in connection with other Community policies Mandate relating to methods of analysis in the field of materials and objects intended to come into contact with foodstuffs. Research mandate to CEN concerning a proposition aimed at including organo-mineral fertilizers in the annexes to directive 76/116/EEC. Standardization mandate entrusted to CEN concerning the revision of standard EN 272 relating to tactile hazard warning indicators. Research and standardization mandate entrusted to CEN concerning the perfection of methods of analysis for trace-element fertilizers. Standardization mandate to CEN and CENELEC concerning measuring methods for domestic washing machines. Standardization mandate to CEN and CENELEC concerning measuring methods for domestic tumble-dryers. Standardization mandate to CEN and CENELEC concerning measuring methods for domestic dishwashers. Standardization mandate to CEN and CENELEC for the drawing up of a measuring standards programme relating to certain types of domestic appliance. Mandate addressed environmental management systems. Mandate addressed to CEN and CENELEC for the drawing up of measuring standards relating to domestic refrigerators and freezers. Directive 94/62/EC planning mandate to CEN and CENELEC in the field of to CEN concerning a standard the field of in 54 packaging and packaging waste. Standardization mandate to CEN and CENELEC in the field of thermal solar systems and components. Mandate to CEN and CENELEC in the field of advanced ceramics. Planning mandate to CEN and CENELEC in the field of equipment and installations for the transport and distribution of electricity. 55 Tabel VII Notifications per Member State 1992-1994 1992 1993 1994 11 28 65 12 73 11 2 40 3 38 12 67 362 18 18 80 15 85 12 3 36 1 24 7 106 385 16 34 98 25 60 12 1 34 0 40 7 62 389 % 1992 % 1993 % 1994 3 7,7 18 3,3 20 3 0,6 11 0,8 10,5 3,3 18,5 4,7 4,7 20,8 3,9 16,9 3,1 0,8 9,4 0,3 6,2 1,8 27,5 4,1 8,7 25,2 6,4 15,4 3,1 0,3 8,7 0 10,3 1,8 15,9 Member States Belgium Danmark Germany Spain France Greece Ireland Italy Luxemburg Netherlands Portugal United Kingdom Total EEC Member States Belgium Danmark Germany Spain France Greece Ireland Italy Luxemburg Netherlands Portugal United Kingdom 56 Notifications of Member States per Sector 1992 Sector 1992 B Building and Construction Agriculture and Food Products Chemical Products Pharmaceutical Products Products for Household and Leisure Use Mechanical Engineering Energy, Minerals and Wood Environment, Packaging Health, Medical Equipment Transport Telecom Other Products Total by Country 1 5 ^s 0 0 2 0 0 0 1 1 1 11 DK 4 1 1 1 1 5 0 0 0 5 9 1 28 D E F 26 1 3 2 4 3 1 2 1 8 14 0 65 3 3 0 0 0 1 0 0 0 0 5 0 12 4 15 3 5 2 3 2 0 2 0 37 0 73 GR 1 4 2 2 0 1 0 0 1 0 0 0 11 IRL 0 0 0 0 0 0 0 0 1 1 0 0 2 I L 4 20 2 1 0 3 0 0 1 3 5 1 40 NL 0 21 2 1 1 1 0 4 0 1 7 0 38 0 1 0 0 0 0 0 2 0 0 0 0 3 P 2 1 0 0 0 3 0 0 1 2 3 0 12 UK 11 5 2 2 2 7 0 1 2 26 8 1 67 Table VIII Total EEC 56 77 15 14 10 29 3 9 9 47 89 4 362 57 Notifications of Member States per Sector 1993 Table IX Sector 1993 B DK D E F GR I L NL P UK Total EEC IR L Building and Construction Agriculture and Food Products Chemical Products Pharmaceutical Products Products for Household and Leisure Use Mechanical Engineering Energy, Minerals and Wood Environment, Packaging Health, Medical Equipment Transport Telecom Other Products Total by Country 0 3 0 0 0 2 0 1 0 2 10 0 18 0 0 2 0 0 1 0 0 0 7 8 0 18 19 7 2 2 0 11 1 1 2 9 24 2 80 1 7 2 0 0 • 3 0 0 0 0 2 0 15 0 2 8 5 0 12 4 0 3 13 18 0 65 4 0 1 3 0 0 0 1 1 2 0 0 12 0 0 0 0 1 2 0 0 0 0 0 0 3 2 20 4 1 0 1 0 0 0 6 2 0 36 0 1 0 0 0 0 0 0 0 0 0 0 1 0 11 1 0 0 3 0 4 1 0 4 0 24 1 3 0 0 0 2 0 0 0 0 1 0 7 8 2 2 9 1 2 1 0 2 14 63 2 106 35 56 22 20 2 39 6 7 9 53 132 4 385 1 58 Notifications of Member States per Sector 1994 Sector 1994 B Building and Construction Agriculture and Food Products Chemical Products Pharmaceutical Products Products for Household and Leisure Use Mechanical Engineering Energy, Minerals and Wood Environment, Packaging Health, Medical Equipment Transport Telecom Other Products Total by Country 0 0 0 1 0 0 0 0 1 1 13 0 16 DK 1 2 2 0 3 7 2 0 0 5 12 0 34 D E F 28 6 2 1 0 29 i 0 2 2 27 0 98 2 4 1 1 0 4 0 0 0 6 4 3 25 4 11 5 4 1 11 0 0 1 8 15 0 60 GR 1 2 2 1 0 n 0 0 0 '2 1 1 12 IRL 0 0 0 0 0 0 0 0 0 1 0 0 1 I L 3 17 2 0 0 5 0 1 0 3 2 1 34 NL 3 14 2 0 1 6 0 1 0 1 12 0 40 0 0 0 0 0 0 0 0 0 0 0 0 0 P UK 10 6 1 6 2 8 1 0 0 5 23 0 62 0 3 0 0 0 2 1 0 0 0 1 0 7 Table X Total EEC 52 65 17 14 7 74 5 2 4 34 110 5 389 59 Notifications of EFTA States Table XI EFTA States Austria Finland Iceland Norway Sweden Switzerland Total EFTA 1992 1993 1994 29 28 1 16 47 10 131 17 18 0 29 18 28 110 18 2 0 7 33 43 103 Notifications of EFTA States per sector 1992-1994 Table XII Sector 1992 1993 1994 Building and Construction Agriculture and Food Products Chemical Products Pharmaceutical Products Products for Household and Leisure Use Mechanical Engineering Energy, Minerals and Wood Environment, Packaging Health, Medical Equipment Transport Telecom Other Products Total 9 9 11 0 3 18 1 18 3 15 38 6 131 2 4 16 3 2 11 10 6 2 8 46 0 110 8 16 10 2 4 13 1 4 0 9 34 2 103 60 ISSN 0254-1475 COM(96) 286 final DOCUMENTS EN 02 08 10 Catalogue number : CB-CO-96-292-EN-C ISBN 92-78-05589-1 Office for Official Publications of the European Communities L-2985 Luxembourg & -i

Proposal for a COUNCIL DECISION authorising the French Republic to apply or to continue to apply reductions in, or exemptions from, excise duties on certain mineral oils used for specific purposes, in accordance with the procedure provided for in Article 8(4) of Directive 92/81/EEC

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 25. 06. 1996 COM(96) 299 final Proposal for a COUNCIL DECISION authorising the French Republic to apply or to continue to apply reductions in, or exemptions from, excise duties on certain mineral oils used for specific purposes, in accordance with the procedure provided for in Article 8(4) of Directive 92/81/EEC (presented by the Commission) -2 EXPLANATORY MEMORANDUM Under Article 8(4) of Council Directive 92/81/EEC1 on the harmonisation of the structures of excise duties on mineral oils, the Council, acting unanimously on a proposal from the Commission, may authorise any Member State to introduce exemptions from, or reductions in, excise duties on the grounds of specific policy considerations. The French authorities have informed the Commission that they wish to exempt, within the limits of an annual quota, liquefied petroleum gas and natural gas from excise duty when they are used as fuel for public transport under a programme for reducing pollution, to which the procedure provided for in Article 8(4) should apply. The Member States have been informed of this request in accordance with the Directive. The Directive provides for the Commission to review such exemptions and reductions periodically. If the Commission considers that they may no longer be applied because they distort competition or the operation of the internal market or are incompatible with Community policy on protection of the environment, it presents appropriate proposals to the Council. In any event, the derogation shall be reviewed before 31 December 1998. The Council will examined the situation on the basis of a proposal from the Commission and decide whether to abolish, modify or extend the derogation. OJNoL316, 31. 10. 1992, p. 12. Proposal for a COUNCIL DECISION authorising the French Republic to apply or to continue to apply reductions in, or exemptions from, excise duties on certain mineral oils used for specific purposes, in accordance with the procedure provided for in Article 8(4) of Directive 92/81 /EEC THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, regard Having the harmonisation of the structures of excise duties on mineral oils, and in particular Article 8(4) thereof, to Council Directive 92/81/EEC of 19 October 1992 on Having regard to the proposal from the Commission, Whereas, under Article 8(4) of Directive 92/81/EEC, the Council, acting unanimously on a proposal from the Commission, may authorise any Member State to introduce exemptions from, or reductions in, excise duties on mineral oils on the grounds of specific policy considerations; Whereas the French authorities have informed the Commission that they, as of 1 jannuray 1997, wish to exempt liquefied petroleum gas and natural gas from excise duty when they are used as fuel for public transport under a programme for reducing pollution, to which the procedure provided for in Article 8(4) should apply; Whereas the other Member States have been informed of this notification; Whereas the Commission and all the Member States accept that such exemption is justified on the grounds of specific policy considerations and that it would not give rise to distortions of competition or hinder the operation of the internal market; Whereas the Commission regularly reviews reductions and exemptions to check that they are compatible with the operation of the internal market or with Community policy on protection of the environment; Whereas, under Article 8(6) of Directive 92/81/EEC, the Council is to review the situation no later the Commission, than 31 December 1996 on the basis of a report from A- Whereas, the French Republic authorities have asked the derogation to apply from 1 January 1997, the Council shall, on the basis of a report from the Commission review this specific derogation before 31 December 1998; HAS ADOPTED THIS DECISION: - 5- AdicJeJL Until 31 December 1998, in accordance with Article 8(4) of Directive 92/81/EEC and without prejudice to the obligations laid down in Council Directive 92/82/EEC of 19 October 1992 on the approximation of the rates of excise duties on mineral oils,2 France is hereby authorised to apply an exemption from excise duty to liquefied petroleum gas and natural gas when used as fuel for vehicles used for local public transport, within the limits of an annual quota. This Decision is addressed to the French Republic. Articled Done at Brussels, For the Council The President 2 OJ No L 316, 31. 10. 1992, p. 19. 4- BSN 0254-1475 COM(96) 299 final DOCUMENTS EN 02 09 12 Catalogue number : CB-CO96-308-EN-C ISBN 92-78-05765-7 Office for Officiai Publications of the European Communities L-2985 Luxembourg

Commission Regulation (EC) No 1140/96 of 25 June 1996 amending Annex III to Council Regulation (EEC) No 2377/90 laying down a Community procedure for the establishment of maximum residue limits of veterinary medicinal products in foodstuffs of animal origin (Text with EEA relevance)

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L_1996151EN. 01000601. xml 26. 6. 1996    EN Official Journal of the European Communities L 151/6 Commission Regulation (EC) No 1140/96 of 25 June 1996 amending Annex III to Council Regulation (EEC) No 2377/90 laying down a Community procedure for the establishment of maximum residue limits of veterinary medicinal products in foodstuffs of animal origin (Text with EEA relevance) THE COMMISSION OF THE EUROPEAN COMMUNITIES, Having regard to the Treaty establishing the European Community, Having regard to Council Regulation (EEC) No 2377/90 of 26 June 1990 laying down a Community procedure for the establishment of maximum residue limits of veterinary medicinal products in foodstuffs of animal origin (1), as last amended by Commission Regulation (EC) No 282/96 (2), and in particular Articles 6, 7 and 8 thereof, Whereas, in accordance with Regulation (EEC) No 2377/90, maximum residue limits must be established progressively for all pharmacologically active substances which are used within the Community in veterinary medicinal products intended for administration to food-producing animals; Whereas maximum residue limits should be established only after the examination within the Committee for Veterinary Medicinal Products of all the relevant information concerning the safety of residues of the substance concerned for the consumer of foodstuffs of animal origin and the impact of residues on the industrial processing of foodstuffs; Whereas, in establishing maximum residue limits for residues of veterinary medicinal products in foodstuffs of animal origin, it is necessary to specify the animal species in which residues may be present, the levels which may be present in each of the relevant meat tissues obtained from the treated animal (target tissue) and the nature of the residue which is relevant for the monitoring of residues (marker residue); Whereas, for the control of residues, as provided for in appropriate Community legislation, maximum residue limits should usually be established for the target tissues of liver or kidney, whereas, however, the liver and kidney are frequently removed from carcases moving in international trade, and maximum residue limits should therefore also always be established for muscle or fat tissues; Whereas, in the case of veterinary medicinal products intended for use in laying birds, lactating animals or honey bees, maximum residue limits must also be established for eggs, milk or honey; Whereas, in order to allow for the completion of scientific studies, azamethiphos, streptomycin, dihydrostrep-tomycin, gentamicin and neomycin should be inserted into Annex III to Regulation (EEC) No 2377/90; Whereas a period of 60 days should be allowed before the entry into force of this Regulation in order to allow Member States to make any adjustment which may be necessary to the authorizations to place the veterinary medicinal products concerned on the market which have been granted in accordance with Council Directive 81/851/EEC (3), as last amended by Directive 93/40/EEC (4) to take account of the provisions of this Regulation; Whereas the measures provided for in this Regulation are in accordance with the opinion of the Committee for the Adaptation to Technical Progress of the Directives on the Removal of Technical Barriers to Trade in the Veterinary Medicinal Products Sector, HAS ADOPTED THIS REGULATION: Article 1 Annex III to Regulation (EEC) No 2377/90 is hereby amended as set out in the Annex hereto. Article 2 This Regulation shall enter into force on the 60th day following its publication in the Official Journal of the European Communities. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Brussels, 25 June 1996. For the Commission Martin BANGEMANN Member of the Commission (1)  OJ No L 224, 18. 8. 1990, p. 1. (2)  OJ No L 37, 15. 2. 1996, p. 9. (3)  OJ No L 317, 6. 11. 1981, p. 1. (4)  OJ No L 214, 24. 8. 1993, p. 31. ANNEX A. Annex III is modified as follows: 1. Anti-infectious agents 1. 2. Antibiotics 1. 2. 5. Aminoglycosides Pharmacologically active substance(s) Marker residue Animal species MRLs Target tissues Other provisions ‘1. 2. 5. 2. Streptomycin Streptomycin Bovine, ovine, porcine, poultry, Bovine, ovine 1 000 μg/kg 500 μg/kg 200 μg/kg Kidney Muscle, liver, fat Milk Provisional MRLs expire on 1 June 2000 1. 2. 5. 3. Dihydrostreptomycin Dihydrostreptomycin Bovine, ovine, porcine, Bovine, ovine 1 000 μg/kg 500 μg/kg 200 μg/kg Kidney Muscle, liver, fat Milk Provisional MRLs expire on 1 June 2000 1. 2. 5. 4. Gentamicin Gentamicin Bovine, porcine Bovine 1 000 μg/kg 200 μg/kg 100 μg/kg 100 μg/kg Kindney Liver Muscle, fat Milk Provisional MRLs expire on 1 June 2000 1. 2. 5. 5. Neomycin (including framycetin) Neomycin Bovine, ovine, caprine, porcine, chicken, turkey, duck 5 000 μg/kg 500 μg/kg Kidney Muscle, liver, fat Provisional MRLs expire on 1 June 2000’ Bovine, ovine, caprine Chicken 500 μg/kg 500 μg/kg Milk Eggs 2. Antiparasitic agents 2. 2. Agents acting against ectoparasites 2. 2. 2. Organophosphates Pharmacologically active substance(s) Marker residue Animal species MRLs Target tissues Other provisions ‘2. 2. 2. 1. Azamethiphos Azamenthiphos Salmonidae 100 μg/kg Muscle and skin in natural proportions Provisional MRLs expire on 1 June 1997’

96/412/EC: Council Decision of 25 June 1996 concerning the conclusion on behalf of the European Community, as regards matters within its competence, of the results of the World Trade Organization negotiations on financial services and on the movement of natural persons

http://publications.europa.eu/resource/cellar/446f6270-4dbf-4f85-afdb-d581344603d5

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L_1996167EN. 01002301. xml 6. 7. 1996    EN Official Journal of the European Communities L 167/23 COUNCIL DECISION of 25 June 1996 concerning the conclusion on behalf of the European Community, as regards matters within its competence, of the results of the World Trade Organization negotiations on financial services and on the movement of natural persons (96/412/EC) THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Articles 54, 57, 63, 66, 73b to 73f, 99, 100, 100a and 113, in conjunction with the second sentence of Article 228 (2) and the first subparagraph of Article 228 (3) thereof, Having regard to the proposal from the Commission, Having regard to the opinion of the European Parliament (1), Having regard to the opinion of the Economic and Social Committee (2), Whereas the Marrakesh Agreement establishing the World Trade Organization and its related agreements as well as the Ministerial Decisions and Declarations and the Understanding on Commitments in Financial Services were approved by a Council Decision of 22 December 1994 (3); Whereas the overall commitments on financial services negotiated by the Commission, on behalf of the European Community and its Member States, constitute a satisfactory and balanced outcome for the interim period concerned; Whereas some commitments were negotiated by the Commission, on behalf of the European Community and its Member States, on the movement of natural persons for the purpose of supplying services; Whereas on 26 July 1995 the Council authorized the Commission to approve, on behalf of the European Community and its Member States, the Decision of the Committee on Trade in Financial Services adopting the Second Protocol annexed to the General Agreement on Trade in Services, the Decision of the Council for Trade in Services on Commitments on Financial Services and the second Decision of the Council for Trade in Services on Financial Services as well as the Decision of the Council for Trade in Services on movement of natural persons commitments, adopting the Third Protocol to the General Agreement on Trade in Services; Whereas the competence of the Community to conclude international agreements derives not only from explicit conferral by the Treaty but may also derive from other provisions of the Treaty and from acts adopted pursuant to those provisions by Community institutions; Whereas, where Community rules have been adopted in order to achieve the aims of the Treaty, Member States may not, outside the framework of the common institutions, enter into commitments liable to affect those rules or alter their scope; Whereas some commitments on financial services fall within the competence of the Community under Article 113 of the Treaty, whereas, furthermore, other commitments on financial services as well as the commitments on the movement of natural persons affect Community rules adopted on the basis of Articles 54, 57, 63, 66, 99, 100 and 100a, and may therefore only be entered into by the Community alone; Whereas, in particular, the use of Article 100 of the Treaty as a legal base for this Decision is justified to the extent that the aforementioned commitments on financial services affect Council Directive 90/434/EEC of 23 July 1990 on the common system of taxation applicable to mergers, divisions, transfers of assets and exchanges of shares concerning companies of different Member States (4) and Council Directive 90/435/EEC of 23 July 1990 on the common system of taxation applicable in the case of parent companies and subsidiaries of different Member States (5), which are based on Article 100 of the Treaty; Whereas, with regard to capital movement commitments contained in the list of specific commitments of the Community and of the Member States and in the present state of Community law, Member States remain competent to act, within the limit laid down by the provisions of Article 73c of the Treaty; Whereas, by their nature, the Agreement establishing the World Trade Organization and the Protocols to the General Agreement on Trade in Services, are not likely to be directly invoked before Community or Member States' courts, HAS DECIDED AS FOLLOWS: Article 1 1. The Second Protocol to the General Agreement on Trade in Services concerning financial services is hereby approved on behalf of the European Community with regard to that portion of it which falls within the competence of the European Community. 2. The text of the Second Protocol, together with the schedule of specific commitments and the list of the exemptions of the Community and the Member States are attached to this Decision, as are also the following Decisions: — the Decision of the Committee on Trade on Financial Services adopting the Second Protocol to the General Agreement on Trade in Services, — the Decision of the Council for Trade in Services on Commitments in Financial Services, — the second Decision of the Council for Trade in Services on Financial Services. 3. The President of the Council is hereby authorized to designate the person empowered to sign the Second Protocol to the General Agreement on Trade in Services in order to bind the European Community with regard to that portion of the Protocol falling within its competence. Article 2 1. The Third Protocol to the General Agreement on Trade in Services concerning movement of natural persons is hereby approved on behalf of the European Community with regard to that portion of it which falls within the competence of the European Community. 2. The text of the Third Protocol, together with the schedule of specific commitments of the Community and the Member States, and the Decision of the Council for Trade in Services on movement of natural persons commitments are attached to this Decision. 3. The President of the Council is hereby authorized to designate the person empowered to sign the Third Protocol to the General Agreement on Trade in Services in order to bind the European Community with regard to that portion of the Protocol falling within its competence. Done at Luxembourg, 25 June 1996. For the Council The President E. RONCHI (1)  Opinion of the European Parliament of 6 June 1996 (not yet published in the Official Journal). (2)  Opinion of the Economic and Social Committee of 30 May 1996 (not yet published in the Official Journal). (3)  OJ No L 336, 23. 12. 1994, p. 1. (4)  OJ No L 225, 20. 8. 1990, p. 1. (5)  OJ No L 225, 20. 8. 1990, p. 6. ANNEX   SECOND PROTOCOL TO THE GENERAL AGREEMENT ON THE TRADE IN SERVICES MEMBERS OF THE WORLD TRADE ORGANIZATION (hereinafter referred to as the ‘WTO’) whose Schedules of Specific Commitments and Lists of Exemptions from Article II of the General Agreement on Trade in Services concerning financial services are annexed to this Protocol (hereinafter referred to as ‘Members concerned’), HAVING CARRIED out negotiations under the terms of the Ministerial Decision on financial services adopted at Marrakesh on 15 April 1994, HAVING REGARD to the Second Annex on financial services, and to the Decision on the application of that Annex adopted by the Council for Trade in Services on 30 June 1995, AGREE AS FOLLOWS: 1. A schedule of specific commitments and a list of exemptions from Article II concerning financial services annexed to this Protocol relating to a Member shall, upon the entry into force of this Protocol for that Member, replace the financial services sections of the Schedule of Specific Commitments and the List of Article II Exemptions of that Member. 2. This Protocol shall be open for acceptance, by signature or otherwise, by the Members concerned until 30 June 1996. 3. This Protocol shall enter into force on the 30th day following the date of its acceptance by all Members concerned. If by 1 July 1996 it has not been accepted by all Members concerned, those Members which have accepted it before that date may, within a period of 30 days thereafter, decide on its entry into force. 4. This Protocol shall be deposited with the Director-General of the WTO. The Director-General of the WTO shall promptly furnish to each Member of the WTO a certified copy of this Protocol and notifications of acceptances thereof pursuant to paragraph 3. 5. This Protocol shall be registered in accordance with the provisions of Article 102 of the Charter of the United Nations. Done at Geneva this. day of [month] one thousand nine hundred and ninety-five, in a single copy in the English, French and Spanish languages, each text being authentic, except as otherwise provided for in respect of the schedules annexed hereto. THE EUROPEAN COMMUNITY AND ITS MEMBER STATES SCHEDULE OF SPECIFIC COMMITMENTS Supplement 1 Revision (This is authentic in English only) This text replaces the Financial Services section contained in:   pages 61 to 77 of document GATS/SC/31,   pages 24 to 29 of document GATS/SC/7,   pages 23 to 26 of document GATS/SC/33 and   pages 30 to 32 of document GATS/SC/82. EUROPEAN COMMUNITY AND ITS MEMBER STATES SCHEDULE OF SPECIFIC COMMITMENTS Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons Sector or subsector Limitations on market access Limitations on national treatment Additional commitments FINANCIAL SERVICES SECTOR (1) 1. The Community and its Member States undertake commitments on financial services in accordance with the provisions of the ‘Understanding on commitments in financial services’ (‘the Understanding’). 2. These commitments are subject to the limitations on market access and national treatment in the ‘all sectors’ section of this schedule and to those relating to the subsectors listed below. 3. The market access commitments in respect of modes (1) and (2) apply only to the transactions indicated in paragraphs B. 3 and B. 4 of the market access section of the Understanding respectively. 4. Notwithstanding note 1 above, the market access and national treatment commitments in respect of mode (4) on financial services are those in the ‘all sectors’ section of this schedule, except for Sweden in which case commitments are made in accordance with the Understanding. 5. The admission to the market of new financial services or products may be subject to the existence of, and consistency with, a regulatory framework aimed at achieving the objectives indicated in Article 2 (a) of the Financial Services Annex. 6. As a general rule and in a non-discriminatory manner, financial institutions incorporated in a Member State of the Community must adopt a specific legal form. A. Insurance and insurance-related services (1) DK: Compulsory air transport insurance can be underwritten only by firms established in the Community. (1) A: Higher premium tax is due for insurance contracts (except for contracts on reinsurance and retrocession) which are written by a subsidiary not established in the Community or by a branch not established in Austria. Exception from the higher tax can be granted. A: Promotional activity and intermediation on behalf of a subsidiary not established in the Community or of a branch not established in Austria (except for reinsurance and retrocession) are prohibited. A: Compulsory air transport liability can be underwritten only by a subsidiary established in the Community or by a branch established in Austria. DK: No persons or companies (including insurance companies) may for business purposes in Denmark assist in effecting direct insurance for persons resident in Denmark, for Danish ships or for property in Denmark, other than insurance companies licensed by Danish law or by Danish competent authorities. D: Compulsory air insurance policies can be underwritten only by a subsidiary established in the Community or by a branch established in Germany. D: If a foreign insurance company has established a branch in Germany, it may conclude insurance contracts in Germany relating to international transport only through the branch established in Germany. E, I: Unbound for the actuarial profession. F: Insurance of risks relating to ground transport may be carried out only by insurance firms established in the Community. I: Insurance of risks relating to cif exports by residents in Italy may be underwritten only by insurance firms established in the Community. I: Transport insurance of goods, insurance of vehicles as such and liability insurance regarding risks located in Italy may be underwritten only by insurance companies established in the Community. This reservation does not apply for international transport involving imports into Italy. FIN: Foreign insurers may without licence offer only reinsurances and retrocessions in Finland. FIN: The supply of insurance broker services is subject to a permanent place of business in Finland. P: Air and maritime transport insurance, covering goods, aircraft, hull and liability can be underwritten only by firms established in the EC; only persons or companies established in the EC may act as intermediaries for such insurance business in Portugal. S: The supply of direct insurance is allowed only through an insurance service supplier authorized in Sweden, provided that the foreign service supplier and the Swedish insurance company belong to the same group of companies or have an agreement of cooperation between them. (2) DK: Compulsory air transport insurance can be underwritten only by firms established in the Community. (2) A: Higher premium tax is due for insurance contracts (except for contracts on reinsurance and retrocession) which are written by a subsidiary not established in the Community or by a branch not established in Austria. Exception from the higher tax can be granted. A: Promotional activity and intermediation on behalf of a subsidiary not established in the Community or of a branch not established in Austria (except for reinsurance and retrocession) are prohibited. A: Compulsory air transport liability insurance can be placed only with established insurers. DK: No persons or companies (including insurance companies) may for business purposes in Denmark assist in effecting direct insurance for persons resident in Denmark, for Danish ships or for property in Denmark, other than insurance companies licensed by Danish law or by Danish competent authorities. D: Compulsory air insurance policies can be underwritten only by a subsidiary established in the Community or by a branch established in Germany. D: If a foreign insurance company has established a branch in Germany, it may conclude insurance contracts in Germany relating to international transport only through the branch established in Germany. F: Insurance of risks relating to ground transport may be carried out only by insurance firms established in the Community. FIN: Obligatory insurances (the statutory employment pension insurance, the statutory accident insurance, the motor third-party liability insurance, the insurance against treatment injury) have to be effected in Finland. I: Insurance of risks relating to cif exports by residents in Italy may be underwritten only by insurance firms established in the Community. I: Transport insurance of goods, insurance of vehicles as such and liability insurance regarding risks located in Italy may be underwritten only by insurance companies established in the Community. This reservation does not apply for international transport involving imports into Italy. P: Air and maritime transport insurance, covering goods, aircraft, hull and liability can be underwritten only by firms established in the EC; only persons or companies established in the EC may act as intermediaries for such insurance business in Portugal. (3) A: Representative offices and agencies of insurers are not allowed to write insurance contracts. (3) FIN: The general agent of the foreign insurance company shall reside in Finland. GR, E: The right of establishment does not cover the creation of representative offices or other permanent presence of insurance companies, except where such offices are established as agencies, branches or head offices. S: Insurance undertakings not incorporated in Sweden are required to deposit assets for agencies established in Sweden. IRL: The right of establishment does not cover the creation of representative offices. S: Non-life insurance undertakings not incorporated in Sweden conducting business in Sweden are — instead of being taxed according to the net result — subject to taxation based on the premium income from direct insurance operations. E: Before establishing a branch or agency in Spain to provide certain classes of insurance, a foreign insurer must have been authorized to operate in the same classes of insurance in its country of origin for at least five years. S: A founder of an insurance company shall be a natural person resident in Sweden or a legal entity incorporated in Sweden. FIN: Requirements concerning citizenship and place of residence, from which an exemption may be granted in some cases, apply to the founder, managing director, auditors and members of the board of directors and the supervisory board of an insurance company. FIN: Branches of foreign insurance companies cannot get a licence in Finland to carry on statutory insurances business (the statutory employment pension insurance, the statutory accident insurance, the motor third party liability insurance, the insurance against treatment injury). F, E: The establishment of branches is subject to a special authorization for the representative of the branch. In the case of Spain, the conditions to be met are related to the technical qualification and good standing of the person. I: Access to actuarial profession through natural persons only. Professional associations (no incorporation) among natural persons permitted. I: The authorization of the establishment of branches is ultimately subject to the evaluation of supervisory authorities. P: Foreign companies may carry out insurance intermediation in Portugal only through a company formed in accordance with the law of a Community Member State. P: In order to establish a branch in Portugal, foreign companies need to demonstrate prior operational experience of at least five years. S: Foreign companies may only establish as a subsidiary or through a resident agent. S: Insurance broking undertakings not incorporated in Sweden may establish a commercial presence only through a branch. (4) Unbound except as indicated in the horizonal section and subject to the specific conditions: (4) Unbound except as indicated in the horizontal section and subject to following specific limitations:     GR: A majority of the members of the board of directors of a company established in Greece shall be nationals of one of the Member States of the Community. DK: The general agent of an insurance branch will need to have resided in Denmark for the last two years unless they are a national of one of the Member States of the Community. The Minister for Business and Industry may grant exemption. DK: Residency requirement for managers and the members of the board of directors of a company. However, the Minister for Business and Industry may grant exemption from this requirement. Exemption is granted on a non-discriminatory basis. E, I: Residence requirement for actuarial profession. B. Banking and Other Financial Services (excluding insurance) (1) B: Establishment in Belgium is required for the provision of investment advisory services. (1) None     I: The offer and marketing of services concerning the distribution to the public, through telecommunication or other information means, of information concerning prices, the volume of transactions, the offer and demand conditions relating to the negotiation of securities dealt in the Italian regulated market, or in other recognized markets, requires prior authorization by the Stock Exchanges Commission (Consob). This authorization may not be granted if the authorities determine that there is a risk that the data provided may induce the public to error. I: An establishment (a securities investment company incorporated in Italy or a bank subsidiary or branch) is needed in order to provide investment research and advice relating to securities (dealing, issue, underwriting) and asset management, securities custody and services regarding mergers, acquisitions, corporate restructuring, management buy-outs and venture capital. Collective asset management (excluding Ucits) is extended to banks, insurance companies, securities investment companies with their legal head office in the EC. I: Unbound for promotori di servizi finanziari (financial salesmen). (2) D: Issues of securities denominated in German marks can be lead managed only by a credit institution, subsidiary or branch, established in Germany. (2) S: Account operating institutions in the VPC register which do not have a clearing account with the central bank (Riksbanken) have to make a certain deposit. GR: Establishment is required for the provision of custodial and depository services involving the administration of interest and principal payments due on securities issued in Greece. I: An establishment (a securities investment company incorporated in Italy or a bank subsidiary or branch) is needed in order to provide investment research and advice relating to securities (dealing, issue, underwriting) and asset management, securities custody and services regarding mergers, acquisitions, corporate restructuring, management buy-outs and venture capital. Collective asset management (excluding Ucits) is extended to banks, insurance companies, securities investment companies with their legal head office in the EC. I: Residents in Italy need authorization to purchase or sell abroad unrefined gold. FIN: Payments from governmental entities (expenses) shall be transmitted through the Finnish postal giro system or through the Postipankki Ltd. P: Open-ended investment funds are required to invest 25 % of their funds in Portuguese Government funds. The ability of residents in Portugal to carry out the following operation abroad is restricted:       — issue on a foreign market of domestic securities and negotiable instruments. S: Custody, depository and settlement services, securities registered in the (Swedish) Securities Register Centre (Värdepapperscentralen VPC SB) can only be supplied by suppliers who are account operating institutions. A prerequisite is that the supplier is supervised by the (Swedish) Financial Supervisory Authority. UK: Sterling issues, including privately led issues, can be lead managed only by a firm established in the Community. (3) All Member States: — The establishment of a specialized management company is required to perform the activities of management of units trusts and investment companies (Articles 6 and 13 of Ucits Directive, 85/611/EEC). — Only firms having their registered office in the Community can act as depositories of the assets of investment funds (Articles 8 (1) and 15 (1) of the Ucits Directive, 85/61 I/EEC). F: In addition to French credit institutions, issues denominated in French francs may be lead managed only by French subsidiaries (under French law) of non-French banks which are authorized, based on sufficient means and commitments in Paris of the candidate French subsidiary of a non-French bank. These conditions apply to lead banks running the books. A non-French bank may be, without restrictions or requirement to establish, jointly-lead or co-lead manager of Euro-franc bond issue. A: Licensing of branches or subsidiaries of foreign banks may be subject to an economic interest test. I: Representative offices of foreign intermediaries cannot carry out promotional activities in the area of investment in securities. A: Only members of the Austrian Stock Exchange may engage in securities trading at the Stock Exchange. A: For trading in foreign exchange and foreign currency the authorization of the Austrian National Bank is required. A: Mortgage bonds and municipal bonds may be issued by banks specialized and authorized for this activity. A: For carrying out services of pension fund management a company specialized only for this activity and incorporated as a stock company in Austria is required. B: With certain exceptions (block trading), financial institutions may engage in securities trading only through stock exchange firms incorporated in Belgium. DK: Financial institutions may engage in securities trading on the Copenhagen Stock Exchange only through subsidiares incorporated in Denmark. E: Financial institutions may engage in securities trading in securities listed on an official stock exchange or in the government securities market only through securities firms incorporated in Spain. FIN: Acquisition of shares by foreign owners giving more than one third of the voting rights of a major Finnish commercial bank or credit institution (with more than 1 000 employees or with a turnover exceeding 1 000 million) Finnish markka or with a balance sheet total exceeding Fmk 1 000 million is subject to confirmation by the Finnish authorities; the confirmation may be denied only if an important national interest would be jeopardized. FIN: For credit institutions including banks, requirements concerning nationality and place of residence, from which exemptions may be granted, apply to the founder, the supervisory board and the board of management as well as the chief general manager and auditors. FIN: Professional intermediation of securities and derivatives (options and futures) requires a permanent place of business in the form of a limited liability company, a deposit bank, other credit institution or a branch of a foreign credit or financial institution. FIN: Requirements concerning citizenship and place of residence apply to the board of directors and managing director of a stock exchange brokerage firm as well as to a stock exchange broker. FIN: Citizenship and residency requirements for market makers and brokers on derivative exchange, from which exemptions may be granted. FIN: Payments from governmental entities (expenses) shall be transmitted through the Finnish postal giro System or through the Postipankki Ltd. GR: Financial institutions may engage in the trading of securities listed on the Athens Stock Exchange only through stock exchange firms incorporated in Greece. GR: For the establishment and operations of branches a minimum amount of foreign exchange must be imported, converted into drachmas and kept in Greece as long as a foreign bank continues to operate in Greece: — Up to four branches this minimum is currently equal to half of the minimum amount of share capital required for a credit institution to be incorporated in Greece; — For the operation of additional branches the minimum amount of capital must be equal to the minimum share capital required for a credit institution to be incorporated in Greece. IRL: In the case of units trusts, collective investment schemes constituted as variable capital companies, and investment limited partnerships (other than undertakings for collective investment in transferable securities, Ucits), the trustee/depositary or management company is required to be incorporated in Ireland or in another Member State of the Community. In the case of an investment limited partnership, at least one general partner must be incorporated in Ireland. IRL: The right of establishment does not cover the establishment of representative offices of foreign banks. I: A separate incorporation in Italy in the form of a securities company is required for firms other than banks (including foreign banks branches) in order to provide services related to securities dealing (including dealing for the own account or for the account of customers (2), issue and distribution of securities, acceptance of sale and purchase orders, investment advice, asset and portfolio management, and raising funds from the public by means of activities which may also be promotional (3) and carried on in a place different from the legal head office or principal administrative establishment of the issuer, supplier or person marketing the investment). I: Clearing and settlement of securities may be conducted only by the official clearing system. I: The public offer of securities (as provided for under 18 bis of Law 216/74), other than shares, debt securities (including convertible debt securities) can only be made by Italian limited companies, foreign companies duly authorized, public bodies or companies belonging to local authorities whose assigned capital is not below Lit 2 billion. I: Centralized deposit, custody and administration services for government securities can be provided only by the Bank of Italy, or by Monte Titoli SpA for shares, securities of a participating nature and other bonds traded in a ruled market. S: A founder of a banking company shall be a natural person resident in Sweden or a foreign bank. A founder of a savings bank shall be a natural person resident in Sweden. NL: Only companies incorporated according to the law and regulations of an EC Member State may become members of the Amsterdam Stock Exchange. S: A branch of a fund management company not incorporated in Sweden may not operate certain collective investment funds, where the investor enjoys certain tax benefits (Allemansfonder). P: The establishment of non-EC banks may be subject to an economic needs tests. P: The services of venture capital, factoring, close-ended investment fund management and broker-dealer services (excluding those provided on the Lisbon Stock Exchange) may be provided by credit-institutions or investment firms incorporated in the Community (if authorized in their country of origin to supply those services). Aforementioned services, when rendered by other companies, as well as pension fund management and broker-dealer services on the LSE, may be provided only by companies incorporated in Portugal. UK: The following categories of financial institutions dealing in government debt are required to be incorporated in the United Kingdom and be separately capitalized: — gilt edged market makers (or GEMMs), which are primary dealers in gilt-edged government debt and through which the government operates in executing government debt management policy; — discount houses which are primary dealers for treasury bills and other money market instruments, and through which the government operates in executing monetary policy, — stock exchange money brokers (SEMBs), which act as intermediaries between GEMMs and lenders of gilt-edged stock; and — inter-dealer brokers (IDBs), which act as intermediaries between GEMMs. S: Undertakings not incorporated in Sweden may establish a commercial presence only through a branch, and in case of banks, also through a representative office. (4) Unbound except as indicated in the horizontal section and subject to the specific conditions: (4) Unbound except as indicated in the horizontal section and subject to the following specific limitations:     F: Sociétés d'investissement a capital fixe: condition of nationality for the president of the board of directors, the directors-general and no less than two thirds of the administrators, and also, when the securities firm has a supervisory board or council, for the members of such board or its director-general, and no less than two thirds of the members of the supervisory council. I: Condition of residence for ‘promotori di servizi finanziari’ (financial salesmen). GR: Credit institutions should name at least two persons who are responsible for the operations of the institution. Condition of residency applies to these persons. EUROPEAN COMMUNITIES AND THEIR MEMBER STATES FINAL LIST OF ARTICLE II (EXEMPTIONS) (This is authentic in English only) EUROPEAN COMMUNITIES AND THEIR MEMBER STATES Sector or subsector Description of measure indicating its inconsistency with Article II Countries to which the measure applies Intended duration Conditions creating the need for the exemption Direct non-life insurance Measures based on a bilateral agreement between the European Communities and Switzerland on direct insurance other than life insurance. This agreement provides, on a reciprocal basis, for freedom of establishment and the right to take up or pursue non-life insurance business for agencies and branches of undertakings whose head office is situated in the territory of the other Contracting Party. Switzerland Indefinite Need to remove obstacles to the taking up and pursuit of non-life insurance business in the framework of an agreement between the European Communities and Switzerland on non-life insurance consistent with the provisions of paragraph 3 of the Annex of Financial Services Financial services Measure granting favourable tax treatment (offshore regime) in Italy to service suppliers trading with the countries to which the measure applies. States in Central, Eastern and South-Eastern Europe, and all Members of the Commonwealth of Independent States 10 years The need to aid the countries concerned in their transition to a market economy. (1)  Unlike foreign subsidiaries, branches established directly in a Member State by a non-Community financial institution are not, with certain limited exceptions, subject to prudential regulations harmonized at Community level which enable such subsidiaries to benefit from enhanced facilities to set up new establishments and to provide cross-border services throughout the Community. Therefore, such branches receive an authorization to operate in the territory of a Member State under conditions equivalent to those applied to domestic financial institutions of that Member State, and may be required to satisfy a number of specific prudential requirements such as, in the case of banking and securities, separate capitalization and other solvency requirements and reporting and publication of accounts requirements or, in the case of insurance, specific guarantee and deposit requirements, a separate capitalization, and the localization in the Member State concerned of the assets representing the technical reserves and at least one third of the solvency margin. Member States may apply the restrictions indicated in this schedule only with regard to the direct establishment from a third country of a commercial presence or to the provision of cross-border services from a third country; consequently, a Member State may not apply these restrictions, including those concerning establishment, to third-country subsidiaries established in other member States of the Community, unless these restrictions can also be applied to companies or nationals of other Member States in conformity with Community law. (2)  From 1 January 1993 neither foreign nor domestic banks may provide securities dealing for its own account or for the account of customers; however, banks, including branches of foreign banks, are allowed to deal in Treasury bonds and State-backed securities. (3)  Door-to-door selling. DECISION ADOPTING THE SECOND PROTOCOL TO THE GENERAL AGREEMENT ON TRADE IN SERVICES Adopted by the Committee on Trade in Financial Services on 21 July 1995 THE COMMITTEE ON TRADE IN FINANCIAL SERVICES, HAVING REGARD to the results of the negotiations conducted under the terms of the Decision on financial services adopted at Marrakesh on 15 April 1994, HAVING REGARD to the Second Annex on financial services, and to the Decision on the application of that Annex adopted by the Council for Trade in Services on 30 June 1995, DECIDES AS FOLLOWS: 1. To adopt the text of the Second Protocol to the General Agreement on Trade in Services. 2. Commencing immediately and continuing until the date of entry into force of the Second Protocol to the General Agreement on Trade in Services, Members concerned shall, to the fullest extent consistent with their existing legislation, not take measures which would be inconsistent with their undertakings resulting from these negotiations. 3. The Committee on Trade in Financial Services shall monitor the acceptance of the Protocol by Members concerned and shall, at the request of a Member, examine any concerns raised regarding the application of paragraph 2. DECISION ON COMMITMENTS IN FINANCIAL SERVICES Adopted by the Council for Trade in Services on 21 July 1995 THE COUNCIL FOR TRADE IN SERVICES, HAVING REGARD to the Second Annex on financial services, and the Second Services adopted by the Council for Trade in Services, HAVING REGARD to the Decision on the Application of the Second Annex on financial services adopted by the Council for Trade in Services on 30 June 1995, NOTING the results of the negotiations carried out under the terms of the Decision on financial services adopted at Marrakesh on 15 April 1994, DECIDES AS FOLLOWS: 1. If the Second Protocol to the General Agreement on Trade in Services (GATS) does not enter into force in accordance with paragraph 3 therein: (a) Notwithstanding Article XXI of the GATS, a Member may during a period of 60 days beginning on 1 August 1996, modify or withdraw all or part of the specific commitments on financial services inscribed in its schedule. (b) Notwithstanding Article II of the GATS and paragraphs 1 and 2 of the Annex on Article II exemptions, a Member may, during the period referred to in point (a), list in that Annex measures relating to financial services which are inconsistent with paragraph 1 of Article II of the GATS. 2. The Committee on Trade in Financial Services shall establish any procedures for the implementation of paragraph 1. SECOND DECISION ON FINANCIAL SERVICES Adopted by the Council for Trade in Services on 21 July 1995 THE COUNCIL FOR TRADE IN SERVICES, HAVING REGARD to the Second Annex on financial services, NOTING the results of the negotiations carried out under the terms of the Decision on financial services adopted at Marrakesh on 15 April 1994, HAVING REGARD to the Decision on the application of the Second Annex on financial services adopted by the Council for Trade in Services on 30 June 1995, DECIDES AS FOLLOWS: 1. Notwithstanding Article XXI of the General Agreement on Trade in Services (GATS), a Member may during a period of 60 days beginning on 1 November 1997, modify or withdraw all or part of the specific commitments on financial services inscribed in its schedule. 2. Notwithstanding Article II of the GATS and paragraphs 1 and 2 of the Annex on Article II exemptions, a Member may, during the same period referred to in paragraph 1, list in that Annex measures relating to financial services which are inconsistent with paragraph 1 of Article II of the GATS. 3. The Committee on Trade in Financial Services shall oversee any negotiations that may take place prior to the date specified in paragraph 1. It shall also establish any procedures necessary for the application of paragraphs 1 and 2. 4. The application of this Decision shall be contingent upon the entry into force of the Second Protocol to the General Agreement on Trade in Services. THIRD PROTOCOL TO THE GENERAL AGREEMENT ON TRADE IN SERVICES MEMBERS OF THE WORLD TRADE ORGANIZATION whose schedules of specific commitments to the General Agreement on Trade in Services relating to movement of natural persons are annexed to this Protocol, HAVING CARRIED out negotiations under the terms of the Ministerial Decision on negotiations on movement of natural persons adopted at Marrakech on 15 April 1994, HAVING REGARD to the results of such negotiations, HAVING REGARD to the Decision on the movement of natural persons adopted by the Council for Trade in Services on 30 June 1995, AGREE AS FOLLOWS: 1. The commitments on movement of natural persons annexed to this Protocol relating to a Member shall, upon the entry into force of this Protocol for that Member, replace or supplement the relevant entries on movement of natural persons in the schedule of specific commitments of that Member. 2. This Protocol shall be open for acceptance, by signature or otherwise, by Members concerned until 30 June 1996. 3. This Protocol shall enter into force on the 30th day after 1 January 1996 for those Members which have accepted it by that date, and for those accepting it after that date, which date shall not be beyond 30 June 1996, it shall enter into force on the 30th day following the date of each acceptance. If a Member whose schedule is annexed to this Protocol does not accept it by thar date, the matter shall be referred to the Council for Trade in Services for consideration and appropriate action. 4. This Protocol shall be deposited with the Director-General of the World Trade Organization. The Director-General shall promplty furnish to each Member a certified copy of this Protocol and notifications of acceptances thereof pursuant to paragraph 3. 5. This Protocol shall be registered in accordance with the provisions of Article 102 of the Charter of the United Nations. Done at Geneva this. day of [month] one thousand nine hundred and ninety-five, in a single copy in the English, French and Spanish languages, each text being authentic, except as otherwise provided for in respect of the schedules annexed hereto. EUROPEAN COMMUNITY AND ITS MEMBER STATES SCHEDULE OF SPECIFIC COMMITMENTS Supplement 2 (This is authentic in English only) This text supplements the entries relating to the movement of natural persons section contained on pages 7 to 11 document GATS/SC/31. EUROPEAN COMMUNITY AND ITS MEMBER STATES SCHEDULE OF SPECIFIC COMMITMENTS Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons Sector or subsector Limitations on market access Limitations on national treatment Additional commitments I. HORIZONTAL COMMITMENTS   (4) (iii) Unbound except for measures concerning the entry into and temporary stay within a Member State of the following category of natural persons without requiring compliance with an economic needs test except where indicated for a specific subsector. Access is subject to the following (1): — The natural persons are engaged in the supply of a service on a temporary basis as employees of a juridical person, who has no commercial presence in any Member State of the European Community. — The juridical person has obtained a service contract, for a period not exceeding three months from a final consumer in the Member State concerned, through an open tendering procedure or any other procedure which guarantees the bona fide character of the contract (e. g. advertisement of the availability of the contract) where this requirement exists or is introduced in the Member State pursuant to the laws, regulations and requirements of the European Community or its Member States. — The natural person seeking access should be offering such services as an employee of the juridical person supplying the service for at least the year (two years in the case of GR) immediately preceding such movement. — The temporary entry and stay within the Member State concerned shall be for a period of not more than 3 months in any 12 month period (24 months in the case of NL) or for the duration of the contract, whatever is less. — The natural person must possess the necessary academic qualifications and professional experience as specified for the sector or activity concerned in the Member State where the service is supplied. — The commitment relates only to the service activity which is the subject of the contract; it does not confer entitlement to exercise the professional title of the Member State concerned. — The number of the persons covered by the service contract shall not be larger than necessary to fulfil the contract, as it may be decided by the laws, regulations and requirements of the European Community and the Member State where the service is supplied. — The service contract has to be obtained in one of the activities mentioned below and subject to the additional conditions mentioned in the subsector by the Member State concerned: — legal services — accounting services — taxation advisory services — architectural services, urban planning and landscape architectural services — engineering services, integrated engineering services — computer and related services — research and development services — advertising — management consulting services — services related to management consulting — technical testing and analysis services — translation services — construction services, site investigation work — higher education services — travel agencies and tour operator services — entertainment services — services related to the sale of equipment or to the assignment of a patent. (4) Unbound except for measures concerning the categories of natural persons referred to in the Market Access column. Legal advice on home country law and public international law (page 12 in the schedule dated April 1994): (4) Unbound except for D and UK where: as indicated in the horizontal section under (iii) and subject to the following specific limitations: (4) Unbound except as indicated in the horizontal section. D and UK: University degree and professional qualifications and three years' professional experience in the sector. D: Unbound for activities reserved to ‘Rechtsanwalt’. Accounting services (page 14 in the schedule dated April 1994) (CPC 86212 other than ‘auditing services’): (4) Unbound except for A, D, L, NL, UK, S where: as indicated in the horizontal section under (iii) and subject to the following specific limitations: (4) Unbound except as indicated in the horizontal section. Bookkeeping services for A only (page 17 in the schedule dated April 1994) (CPC 86220): A, D, NL, UK, S: University degree and professional qualifications and three years' experience in the sector. A: examination before the Austrian professional body. The employer must be a member of the relevant professional body in the home country where such body exists. D: Unbound for activities reserved by law in the ‘Wirtschaftspriifer’. Taxation advisory services (page 18 in the schedule dated April 1994) (CPC 86301): (4) Unbound except for A, B, D, L, NL, UK, S where: as indicated in the horizontal section under (iii) and subject to the following specific limitations: (4) Unbound except as indicated in the horizontal section. A, B, NL, UK, S: University degree and professional qualifications and three years' experience in the sector. A: Examination before the Austrian professional body. The employer must be a member of the relevant professional body in the home country where such body exists. D: Unbound except for consulting services related to foreign tax law, where: university degree and professional, qualifications and three years' professional experience in the sector. Architectural services (page 20 in the schedule dated April 1994): (CPC 8671) (4) Unbound except for DK, E, L, NL, UK, S where: as indicated in the horizontal section under (iii) and subject to the following specific limitations: (4) Unbound except as indicated in the horizontal section. and urban planning and landscape architectural services (page 22 in the schedule dated April 1994): (CPC 8674) DK, NL, UK, S: University degree and professional qualifications and three years' professional experience in the sector. E: Academic and professional qualifications recognized by the national authorities and licence delivered by the Professional Association. Unbound for CPC 86713, 86714, 86719. Engineering services (page 21 in the schedule dated April 1994): (CPC 8672) (4) Unbound except for B, DK, E, NL, UK, S where: as indicated in the horizontal section under (iii) and subject to the following specific limitations: (4) Unbound except as indicated in the horizontal section. B, DK, NL, UK, S: University degree and professional qualifications and three years' professional experience in the sector. UK: Compliance with an economic needs test is required. E: Academic and professional qualifications recognized by the national authorities and licence delivered by the professional association. Integrated engineering services (page 22 in the schedule dated April 1994): (CPC 8673) (4) Unbound except for B, DK, E, NL, UK, S where: as indicated in the horizontal section under (iii) and subject to the following limitations: (4) Unbound except as indicated in the horizontal section. B, DK, NL, UK, S: University degree and professional qualifications and three years' professional experience in the sector. UK: Compliance with an economic needs test is required. E: Academic and professional qualifications recognized by the national authorities and licence delivered by the professional association. Computer and related services (pages 31 to 33 in the schedule dated April 1994): (CPC 841, 842, 843, 844) (4) Unbound except for B, DK, GR, I, L, NL, S where: as indicated in the horizontal section under (iii) and subject to the following specific limitations: (4) Unbound except as indicated in the horizontal section. B, DK, I, NL, S: Unbound, except for computer scientists, systems analysts, programmers, software document analysts and field engineers where: university degree and three years' professional experience in the sector. I: Compliance with an economic needs test is required. GR: Unbound, except for computer scientists, systems analysts, programmers, software document analysts where: university degree and five years' professional experience in the sector. Research services (CPC 852) (page 33 of the schedule dated April 1994): (to be added under CPC 851 and 853 for F only) (4) Unbound except for F and L where concerning the temporary entry of researchers: as indicated in the horizontal section under (iii) and subject to the following specific limitations: (4) Unbound except as indicated in the horizontal section. F: — The researchers are in possession of an employment contract from a research body. — The work permit is delivered for a period not exceeding nine months renewable for the duration of the contract. — Compliance with an economic needs test is required. — The research body must pay a tax to the International Migration Office. Advertising (page 38 in the schedule dated April 1994): (CPC 871) (4) Unbound except for B, D, GR, I, L, UK, S where: as indicated in the horizontal section under (iii) and subject to the following specific limitations: (4) Unbound except as indicated in the horizontal section. B, D, I, UK, S: Relevant qualifications and three years' professional experience. I, UK: Compliance with an economic needs test is required. GR: Relevant qualifications and five years' professional experience. Management consulting services (page 39 in the schedule dated April 1994): (CPC 865) (4) Unbound except for B, D, DK, I, L, UK, S where: as indicated in the horizontal section under (iii) and subject to the following specific limitations: (4) Unbound except as indicated in the horizontal section. B, D, DK, I, UK, S: Unbound except for managers and senior consultants where: university degree and three years' professional experience. I, UK: Compliance with an economic needs test is required. Services related to management consulting (page 39 in the schedule dated April 1994): (CPC 866) (4) Unbound except for B, D, DK, I, L, UK, S where: as indicated in the horizontal section under (iii) and subject to the following specific limitations: (4) Unbound except as indicated in the horizontal section. B, D, DK, I, UK, S: Unbound except for managers and senior consultants where: university degree and three years' professional experience. I, UK: Compliance with an economic needs test is required. Technical testing and analysis services (page 40 in the schedule dated April 1994): (CPC 8676) (4) Unbound except for D, DK, L, UK, S where: as indicated in the horizontal section under (iii) and subject to the following specific limitations: (4) Unbound except as indicated in the horizontal section. D, DK, UK, S: University degree or technical qualifications demonstrating knowledge and three years' professional experience       UK: Compliance with an economic needs test is required. Translation services (page 48 in the schedule dated April 1994): (CPC 87905) (4) Unbound except for GR, I, IRL, UK, S where: as indicated in the horizontal section under (iii) and subject to the following specific limitations: (4) Unbound except as indicated in the horizontal section. GR: Relevant qualifications and five years' professional experience. I, IRL, UK, S: Relevant qualifications and three years' professional experience. I, UK: Compliance with an economic needs test is required. Construction services (page 51 in the schedule dated April 1994): (CPC 511, 512, 513, 514, 515, 516, 517, 518) (4) Unbound except for NL and F where: as indicated in the horizontal section under (iii) and subject to the following specific limitations: (4) Unbound except as indicated in the horizontal section. NL: University degree and professional qualifications and three years' professional experience in the sector. F: Unbound except for measures concerning the temporary entry for technicians under the following conditions: — The technician is an employee of a juridical person within the territory of another Member and is transferred to a commercial presence in F which has a contract with that juridical person. — The work permit is delivered for a period not exceeding six months. — The technician presents a work certificate from the commercial presence in F and a letter from the juridical person within the territory of another Member, demonstrating its agreement to the transfer. — Compliance with an economic needs test is required. — The commercial presence body must pay a tax to the International Migration Office. Site investigation work (CPC 5111) (4) Unbound except for B, D, DK, UK, S where: as indicated in the horizontal section under (iii) and subject to the following specific limitations: (4) Unbound except as indicated in the horizontal section. B, DK, UK, S: University degree and professional qualifications and three years' professional experience in the sector. UK: Compliance with an economic needs test is required. D: Unbound except for limited range of services of site investigation work where: university degree and professional qualifications and three years' professional experience in the sector. Higher education services (page 57 of the schedule dated April 1994): (CPC 923) (4) Unbound except for F and L concerning the temporary entry of professors where: as indicated in the horizontal section under (iii) and subject to the following specific limitations: (4) Unbound except as indicated in the horizontal section. F: — The professors have obtained an employment contract from a university or other higher education institution. — The work permit is delivered for a period not exceeding nine months renewable for the duration of the contract. — Compliance with an economic needs test is required unless those professors are designated directly by the Minister in charge of higher education. — The recruiting institution must pay a tax to the International Migration Office. Travel agencies and tour operators services (page 82 in the schedule dated April 1994): (CPC 7471) (4) Unbound except for A, B, D, DK, I, FIN, IRL, S where: as indicated in the horizontal section under (iii), and subject to the following specific limitations: (4) Unbound except as indicated in the horizontal section. A, B, D, DK, FIN, I, IRL, S: Unbound except for tour managers (persons whose function is to accompany a tour group of a minimum of 10 people, without acting as guides in specific locations) where for A, B, D, DK, I, IRL, S: professional certificate and three years' professional experience. I: Compliance with an economic needs test is required     Entertainment services (including theatre, live bands and circus services) (page 84 in the schedule dated April 1994): (CPC 9619) (4) Unbound except for A and F concerning the temporary entry of artists where: as indicated under the horizontal section under (iii) and subject to the following specific limitations: (4) Unbound except as indicated in the horizontal section. A: Access is limited to persons whose main professional activity is in the field of fine arts, deriving the major part of their income from that activity. Such persons shall not exercise any other commercial activity in Austria. F: — The artists have obtained an employment contract from an authorized entertainment enterprise. — The work permit is delivered for a period not exceeding nine months renewable for a duration of three months. — Compliance with an economic needs test is required. — The entertainment enterprise must pay a tax to the International Migration Office. Services related to the sale of equipment or to the assignment of a patent: (4) Unbound except for F concerning the temporary entry of technicians where: as indicated under the horizontal section under (iii) and subject to the following specific limitations: (4) Unbound except as indicated in the horizontal section. — The technician is an employee of a juridical person within the territory of another Member, and — that juridical person manufactures equipment and has sold that equipment to a commercial presence in France, or — that juridical person has assigned a patent to a commercial presence in France. — the technician is in charge of supervising the construction of the equipment, or of ensuring the preparation for the exploitation of the patent. — the work permit is delivered for a period not exceeding six months. — the technician presents a work certificate from the commercial presence in France and a letter from the juridical person within the territory of another Member demonstrating its agreement to the transfer. — the commercial presence in France must pay a tax to the International Migration Office. (1)  All other requirement of European Community and Member States' laws, regulations and requirements regarding entry, stay and work shall continue to apply. The service contract shall comply with the laws, regulations and requirements of the European Community and the Member State where the service contract is executed. DECISION ON MOVEMENT OF NATURAL PERSONS COMMITMENTS Adopted by the Council for Trade in Services on 21 July 1995 THE COUNCIL FOR TRADE IN SERVICES, HAVING REGARD to the results of the negotiations conducted under the terms of the Decision on movement of natural persons adopted in Marrakesh on 15 April 1994, HAVING REGARD to the Decision on the movement of natural persons adopted by the Council for Trade in Services on 30 June 1995, DECIDES AS FOLLOWS: 1. To adopt the text of the Third Protocol to the General Agreement on Trade in Services. 2. Commencing immediately and continuing until the date of entry into force of the Third Protocol to the General Agreement on Trade in Services, Members concerned shall, to the fullest extent consistent with their existing legislation, not take measures which would be inconsistent with their undertakings resulting from these negotiations. 3. The Council for Trade in Services shall monitor the acceptance of the Protocol by Members concerned and shall, at the request of a Member, examine any concerns raised regarding the application of paragraph 2 above

Proposal for a COUNCIL DECISION authorizing the Kingdom of Sweden in accordance with Article 8(4) of Council Directive 92/81/EEC to introduce or continue to apply exemptions from, or reductions in, excise duties on certain mineral oils used for specific purposes

http://publications.europa.eu/resource/cellar/eaf4d163-ffdc-41a0-a893-ccaf7aa19856

eng

*F*fcf#» COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 25. 06. 1996 COM(96) 298 final Proposal for a COUNCIL DECISION authorizing the Kingdom of Sweden in accordance with Article 8(4) of Council Directive 92/81/EEC to introduce or continue to apply exemptions from, or reductions in, excise duties on certain mineral oils used for specific purposes (presented by the Commission) EXPLANATORY MEMORANDUM Under Article 8(4) of Council Directive 92/81/EEC1 on the harmonization of the structures of excise duties on mineral oils, the Council, acting unanimously on a proposal from the Commission, may authorize any Member State to introduce exemptions from, or reductions in, excise duties on the grounds of specific policy considerations. The Swedish authorities have informed the Commission that they wish to extend application of the reduced rate of excise duty on mineral oils used for industrial purposes, as authorized in the Treaty of Accession2 (annex 9, item taxation 9G). Sweden wishes to continue to apply a reduced rate of excise duty on mineral oils by introducing both a lower rate than the standard rate and a reduced rate for enterprises with a very high consumption of energy3. The Member States have been informed of this request in accordance with the Directive. The Directive provides for the Commission to review such exemptions and reductions periodically. If the Commission considers that they may no longer be applied on the grounds that they distort competition or the operation of the internal market or are incompatible with Community policy on protection of the environment, it is to submit appropriate proposals to the Council. In any event, the Commission is to submit a report to the Council on such exemptions and reductions no later than 31 December 1996. 1 2 OJ No L 316, 31. 10. 1992, p. 12. OJ No C 241, 29. 8. 1994, pp. 340 The Swedish administration regards as large companies consuming energy, the companies where the C02 tax is higher than 0,8% of the turnover. Proposal for a COUNCIL DECISION authorizing the Kingdom of Sweden in accordance with Article 8(4) of Council Directive 92/81/EEC to introduce or continue to apply exemptions from, or reductions in, excise duties on certain mineral oils used for specific purposes THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, Having regard to Council Directive 92/81/EEC of 19 October 1992 on the harmonization of the structures of excise duties on mineral oils, and in particular Article 8(4) thereof, Having regard to the proposal from the Commission, Whereas, under Article 8(4) of Council Directive 92/81 /EEC, the Council, acting unanimously on a proposal from the Commission, may authorize any Member State to introduce exemptions from, or reductions in, excise duties on the grounds of specific policy considerations; Whereas the Swedish authorities have informed the Commission that they wish to apply a reduced rate of excise duty on mineral oils used for industrial purposes, as authorized in the Treaty of Accession; Whereas Sweden wishes to apply a reduced rate of excise duty on mineral oils by introducing both a lower rate than the standard rate and a reduced rate for enterprises with a very high consumption of energy; Whereas the other Member States have been informed of this notification; Whereas the Commission and all the Member States accept that such exemption is justified on the grounds of specific policy considerations and that it does not give rise to distortions of competition or hinder the operation of the internal market; Whereas the Commission regularly reviews reductions and exemptions to monitor their continued compatibility with the proper operation of the internal market or with Community policy on protection of the environment; Whereas, under Article 8(6) of Council Directive 92/81/EEC, the Council is to review the situation no later than 31 December 1996 on the basis of a report by the Commission, HAS ADOPTED THIS DECISION: - 4- Article 1 1998, 31 December in accordance with Article 8(4) Until of Council Directive 92/81/EEC and without prejudice to the obligations imposed by Council Directive 92/82/EEC of 19 October 1992 on the approximation of excise dunes on mineral oils,4 Sweden is hereby authorized to apply a reduced rate of excise duty on mineral oils used for industrial purposes by introducing both a lower rate than the standard rate and a reduced rate for enterprises with a very high consumption of energy, provided that such rates at all times respect the minimum rates of excise duty on mineral oils laid down in Community law, and that it does not give rise to distortions of competition. Article 1 This Decision is addressed to the Kingdom of Sweden. Done at Brussels, For the Council The President 4 OJ No L 316, 31. 10. 1992, p. 19. - S- ISSN 0254-1475 COM(96) 298 final DOCUMENTS EN 02 B9 12 Catalogue number : CB-CO-96-307-EN-C ISBN 92-78-05754-1 Office for Official Publications of the European Communities L-2985 Luxembourg

Proposal for a COUNCIL REGULATION (EC) laying down certain technical measures for the conservation of fishery resources

http://publications.europa.eu/resource/cellar/ce5b44d8-525f-44a2-b89d-b9ae42407f46

eng

"H. WWlWftfl Tf* COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 25. 06. 1996 COM(96) 296 final 96/0160 (CNS ) Proposal for a COUNCIL REGULATION (EC) laying down certain technical measures for the conservation of fishery resources (presented by the Commission) EXPLANATORY MEMORANDUM At the Council of Ministers of 21-22 December 1995, the Commission presented the "Report of the application of technical measures in the Common Fisheries Policy" (COM(95) 669 final). The report concluded that the technical regulations currently in force (for the Atlantic, Baltic and Mediterranean respectively) have not been effective enough in reducing the catch of juvenile fish, and suggested a series of ways in which their effectiveness could be improved. On the basis of this document, the Commission committed itself to present, by 1 June 1996, proposals for a modification of existing technical measures that would improve their effectiveness to avoid the catch of juvenile fish. This new regulation, when adopted, will replace Council regulation (EEC) No. 3094/86 laying down technical conservation measures for fisheries in the Atlantic. The two fundamental aspects to consider in relation with this proposal are the following: Firstly, two types of measure are proposed to reduce the catch of juvenile fish: to improve the selectivity of towed gear with respect to the existing legislation and to limit the fishing activity in certain areas and seasons where and when juvenile fish are abundant. Secondly, the experience of the application of the current regulations shows that the existing rules are complex, difficult to understand (to both managers and fishermen) and difficult to enforce. These difficulties contribute to make the regulation less effective. Therefore the current proposal includes provisions that intend to be simple, understandable and enforceable. The selectivity of towed gear. The selectivity of towed gear is influenced by a number of factors: mesh size, twine diameter, the use of certain devices (separator trawls, square mesh panels), etc. These possibilities are not mutually exclusive; on the contrary they can be combined in some cases. However, it is understood that the single most effective way to improve the selectivity of towed gear is the increase in mesh size. The proposal therefore concentrates on a general increase in mesh sizes, with respect to the current situation, but also includes provisions on other characteristics of fishing gear. At the same time, the use of square mesh panels to increase species separation or improve selectivity is made mandatory for the larger mesh sizes. The proposal establishes provisions on the mesh size of towed gear that are common for all Community waters in the Atlantic (except Skagerrak and Kattegat). It is understood that technical measures should refer to specific fisheries (groups of species caught together) rather than to geographical areas. Skagerrak and Kattegat are treated separately. The reason for this is that technical measures in this area are a part of the Agreed Minute signed with Norway in 1982. Although there seems to be little biological reason to justify provisions for Skagerrak and Kattegat different to those for the North Sea, and while the Commission will try to bring the measures in this area in line with those applicable to the rest of the Atlantic, any modification of these measures should be agreed with Norway in the first place. Because of time constraints, consultations with Norway on this issue will be held after the present proposal is adopted by the Commission. The proposal does not consider authorized or unauthorized mesh sizes. In principle all mesh sizes can be used (except for a certain gap) provided that the species composition retained on board correspond to the percentages established. To the extent possible, the groups of target species corresponding to a given mesh size range are species usually caught together. Moreover, the proposal considers that the number of nets of different mesh size carried on board of different mesh sizes should be minimized, in order to allow an adequate enforcement. The proposal includes a general increase in the reference mesh sizes. Scientific data show that there are significant long-term gains in yield for some stocks to be expected from this increase. Smaller mesh sizes are also authorized for particular fisheries, and are associated with a percentage of target species retained on board. Other measures to reduce the catch of juveniles: closed areas/seasons The catch of juveniles can be reduced by closing certain areas during certain periods of the year where and when juveniles of important species tend to accumulate. For these measures to be effective, the conditions applying to these areas should be as stringent as possible. Particular attention has been given to the conservation of hake. To this end, the number of areas for protecting hake has been increased, with regard to the legislation currently in place, and the conditions applying to some of them have been made more stringent. In other cases, however, closed areas/seasons are also established with the aim of protecting spawning adults from fishing. This is the case of herring and demersal species in some areas. Minimum landing sizes. Since minimum mesh sizes for towed gear are harmonized, minimum landing sizes are also harmonized. In addition, minimum landing sizes are considered for those species that constitute the most important part of the catch and therefore determine the behaviour of the skippers. These minimum landing sizes correspond, to the extent possible, to the selectivity of the towed gear: for the large demersal species the minimum landing size has been calculated as. the L^ for the mesh size corresponding to each of the species, where selectivity d data exist. L25 for a given mesh size corresponds to the length of the fish for which 25% of the individuals are retained by the net in question. That is, these minimum landing sizes are established so that the mesh size appropriate for a particular species or groups of species will tend to catch sized fish. Structure and presentation. To make the regulation simple, easy to understand and easy to enforce, the proposal considers two aspects: (a) substantial aspects. Derogations to the general rules have been kept to a minimum. (b) formal aspects. The language has been made as direct and clear as possible. To make the regulation simple: Some derogations existing in the current regulation only add complexity to the regulation and are no longer justified or necessary. These are not included in the present proposal. Some administrative requirements related to specific derogations are taken out of the text, to be dealt with by Commission Regulations. To make the text understandable: a new, more user-friendly presentation and structure is proposed. Articles are made short and titles are provided to chapters and articles to clarify their content. Where a derogation or a special provision is introduced, a "whereas" is also provided to explain the reasons justifying such cases. The idea is that all provisions in the regulation are adequately explained. As to the presentation, the tables on mesh sizes for towed and fixed gear indicate the different ranges of mesh sizes against the target species for them and establish minimum percentages for these target species. The reference in existing regulation to "protected species" is not necessary in this context. To make the regulation enforceable: Some ambiguous expressions are improved. An example is that of the term "fishing for. ", which is replaced by "retaining on board. ". While it is not possible for an inspector to determine what a fisherman is trying to "fish for", the use of the term "retained on board" provides an objective criterion to enforce the provisions in question. \ Xr fc Overall, this proposal represents a significant improvement in the technical measures, in comparison with the existing legislation. In some aspects the present proposal appears as more lenient than the existing regulation (for example, the removal of the "protected species" concept) but these provisions are intended to provide more flexibility to fishermen and to promote a reduction of discards. Another case in this context is the proposed flexibility for the discarding of species retained on board in excess of the authorized percentages for the mesh size used. While current regulation requires that these excess catches must be discarded immediately, the present proposal provides a flexibility allowing the discard to be done at the end of the fishing trip. This flexibility is intended to reduce by-catches, by allowing fishermen to compensate excess percentages in some hauls with possible lower percentages of target species in subsequent hauls. And, in any case, these elements are largely out weighted by the overall increase in selectivity of the gear introduced in the present proposal. The Council is requested to adopt this proposal. -1 c Proposal for a COUNCIL REGULATION (EC) No. /. laying down certain technical measures for the conservation of fishery resources. THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community and, in particular, Article 43 thereof, Having regard to the proposal from the Commission, Having regard to the opinion from the European parliament,1 Having regard to the opinion from the Economic and Social Committee,2 Whereas Council Regulation (EEC). constitutes the consolidated version of Council regulation (EEC) 3094/86 of 7 October 1986 laying down certain technical measures for the conservation of fishery resources, which regulation has been frequently and substantially amended; Whereas experience in the application of Regulation (EEC) No 3094/86, has brought to light certain deficiencies which result in problems of application and enforcement and which should be rectified, notably by reducing the number of different specifications concerning mesh-sizes, by deleting the concept of protected species and by restricting the number of different mesh- sizes that may be kept on board. (Art. 5, 9, Ann. tow. gears); whereas it is therefore appropriate to replace Regulation (EC). with a new text with the exception of Art. 11 and part of Art. 9; Whereas it is necessary to define principles and certain procedures for establishing technical conservation measures at Community level, so that each Member State can manage fishing activities in the maritime waters under its jurisdiction or sovereignty; Whereas a balance needs to be established between adapting technical conservation measures to the diversity of the fisheries and the need for homogeneous rules which are easy to apply; Whereas Article 130r(2) of the Treaty establishes the principle that all Community measures must integrate environmental protection requirements notably in the light of the precautionary principle; Whereas Council Directive 92/43/EEC of 21. 5. 1992 lays down measures for conservation of natural habitats and of wild life and fauna; whereas the list of marine organisms contains names of species protected by the requirements of that directive; O. J. No. C O. J. No. C. Whereas to ensure the protection of marine biological resources and the balanced exploitation of fishery resources in the interests of both fishermen and consumers, technical conservation measures should be laid down, specifying inter alia the minimum mesh-sizes appropriate for the capture of certain species and other characteristics of fishing gear, and the minimum landing sizes of marine organisms, as well as limitations of fishing within certain areas and time-periods and with certain gears and equipment; Whereas in the light of scientific advice, provisions should be made for increases in mesh- sizes of towed gears when fishing for certain species of marine organisms, and provisions should be made for the mandatory use of square-meshed netting, as this can play a significant role in reducing the capture of juveniles of marine organisms; Whereas to avoid the possibility of using ever smaller mesh sizes for fixed gears, which is resulting in increasing mortality rates for juveniles of the target species of the fisheries concerned, minimum mesh sizes for fixed gears need to be established; Whereas the species composition of catches and the associated fishing practices in the case of fisheries with fixed gears differ between geographical areas; whereas these differences justify the application of different measures in those areas; Whereas the catching of certain species to be transformed into fish-meal or fish-oil may be carried out with small mesh sizes, provided that such catching operations do not have a negative influence on other species; Whereas the practice of discarding should be reduced as much as possible; Whereas minimum landing sizes need to be applied with respect to species that constitute a major proportion of the landings by Community fleets; Whereas the minimum landing size of a species should be in accordance with selectivity of the mesh size applicable to that species; Whereas the manner in which the size of marine organisms is to be measured should be defined; Whereas protection of nursery areas should be provided for, taking into account the specific biological conditions in the various zones concerned; Whereas to protect juvenile herring, specific provisions regarding the catching and retaining on board of sprat should be adopted; Whereas to take into account traditional fishing practice in certain areas, specific provisions regarding the catching and retaining on board of anchovy and tuna should be adopted; Whereas the use of purse seines on schools offish found in association with marine mammals may result in the catching and killing of such mammals; whereas however, when properly conducted, the use of purse seines is an effective method of fishing solely for the desired target species; whereas the encirclement of marine mammals with purse seines must therefore be forbidden; Whereas in order not to hinder scientific research, artificial restocking or transplantation, this Regulation should not apply to operations which may be necessitated by the conduct of such activities; Whereas certain measures, necessary in the context of conservation, are contained in Council Regulations (EEC) Nos 2930/86, 3760/92 and 2847/93, and therefore need not be reiterated; Whereas where conservation is seriously threatened, the Commission and the Member States should be authorised to take appropriate provisional measures; Whereas additional national measures of a strictly local character may be maintained or adopted, subject to examination by the Commission of their compatibility with Community law and conformity with the Common Fisheries Policy; Whereas where detailed rules on the implementation of this Regulation may be necessary, such measures and rules should be adopted in accordance with the procedure laid down in Article 18 of Regulation (EEC) No 3760/92; HAS ADOPTED THIS REGULATION : Article 1 This regulation, laying down technical conservation measures, shall apply to the taking and landing of fishery resources occurring in the maritime waters under the sovereignty or jurisdiction of the Member States and situated in one of the regions specified in Article 2, except as otherwise provided in Articles 29 and 38. TITLE I: DEFINITIONS Article 2 1. For the purposes of this Regulation, the following definitions of maritime waters shall apply : Region 1: All waters which lie to the north and west of a line running from a point at latitude 48° N, longitude 18° W, thence due north to latitude 60° N, thence due east to longitude 5° W, thence due north to latitude 60°30' N, thence due east to longitude 4° W. thence due north to latitude 64° N, thence due east to the coast of Norway. Region 2: All waters situated north of latitude 48° N, but excluding the waters in Region 1 and ICES Divisions Illb, IIIc and Hid. Region 3: All waters corresponding to ICES Sub-areas VIII and IX. Region 4: All waters corresponding to ICES Sub-area X. Region 5: All waters situated in that part of the east central Atlantic comprising divisions 34. 1. 1, 34. 1. 2 and 34. 1. 3 and subarea 34. 2. 0 of fishing zone 34 of the CECAF region. Region 6: All waters off the coasts of the French department of Guyana that come under the sovereignty or jurisdiction of said department. Region 7: All waters off the coasts of the French departments of Martinique and Guadeloupe that come under the sovereignty or jurisdiction of said departments. Region 8: All waters off the coasts of the French department of Réunion- that come under the sovereignty or jurisdiction of said department. The geographical areas designated in this regulation by the letters "ICES" and "CECAF" shall be those defined by the International Council for the Exploration of the Sea, and the Fishery Committee for Eastern Central Atlantic, respectively. They are described, subject to any subsequent amendments, in Commission Communications No 85/C 335/02 and No 85/C 347/05. The regions referred to in paragraph 1 may be divided into geographical areas, in particular on the basis of the definitions referred to in paragraph 2, in accordance with the procedure referred to in Article 52. 2. 3. 4. Notwithstanding paragraph 2, for the purposes of this regulation: - the Kattegat is limited in the north by a line drawn from Skagen Lighthouse to the lighthouse in Tistlarna, and from there to the nearest point on the Swedish coast, and in the south by a line drawn from Hasenore Head to Gniben Point, from Korshage to Spodsbjerg, and from Gilbjerg Head to the Kullen, - the Skagerrak is limited in the west by a line drawn from the lighthouse of Hanstholm to the lighthouse of Lindesnes, and in the south by a line drawn from Skagen Lighthouse to the lighthouse of Tistlarna, and from there to the nearest point on the Swedish coast, - the North Sea shall comprise ICES Sub-area IV, the adjacent part of ICES Division Ha lying south of latitude 64° N, and that part of ICES Division Ilia which is not covered by the definition of the Skagerrak given in the second indent of this paragraph. Article 3 For the purposes of this regulation "marine organisms" are those species or groups of species which are listed in Annex I. Article 4 For the purposes of this regulation: a) b) c) d) the "minimum mesh size" of a net is the mesh size in that part of the net having the smallest meshes, "square-meshed netting" shall mean a section of netting mounted so that of the two sets of parallel lines fonned by the mesh bars, one set is parallel to, and the other at right angles to, the long axis of the net, "bottom set gill nets" or "entangling nets" are any fixed gear made up of a single piece of net, fixed by any means to the bottom of the sea, "trammel nets" are any fixed gear made up of two or more pieces of net hung jointly in parallel on a single headline, fixed by any means to the bottom of the sea. TITLE II: NETS AND CONDITIONS FOR THEIR USE CHAPTER I: PROVISIONS FOR TOWED NETS Article 5 1. For each of the regions or geographical areas mentioned in Annexes II, III and IV, and depending where applicable on the time-period, it is prohibited to use any trawl, Danish seine or similar towed net unless: its minimum mesh size corresponds to one of the categories set out in that annex, and the catch taken with that net and retained on board includes a percentage of target species equal to or greater than that specified for the mesh size category set out in that annex. 2. The minimum percentage of target species may be obtained by aggregating the quantities of all the target species caught. Article 6 1. 2. 3. 4. The percentages referred to in Annexes II, III and IV shall be calculated as the proportion by weight of all marine organisms on board after sorting or on landing. The percentages may be calculated on the basis of one or more representative samples. Notwithstanding paragraph 1, catches of sandeel retained on board and caught with nets having mesh sizes smaller than 16 millimetres, the percentage may be measured before sorting. For the purpose of this article, the equivalent weight of whole Norway lobster shall be obtained by multiplying the weight of Norway lobster tails by three. Article 7 It is prohibited to have on board or to use any trawl, Danish seine or similar towed net havina more than 100 meshes in the circumference of the cod-end, excluding the joinings and selvedges. i Paragraph 1 shall apply to nets of which the minimum mesh size is equal to or greater than 70 mm. Article 8 Any towed net of which the mesh size is equal to or greater than 70 millimetres shall be equipped, in the upper part of the net, with a section (panel or window) of square- meshed netting having a mesh size equal to or greater than that of the cod-end. The following conditions shall apply to any section of square-meshed netting as referred to in paragraph 1 : (a) it shall be at least 3 metres in length, (b) it shall be attached along each lengthwise edge to the net in such a way that the stretched length of that part of the net to which the section of square-meshed netting is attached, is the same as the stretched length of the section of square-meshed netting along that lengthwise edge, (c) it shall cover at least 90% of the width of that part of the net into which it is inserted. It is prohibited to retain on board any quantity of prawns caught with towed net having any mesh size between 32 and 54 millimetres, unless the upper part of the net is equipped with a section of square-meshed netting having a minimum mesh-size which is double that of the cod-end. (a) It is prohibited to retain on board any quantity of deepwater rose shrimp caught with demersal towed net having any mesh size between 55 and 60 millimetres, unless the upper part of the net is equipped with a section of square-meshed netting having a minimum mesh-size which is double that of the cod-end. (b) However, it shall be permitted to retain on board quantities of deepwater rose shrimp caught with the net described in subparagraph (a), provided they do not exceed 5% of the total weight of the marine organisms on board which have been caught with said net. Article 9 It is prohibited for vessels which carry on board or use any towed net with a minimum mesh size equal to or greater than 110 millimetres simultaneously to carry on board or to use any other towed net with a minimum mesh size less than 110 millimetres. Vessels may carry on board or use towed nets of two different minimum mesh sizes, provided that one of these minimum mesh sizes falls within the range of 0 through 60 millimetres, and the other of these minimum mesh sizes falls within the range of 70 through 109 millimetres. In this case, and derogating from the provisions of Article 5, the minimum percentage of target species that must be retained on board shall be 85%. This percentage shall apply to thetarget species as defined for the net or nets with the larger of the two mesh sizes that are being kept on board. It is prohibited for vessels not complying with the conditions of paragraphs 1 and 2 to use any trawl, Danish seine or similar towed net. Article 10 1. 2. It is prohibited to carry on board or to use any towed nets constructed wholly or in part of netting materials having a twine diameter of more than 8 millimetres. It is prohibited to carry on board or to use any towed nets constructed wholly or in part of netting materials consisting of multiple twine. Article 11 1. 2. It is prohibited to carry on board or to use any towed net constructed wholly or in part of any type of mesh other than square mesh or diamond mesh. Paragraph 1 shall not apply to towed net with a minimum mesh size of 31 millimetres or less. Article 12 Dredges are exempted from the provisions of Article 5, provided that the quantities of marine organisms retained on board and caught with these nets, other than bivalve molluscs, do not exceed 10% of the total weight of the marine organisms on board. CHAPTER II: PROVISIONS FOR FIXED GEARS Article 13 1. For each of the regions or geographical areas mentioned in Annexes V and VI, and depending where applicable on the time-period, it is prohibited to use or to keep on board any bottom set gillnet, entangling net or trammel net unless: the catch taken with that net and retained on board includes a percentage of target species no less than 70%, and in the case of bottom set gillnets and entangling nets: its mesh size corresponds to one of the categories set out in the relevant annex, in the case of trammel nets: its mesh size in that part of the net having the smallest meshes corresponds to one of the categories set out in the relevant annex. 2. The minimum percentage of target species may be obtained by aggregating the quantities of all the target species caught. Article 14 1. The percentage referred to in Article 13 paragraph 1 shall be calculated as the proportion by weight of all marine organisms on board after sorting or on landing. 2. The percentage may be calculated on the basis of one or more representative samples. Article 15 Articles 13 and 14 shall not apply to catches of salmonids, lampreys or hagfish. CHAPTER III: GENERAL PROVISIONS ON NETS AND CONDITIONS FOR THEIR USE Article 16 Sorting shall be carried out immediately after hauling. Article 17 1. 2. Quantities of marine organisms retained on board in excess of permitted percentages according to Annexes II through VI shall be discarded into the sea at any time prior to return to port. Paragraph 1 shall apply to marine organisms other than those defined as target species for any one of the mesh size categories set out in Annexes II through VI. Article 18 No device shall be used by means of which the mesh in any part of the fishing net is obstructed or otherwise effectively diminished. This provision shall not exclude the use of certain devices of which a list and teclinical descriptions shall be drawn up in accordance with the procedure referred to in Article 52. TITLE III: MINIMUM SIZE OF MARINE ORGANISMS Article 19 A marine organism is undersized if its dimensions are smaller than the minimum dimensions specified in Annex VII for the relevant species and the relevant geographical area. Article 20 1. 2. The measurement of the size of a marine organism shall take place in accordance with the provisions laid down in Annex VIII. Where more than one method of measuring the size of a marine organism is provided for, the organism is considered to be of the minimum size if the application of any one of these methods results in a size equal to or greater than the corresponding minimum size. 3. Bivalve molluscs, edible crabs and lobsters may only be landed whole. Article 21 1. Undersized marine organisms must not be retained on board or be transhipped, landed, transported, stored, sold, displayed or offered for sale, but must be discarded immediately into the sea. 2. Paragraph 1 shall not apply to : a) herring, horse mackerel and mackerel, within a limit of 10% by weight of the total catches retained on board of these species, b) marine organisms other than those defined in Annexes II, III and IV as target species for the mesh size categories 0-15 or 16-31, and caught with towed gear of a mesh size less than 32 millimetres, provided that said organisms are not sorted and are not sold, displayed or offered for sale for human consumption. 3. However, undersized anchovy, horse mackerel or mackerel caught for use as live bait may be retained on board, provided they are retained alive. Article 22 1. The percentage of undersized marine organisms shall be calculated as the proportion by weight of all marine organisms on board after sorting or on landing. 2. The percentage may be calculated on the basis of one or more representative samples. 10 TITLE IV: SPECIAL PROVISIONS RELATING TO FISHING FOR CERTAIN MARINE ORGANISMS Article 23 Restrictions on fishing for herring 1. a) b) c) d) It is prohibited to retain on board herring which are caught within the geographical areas and during the periods mentioned below : from 1 January through 50 April, within the geographical area situated to the north east of a line drawn between Mull of Kintyre and Corsewall Point. from 1 July through 31 October, within the geographical area bounded by the following coordinates: the west coast of Denmark at latitude 55°30'N, latitude 55°30'N, longitude 07°00'E, latitude 57°00'N, longitude 07°00'E, the west coast of Denmark at latitude 57°00'N. from 15 August through 15 September, within the zone extending from six to twelve miles off the east coast of the United Kingdom as measured from the baselines between latitudes 55°30'N and 55°45'N. from 15 August through 30 September, within the geographical area bounded by a line joining the following points: the Butt of Lewis, - - Cape Wrath, - - - - - latitude 58°55'N, longitude 05°00'W, latitude 58°55'N, longitude 07°10'W, latitude 58°20'N, longitude 08°20'W, latitude 57°40'N, longitude 08°20'W, the west coast of North Uist at latitude 57°40'N, then along the north coast of the island as far as latitude 57°40'36"N, longitude 07°20'39"W, latitude 57°50'3"N, longitude 07°8'6"W, - - north-east along the west coast of Lewis as far as the point of departure (Butt of Lewis). e) • from 15 August through 30 September, within the zone extending from six to twelve miles off the east coast of the United Kingdom as measured from the baselines between latitudes 54°10'N and 54°45'N. 11 f) from 21 September through 31 December, within the parts of ICES Division Vila bounded by the following coordinates: - - - - - the east coast of the Isle of Man at latitude 54°20'N, latitude 54°20'N, longitude 3°40'W, latitude 53°50'N, longitude 3°50'W, latitude 53°50'N, longitude 4°50'W, the south-west coast of the Isle of Man at longitude 4°50'W. and - - - - the east coast of Northern Ireland at latitude 54°15'N, latitude 54°15'N, longitude 5°15'W, latitude 53°50'N, longitude 5°50'W, the east coast of Ireland at latitude 53°50'N. g) h) i) throughout the year within ICES Division Vila, in the geographical area between the west coasts of Scotland, England and Wales, and a line drawn twelve miles from the baselines of the coasts bounded to the south by latitude 53°20'N and the north-west by a line drawn between the Mull of Galloway (Scotland) and the Point of Ayre (Isle of Man). throughout the year within Logan Bay, defined as being the waters east of a line drawn from the Mull of Logan situated at latitude 54°44'N and longitude 4°59'W, to Laggantalluch Head, situated at latitude 54°41'N and longitude 4°58'W. In 1998 and every third year afterwards, and throughout the year , within the area bounded by the following coordinates: - - - - - the south coast of Ireland at longitude 9°00'W, latitude 51 ° 15'N, longitude 9°00'W, latitude 51°15'N, longitude 7°30'W, latitude 52°00'N, longitude 7°30'W, the south-east coast of Ireland at latitude 52°00'N. j) In 1999 and every third year afterwards, within the areas bounded by the following coordinates : • i) from 15 January through 31 January: the south-east coast of Ireland at latitude 52°00'N, latitude 52°00'N, longitude 6°00'W, latitude 52°30'N, Longitude 6°00'W, the south-east coast of Ireland at latitude 52°30'N. 12 ii) from 1 November through 15 November: - - - - - the south coast of Ireland at longitude 9°00'W, latitude 51°15TSI, longitude 9°00'W, latitude 51 ° 15*N, longitude 11 °00*W, latitude 52°30*N, longitude 11°00'W, the east coast of Ireland at latitude 52°30'N. 2. However, it is permitted to retain on board quantities of herring from any of the areas described, provided they do not exceed 5% of the total weight of the marine organisms on board which have been caught in each separate area during one of the periods specified. Article 24 Restrictions on fishing for sprat to protect herring 1. a) b) c) 2. It is prohibited to retain on board sprat which are caught within the geographical areas and during the periods mentioned below : from 1 January through 31 March, and from 1 October through 31 December, within ICES statistical area 39E8. For the purpose of this regulation, this ICES area shall be the area bounded by a line due east from the United Kingdom east coast along latitude 55°00'N to a point at longitude 1°00'W, from there due north to a point at latitude 55°30'N and from there due west to the United Kingdom coast. from 1 January through 31 March, and from 1 October through 31 December, within the inner waters of the Moray Firth west of longitude 3°30'W, and in the inner waters of the Firth of Forth west of longitude 3°00'W. from 1 July through 31 October, within the geographical area bounded by the following coordinates: - - the west coast of Denmark at latitude 55°30'N, latitude 55°30'N, longitude 07°00'E, latitude 57°00'N, longitude 07°00'E, the west coast of Denmark at latitude 57°00'N. However, it is permitted to retain on board quantities of sprat from any of the areas described, provided they do not exceed 5% of the total weight of the marine organisms on board which have been caught in each separate area during one of the periods specified. Article 25 Restrictions on fishing for mackerel 1. It is prohibited to retain on board mackerel which are caught within the geographical area bounded by the following coordinates: 13 - a point on the south coast of the United Kingdom at longitude 02°00' W, - - - a point on the west coast of the United Kingdom at latitude 52°00' N, latitude 49°30" N, longitude 02°00' W, latitude 49°30* N, longitude 07°00' W, unless the weight of the mackerel does not exceed 15% by weight of the total quantities of mackerel and other species on board which have been caught in this area. 2. Paragraph 1 shall not apply: (a) to vessels fishing exclusively with gill nets and/or hand lines; (b) to vessels fishing with bottom trawls, Danish seines or other similar towed nets, provided that they have on board a minimum of 75% by weight of marine organisms with the exception of anchovy, herring, horse mackerel, mackerel, pelagic cephalopods and sardine, calculated as a percentage of the total weight of all the species on board; (c) to vessels in transit through this area, provided that all fishing gear is stowed in accordance with the provisions laid down in Article 20 paragraph 1 of Council Regulation (EEC) No 2847/93; (d) to vessels which are not equipped for fishing and to which mackerel are being transhipped. Article 26 Restrictions on fishing for anchovy 1. 2. It is prohibited to retain on board anchovy which are caught using pelagic trawls in ICES Division VIIIc. Within that Division, it is prohibited simultaneously to carry on board pelagic trawls and purse seines. Article 27 Restrictions on fishing for tuna 1. 2. It is prohibited to retain on board any quantity of skipjack, bigeye or longfin tuna which are caught using purse seines in waters under the sovereignty or jurisdiction of Portugal in ICES sub-area X north of 36°30'N, or in CECAF areas north of 31°N and east of 17°30'W. It is prohibited to retain on board tuna which are caught using drift nets in waters under the sovereignty or jurisdiction of Spain or Portugal in ICES sub-areas VIII, IX or X, or, in CECAF areas around the Canary Islands. 14 Article 28 Restrictions on fishing for shrimps to protect flatfish 1. It is prohibited to retain on board any quantity of common shrimps and Aesop shrimps caught with demersal towed gear having any mesh size between 16 and 31 millimetres unless: - the vessel has permanently installed on board a functioning sieve designed to separate juvenile flatfish from common shrimps and Aesop shrimps, and, - a separator trawl or a net with a sorting grid is being used for catching said species. 2. However, it is permitted to retain quantities of common shrimp or Aesop shrimp on board of fishing vessels that do not comply with the provisions laid down in paragraph 1, provided these quantities do not exceed 5% of the total weight of the marine organisms on board. Article 29 Restrictions on fishing for salmon and sea trout 1. Salmon and sea trout must not be retained on board or be transhipped, landed, transported, stored, sold, displayed or offered for sale, but must be returned immediately to the sea, when taken: - within the waters situated outside the 12-mile limit measured from Member States' baselines in regions 1,2,3 and 4, - by way of derogation from Article 2 paragraph 1, outside the waters under the sovereignty or jurisdiction of the Member States in regions 1, 2, 3 and 4, except in the waters under the jurisdiction of Greenland and the Faroe Islands, - when fishing with any towed net. 2. This article shall not apply to salmon and sea trout taken within the Skagerrak and Kattegat. Article 30 Restrictions on fishing for Norway pout to protect other roundfish 1. It is prohibited to retain on board Norway pout which are caught with any towed gear in the area which is bounded by a line joining the following points: - a point at 56°N on the east coast of the United Kingdom as far as 2°E, - then running north to 58°N, west to 0°30'W, north to 59°15'N, east to 1°E, north to 60°N, west to longitude 0°00*, 15 - from there north to 60°30'N, west to the coast of the Shetland Isles, then west from 60°N on the west coast of the Shetlands to 3°W, south to 58°30'N, - and finally west to the coast of the United Kingdom. 2. However, it is permitted to retain on board quantities of Norway pout from the area and caught with the gear described in paragraph 1, provided they do not exceed 5% of the total weight of the marine organisms on board which have been caught in said area with said gear. Article 31 Restrictions on fishing for hake 1. a) It is prohibited to fish with any trawl, Danish seine or similar towed net in the geographical areas and during the periods mentioned below : from 1 April to 31 July, within the geographical areas bounded by a line joining the following coordinates: - - - - latitude 51°35'N, longitude 11°40'W, latitude 51°35'N, longitude 11°25'W, latitude 51 °25'N, longitude 11 °25'W, latitude 51 °25'N, longitude 11 °40'W. b) from 1 May to 31 July, within the geographical areas bounded by a line joining the following coordinates: - - - - latitude 51 °00'N, longitude 11 °35'W, latitude 51°00'N, longitude H°25'W, latitude 49°40'N, longitude H°25'W, latitude 49°40'N, longitude 11°35'W. and latitude 50°30'R longitude 10°30'W, latitude 50°30'N, longitude 09°20'W, latitude 50°45'N, longitude 09°20'W, latitude 50°45'N, longitude 10°30'W. and latitude 51°45'N, longitude 14°30'W, latitude 51°45'N, longitude 13°00' W, latitude 52°30'N, longitude 13°00'W, latitude 52°30'N, longitude 14°30'W. 16 and - - - - latitude 48°10*N, longitude 09°40*W, latitude 48°10'N, longitude 09°10'W, latitude 48°40'N, longitude, 09°10'W, latitude 48°40'N, longitude 09°40'W. c) from 1 September to 31 December, within the geographical area bounded by a line joining the following coordinates : - - - - the point on the north coast of Spain called Cabo Prior (latitude 43°34'N, longitude 8°19'W), latitude 43°50'N, longitude 8°19'W, latitude 43°25'N, longitude 9°12'W, the point on the west coast of Spain called Cabo Villano (latitude 43°10'N, longitude 9°12'W). d) from 1 October to 31 December, within the geographical area bounded by a line joining the following coordinates : - the point on the west coast of Spain called Cabo Corrubedo (latitude 42°35'N, longitude 9°05'W), - latitude 42°35'N, longitude 9°25'W, - latitude 43°00'N, longitude 9°30'W, - the point on the west coast of Spain at latitude 43°00'N. e) from 1 December to the last day of February in the following year, within the geographical area bounded by a line joining the following coordinates : - a point on the west coast of Portugal at latitude 37°50'N, - - - a point on the west coast of Portugal at latitude 37°00'N. latitude 37°50'N, longitude 9°03'W, latitude 37°00*N, longitude 9°06'W, 1) from 1 December to the last day of February in the following year, within the geographical area bounded by a line joining the following coordinates: - - - • - - - - - - - - latitude 41°32T'N, longitude 09°07'3"W, latitude 41°20'7"N, longitude 09°05T"W, latitude 41 ° 12'0"N, longitude 09°02'7"W, latitude 41°02'8"N, longitude 08°59'0"W, latitude 40°38'5"N, longitude 09°04'6"W, latitude 40°27'5"N, longitude 09°08'2"W, latitude 40° 11T"N, longitude 09°13'8"W, latitude 40°11T"N, longitude 09°33'5"W, latitude 40°27'5"N, longitude 09°32,0"W, latitude 40°38*5"N, longitude 09°19'5"W, latitude 41°02'8"N, longitude 09°19*0"W, 17 - - - latitude 4ri2'0"N, longitude 09° 16' 1 "W, latitude 41°207"N, longitude 09°07'8"W, latitude 41°32'1"N, longitude 09°14T'W. Additionally, is prohibited to fish with demersal fixed gears in the are^ and during the period mentioned above. g) Throughout the year, within the geographical areas bounded by a line joining the following coordinates: - - - - latitude 47°40'N, longitude 4°40'W, latitude 47°28'N, longitude 4°40'W, latitude 47°23'N, longitude 3°45'W, latitude 47°35'N, longitude 3°45'W. and - - - - latitude 46°50'N, longitude 3°31'W, latitude 45°55'N, longitude 2°45'W, latitude 46°15'N, longitude 2°35'W, latitude 46°50'N, longitude 3°20'W. and - - - - latitude 45°55'N, longitude 2°40'W, latitude 45°45'N, longitude 2°40'W, latitude 45°45'N, longitude 1°55'W, latitude 45°55'N, longitude 2°00'W. 2. 3. Within the zones and during the periods referred to in paragraph 1, it is prohibited to carry on board any towed net, unless such a net is stowed in accordance with the provisions laid down in Article 20 paragraph 1 of Council Regulation (EEC) No 2847/93. Within the zones, and outside of the periods referred to in paragraph 1, it is prohibited to carry on board or to use any towed net with a minimum mesh size of less than 80 millimetres. Article 32 Restrictions on fishing for plaice 1. It is prohibited for any vessel exceeding 8 metres length overall to use any beam trawl, otter trawl or bottom pair trawl inside the following geographical areas: (a) the area within 12 miles of the coasts of France, north of latitude 51°00' N, Belgium, and the Netherlands up to latitude 53°00' N, measured from the baselines; (b) the area bounded by a line joining the following coordinates: - a point on the west coast of Denmark at latitude 57°00'N, - - - - - - - - - - - - - a point on the coast of the Netherlands at latitude 53°00'N. latitude 57°00*N, longitude 7°15'E, latitude 55°00'N, longitude 7°15'E, latitude 55°00'N, longitude 7°00'E, latitude 54°30'N, longitude 7°00'E, latitude 54°30'N, longitude 7°30*E, latitude 54°00'N, longitude 7°30'E, latitude 54°00'N, longitude 6°00'E, latitude 53°50'N, longitude 6°00'E, latitude 53°50*N, longitude 5°00*E, latitude 53°30'N, longitude 5°00'E, latitude 53°30'N, longitude 4°15'E, latitude 53°00'N, longitude 4°15'E, (c) the area within 12 miles of the west coast of Denmark from latitude 57°00' N as far north as the Hirtshals Lighthouse, measured from the baselines. (a) However, vessels - whose names and technical characteristics are contained on a list which shall be drawn up in accordance with the procedure laid down in Article 52, - and to which a special fishing permit has been issued in accordance with Article 7 paragraph 3 of Council Regulation (EEC) No 1627/94 of 27 June 1994, are authorized to fish in said areas using beam trawls. (b) Vessels which may appear on the list referred to in subparagraph (a) must comply with the following criteria: - be listed on the nominative list of vessels contained in Commission Regulation (1-1- 1996), - their engine power does not exceed 221 kW and, in the case of derated engines did not exceed 300 kW before derating. (c) Any individual vessel on the list may be replaced by another vessel, provided that - the engine power of the replacement vessel does not exceed that of the vessel replaced and - the length overall of the replacement vessel does not exceed 24 metres. (d)The engine of any individual vessel on the list may be replaced, provided that - the replacement engine is not derated and - the power of the replacement engine does not exceed that of the engine replaced. 19 3. Notwithstanding paragraph 2 subparagraph (a), it is prohibited to use any beam trawl of which the beam length or beam trawls of which the aggregate beam length is greater than 9 metres, or can be extended to a length greater than 9 metres, except when operating with gear having a mesh size between 16 and 31 millimetres. 4. a) By way of derogation from paragraph 1: - vessels whose engine power does not exceed 221 kW and, in the case of derated engines did not exceed 300 kW before derating, are authorized to fish in said areas using otter trawls. - paired vessels whose combined engine power does not exceed 221 kW and, in the case of derated engines did not exceed 300 kW before derating, are authorized to fish in said areas using bottom pair trawls. b) However, vessels whose engine power exceeds 221 kW shall be permitted to use otter trawls, or paired vessels whose combined engine power exceeds 221 kW shall be permitted to use bottom pair trawls, provided that: (i) the catch retained on board consists of sand-eel and/or sprat, and constitutes at least 90% of the total weight of the marine organisms on board, and, (ii) the quantities of plaice and/or sole retained on board do not exceed 2% of the total weight of the marine organisms on board, or (iii) the mesh size used is at least 110 millimetres, and (iv) the quantities of plaice and/or sole retained on board do not exceed 5% of the total weight of the marine organisms on board. 5. 6. 7. Fishing vessels which do not comply with the criteria specified in paragraphs 2 through 4. shall not be allowed to engage in the fishing activities referred to in those paragraphs. Detailed rules for the implementation of this article shall be drawn up in accordance with the procedure laid down in Article 52. Within areas where beam trawls, otter trawls or bottom pair trawls may not be used, it is prohibited to carry on board such nets, unless they are stowed in accordance with the provisions laid down in Article 20 paragraph 1 of Council Regulation (EEC) No 2847/93. 20 Article 33 Restrictions on fishing for sole and plaice From 1 February to 31 May it is prohibited to fish with any demersal towed gear in the geographical area bounded by a line joining the following coordinates: - a point on the west coast of the United Kingdom at longitude 03°40'W, latitude 53°40'N, longitude 03°40'W, a point on the west coast of the United Kingdom at latitude 53°40'N. Article 34 Restrictions on fishing for demersal fish From 1 March to 30 April it is prohibited to fish with any demersal towed gear in the geographical area bounded by a line joining the following coordinates: - - - a point on the west coast of the United Kingdom at latitude 50°15'N, latitude 50°15'N, longitude 06°00'W, latitude 51°00'N, longitude 06°00'W, latitude 51°00'N, longitude 04°40*W, a point on the west coast of the United Kingdom at longitude 04°40W. 21 TITLE V: RESTRICTIONS ON CERTAIN TYPES OF FISHING AND ASSOCIATED ACTIVITIES Article 35 Restrictions on the use of beam trawls 1. 2. It is prohibited for a vessel to have on board or to use any beam trawl of which the beam length, or beam trawls of which the aggregate beam length measured as the sum of the length of each beam, is greater than 24 metres or can be extended to a length greater than 24 metres. The length of a beam shall be measured between its extremities including all attachments thereto. It is prohibited for a vessel to have on board or to use any beam trawl of which the minimum mesh size lies between 32 and 109 millimetres within either of the following geographical areas: (a) the North Sea north of a line joined by the following points: - a point on the east coast of the United Kingdom at latitude 55°N, - then east to latitude 55°N, longitude 05°E, - then north to latitude 56°N, - and finally east to a point on the west coast of Denmark at latitude 56°N; (b) the area west of Scotland north of latitude 56°N. Article 36 Unconventional fishing methods It is prohibited fish with methods incorporating the use of explosives, poisonous or stupefying substances, electric current, or guns. Article 37 Restrictions on the use of automatic sorting equipment 1. 2. It is prohibited for vessels carrying or using either towed gear with a mesh size smaller than 55 mm or purse seines to carry automatic sorting equipment on board. However, freezer vessels shall be authorized to carry automatic sorting equipment on board, provided that its sole function is commercial grading of all the fish caught and intended for freezing. Automatic sorting equipment must be installed in such a way, that following grading the catch is immediately frozen for marketing and cannot easily be discarded into the sea. 22 Article 38 Restrictions on the use of purse seines 1. 2. It is prohibited to undertake any encirclement with purse seines of any school or group of marine mammals. Notwithstanding Article 1, paragraph 1 of the current article shall apply to all vessels flying the flag of, or registered in a Member State, in all waters. Article 39 Restrictions on fishing activities in the 12-mile-zones around the United Kingdom and Ireland 1. 2. 3. 4. 5. 6. It is prohibited for any vessel to use any beam trawl inside the areas within 12 miles of the coasts of the United Kingdom and Ireland, measured from the baselines from which the territorial waters are measured. However, vessels in any of the following categories are authorized to fish in said areas using beam trawls: "•b (a) a vessel which entered into service before 1 January 1987, and whose engine power does not exceed 221 kW, and in the case of derated engines did not exceed 300 kW before derating; (b) a vessel which entered into service after 31 December 1986 whose engine is not derated, whose engine power does not exceed 221 kW, and whose length overall does not exceed 24 metres; (c) a vessel which had its engine replaced after 31 December 1986 with an engine which is not derated and whose power does not exceed 221 kW. Notwithstanding paragraph 2, it is prohibited to use any beam trawl of which the beam length or beam trawls of which the aggregate beam length is greater than 9 metres, or can be extended to a length greater than 9 metres, except when operating with gear having a mesh size between 16 and 31 millimetres. Fishing vessels which do not comply with the criteria specified in paragraphs 2 and 3, shall not be allowed to engage in the fishing activities referred to in those paragraphs. Detailed rules for the implementation of this article shall be drawn up in accordance with the procedure laid down in Article 52. The vessels which may not use beam trawls are prohibited to carry on board such nets within the areas referred to in this article, unless they are stowed in accordance with the provisions laid down in Article 20 paragraph 1 of Council Regulation (EEC) No 2847/93. 23 TITLE VI: SPECIFIC PROVISIONS FOR THE SKAGERRAK AND KATTEGAT Article 40 Notwithstanding Article 21 paragraph 1, undersized marine organisms caught in the Skagerrak or Kattegat may be retained on board, or be transhipped, landed, transported, stored, sold, dispayed or offered for sale within a limit of 10% by weight of the total catches retained on board. Article 41 Salmon and sea trout must not be retained on board or be transhipped, landed, transported, stored, sold, displayed or offered for sale, but must returned immediately to the sea, when taken within any part of the Skagerrak and Kattegat situated outside the 4-mile-limit measured from Member States' baselines. Article 42 1. It is prohibited to use trawls having a mesh size of less than 32 mm from 1 July through 15 September in the waters situated within three miles of the baselines in the Skagerrak and Kattegat. 2. However, when trawling within said waters and during said period: - for northern shrimp, nets with a minimum mesh size of 30 millimetres may be used, - for eelpout (Zoarces viviparus), gobies (Gobiidae) or scorpion fish {Cottus spp. ) to be used as bait, nets with any mesh size may be used. Article 43 It is prohibited to retain on board any quantity of herring, mackerel or sprat caught using trawls or purse seines between Saturday midnight and Sunday midnight in the Skagerrak, and between Friday midnight and Sunday midnight in the Kattegat. Article 44 It is prohibited to use any beam trawl in the Kattegat. Article 45 During the periods and within the areas referred to in articles 42, 43 and 44, where trawls or beam trawls may not be used, it is prohibited to carry on board such nets, unless they are stowed in accordance with the provisions laid down in Article 20 paragraph 1 of Council Regulation (EEC) No 2847/93. 24 Article 46 Notwithstanding Article 36, it shall be permitted to use electric current or harpoon guns to catch tuna and basking shark (Cetorhinus maximus) in the Skagerrak and Kattegat. 25 TITLE VII: TECHNICAL PROVISIONS Article 47 Processing operations It is prohibited to carry out on board a fishing vessel any physical or chemical processing of fish to produce fish-meal, fish-oil, or similar products, or to tranship catches of fish for such purposes. This prohibition shall not apply to the processing of offal. Article 48 Scientific research 1. This regulation shall not apply to fishing operations conducted solely for the purpose of scientific investigations, which are carried out with the permission and under the authority of the Member State or Member States concerned, and of which the Commission and the Member State or Member States in whose water the research is carried out have been informed in advance. 2. Marine organisms caught for the purposes specified in paragraph 1 may be sold, stored, displayed or offered for sale, provided that: - they meet the standards laid down in Annex VII of the present regulation and the marketing standards adopted pursuant to Article 2 of Council Regulation (EEC) No 3759/92 of 17 December 1992 on the common organization of the market in fishery and aquaculture products, or - they are sold directly for purposes other than human consumption. Article 49 Artificial restocking and transplantation 1. 2. This regulation shall not apply to fishing operations carried out during the course of artificial restocking or transplantation of marine organisms. Marine organisms caught for the purposes set out in paragraph 1 may not be used for any other purposes. 26 TITLE VIII: FINAL PROVISIONS Article 50 1. 2. 3. Where the conservation of stocks of marine organisms calls for immediate action, the Commission may, in addition to or by way of derogation to this Regulation, adopt any measures necessary in accordance with the procedure referred to in Article 52. Where the conservation of certain species or fishing grounds is seriously threatened, and where any delay would result in damage which would be difficult to repair, the coastal State may take appropriate non-discriminatory conservation measures in respect of the waters under its jurisdiction. The measures referred to in paragraph 2, together with an explanatory memorandum, shall be communicated to the Commission and the other Member States as soon as they are adopted. Within 10 working days of receipt of such notification, the Commission shall confirm such measures, or require their cancellation or amendment. The Commission's decision shall be immediately notified to the Member States. Member States may refer the Commission's decision to the Council within 10 working days of receiving this notification. The Council, acting by a qualified majority, may adopt a different decision within one month. Article 51 1. Member States may take measures for the conservation and management of stocks : (a) in the case of strictly local stocks which are of interest solely to the fishermen of the Member State concerned, or (b) in the form of conditions or detailed arrangements designed to limit catches by technical measures : (i) supplementing those laid down in the Community legislation on fisheries, or (ii) going beyond the minimum requirements laid down in the said legislation, provided that such measures apply solely to the fishermen of the Member State concerned, are compatible with Community law, and are in conformity with the common fisheries policy. 27 2. The Commission shall be informed, in time for it to present its observations, of any plans to introduce or amend national technical measures. If the Commission so requests within one month of such notification, the Member State concerned shall suspend the entry into force of the measures planned until three months have elapsed from the date of the said notification, so that the Commission can decide within that period whether the measures in question comply with the provisions of paragraph 1. Where the Commission finds, by a decision which it shall communicate to all Member States, that a planned measure does not comply with the provisions of paragraph 1, the Member State concerned may not bring it into force without making the necessary amendments thereto. The Member State concerned shall immediately inform the other Member States and the Commission of the measures adopted, having made any amendments which may be necessary. 3. 4. Member States shall provide the Commission, on request, with all particulars necessary for an assessment of whether their national technical measures comply with the provisions of paragraph 1. At the instigation of the Commission, or at the request of any Member State, the question of whether a national technical measure applied by a Member State complies with paragraph 1 may be subject of a decision taken in accordance with the procedure laid down in Article 52. Should such a decision be taken, the third and fourth subparagraphs of paragraph 2 shall apply. 5. Measures relating to fishing from the shore shall be communicated by the Member State concerned to the Commission for information purposes only. Article 52 Detailed rules for the implementation of this regulation may be adopted, in accordance with the procedure laid down in Article 18 of Council Regulation (EEC) 3760/92 of 20 December 1992. These rules may include, inter alia: technical rules for the determination of twine diameter, technical rules for the determination of mesh size, rules for sampling, lists and- technical descriptions of devices that may be attached to nets. 28 Article 53 The following articles, paragraphs and annexes of Regulation. are hereby repealed : Articles 1 through 8, Article 9, paragraphs 1 and 2, and the final subparagraph of paragraph 3, Article 10, Articles 12 through 18, annexes I through IV. References to said regulation shall be construed as references to this regulation and shall be read in accordance with the correlation table set out in Annex IX. Article 54 This regulation shall enter into force on the seventh day after its publication in the Official Journal of the European Communities. It shall be applicable from. This regulation shall be binding in its entirety and directly applicable in all Member States. 29 ANNEX 1 CHECKLIST OF MARINE ORGANISMS CODE Scientific Name Vernacular Name , AES ALB ANE ARG BIB BET CLX ARA BLI WHB BOG BLL COD CNZ COE CTC DAB DPS ELE FLE PLZ FOX GUG MUL GUX HAD HKE HER JAX LAS LIN LBE LUM MAZ LEZ PRA NEP NOP OCC PIC DGS PIL PLE Pandalus montagui Thunnus alalunga Engraulis encrasicolus Lophius spp. Argentina spp. Palaemon adspersus Trisopterus luscus Thunnus obesus Bivalvia Aristeus antennatus Molva dypterygia Micromesistius poutassou Boops boops Scophthalmus rhombus Venus verrucosa Gadus morhua Crangon spp. Conger conger Sepia officinalis Limanda limanda Parapenaeus longirostris Anguilla anguilla Microc. hirus azevia Platichthys flesus Pleuronectidae Phycis spp. Belone spp. Aristaeomorpha foliacea Eutrigla gumardus Mugilidae Triglidae Melanogrammus aeglefinus Myxinidae Merluccius merluccius Clupea harengus Trachurus spp. Petromyzonidae Molva molva Homarus gammarus Cyclopterus lumpus Scomber spp. Lepidorhombus spp. Pandalus borealis Nephrops norvegicus Trisopterus esmarkii Octopus vulgaris Loligo spp. Centracanthidae Squalus acanthias Sardina pilchardus Pleuronectes platessa Aesop shrimp Albacore, longfin tuna Anchovy Anglerfish Argentine, silver smelt Baltic shrimp Bib Bigeye tuna Bivalve molluscs Blue and red shrimp Blue ling Blue whiting Bogue Brill Clam or warty venus Cod Common shrimp Conger Cuttlefish Dab Deepwater rose shrimp Eel Eyed sole Flounder Flounders Forkbeards Garfish Giant red shrimp Grey gurnard Grey mullets, Mullets nei Gurnards Haddock Hagfish Hake Herring Horse mackerel Lampreys Ling Lobster Lumpsucker Mackerel Megrim Northern shrimp Norway lobster Norway pout Octopus Pelagic cephalopods Picarels Picked dogfish Pilchard or sardine Plaice 3o ANNEX 1 CHECKLIST OF MARINE ORGANISMS CODE Scientific Name Vernacular Name POL PAN MUM SCO POK SAL SAN SCE BSS SBX TRS OMZ SKJ SOL SCR SCL SPR LTA TUS TUR CET TRA WHG WRA Pollachius pollachius Pandalus spp. Coris julis Mullidae Scorpaenidae Pollachius virens Salmo salar Salmonidae Ammodytes spp. Pecten maximus Dicentrarchus labrax Sparidae Salmo trutta Ommastrephidae Katsuwonus pelamis Solea vulgaris Maja squinado Scyliorhinus spp. Sprattus sprattus Auxis spp. , Euthynnus spp. Katsuwonus spp. , Thunnus spp. Psetta maxima Dicologoglossa cuneata Trachinidae Merlangius merlangus - Labridae Pollack Prawns Rainbow wrass Red mullets Rockfish Saithe Salmon Salmonids Sand eel Scallop Sea bass Sea breams Sea trout Shortfinned squids Skipjack tuna Sole Spinous spider crab Spotted dogfish Sprat Tuna Tuna Turbot Wedge sole Weevers Whiting Wrasses 30 ANNEX Kattegat) II. Minimum mesh sizes and target species in Regions 1, 2, 3 and 4(except Skagerrak and Target species 0-15 16-31 32-54(4) 5 5 - 6 0w 70-79(l><4> 80. 109<1)(4)(6) >110(1) Mesh size range (mm) Minimum percentage of target species 90 30 90 70 40 70 none * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 95 * spp. ) Sand eel (Ammodytidae)a) (Ammodytidaef^ Sand eel esmarkii)(>) Norway pout (Trisopterus Shrimps (Pandalus montagui, Crangon Sprat (Sprattus Eel (Anguilla Anchovy (Engraulis encrasicholus) anguilla) sprattus) Prawns (Pandalus spp. )0) Mackerel (Scomber spp. ) Horse mackerel (Trachurus Herring (Clupea harengus) Blue Whiting (Micromesistius Sardine (Sardina Pelagic cephalopods (Loligo pilchardus) spp. ) poutassou) spp. ) longirostris)m acexia) (Ommastrephidae) (Sparidae) (Scorpaenidae) Shrimp (Parapenaeus Sea breams Rockfish Fyed sole (Microchirus Short-finned squids Conger (Conger Forkbeard (Phycis Weevers Gurnards Picarels Red mullets Octopus (Octopus conger) spp. ) (Irachinidae) (Triglidae) (Centracanthidae) (Mullidae) vulgaris) * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * Norway lobster (Nephrops Shrimps (Aristeus antennatus Arislaeomorpha foliacea) norvegicus) and vulgaris) Sole (Solea Plaice (Pleuroncctes Hake (Merluccius Megrim (iepidorhombus Whiting (Merlangius Brill (Scophthalmus Pollack (Pollachius Dab (Limanda Cuttlefish (Sepia Sea bass (Dicentrarchus Flounder (Platichtys platessa) merluccius) spp. ) merlangus) rhombus) pollachius) limanda) officinalis) labrax) flesus) /Ml other marine organisms (1) Mandatory use of square mesh panels, in accordance with article 7. (2) In areas and times of the year other than those specified in footnote (3). (3) In the North Sea. from 1 November to the last day of February. In Region 3. (4) See Article 35. 2. (5) See Article 30. (6) See Article 3 1. (7) See Article 8. 3. (S) See Article S. 4. 2 >£ ANNEX III. Minimum mesh sizes and target species in Skagerrak and Kattegat Species 0-15 16 - 31 3 2 - 69 70-89 >90 Minimum percentage of target species Mesh size range (mm) Sand eel (Ammndyiidae)'" 50% 8 0% • * 20% * (Trisap/enisesmarkii) (Micromcsisiiuspouiassou) fl'nicliinusdraco)'" (Anguillaanguilla) Sand eel (Ammodylidae)'*' Norway pout Eel Blue whiting Greater weever Molluscs (except Sepia)"* Garfish (Reloue belone/" Gray gurnard Argentine (Argentinaspp. ) (liiilri^la^urnardus)'" Common shrimp/Baltic shrimp (Crangonxpp. iidspersus)'1' I'alaemon * (Scomberspp. ) Mackerel Horse mackerel (Trachurusspp Herring (( 'lupea harengus) Sprat (Sprollussprallus) i Northern shrimp Common shrimp/Baltic shrimp il'rcingtmspp, udspersusf (I'andalusborealis) I'alaemon Whiting (Merlangiusnierlanpis Norway lobster (Xephropsnorvcgiais) i All other marine organisms 6 0% 20% 50 % * * * * 4 * * * * * * * * • * * * * ; * * none * * * * * * * (1) Only within 4 miles from the baselines. (2) Outside 4 miles from the baselines. (3) From 1 March to 31 July. (4) In Skagerrak, from 1 November to the last day of February. In Kattegat, from 1 August to the last day of February. 13 ANNEX IV. Minimum mesh sizes and target species in regions 5 and 6. A. Region 5 Species Bogue {Boops boops) Sardine {Sardina pilchardus) Mackerel {Scomber spp. ) Horse mackerel {Trachurus spp. ) All other marine organisms B. Region 6 Species Shrimps {Penaeus subtilis, Penaeus brasiliensis, Xiphopenaeus kroyeri) All species Mesh size range (mm) 20-39 40-64 >65 Minimum percentage of target species 5 0% * * 80% None * * * * * * * * * Mesh size range (mm) 45-50 >100 Minimum percentage of target species 30% * None * * z V- ANNEX V FIXED GEARS Regions 1 and 2 Species / mesh Sardine (Sardina pilch ardus) Eel (Anguilla anguilla) Sprat (Sprattus sprattus) Horse mackerel (Trachurus spp. ) Herring (Clupea harengus) Mackerel (Scomber spp. ) Red mullets (Mullidae) Garfish (Belone spp. ) Sea bass (Dieentrarchus labrax) Grey mullets (Mugilidae) Dab (Limanda limanda)' Haddock (Melanogramus aeglefinus) Whiting (Merlangius merlangus)(2) Flounder (Platichthys flesus) Sole (Solea vulgaris) Plaice (Pleuronectes platessa) Cuttlefish (Sepia officinalis) Cod (Gadus morrhua) Pollack (Pollachius pollachius)(3) Ling (Molva molva) Saithe (Pollachius virens) Hake (Merluccius merluccius)^ Picked dogfish (Squalus acanthias) Spotted dogfish (Scyliorhinus spp. ) Megrim (Lepidorhombus spp. ) Lumpsucker (Cyclopterus lumpus) Others 10-30 mm 50-70 mm 90-99 mm 100-119 mm 120-220 mm >220 mm * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *m (1) Catches of anglerfish {Lophius spp. ) taken from ICES divisions [VI and VII] and retained on board in excess of 30 " n of the total catch on board from those areas must be taken with a minimum mesh size of 250 mm or greater. (2) In ICES divisions Vile and Vlld, for a period of [2] years following the entry into force of this regulation, the minimum size will be 90 mm. (3) In ICES divisions Vile and Vlld, for a period of [2] years following the entry into force of this regulation, the minimum size will be 110 mm. SvP ANNEX VI: FIXED GEARS Region 3 Species / mesh size Sardine (Sardina pilchardus) Shrimps (Palaemon spp. ) Rainbow wrasse (Coris julis) Bogue (Boops boops) Shrimps (Penaeus spp. ) Mantis shrimp (Squilla mantis) Red mullets (Mullidae) Wedge sole (Dicologoglossa cuneata) Wrasses (Labridae) Horse mackerel (Trachurus spp. ) Mackerel (Scomber spp. ) Bib (Trisopterus luscus) Cuttlefish (Sepia officinalis) Gurnards (Triglidae) Sea breams (Sparidae) Rockfish (Scorpaenidae) Eyed sole (Microchirus acevia) Shortfinned squid (Ommatostrephidae) Conger (Conger conger) Forkbeard (Phycis spp. ) Brill (Scophtalmus rhombus) Wee ver s (Trachinidae) Picarels (Centracanthidae) Sea bass (Dicentrai'chus labrax) Whiting (Merlangius merlangus) Turbot (Psetta maxima) Pollack (Pollachius pollachius) Flounders (Pleuronectidae) SoleOSo/ea vulgaris)(]) Hake ( Merluccius merluccius){]) Others(2) <40 mm 40-49 mm 50-59 mm 60-79 mm 80-99 mm > 100 mm * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * (1) In ICES divisions VII. Ic and IX the minimum mesh size will be 80-99 mm. However, for a period of [2] years following the entry into force of this regulation, the minimum mesh size will be 60 mm. (2) Catches of anglerfish {Lophius spp. ) and retained on board in excess of 30 % of the total catch on board must be taken with a minimum mesh size of 280 mm or greater. 1 er ANNEX VII. Minimum landing sizes Species Minimum landing size Regions 1 to 5 except Skagerrak / Skagerrak/Kattegat Kattegat Cod (Gadus morhua) Haddock (Melanogramus aeglefinus) Saithe (Pollachius virens) Pollack (Pollachius pollachius) Hake (merluccius merluccius) Megrim (Lepidorhombus spp. ) Sole (Solea spp. ) Plaice (Pleuronectes platessa) Whiting (Merlangius merlangus) Ling (Molva molva) Blue ling (Molva dipterygia) Bass (Dicentrarchus labrax) 30 cm 27 cm 30 cm 30 cm 25 cm 24 cm 27 cm 23 cm 33 cm 31cm 37 cm 26 cm 26 cm 20 cm 24 cm 17 cm 25 cm 63 cm 10 cm 36 cm Norway lobster (Sephrops norvegicus){]) 105(30) mm 130(40) mm Mackerel (Scomber scombrus) Herring (Clupea harengus) Horse mackerel (Trachurus trachurus)^ Anchovy (Engraulis encrasicholus) Sardine (Sardina pilchardus) Lobster (Homarus gammarus)C) Spinous spider crab (Maia squinado) Edible crab (Cancer pagurus) Scallop (Pccten maximus) Queen scallop (Chlamys spp. ) Grooved carpetshell (Ruditapes decussatus) Carpetshell (Venerupis pullastra) Short-necked clam (Ruditapes philipinarum) Clam (Venus verrucosa) (1) Total length (carapace length) (2) 30 cm in the North Sea (3) 30 cm for industrial purposes only. 20 cm"1 18 cm 15 cm 20 cm<:) 20 cm 15 cm 12 cm 11 cm 240(85) mm 220 (78) mm 120 mm 100 mm 100 mm 40 mm 40 mm 38 mm 40 mm 40 mm "M ANNEX VIII MEASUREMENT OF THE SIZE OF A MARINE ORGANISM 1. 2. 3. 4. The size of any fish shall be measured, as shown in Figure 1, from the tip of the snout to the end of the tail fin. The size of a Norway lobster or a lobster shall be measured, as shown in Figures 2 and 3. respectively: - as the length of the carapace, parallel to the midline, from the back of either eye socket to the distal edge of the carapace, and/or, ' - as the total length, from the tip of the rostrum to the rear end of the telson, not including the setae, and/or, - in the case of detached Norway lobster tails: from the front edge of the first tail segment present to the rear end of the telson, not including the setae. The tail shall be measured flat, unstretched and on the dorsal side. The size of a spinous spider crab shall be measured, as shown in Figure 4, along the midline, form the edge of the carapace between the rostrums to the posterior edge of the carapace. The size of any bivalve mollusc shall be measured, as shown in Figure 5, across the longest part of the shell. 1% ANNEX IX Correlation table Regulation (EEC) n°. (consolidated version 3094/86) This Regulation 1 2. 1 2. 2 2. 3 2. 4 2. 5 2. 6 2. 9 2. 10 4 5. 1 5. 2 5. 3 5. 4 6. 1 6. 2 7 8 9. 1 9. 2 10. 2. a 10. 2. b 10. 3 10. 4 10. 5 10. 6 10. 9 10. 10 10. 11 10. 12 10. 14 10. 15 10. 16 10. 17 10. 18 10. 19 1,2 4 ,5 12 6 16, 17 9 6. 4 4. 2, 7. 1, 7. 2, 8 4. 3, 13, 15 52 18, 52 19, 20. 2, 40 20. 1, Annex VIII 21, 22 20. 3 29 41 23 24 25. 1 25. 2 35. 1 44 32 39 32. 8, 39. 4 32. 9, 39. 5 42 26. 1 26. 2, 31. 14, 31. 15, 32. 10, 45 36, 46 35. 1 31 37 38 43 27. 1 3 >^ Regulation (EEC) n°. (consolidated version 3094/86) This Regulation 12 13 14 15 16 17 18 19 20 Annex I, footnote 5 Annex I, sole Annex I Annex II Annex III Annex V Annex VI Annex VII 27. 2 47 48 49 50 51 52 53 54 30 35. 2 Annexes II, III, IV Annex VII Annex VII Annex IX Annex V Annex VI M° M1 (Homo rus) Lobster (a) Carapace lengih (b) Overall length {Ncphrops) F i g u re 2 F i g u re 3 HZ Figure A Figure 5 M^ ISSN 0254-1475 COM(96) 296 final DOCUMENTS EN 03 15 10 Catalogue number : CB-CO-96-303-EN-C ISBN 92-78-05710-X Office for Official Publications of the European Communities L-2985 Luxembourg L f7

Commission Regulation (EC) No 1147/96 of 25 June 1996 amending Annexes II and III to Council Regulation (EEC) No 2377/90 laying down a Community procedure for the establishment of maximum residue limits of veterinary medicinal products in foodstuffs of animal origin (Text with EEA relevance)

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L_1996151EN. 01002601. xml 26. 6. 1996    EN Official Journal of the European Communities L 151/26 COMMISSION REGULATION (EC) No 1147/96 of 25 June 1996 amending Annexes II and III to Council Regulation (EEC) No 2377/90 laying down a Community procedure for the establishment of maximum residue limits of veterinary medicinal products in foodstuffs of animal origin (Text with EEA relevance) THE COMMISSION OF THE EUROPEAN COMMUNITIES, Having regard to the Treaty establishing the European Community, Having regard to Council Regulation (EEC) No 2377/90 of 26 June 1990 laying down a Community procedure for the establishment of maximum residue limits of veterinary medicinal products in foodstuffs of animal origin (1), as last amended by Commission Regulation (EC) No 0000/96 (2), and in particular Articles 6, 7 and 8 thereof; Whereas, in accordance with Regulation (EEC) No 2377/90, maximum residue limits must be established progressively for all pharmacologically active substances which are used within the Community in veterinary medicinal products intended for administration to food-producing animals; Whereas maximum residue limits should be established only after the examination within the Committee for Veterinary Medicinal Products of all the relevant information concerning the safety of residues of the substance concerned for the consumer of foodstuffs of animal origin and the impact of residues on the industrial processing of foodstuffs; Whereas, in establishing maximum residue limits for residues of veterinary medicinal products in foodstuffs of animal origin, it is necessary to specify the animal species in which residues may be present, the levels which may be present in each of the relevant meat tissues obtained from the treated animal (target tissue) and the nature of the residue which is relevant for the monitoring of residues (marker residue); Whereas, for the control of residues, as provided for in appropriate Community legislation, maximum residue limits should usually be established for the target tissues of liver or kidney, whereas, however, the liver and kidney are frequently removed from carcases moving in international trade, and maximum residue limits should therefore also always be established for muscle or fat tissues; Whereas, in the case of veterinary medicinal products intended for use in laying birds, lactating animals or honey bees, maximum residue limits must also be established for eggs, milk or honey; Whereas propane, n-butane, isobutane, papaverine, polyethylene glycols (molecular weight ranging from 200 to 10 000), policresulen, magnesium and its compounds, papain and phenol should be inserted into Annex II to Regulation (EEC) No 2377/90; Whereas, in order to allow for the completion of scientific studies, clorsulon and vedaprofen should be inserted into Annex III to Regulation (EEC) No 2377/90; Whereas a period of 60 days should be allowed before the entry into force of this Regulation in order to allow Member States to make any adjustment which may be necessary to the authorizations to place the veterinary medicinal products concerned on the market which have been granted in accordance with the Council Directive 81/851/EEC (3), as last amended by Directive 93/40/EEC (4), to take account of the provisions of this Regulation; Whereas the measures provided for in this Regulation are in accordance with the opinion of the Standing Committee on Veterinary Medicinal Products, HAS ADOPTED THIS REGULATION: Article 1 Annexes II and III to Regulation (EEC) No 2377/90 are hereby amended as set out in the Annex hereto. Article 2 This Regulation shall enter into force on the 60th day following its publication in the Official Journal of the European Communities. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Brussels, 25 June 1996. For the Commission Martin BANGEMANN Member of the Commission (1)  OJ No L 224, 18. 8. 1990, p. 1. (2)  See page 6 of this Official Journal. (3)  OJ No L 317, 6. 11. 1981, p. 1. (4)  OJ No L 214, 24. 8. 1993, p. 31. ANNEX A. Annex II is modified as follows: 1. Inorganic chemicals Pharmacologically active substance(s) Animal species Other provisions ‘ 1. 9. Magnesium All food producing species   1. 10. Magnesium sulphate All food producing species   1. 11. Magnesium hydroxide All food producing species   1. 12. Magnesium stearate All food producing species   1. 13. Magnesium glutamate All food producing species   1. 14. Magnesium orotate All food producing species   1. 15. Magnesium aluminium silicate All food producing species   1. 16. Magnesium oxide All food producing species   1. 17. Magnesium carbonate All food producing species   1. 18. Magnesium phosphate All food producing species   1. 19. Magnesium glycerophosphate All food producing species   1. 20. Magnesium aspartate All food producing species   1. 21. Magnesium citrate AH food producing species   1. 22. Magnesium acetate All food producing species   1. 23. Magnesium trisilicate All food producing species’   2. Organic compounds Pharmacologically active substance(s) Animal species Other provisions ‘ 2. 37. Propane All food producing species   2. 38. n-butane All food producing species   2. 39. Isobutane All food producing species   2. 40. Phenol All food producing species   2. 41. Papaverine Bovine Newborn calves only 2. 42. Policresulen All food producing species For topical use only’ 2. 43. Papain All food producing species   3. Substances generally recognized as safe Pharmacologically active substance(s) Animal species Other provisions ‘3. 62. Polyethylene glycols (molecular weight ranging from 200 to 10 000) All food producing species’   B. Annex III is modified as follows: 1. Anti-infectious agents 1. 1. Chemotherapeutics 1. 1. 5. Benzenesulphonamides Pharmacologically active substance(s) Marker residue Animal species MRLs Target tissues Other provisions ‘1. 1. 5. 1. Clorsulon Clorsulon Bovine 50 μg/kg Muscle Provisional MRLs expire on 1 January 2000’ 150 μg/kg Liver 400 μg/kg Kidney 5. Anti-inflammatory agents 5. 1. Nonsteroidal anti-inflammatory agents 5. 1. 1. Arylpropionic acid derivative Pharmacologically active substance(s) Marker residue Animal species MRLs Target tissues Other provisions ‘5. 1. 1. 1. Vedaprofen Vedaprofen Horse 100 μg/kg Liver Provisional MRLs expire on 1 January 1998’ 1 000 μg/kg Kidney 50 μg/kg Muscle

96/428/EC: Council Decision of 25 June 1996 on acceptance by the Community of the Agreement to promote compliance with international conservation and management measures by fishing vessels on the high seas

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L_1996177EN. 01002401. xml 16. 7. 1996    EN Official Journal of the European Communities L 177/24 COUNCIL DECISION of 25 June 1996 on acceptance by the Community of the Agreement to promote compliance with international conservation and management measures by fishing vessels on the high seas (96/428/EC) THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 43 thereof, in conjunction with the first sentence of Article 228 (2) and with the first subparagraph of Article 228 (3), Having regard to the proposal from the Commission (1), Having regard to the opinion of the European Parliament (2), Whereas international cooperation is essential to ensure the conservation and the rational, responsible and sustainable utilization of the biological resources of the high seas; Whereas the Community has signed the United Nations Convention on the Law of the Sea, which obliges all members of the international community to cooperate in the conservation and management of the biological resources of the high seas; Whereas, as regards maritime fishing, the Community has the authority to adopt fishery resource conservation and management measures and to conclude agreements in this field with third countries or international organizations, as set out in the Declaration of Competence which the Community submitted at the time it joined the Food and Agriculture Organization of the United Nations; Whereas the practice of requesting the allocation or change of flag by flying vessels in order to circumvent international measures for the conservation and management of living marine resources should be discouraged; Whereas each Member State must therefore meet its responsibilities to ensure that the fishing vessels authorized to fly its flag comply with international conservation and management measures by appropriate and effective means coordinated at international level; Whereas to that end the Community took part in international negotiations which culminated in the approval by the conference of the Food and Agriculture Organization of the United Nations at its twenty-seventh session in November 1993 of the Agreement to promote compliance with international conservation and management measures by fishing vessels on the high seas; Whereas that Agreement is a useful framework for strengthening international cooperation to ensure that the effectiveness of international conservation and management measures is not undermined; Whereas that Agreement will form an integral part of the International Code of Conduct for Responsible Fishing called for in the Declaration of Cancun of May 1992; Whereas Community fishermen fish on the high seas and it is therefore in the Community's interest to accept that Agreement, HAS DECIDED AS FOLLOWS: Article 1 The European Community hereby accepts the Agreement to promote compliance with international conservation and management measures by fishing vessels on the high seas. The text of the Agreement is attached to this Decision. Article 2 The President of the Council shall designate the person authorized to lodge the instrument of acceptance with the Director-General of the Food and Agriculture Organization of the United Nations in accordance with Article X (2) of the Agreement. Done at Luxembourg, 25 June 1996. For the Council The President M. PINTO (1)  OJ No C 229, 18. 8. 1994, p. 10. (2)  OJ No C 18, 23. 1. 1995, p. 438

Proposal for a COUNCIL REGULATION (EC) amending Regulation (EEC) N 1765/92 establishing a support system for producers of certain arable crops

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 25. 06. 1996 COM(96) 175 final 96/ 0167 (CNS) Proposal for a COUNCIL REGULATION (EC) amending Regulation (EEC) N* 1765/92 establishing a support system for producers of certain arable crops (presented by the Commission) (PCER\EN\0142. wpd) EXPLANATORY MEMORANDUM This draft Council Regulation is in response to a request by the Agriculture Council in November 1995 that the Commission submit a proposal, within two months, for making the system of penalties applied when the base area is exceeded more flexible. This draft Regulation contains two proposals: Under the first proposal, the Commission could help producers in areas which had suffered climatic disaster by granting partial or total exemption in the year in question from the rule under which, when regional base areas are exceeded, the area per farmer eligible for the arable compensatory aid is reduced. Under the second proposal, Member States which opt to treat the whole of their territory as a single base area could subdivide that area into sub-base areas and concentrate all or part of the penalties which arise when base areas are exceeded on sub-base areas where expansion has taken place. The first of these measures complements the measure already adopted by the Council under which the Commission can give partial or total exemption from supplementary set- aside when a base area has been overshot for exceptional climatic reasons (Regulation (EC) No 2989/95). If one of the two penalties which arise from base areas being overshot may, exceptionally, be relaxed in cases where the overshoot is due to climatic disaster such as that recently experienced in Spain, then it is only reasonable to provide the possibility for the other to be relaxed also. It has to be stressed, however, that this possibility can never constitute a right. The general principle remains that base area overshoots lead to reductions in the area eligible for aid even when climatic conditions have contributed to the overshoot. The possibility of providing derogations is meant to be used under very exceptional circumstances. Furthermore the possibility which will be introduced by this measure to relax the rule on the reduction of eligible areas will have budgetary consequences. It can, therefore, only be applied in years when the necessary budgetary resources are available. The second measure arises from an undertaking given by the Commission on 28 September 1995 to examine the possibility of giving Member States which apply a single national base area the power to concentrate penalties arising from that area being exceeded, in whole or in part, on the sub-base areas which were responsible for that excess. This examination has taken account of a number of key considerations referred to in that undertaking: equality of treatment of producers, the effective application of the base area system and the possible consequence in terms of the Union's budget and its international obligations. A tt (PCER\EN\0142. wpd) As regards the budget, the proposal does not introduce any risk of additional expenditure going beyond what could arise at present as it does not allow a Member State to apply lower penalties than would arise in the case of a national base area. All it does is to allow for the distribution of these penalties to be modulated. There are potential budgetary risks inherent in allowing Member States to have base areas whose boundaries do not coincide with their yield regions, but these consequences already exist and the means of controlling them is provided by the yield stabiliser (Article 3(6) of Regulation (EEC) No 1765/92). As regards the Union's international obligations, the measure in question does not derogate from the principle that the aids provided under CAP reform are limited to a set area. Nor does it imply an additional production by comparison with the existing provision permitting a national base area, provided that it does not lead to situations in which the base area system could not be applied effectively. As regards the effective application of the base area system, there are two dangers which must be avoided. The first is that the risk of penalties may be less clearly perceived by producers and that the way in which the penalties were divided could be controversial, particularly in the case of federal states. Such controversies could lead to delays in the announcement of the penalties, which would make it difficult to respect the dates laid down by the Council Regulation for the payment of the arable aids and the starting date for supplementary set-aside. The second is that within a regional sub-base area producers might expand their area planted with eligible arable crops over several years without any warning signals being applied in terms of eligible area reductions or supplementary set- aside, because of offsetting reductions in sub-base areas in other parts of that Member State. Then, as a result of an expansion in the area elsewhere in that Member State, they could find themselves confronted with penalties which were either too high to be borne economically or which led to such a large supplementary set-aside requirement that participation in the general scheme could become uneconomic for most producers. In such circumstances producers could opt to reduce their claims to the limit for access to the small producer scheme, thereby escaping both supplementary set-aside and obligatory set-aside. These potential problems would be overcome by two important provisions of the current proposal. First, it is proposed that Member States which wish to use this option must announce publicly, and communicate to the Commission, the rules which will be applied to distribute penalties arising from base area overshoots before 31 March, the deadline for the submission of claims. Second, it is proposed that the size of sub-base areas be limited. (PCER\EN\0142. wpd) As reg£ ds equality of treatment between producers, big differences already exist between the size of the regional base areas in different Member States. The existing Council Regulation, in the spirit of subsidiarity, gives individual Member States the right to choose to have a series of regional base areas or a national base area, depending on their judgement as to the size of the area within which producers have a sufficient degree of mutual solidarity to be prepared to share in the risk of being subject to penalties arising from expansion of others, in return for the possibility of being able to benefit from area reductions by others. Given that, at the level of the individual producers, there is a balance between the < dvantages and disadvantages of being situated in a large base area, the difference in the size of the regional base areas does not create a feeling of unfairness. The current proposal would not change this, given that all producers within national base areas could, at least in principle, be asked to share to some degree in the adverse consequences of an expansion by others, just as they could benefit from the consequences of a contraction by others. These are the major principles of this proposal. One subsidiary point has also to be mentioned. In the new Lander of the Federal Republic of Germany the base area was temporarily adjusted to take account of the special problems arising from the application of the common agricultural policy in this new part of the Union. The supplementary hectares provided for this purpose should, of course, be reserved for the new Lander, even if the Federal Republic of Germany as a whole were to opt for a single base area. (PCER\EN\0142. wpd) Proposal for a Council Regulation (EC) N\. amending Regulation (EEC) N* 1765/92 establishing a support system for producers of certain arable crops THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Articles 42 and 43 thereof, Having regard to the proposal from the Commission1, Having regard to the opinion of the European Parliament2, Whereas the support system for producers of certain arable crops introduced by Regulation (EEC) No 1765/923 provides that in the case where the sum of the individual areas for which aid is claimed is in excess of the regional base area two types of measures are to be applied, one in the form of a reduction in eligible area, the other in the form of extraordinary set-aside; whereas that Regulation also provides that in the case where exceptional climatic conditions have caused a reduction in yields and an overshoot of the regional base area the producers concerned may be exempted from extraordinary set-aside; whereas severe climatic conditions have adverse financial consequences for the producers in the affected regions; whereas it is thus justified to broaden the scope of the exemption possible to include the reduction in eligible area provided that the budgetary situation allows it; whereas severe climatic conditions have been noted in certain regions of the Union in 1995; whereas the exemption from one or both measures under such conditions should already apply from 1995 onwards; OJNoC OJNoC OJ No L 181, 1. 7. 1992, p. 12. Regulation last amended by Regulation (EC) No 2989/95 (OJNo L 312, 23. 12. 1995, p. 5). ti (PCER\EN\0142. wpd) Whereas Member States may apply one or more national base areas; whereas in such a case the measures to be applied in the case of a possible overshoot of the base area are currently applied on a national basis; whereas it is considered appropriate that the Member States which choose this option should be able to divide each national base area into sub-base areas; whereas the minimum size of such sub-base areas should be laid down; whereas when a national base area has been exceeded the Member State concerned should be allowed to concentrate the application of the measures totally or partially on those areas for which the overshoot has been noted; whereas the Member States should be required to notify the Commission and producers, in due time, of the exercise of this option and how they intend to apply the measures; Whereas Regulation (EEC) N* 1765/92 should therefore be amended, HAS ADOPTED THIS REGULATION: Article 1 Regulation (EEC) N" 1765/92 is hereby amended as follows: 1. Article 2(6) is replaced by the following: "6. In the case of a regional base area, when the sum of the individual areas for which aid is claimed under the arable producers' scheme, including the set-aside provided for under that scheme, and land counted as being set- aside pursuant to Article 7(2) and to Council Regulation (EEC) N" 2328/91 of 15 July 1991 on improving the efficiency of agricultural structures4, is in excess of the regional base area, the following measures will be applied in the region in question: OJ No L 218, 6. 8. 1991, p. 1. Regulation last amended by Regulation (EC) No 2387/95 (OJ No L 244, 12. 10. 1995, p. 50). S (PCER\EN\0142. wpd) during the same marketing year, the eligible area per farmer will be reduced proportionately for all the aids granted under this Title, in the following marketing year, producers in the general scheme will be required to make, without compensation, an extraordinary set-aside. The percentage rate for extraordinary set-aside shall be equal to the percentage by which the regional base area has been exceeded, established by deducting 85% of the area set aside under voluntary set-aside in accordance with Article 7(6). This shall be additional to the set-aside requirement given in Article 7. However, if the excess in the regional base area leads to a level of extraordinary set-aside of less than 1% being applied in respect of the 1996 harvest, the extraordinary set-aside shall not be applied. Areas which are the subject of extraordinary set-aside in accordance with the second indent of the preceding subparagraph shall not be taken into account in applying this paragraph. In the event that exceptional climatic conditions have affected production in a marketing year in which it is found that the regional base area has been exceeded, and those conditions have had the effect of lowering yields to a level considerably below the normal and of causing the excess in question, the Commission may, pursuant to the procedure laid down in Article 23 of Regulation (EEC) No 1766/92 on the common organisation of the market in cereals5, totally or partially exempt producers in the regions affected from one or both measures applicable under this paragraph. " OJ No L 181, 1. 7. 1992, p. 21. Regulation last amended by Regulation (EC) No 1863/95 (OJNo L 179, 29. 7. 1995, p. 1). c 2. The following is added after Article 2(6): (PCER\EN\0142. wpd) "7. Without prejudice to Article 3, where a Member State has chosen to establish one or more national base areas, it may subdivide each national base area into sub-base areas established in accordance with paragraph 2. A sub-base area shall not be smaller than level 2 of the Nomenclature of Territorial Statistical Units (NUTS). In the case of an overshoot of a national base area, the Member State concerned may, in accordance with objective criteria, concentrate the measures applicable under paragraph 6 totally or partially on the sub-base areas for which the overshoot has been noted. The Member State which has decided to apply the possibility provided for in the first and second subparagraphs shall notify producers and the Commission by 31 March of its choices and the rules and procedures for their application. Where the option provided for in this paragraph is applied, the consequences must be the same as those that would result from application of the measures at national level. If the option provided for in this paragraph is applied, the expression "regional base area" shall, for the purposes of Article 5(l)(f), be understood to mean a sub- base area. " 3. In Article 12 the following is added at the end of the first indent: "and (7), including the special conditions to be applied in the case of Germany,". 7- (PCER\EN\0142. wpd) Article 2 This Regulation shall enter into force on the seventh day following its publication in the Official Journal of the European Communities. However, Article 1(1) shall apply from 1995/96 onwards. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Brussels, 1996 For the Council FINANCIAL STATEMENT BUDGET HEADING: 1040 to 1055 TITLE: (PCER\EN\0143. wpd) DATE: 1 8. V! m APPROPRIATIONS: ECU 15 545 million Council Regulation amending Regulation (EEC) No 1765/92 establishing a support system for producers of certain arable crops LEGAL BASIS: Articles 42 and 43 AIMS OF PROJECT: To alter the application of penalties in the case of overshoot of base areas, to introduce the possibility of creating sub-base areas within a national base area. 5. FINANCIAL IMPLICATIONS 5. 0. 5. 1. EXPENDITURE - CHARGED TO THE EC BUDGET (REFUNDS/INTERVENTION) - NATIONAL ADMINISTRATION - OTHER REVENUE - OWN RESOURCES OF THE EC (LEVIES/CUSTOMS DUTIES) - NATIONAL 5. 0. 1. 5. 1. 1. ESTIMATED EXPENDITURE ESTIMATED REVENUE 5. 2. METHOD OF CALCULATION: SEE ANNEX TO FINANCIAL STATEMENT PERIOD OF 12 MONTHS million ecu CURRENT FINANCIAL YEAR (96) million ecu + 143,6 FOLLOWING FINANCIAL YEAR (97) million ecu 1998 1999 2000 2001 6. 0. 6. 1. 6. 2. 6. 3. CAN THE PROJECT BE FINANCED FROM APPROPRIATIONS ENTERED IN THE HI II VAN I (MAPI! R OI< II It-: CIIRRINT milKilT? YFS/NO CAN THE PROJECT BE FINANCED BY TRANSFER BETWEEN CHAPTERS OF THE CURRENT BUDGET? IS A SUPPLEMENTARY BUDGET NECESSARY? WILL FUTURE BUDGET APPROPRIATIONS BE NECESSARY? ¥BS/NO YES/NQ OBSERVATIONS: The additional expenditure for 1996 is offset by savings, in particular through lower cereals exports and more profitable use of cereal slocks resold within the Community. *r ANNEX TO FINANCIAL STATEMENT Firstly, the proposal is intended to exempt Member States from financial penalties arising from overshoots that are the consequence of exceptional weather conditions. The measure will apply from the 1995 harvest and concerns overshoots noted in Spain. Detailed figures for the cost of this measure for 1996 (ECU 143. 6 million) are shown in the attached table. Figures cannot be calculated for the measure as such for the following budget years. However, one may consider that any expenditure will be offset by savings on refunds and production aid in the cereals sector or other sectors such as rice, cotton or tobacco. Secondly, the proposal authorizes Member States that opt to create one or more national base areas, possibly subdivided into sub-base areas, to concentrate any penalties partially or entirely on one or more of those sub-base areas provided that such redistribution does not lead to an overall reduction in the national penalty. In the context of current regionalization plans, the budget impact of this measure is neutral. sC? ANNEX FINANCIAL TABLE Supplementary expenditure in Spain in 1996 arising from Article 1(1) Impact of drought for 1995 marketing year WITHOUT REDUCTIONS WITH REDUCTIONS CROPS AREA1 (1000 ha) AID (ECU/ha) COST2 (ECU million) AREA' (1000 ha) AID (ECU/ha) COST2 (ECU million) DIFFERENCE (ECU million) Simplified system - maize base - other crops General system - maize base - other crops - oil seeds - protein crops - non-textile flax - set-aside TOTAL 142. 37 142. 37 432. 00 132. 59 360. 94 259. 02 392. 9 182. 39 84 1770 153 4401 1069 91 5 1426 8999 12. 0 252. 0 66. 1 583. 5 385. 8 23. 6 2. 0 260. 1 1585. 0 141. 28 141. 28 432. 00 130. 42 343. 03 230. 76 380. 26 176. 20 84 1676 153 4165 977 83 4 1339 8481 11. 9 236. 8 66. 1 543. 2 335. 1 19. 2 1. 5 235. 9 1449. 7 0. 09 15. 21 0. 00 40. 33 50. 70 4. 42 0. 44 24. 16 135. 4 Impact of double rate: ECU 135. 4 million x 1. 061 (double rate) = ECU 143. 6 million A \ Excluding five-year set-aside and forage area Excluding supplementary expenditure on durum wheat 23 ISSN 0254-1475 COM(96) 175 final DOCUMENTS EN 03 Catalogue number : CB-CO-96-321-EN-C ISBN 92-78-05908-0 Office for Official Publications of the European Communities L-2985 Luxembourg

Re-examined proposal for a COUNCIL DIRECTIVE on AMBIENT AIR QUALITY ASSESSMENT AND MANAGEMENT

http://publications.europa.eu/resource/cellar/91730d32-ebb9-48d6-ae55-999e4180d23a

eng

COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 24. 06. 1996 COM(96)311 final 94/0106 (SYN) Re-examined proposal for a COUNCIL DIRECTIVE on AMBIENT AIR QUALITY ASSESSMENT AND MANAGEMENT (presented by the Commission pursuant to Article 189 c (d) of the EC Treaty) EXPLANATORY MEMORANDUM On 4 July 1994, the Commission adopted a "Proposal for a Council Directive on ambient air quality assessment aad management". The Economic and Social Committee delivered its opinion on 23 February 1995. 2 Parliament gave its opinion on the first reading on 16 June 1995. 3 On 6 July 1995, the Commission adopted an amended proposal, in accordance with Article 189a, paragraph 2, of the EC Treaty. This amended proposal included, in whole, in part or in principle, 24 of the 37 proposed amendments. On 30 November 1995, the Council adopted a common position on the Commission's amended proposal. Par'lament discussed the Council's common position at a second reading on 22 May 1996 and approved it, subject to 23 proposed amendments. The Commission has examined the amendments proposed by Parliament at its second reading and has included a number of them in this reexamined proposal. The Commission's position on each of the amendments approved by Parliament at its second reading is as follows: Amendments 1, 2 and 3 These amendments require the introduction of the "critical load concept" which was developed in the context of United Nations protocols on trans-boundary pollution. This concept is applicable only to a very limited number of substances (having an acidifying effect); it is not appropriate for most of the substances covered by the Directive. Furthermore, the impact of acid depositions largely depends on the types of soil on which they occur and it varies greatly from one European region to another. Accordingly, this concept appears to fall outside the scope of the Directive, which deals with concentrations of pollutants in the ambient air and not with the problem of depositions. Moreover, the geographical variability of critical loads will make it impossible to set harmonized limit values throughout the European Union. Consequently, these amendments are not accepted. OJC216, 16. 8. 1994. OJC 110, 2. 5. 1995, p. 5. OJC 116, 3. 7. 1995, p. 173. OJC 28, 13. 9. 1995, p. 10. OJC 59, 28. 2. 1996, p. 24. Amendments 4. 7 (target values). 8 (part 2) and 9 These amendments seek to generalize the concept of "target values". This concept, which did not appear in the Commission's original proposal, was introduced during discussions at the Council to enable the problem of air pollution b} ozone to be tackled in the most appropriate way. In general, the Directive provides for two types of value: the limit value, which is legally binding and which must not be exceeded in any of the Member States after a certain date. If this value is exceeded, steps must be taken to ensure that it is complied with in the future; the alert threshold: if this figure is exceeded, the general public must be informed. Target values constitute long term objectives, and there are no precise and binding requirements that they should be met. Experience has shown that they were not operative. Moreover, as in the case of limit values based on objective criteria for health and environmental protection, it is difficult to understand on what basis such target values would be set. Finally, the introduction of yet more values and value types does not make it any easier to inform the general public simply and comprehensibly. The "target value" concept is acceptable only in the case of ozone in view of the particular nature of the problem: ozone, being a secondary pollutant, requires special measures and it is uncertain whether, on the basis of present knowledge, it is possible to lay down a limit value which can be met in the near future. Accordingly, these amendments are not accepted. Amendments 5 and 12 On the basis of these amendments, it is proposed to reduce from 250 000 to 100 000 the population concentration in excess of which a measurement network must be established, and to add a third category of zones. The Directive already lays down that ambient air quality must be assessed - using a whole range of methods - throughout the territory of the Member States and that measurement networks must be established in all zones where concentrations exceed or may exceed the limit values. In addition, there must be a measurement network in all areas having a population of more than 250 000, whatever the levels of pollution. This system ensures that concentrations in the ambient air will be assessed everywhere and, in all cases, measured in areas which have a high population density or a high pollution level, without obliging small towns which have no pollution problems to introduce and pay for an unnecessary measurement network. Industrial areas need not be included since, in most cases, they will be zones within which levels exceed the limit values. Accordingly, these two amendments have not been included. Amendment 6 This amendment, under which the information collected pursuant to the Directive is to be made available to the public, is in line with Community policy and is consequently accepted. Amendment 10 This amendment seeks to set a time limit of five years for the margin of tolerance for limit values. The purpose of this margin of tolerance is to allow a period of time within which measures to reduce concentrations and to comply with limit values can be implemented. This period may well be different for each substance, given the levels concerned and the more or less complex nature of the measures to be adopted. Moreover, if too short a period is laid down, the limit values may be less rigorously complied with. This amendment is not accepted. Amendments 8 (part 1). 11 and 14 These amendments bring useful additions to the text of the Directive and will enable it to be implemented more swiftly and effectively. They are therefore accepted. Amendments 7 (timetable), 16, 17. 18, 19, 20, 21 and 22 These various amendments are aimed at speeding up the timetable for future directives on benzene and carbon monoxide and at introducing a third list of substances to be considered in future. The principle of these amendments is acceptable, subject to the following reservations: the proposed deadline cannot be met in practice: December 1997 is the most realistic date for the Commission; although it is feasible to consider the possibility of setting quality objectives for new substances, it is premature to draw a list of such substances at present. Amendments 13. 15 and 23 These amendments are not acceptable as they are incompatible with the other provisions of the Directive. Reexamined proposal for a COUNCIL DIRECTIVE on AMBIENT AIR QUALITY ASSESSMENT AND MANAGEMENT Text of the common position Reexamined proposal Article 3, second paragraph (new) Article 3, second paragraph (new) At the same time that thev supply it to the Member States the Commission, the above shall make information available the public bv every to appropriate means. Article 4 (1) 1. For those pollutants listed in Annex I, the Commission shall submit to the Council proposals for the setting of limit values and, as appropriate, alert thresholds according to the following timetable: - no later than 31 December 1996 for pollutants 1 to 5 - Directive 92/72/EEC for ozone; - no later than 31 December 1997 for pollutants 7 and 8; - as soon as possible, and no later than 31 December 1999, for pollutants 9 to 13. in accordance with Article 8 of Article 4 (1) 1. For those pollutants listed in Annex I, the Commission shall submit to the Council proposals for the setting of limit values and, as appropriate, alert thresholds according to the following timetable: - no later than 31 December 1996 for pollutants 1 to 5 - Directive 92/72/EEC for ozone; in accordance with Article 8 of - as soon as possible, and no later than 31 December 1999, for pollutants 7 to. 13. Article 4 (2) Article 4 (2) shall The Commission 2. be responsible, taking account of the most recent scientific-research data in the epidemiological fields concerned and of the most recent advances in metrology, for re-examining the elements on which the limit values and alert thresholds referred to in paragraph 1 are based. shall The Commission be 2. responsible, taking account of the most recent scientific-research data in the epidemiological and environmental fields the most recent concerned and of advances in metrology, for re-examining the elements on which the limit values and alert in paragraph 1 are based. thresholds referred to Article 4 (7) Article 4 (7) When a Member State intends to 7. set limit values or alert thresholds for pollutants not referred to in Annex I and not covered by Community provisions concerning ambient air quality in the Community, the Commission thereof in sufficient time to allow examination of the need to act at Community level following the criteria laid down in Annex III. inform shall it 7. When a Member State intends to set limit values or alert thresholds for pollutants not referred to in Annex I and not covered by Community provisions concerning ambient air quality in the Community, the Commission thereof in sufficient time. The Commission shall be required to supply, in sufficient time, an answer to the question of the need to act at Community level following the criteria laid down in Annex III. inform shall it Article 11 (1) (a) (iii) Send to the Commission the plans or programmes referred to in Article 8 (3) no later than two years after the end of the year during which the levels were observed; Annex I Pollutants governed by existing I. ambient air quality directives Article 11 (1) (a) (iii) Send to the Commission the plans or programmes referred to in Article 8 (3) no later than one year after the end of the year during which the levels were observed; Annex I I. Pollutants to be studied at an initial stage, including pollutants governed by existing ambient air quality directives II. Other air pollutants 7. Benzene 8. Polycyclic aromatic hydrocarbons 9. Carbon monoxide 10. Cadmium 11. Arsenic 12. Nickel 13. Mercury 7. Benzene 8. Carbon monoxide 9. Polycyclic aromatic hydrocarbons 10. Cadmium 11. Arsenic 12. Ni compounds classified as under Directive carcinogens 67/548/EEC 13. Mercury Ï ISSN 0254-1475 COM(96) 311 final DOCUMENTS EN 14 Catalogue number : CB-CO-96-319-EN-C ISBN 92-78-05886-6 Office for Official Publications of the European Communities L-2985 Luxembourg

Re-examined proposal for a COUNCIL DIRECTIVE on integrated pollution prevention and control

http://publications.europa.eu/resource/cellar/c9ec8344-2f59-4c37-9d38-26cfead6609f

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**•$= COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 24. 06. 1996 COM(%) 306 final - SYN 526 Re-examined proposal for a COUNCIL DIRECTIVE on integrated pollution prevention and control (presented by the Commission pursuant to Article 189 c (d) of the EC Treaty) EXPLANATORY MEMORANDUM On 14 September 1993 the Commission adopted a "Proposal for a Council Directive on Integrated Pollution Prevention and Control". (l) OJ C311, 17. 11. 93 The Economic and Social Committee delivered its opinion on 27 April 1994. (2) OJ CI95, 18. 7. 94 The European Parliament delivered its opinion at first reading on 14 December 1994. (3) OJ CI8, 23. 1. 95 On 15 May 1995 the Commission adopted an amended proposal under Article 189a(2) of the EC Treaty, incorporating a number of the amendments proposed by the European Parliament. (4) OJ C165, 1. 7. 95 On 27 November 1995 the Council adopted a common position on the Commission's amended proposal. (5) OJ C87, 25. 3. 96 The European Parliament examined the Council's common position at second reading on 22 May 1996 and approved it subject to 31 proposed amendments. The Commission has examined the amendments proposed by the European Parliament at second reading, incorporating a number of them into the present reexamined proposal. The Commission's position on the amendments approved by Parliament at second reading is as follows. Amendments accepted by the Commission Amendment 14 on Article 2(11) on definition of "best" in the concept of "best available techniques" deletes a superfluous phrase. Amendments 16 and 17 (article 3 paragraphs (b) and (f)) clarify the obligations of the operator regarding pollution control and on cessation of activities. Respect for human health was already implicit by virtue of its inclusion in the directive's definition of pollution, but a slightly modified form Parliament's proposal is included to make this explicit. amendments 18 and 21 (article 6(1), first indent and new 2nd subparagraph respectively) make more explicit the information which must be included in the permit application. The first is a minor modification, but the second is a useful provision regarding a non-technical summary of the rest of the information provided which will increase accessibility to the public and therefore transparency. Amendment 28 (article 13(1)) relates to the periodicity of permit review. The Commission accepts the principle of Parliament's amendment that a maximum period between revisions should be specified. However five years is too short and the Commission therefore reverts to its original proposal of a ten- year review period. Amendment 30 (article 15(1) first subparagraph) relates to the public information provisions of the directive. The Commission accepts the tie-in with the EIA Directive proposed by Parliament with a slightly modified wording to take account of the specific provisions of that Directive. Amendment 39 (Annex I point 3. 5) relates to the ceramic industry. Part of this amendment simply corrects translation errors. The significant part is the phrase "setting density per kiln". This reflects the fact that setting density, being a measurement of density, is kiln-specific and cannot be aggregated for the installation as a whole. Amendment 42 (Annex I point 6. 7) relates to solvent using industries. The text proposed in the reexamined proposal has the same effect as that proposed by Parliament, and aligns the IPPC text with the threshold criterion the Commission proposes to use in its forthcoming proposal for the control of VOC emissions from certain stationary sources. Amendments not accepted by the Commission A group of 7 amendments - 4,5,8,15,24,49 and 52 - cannot be accepted because they would fundamentally distort the integrated approach. The obligation to consider local environmental conditions, which would be removed by amendments 4, 5 and 24, is essential to produce the optimised pollution control solution which is the goal of the Directive. Incorporation of the principle of costs and advantages in the definition of BAT, which would be deleted or distorted by amendments 49 and 52, is also essential, as that definition determines the level of effort under the Directive, and without the reference to costs and benefits there would be no proportionality to the controls. Moreover every Member State makes this balance in practice in setting its own controls, and it is reasonable to recognise this at Community level also. Mandating the Commission to produce uniform emission limit value directives in every case, which would be the effect of amendment 8, would again distort the potential for local optimisation, although the Commission will propose such directives where necessary. The remaining 15 amendments - 2,7,10,19,20,22,32,33,34,35,37,44,46,54,57 - proposed a large number of small drafting changes. These are not included because they are already reflected elsewhere in the Common Position, or because they are out of keeping with the proposal for legal or technical reasons. In accordance with Article 189C(d) of the EC Treaty, the Commission modifies as follows the text of the Common Position on its proposal concerning integrated pollution prevention and control, in order to include the accepted amendments in the Common Position. REEXAMINED PROPOSAL FOR A COUNCIL DIRECTIVE on integrated pollution prevention and control COMMON POSITION AMENDED TEXT Citations Recitals Article 1 Article 2ri 1> first subparagraph Unchanged Unchanged Unchanged in and stage indicate "best available techniques" shall mean the most the advanced effective development of activities and their methods of the practical operation which suitability of particular for providing in principle the basis for emission limit values designed to prevent, and where that is not practicable, generally to reduce emissions and the impact on the environment as a whole. techniques in and stage "best available techniques shall mean the most the advanced effective development of activities and their methods of the practical operation which suitability of particular for providing the basis for emission limit values designed to prevent and, where that is not practicable, generally to reduce emissions and the impact on the environment as a whole. techniques indicate Article 3(b) (b) no significant pollution is caused; Article 3ffl (f) the necessary measures are taken upon definitive cessation of activities to avoid any pollution risk and return the site of operation to a satisfactory state. Article 4 Article 5 Article 6(1), first indent - the installation and its activities; (b) no significant pollution, particular harm to human health, is caused; including in (f) the necessary measures are taken upon significant cessation of activities to avoid any pollution risk, including in particular risk to human health, and return the site of operation to a satisfactory state. Unchanged Unchanged - the installation and the nature and extent of its activities; Article 6(1), 2nd subparagraph (new) An application for a permit shall also include a non-technical summary of the details referred to in the above indents. Unchanged Unchanged Unchanged Unchanged Unchanged Unchanged Article 7 Article 8 Article 9 Article 10 Article 11 Article 12 Article 13(1) take Member States shall the necessary measures to ensure that competent authorities periodically reconsider and where necessary update permit conditions. take Member States shall the necessary measure to ensure that competent authorities periodically, and at the latest ten years from the start-up of the operation, and at least once every ten years thereafter, reconsider and where necessary update permit conditions. Where a permit is updated for one of the reasons set out in paragraph 2. the ten-year period shall run from the date of the updating of the permit. Article 14 Unchanged Article 15(1). first subparagraph take 1. Without prejudice to Council Directive 90/313/EEC of 7 June 1990 on the freedom of access to information on the environment, Member States shall the necessary measures to ensure that applications for permits for new installations or for substantial changes are made available for an appropriate period of time to the public, to enable it to comment on them before the competent authority reaches its decision. take 1. Without prejudice to Council Directive 90/313/EEC of 7 June 1990 on the freedom of access to information on the environment, Member States shall the necessary measures to ensure that applications for permits for new installations or for substantial changes are made available for an appropriate period of time to the public, together with any relevant information obtained or conclusion arrived at pursuant to Articles 5. 6 and 7 of Directive 85/337/EEC where article 4 of that Directive applies, to enable it to comment on them before the competent authority reaches its decision. Article 16 Article 17 Unchanged Unchanged s Article IS Article 19 Article 20 Article 21 Article 22 Article 23 ANNEX 1(3,5) Unchanged Unchanged Unchanged Unchanged Unchanged Unchanged 3. 5 tiles, Installations for the manufacture of ceramic products ^ by burning in particular bricks, roofing refractory bricks, tiles, stoneware or porcelain, with a production capacity exceeding 75 tonnes per day, and/or with a kiln capacity exceeding 4m3 and exceeding a loading density of 300 kg/m3. ANNEX 1(6. 7) 6. 7 Installations for the surface treatment of substances, objects or products using organic solvents, in particular for dressing, printing, coating, degreasing, painting, waterproofing, cleaning or impregnating, with a consumption capacity of more than 150kg per hour or more than 200 tonnes per year. sizing, 3. 5 6. 7 Installations for the manufacture of ceramic products by firing in particular roofing tiles, bricks, refractory bricks, tiles, stoneware or porcelain, with a production capacity exceeding 75 tonnes per day, and/or with a kiln capacity exceeding 4m3 and with a setting density per kiln exceeding 300 kg/m3. Installations for the surface treatment of substances, objects or products using organic solvents, in particular for dressing, printing, coating, degreasing, painting, waterproofing, cleaning or impregnating, with a solvent consumption of more than 150kg per hour or more than 200 tonnes per year. sizing, ANNEX II ANNEX III ANNEX IV Unchanged Unchanged Unchanged ISSN 0254-1475 COM(96) 306 final DOCUMENTS EN 14 Catalogue number : CB-CO-96-315-EN-C ISBN 92-78-05842-4 Office for Official Publications of the European Communities L-2985 Luxembourg ~\-

OPINION OF THE COMMISSION on the amendments proposed by the European Parliament to the Council' s common position on the proposal for a COUNCIL DIRECTIVE on the disposal of polychlorinated biphenyls and polychlorinated terphenyls (PCBs/PCTs)

http://publications.europa.eu/resource/cellar/30c5ff69-8817-4022-8b10-ede07cd749ce

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 24. 06. 1996 COM(96) 301 final - SYN 161 OPINION OF THE COMMISSION on the amendments proposed by the European Parliament to the Council's common position on the proposal for a COUNCIL DIRECTIVE on the disposal of poJychlorinated biphenyls and polychlorinated terphenyls (PCBs/PCTs) (presented by the Commission pursuant to Article 189 c (d) of the EC Treaty) 1. 2. 3. 4. 5. 6. 7. On the 12 December 1988 the Commission presented to the Council a proposal for a Directive, based on Article 100 a of the EC Treaty, on the disposal of PCBs and POTs1 The Economic and Social Committee delivered its opinion on 28 February 19892. The European parliament delivered its opinion at first reading on 17 May 19903 and 12 December 19904. The Commission submitted to the Council an amended proposal based on Articles 100a and 113 of the Treaty5 on 22 October 1991. The Council reached agreement in principle with a view to adopting a common position based on the Article 130 s of the Treaty on 16 December 1994. It accordingly consulted the European Parliament on that point. The European Parliament agreed to that change in the legal basis in its resolution of 20 September 1995. On 27 November 1995 the Council adopted a common position in accordance with Article 189 c of the Treaty. At its sitting of 22 May 1996 the European Parliament adopted its decision at second reading on the common position with 3 amendments. The Commission did not accept any of the amendments suggested by the European Parliament. The Commission' s position on each of the amendments adopted by the European Parliament at its second reading is as follows : Amendment 5 -This amendment to the third recital asks for funding research into other methods of disposal of PCBs-PCTs and in particular in those involving bacterial biodégradation and pretreatment using chlorine extraction. research goes beyond PCBs-PCTs. Such It concerns organochlorine compounds in general. However, the Commission will endeavour to include this research in the fifth research programme. 1 COM(88) 559 final-SYN 161 of 18 October 1988 OJ No C 319, 12. 12. 1988 2 OJ No C 139, 5. 6. 1989, p. l 3 OJ No C 149, 18. 6. 1990, p. 150 4 OJ No C 19, 28. 1. 1991, p. 83 5 COM(91) 373 final-SYN 161, 22 October 1991, OJ No C 299, 20. 11. 1991, p. 9 Amendment 2 K n f c f 'i lo H it ? Hlh lociliil iincl N?(|un?. lr. lui induction of lh<- m a x i m um hunt lei PCBs-PCTs content in mixtures to be used as combustibles, including waste oils, from 50 to 20 ppm. In the Commissions view this reduction should be achieved through an amendment of Directive 75/439 on the disposal of waste oils. The Commission undertook, by way of a declaration to the Council minutes, to propose a modification to Directive 75/439 with a view to reduce the maximum limit of 50 ppm to 20 ppm PCB/PCT content in mixtures to be used as combustibles including waste oils. Amendment 3 -It refers to Article 3 and asks Member States to monitor compliance with the present Directive and to provide for effective penal sanctions. The monitoring of compliance and providing of penal sanctions is the task of each Member State. 3 ISSN 0254-1475 COM(yô) 301 iinaJ DOCUMENTS EN 14 Catalogue number : CB-CO-96-309-EN-C ISBN 92-78-05776-2 Office for Official Publications of the European Communities L-2985 Luxembourg

Amended proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE ON CONSUMER PROTECTION IN THE INDICATION OF THE PRICES OF PRODUCTS OFFERED TO CONSUMERS

http://publications.europa.eu/resource/cellar/fddfdc62-a2b2-4114-8099-6f83e611079e

eng

COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 24. 06. 1996 COM(96) 264 final 95/0148 (COD) Amended proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE ON CONSUMER PROTECTION IN THE INDICATION OF THE PRICES OF PRODUCTS OFFERED TO CONSUMERS (presented by the Commission pursuant to Article 189 a (2) of the EC-Treaty) Explanatory memorandum I REVIEW OF THE PROCEDURE On 12 July 1995 the Commission of the European Communities adopted the proposal for a Directive on consumer protection in the indication of the prices of products offered to consumers. The Economic and Social Committee delivered its opinion at its 331st plenary session of 20 and 21 December 1995, acting on the proposal of its rapporteur Mr Folias. On 18 April 1996 the European Parliament adopted a legislative resolution embodying the opinion of the European Parliament, acting on the proposal of its rapporteur, Mrs Oomen-Ruitjen. In this resolution Parliament invites the Commission to modify its proposal on the basis of the proposed amendments. The "Consumer Affairs" Council met on 23 April 1996 in Luxembourg under the Italian Presidency. It came to a unanimous political agreement on the common position concerning the above-mentioned proposal for a directive. II COMMENTS ON THE MODIFICATIONS The 22 amendments adopted by the European Parliament can be seen as a response to four main concerns. Firstly, in a certain number of amendments, Parliament pinpointed the remit of the text proposed by the Commission, notably the objective and the scope of the mechanism. These aspects do not substantially modify the Commission's proposal. Secondly, it took into account the supplementary costs which might be imposed on small retail businesses by providing for a permanent follow-up by the Commission and financial support for information for programmes targeted at small businesses. However, instead of a permanent or temporary exemption for certain small businesses, Parliament opted for a longer adaptation period. Thirdly, Parliament also wanted to emphasise the importance of consumer information in the context of introducing the single currency by provided for dual price labelling and training of employees in businesses. Finally, Parliament jettisoned without ambiguity the link between the obligation to indicate the unit price and the exemption for products sold in ranges. 1. Clarification of the text As regards Parliament's first concern, the Commission shares its viewpoint. Hence in its amended proposal the Commission has incorporated Amendments 1, 2 and 9 (in respect of letters (a) and )b) of former Article 2), 10, 11, 12, 13, 16, 20, 21 and 24 to clarify and pinpoint the proposed mechanism. In seven cases (Amendments 2, 3, 5, 11, 16, 20 and 24) the Commission has reformulated the text by making drafting changes or changes of a technical legislative nature, without, therefore, making any substantive modifications. The approval of amendment 16 made a modification of the recitals 15 and 16 necessary. Concerning the amendment 24 the Commission has in addition separated the amendment and has incorporated it into Articles 1(2) and 3(2). This implies that, in respect of the items refered to in Article 3(2), the obligation of mentioning the selling price, but not the unit price, will remain. The approval of amendment 24 made it also necessary to modify article 7. Amendment 9 (in respect of letter (c)) has not been taken up by the Commission, because its definition of the retail trade is too ambiguous and overbroad. Amendment 14 concerns labelling methods. The Commission considers that Member States are in a better position to lay down detailed procedures in this domain, as a function of local circumstances; hence this amendment has not been taken up. 2. Small retail businesses The new mechanism imposes some additional burdens on trade. But the European Parliament is particularly concerned with this sector, and notably with small retail businesses. As for the Commission, it has tried to find a solution which is not too heavy, while upholding the objective of providing the necessary information. Amendments 6 and 22 propose a report on the situation of small retail businesses one year after the. deadline for transposai. In the Commission's experience a period of one year is not long enough to acquire experience in the application of the Directive such as to draw up a report. Hence a minimum period of two years would be necessary. Such a period will allow the Commission to scrutinize in depth the economic impact of the Directive on small retail businesses. Amendment 19 concerns financial support for certain small retail businesses. The Commission does not consider that financial support for information programmes targeted at small retail businesses is a realistic solution. Firstly, the problem of small retail businesses is too complex to be regulated definitively at Community level. More specifically, the nature of the aid depends entirely on factors which the Commission can neither know nor influence. In certain Member States, where the entire retail trade already applies unit prices, such an aid would not be justified. Moreover, criteria would have to be laid down. It is also important for Member States to be in a position to fully assess the nature of the potential difficulties, particularly if these difficulties are directly bound up with the enforcement of the mechanism. After all, at least in the case of foodstuffs, many of the rules have already been in force for several years anyhow. Finally, investments in price indication technology make economic sense, because this technology constitutes a marketing and inventory management tool. The costs involved are not substantial, especially as small retail businesses enjoy an adjustment period allowing them to stagger the costs over an extended period. For this reason the Commission welcomes the solution contained in Parliament's Amendment 18 on small retail businesses: a generous adaptation period of six additional years after the date of entry into effect of the provisions adopted under the Directive. Moreover, the Commission is willing to provide particulars pertaining to costs and hence has incorporated Amendment 5. 3. Introduction of the Single Currency Parliament wanted to emphasise the importance of consumer information in the context of the move to the single currency. Hence it proposed Amendments 4, 15, 17 and 23 on the transitional period for the introduction of the single currency, so as to familiarise customers with the relative values of the currencies. While agreeing that price transparency is a priority on the road to Economic and Monetary Union, the Commission considers it premature to spell out the details at this stage and holds that accompanying measures should be the subject of an overall approach. 4. Abandonment of the link with ranges The Commission has incorporated Amendment 3. This amendment specifies that the ranges have a distinct function and clearly abandons the link with ranges. Ill OVERVIEW OPINION OF THE COMMISSION CONCERNING THE PROPOSED PARLIAMENTARY AMENDMENTS No of amendment 1 2 3 4 5 6 9 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Provisions concerned Commission New numbering recital - 1 (new) recital 1 recital 6a (new) recital 12a (new) recital 17a (new) recital 19 Article 2 a) and b) Article 2 c) Article 3, paragraph 2 Article 3, paragraph 2 Article 4, paragraph 2 Article 4, paragraph 3 Article 5 Article 5 a (new) Article 6 Article 6, paragraph 3a (new) Article 7, first sentence Article 7a (new) Article 9 Article 10 paragraph 1 Article 11 paragraph 1 Article 6 paragraph 3 b (new) Article la (new) accepted accepted accepted rejected accepted rejected accepted rejected accepted accepted accepted accepted rejected rejected accepted rejected accepted rejected accepted accepted rejected rejected accepted Recital 1 Recital 2 Recital 8 Recital 20 Article 2 Article 4 paragraph 3 Article 4 paragraph 4 Deleted Article 4 paragraph 2 Article 6 Article 7, first sentence Article 9 Article 10 Article 1, paragraph 2, and Article 3, paragraph 2 The above table shows that the Commission has accepted 14 out the 22 amendments voted by the European Parliament. AMENDED PROPOSAL FOR A EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE ON CONSUMER PROTECTION IN THE INDICATION OF THE PRICES OF PRODUCTS OFFERED TO CONSUMERS INITIAL PROPOSAL AMENDED PROPOSAL The European Parliament and the Council of the European Union Having regard to the Treaty establishing the European Community, and in particular Article 129a(2) thereof, Unchanged Unchanged Having regard to the proposal from the Commission1 Unchanged Having regard to the opinion of the Economic and Social Committee2 Unchanged Acting in conformity with the procedure provided for in Article 189b of the Treaty establishing the European Community, Unchanged 1. Whereas transparent operation of the market and correct information can be of benefit to consumer protection and to healthy competition between enterprises and their products 1 OJ No C 260, 5. 10. 1995, p. 5. 2 OJ No C 82, 19. 3. 1996, p. 32. Whereas, consumers must therefore 2. be guaranteed a high level of protection; whereas the Community should contribute thereto by specific actions which provide for precise, transparent and unambiguous information of consumers on the prices of products offered to them; 3. Unchanged Unchanged Unchanged Unchanged Whereas consumers must be 1. guaranteed a high level of protection; whereas the Community should contribute thereto by specific actions which provide for adequate information of consumers on the prices of products offered to them; Whereas 2. Community's the programmes for a consumer protection and policy3 provide information the establishment of common principles for indicating prices; for Whereas these principles have been 3. established by Council Directive 79/581/EEC of 19 June 19794 as amended by Council Directive 88/315/EEC of 7 June 19885 and Council Directive 88/314/EEC of 7 June 19886 concerning the indication of prices of foodstuffs and non-food products; Whereas the obligation to indicate 4. the selling price and the price per unit of measurement contributes substantially to by improving providing consumers with essential data in order to make reasoned choices; information consumer Whereas, however, the mechanism 5. adopted included a certain number of exceptions to the general obligation to the unit price, notably when indicate products are marketed in quantities or capacities corresponding to the values of the ranges adopted at Community level. 3 OJ No C 92, 25. 4. 1975, p. 2 and OJ No C 133, 3. 6. 1981, p. 2. 4 OJ No L 158, 26. 6. 1979, p. 19. 5 O J N oL 142, 9. 6. 1988, p. 23. 6 OJ No L 142, 9. 6. 1988, p. 19. Whereas this link between indication 6. the unit price of products and of standardisation of packaging introduced rigidities into the implementation of the mechanism adopted, which has proven overly complex to apply; whereas it is thus Unchanged to abandon this link in the necessary interests of simplification, without prejudice to packaging rules the standardization; governing 8. traders Whereas producers and having resort to ranees may retain and further develop them, provided, however, that they also indicate the unit price; 9. Unchanged 10. Unchanged 11. Unchanged 7. Whereas, therefore, account should be taken of all the difficulties encountered in implementing the mechanism provided for in the above-mentioned Directives and a new and simplified mechanism proposed which will enable the main objective to be achieved more easily, namely adequate information of consumers; Whereas indicating the selling price 8. and the unit price is the easiest way to enable consumers to evaluate and compare the nature and quality of products in an optimum manner and hence to make informed choices on the basis of simple comparisons; Whereas, therefore, 9. the general obligation to indicate both the selling price and the unit price for all products should be maintained except for products marketed in bulk, where the selling price cannot be determined until consumer the indicates how much of the product he requires; final 10. Whereas only Community-level rules can ensure homogenous and transparent information that will benefit all consumers in the context of the internal market; whereas the new, simplified approach is 12. Unchanged 13. Unchanged 14. Unchanged 15. Unchanged both necessary and sufficient to achieve this objective; price 11. Whereas, moreover, transparency is a priority in the run-up to Economic and Monetary Union, and must therefore be significantly improved and arrangements made for its entry into effect in good time for the transition to the single currency; 12. Whereas introduction of the single currency will be greatly facilitated by providing consumers with simple yardsticks for comparing the prices of products; 13. Whereas there is a need to take into account the fact that certain products are widely and customarily sold in quantities the values of the base different the Directive; quantity to allow is thus advisable whereas Member States, in certain cases, to authorise that the unit price be indicated in relation to the quantity value which custom has enshrined; from referred it in to 16. Unchanged 14. Whereas Member States must be free to adapt the obligation to indicate the unit price for certain trades of forms of trade, and also to determine that such indication is not necessary for a certain number of products, when it does not provide useful information for consumers; 15. Whereas Member States should also remain free to waive the obligation to indicate the unit price in the case of products for which such price indication would not be meaningful or would be liable to cause confusion; whereas this is the case notably when indication of the quantity is for price not comparison purposes, or when different products are marketed same packaging; relevant particular the in a 17. Whereas Member States should also remain free to waive the obligation to indicate the unit price in the case of products for which such price indication would not be meaningful; whereas this is the case notably when indication of the quantity is not a relevant particular for price comparison purposes, or when different products are marketed same packaging; the in 16. Whereas in the case of non-food products, Member States, with a view to facilitating application of the mechanism implemented, are free to draw up a list of products or categories of products for which the obligation to indicate the unit price remains applicable; 17. Whereas in distribution trends methods must be taken into consideration; whereas solutions must be found to permit information of consumers on optimum product prices at lowest possible marginal cost; the 18. Whereas in the case of non-food products, Member States, with a view to facilitating application of the mechanism shall draw up, a list of implemented, products for which the obligation to indicate the unit price remains applicable; 19. Unchanged 20. Whereas it is therefore essential that before the application of the mechanism, the Commission should draw up. in cooperation with the governments and competent national bodies, an accurate statement of the total costs of retail businesses, especially in the small and medium-sized sector: the Directive to 21. Unchanged 22. Unchanged 18. Whereas a variable adaptation period should be provided for depending on the economic operators concerned in order to enable the detailed to make arrangements for indicating unit prices; them technological taking trends and 19. Whereas particular attention should be paid to the adaptations required in small retail businesses, notably into the account envisaged timetable for the introduction of the single currency; whereas to this end the Commission shall present an evaluation report on the situation two years before the final deadline for the general application of the mechanism, HAVE ADOPTED THIS DIRECTIVE Article 1 The purpose of this Directive is to stipulate indication of the selling price and the price per unit of measurement of products offered by traders to final consumers, so as to improve consumer information and to allow easy comparison of prices, wherever such comparison is relevant. 1. Unchanged 2. The following are excluded from this directive: - auctions private sales. Article 2 For the purposes of this Directive: For the purposes of this Directive: "selling price" means the price for a a) given quantity of the product; b) "unit price" means the price for one kilogram, one litre, one metre, one square metre or cubic metre of the product or any is widely and other quantity which customarily used in the Member States in the marketing of specific products; "selling price" means the final price a) the product, for a given quantity of including VAT, all other taxes and the costs of all services which the consumer is obliged to pay for in addition; b) "unit price" means the final price, including VAT, all other taxes and the costs of all services which the consumer is obliged to pay for in addition, for one kilogramme, one litre, one metre, one square metre, one cubic metre or one item of the product or any other quantity which is widely and customarily used in the Member States in the marketing of specific products. "products sold c) in bulk" means products which are not pre-packaged and/or are not measured or weighed except in the presence of the final consumer. "products sold c) in bulk" means products which are not pre-packaged and/or not measured or weighed except in the presence of the final consumer. 10 Article 3 1. The selling price and the unit price shall be indicated for all products referred to in Article 1, subject to the provisions of Article 6. 1. Unchanged foodstuffs in hotels, 2. The obligation to indicate the price per unit measurement shall not apply to: cafes, sold - restaurants, public houses, cinemas and theatres, leisure centres, staff shops, hospitals, canteens and similar establishments, - itinerant traders. - products sold in means of transport. - products sold in vending machines. institutions, teaching 2. For products sold in bulk, the unit price must be indicated for all products referred to in Article 1, since the selling price cannot be determined prior to the request expressed by the final consumer. 3. For products sold in bulk only the unit price must be indicated for all products referred to in Article 1. 4. The above paragraphs shall apply also to any type of advertising in which a price is mentioned. Article 4 1. The selling price and the unit price must be unambiguous, easily identifiable and clearly legible. 2. The selling price and the unit price shall relate to the final price of the product under the conditions laid down by the Member States. The unit price shall refer to the 3. quantity declared, in accordance with national and Community provisions, and notably net quantities of products. 11 Unchanged Deleted The unit price shall refer to the in accordance with 2. quantity declared, national and Community provisions Article 5 Member States shall lay down the detailed indicating prices, notably as rules for regards prices applying to quantities that are widely and customarily used, referred to in Article 2(b). Unchanged Article 6 Member States may waive the 1. obligation to indicate the unit price of products for which such indication would not be meaningful because of the products' nature or purpose, and products for which such indication would not provide the consumer with adequate information or would be liable to create confusion. 2. the Member States may waive obligation to indicate the unit price of products for which indication of length, mass or volume is not required by national or Community provisions. This applies in particular to products sold by individual item or singly. 3. With a view to implementing the provisions set out in paragraphs 1 and 2 above, the Member States may, in the case of non-food products, establish a list of the products or product categories to which the obligation to indicate the unit price shall remain applicable. Article 7 that Member States may provide the obligation to indicate the unit price of products other than those marketed in bulk which are sold by certain small retail businesses shall apply at the latest by 6 June 2001, if the obligation to indicate the unit price from 7 June 1997 12 the Member States may waive 1. obligation to indicate the unit price of products for which such indication is not meaningful because of the products' nature or purpose. 2. Deleted 2. In the case of non-food products, Member States shall establish a list of the products to which the obligation to indicate the unit price shall remain applicable. This list shall be drawn up in a practical way by using a common nomenclature. The Commission shall provide a framework so that the lists in the various Member States are as consistent as possible in terms of content. that Member States may provide the obligation to indicate the unit price of products other than those marketed in bulk which are sold by certain small retail businesses shall apply at the latest bv six years after publication of this Directive, if the obligation to indicate the unit price by the date provided for in Article 10(0. is likely to constitute a excessive - burden for these businesses is likely to constitute a excessive - burden for these businesses or or is impracticable because of - the number of products on sale, the sales area, the nature of the place of sale or specific conditions applicable to certain forms of business, such as certain types of itinerant trade. is impracticable because of - the number of products on sale, the sales area, the nature of the place of sale or specific conditions applicable to certain forms of business. Article 8 Member States shall lay down penalties for infringements of national provisions adopted in application of this Directive, and shall take all necessary measures to ensure that these are enforced. These penalties must be effective, proportionate and dissuasive. Article 9 unchanged 1. In Article 10, first sentence, first line of the Council Directive 79/581/EEC of 19 1979. and in the article 10. first June sentence, first line of the Council directive 88/314/CEE of 7 June 1988. the words "a period of 9 years" shall be replaced bv the words "a period expiring on the date referred of Directive 96/. /EC in Article 10(1) to Council Directive 79/5 81/EEC of 19 June 1979, as amended by Council Directive 88/315/EEC of 7 June 1988 and Directive 88/314/EEC of 7 June 1988 shall be repealed with effect from 7 June 1997. 7 OJ No L 299, 12. 12. 1995, p. l l. 13 2. Council Directive 79/581/EEC of 19 June 1979, as amended by Council Directive 88/315/EEC of 7 June 1988, Council Directive 88/314/EEC of 7 June 1988 and the European Parliament and Council Directive 29 November 19957 shall be repealed with in from effect Article 10m. the date 95/58/EC referred of to Article 10 1. Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive by 6 June 1997 at the latest. They shall forthwith the Commission inform thereof. The provisions adopted shall be applicable as of 7 June 1997. 2. When Member States adopt these provisions, these shall contain a reference to this Directive or shall be accompanied by such a reference at the time of their official such publication. The procedure reference shall be adopted by the Member States. for Member States shall communicate to 3. the Commission the text of the provisions of national law which they adopt in the field governed by In particular, they shall indicate the rules adopted pursuant to Articles 5, 6 and 7, and any later amendments thereto. this Directive. Member States shall communicate 4. the provisions governing the penalties provided for in Article 8, and any later amendments thereto. Article 11 to 1. The Commission shall, not more than two years after the date referred to in Article 10(1), submit the European Parliament and the Council an initial report on the application of the provisions of Article 7. The Commission shall, not more 2. than four years after the date referred to in Article 10(1), submit the European Parliament and the Council a global report on the application of this Directive. to 1. Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive two years after publication of the Directive at the latest. They shall forthwith inform thereof. The provisions adopted shall be applicable two years after application of the Directive. the Commission 2. Unchanged 3. Unchanged 4. Unchanged 1. Unchanged 2. Unchanged Article 12 This Directive is addressed to the Member States. Unchanged ^ ISSN 0254-1475 COM(96) 264 final DOCUMENTS EN 10 Catalogue number : CB-CO-96-275-EN-C ISBN 92-78-05303-1 Office for Official Publications of the European Communities L-2985 Luxembourg IS

Amended proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE concerning the placing of biocidal products on the market

http://publications.europa.eu/resource/cellar/f5f43e93-cd36-44cb-aad3-fd14dfc27093

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 24. 06. 1996 COM(96) 312 final - COD 465 Amended proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE concerning the placing of biocidal products on the market (presented by the Commission pursuant to Article 189 a (2) of the EC-Treaty) EXPLANATORY MEMORANDUM Pursuant to Article 189(a) paragraph 2 of the EC treaty, the Commission submits an amended proposal for a European Parliament and Council Directive concerning the placing of biocidal products on the market. The amended proposal takes account of a number of amendments from the European Parliament, adopted at its plenary session on 18 April 19961. A large number of amendments were proposed by Parliament, grouped essentially as follows: to limit the use of laboratory animals, to alter the scope, to clarify the text, to introduce simplified procedures, to modify the data requirements, to alter the operation in certain areas (eg labelling, treatment of anti-fouling products) and to introduce a system to charge fees. Amendment 5 contains a proposal that a new recital, number 20a, be introduced stating that this directive assists in reducing the number of tests carried out on laboratory animals; the Commission agrees with this important addition. As this proposal is designed to fill a gap in the existing European chemicals legislation the scope is critical - it needs to cover all relevant products not covered by other legislation but at the same time must avoid any duplication with existing legislation. The Commission agrees that reference needs to be made to additional relevant Community legislation, and accepts amendment number 2. The suggested text has, however, been added to recital 20 rather than recital 13 as this is a more logical place for it. Additions have also been made to article 1 as proposed in amendments 9, 10 and 11. Proposals to restrict the scope would leave gaps in the European legislation and so the Commission cannot accept amendment 12 which indirectly alters the scope by modifying an important definition, that of harmful organisms. Amendment 13 cannot be accepted as it would increase the scope unnecessarily by including products which are for export only; amendment 15 is unacceptable as it would bring treated materials under the scope of the proposal. The proposal is concerned with the placing of biocidal products on the European market and does not include the manufacturing stage of the biocidal products themselves nor the post treatment stage ie materials after they have been treated with biocides (eg treated wood). Amendments 4, 7, 42 and 43 propose the setting up of action plans or other measures to reduce the usage of biocidal products. However, whilst these ideas are laudable and indeed are in line with the 5th Environmental Action Programme they cannot be incorporated into this proposal. The proposal is concerned with the assessment of individual active substances and biocidal products and not with the setting of an overall strategy for their use. For similar reasons the Commission cannot accept the part of amendment 38 which proposes that all product labels advise that the biocidal product should be used moderately. The Commission recognizes that this is a very technical proposal and welcomes any relevant clarification. Amendments 3 and 92 (grouped together), which clarify certain basic principles, 1 Reference- minutes of the session of 18 April 1996, provisional edition, PE 198. 355. L have therefore been incorporated into recital 19 as suggested. A new recital, number 20b, has been introduced as proposed in amendment 6; this explains that a guidance document will be produced to assist in the implementation of annex VI (the common principles). The Commission agrees with the introduction of the concept of "frame-formulations" in article 2, as suggested in amendment 14, as this will simplify certain procedures. Another very useful clarification which has been accepted by the Commission is the principle of grouping all pertinent references to mutual recognition together in the manner suggested by amendments 19 and 20. This has resulted in a restructuring of the text in article 3 which is now split into two parts, a new article 3 which contains the general requirements for authorization and a new article 3a which contains the text dealing with mutual recognition. The rewording suggested in amendment 17 clarifies the time period stipulated for applications to be processed and this has been incorporated into the text of article 3. 2. Amendment 18 has also been incorporated into the text in the new article 3 as the Commission agrees that biocidal products to which the concept of frame formulations has been applied should be processed within 60 days. An addition to the text in article 14 has been made, as suggested in amendment 31 as this clarifies certain aspects of what happens in the transitional period. Amendment 57 has been accepted and the deletion of some text in paragraph 59 of annex VI clarifies the meaning. The Commission cannot accept the proposal, contained in amendment 8, to delete the reference to the 5th Environmental Action Programme in recital 24 since the proposed directive underpins a key part of this Programme and so a reference to it is important. A number of amendments were proposed which alter the data requirements; some of these have been incorporated into the text but others, which remove certain provisions for flexibility, are not acceptable. This flexibility is needed to ensure that only data which is really needed for the purposes of carrying out a risk assessment is submitted and evaluated; this flexibility does, of course, not result in a reduction in the level of protection afforded to humans or the environment. Amendments 23, 25, 27, 28, 44, 50, 51, 53 and 54 are therefore not acceptable. Other amendments propose adding to the data requirements regardless as to whether or not they are necessary for the purposes of the risk assessment eg requesting data on all degradation products of the active substances or decreasing the acceptable concentration limits in water. Amendment numbers 45, 46, 47, 48, 49, 52 and 60 fall into this category and are therefore unacceptable. The amendments relating to data requirements which have been incorporated into the modified text are numbers 79, 80, 81, and 83; these state that the dossier requirements must be in line with technical development. Combining an alteration in the data requirements with a change in operation of the authorization conditions the Commission has incorporated amendments 21 and 24 into the text of article 4 and amendment 59 into paragraph 80 of annex VI; these now stipulate that effects on air and on surface water must be specifically considered and that application methods must be incorporated into the conditions of authorization. Amendment 56 states that only where appropriate should certain types of tests be used for efficacy purposes; this is a helpful amendment and the text in paragraph 51 of annex VI has been altered accordingly. 3 A number of amendments were concerned with labelling. Amendment 37 proposes that all biocides be labelled according to the Preparations Directive (88/379/EEC); the Commission agrees with this in principle but as Directive 88/379/EEC is currently being revised cannot implement this amendment yet. Amendment 37 will be acted upon once the modifications to Directive 88/379/EEC have been completed; article 18. 4 has been amended slightly insofar as the reference to other Community provisions has been deleted. Amendment 36 also proposes modifications to the product label; the part which states that labels must not be misleading is acceptable but the request not to have claims on the label cannot be supported. Part of amendment 38 proposed that labelling should be clearly legible; this is not necessary as this point is already covered in Directive 88/379/EEC under which all biocidal products will be labelled. Directive 88/379/EEC also contains requirements as to when safety lids are required and so amendment 35 has not been accepted. Part of amendments 29 & 95 (grouped together) clarifies that the principle of comparative assessment will not be applied to biocidal products, this helpful clarification has been incorporated into article 9. 5. In contrast amendment 58 cannot be accepted as it implies that comparative assessment would be applied to biocidal products. The part of amendments 29 and 95 which is not acceptable relates to the request to have a 5 year phasing out period based on the procedure in article 10 of the proposal; this cannot be accepted as the reference to article 10 is not relevant and the 5 year period proposed is too long. The requirement that the consultation between the applicant and the Commission be made mandatory, as proposed in amendment 39, is acceptable with the proviso that such consultation is not needed when a positive authorization decision is envisaged, article 24. 3 has been reworded accordingly. However the suggestion that all requests for the composition of all product formulations be kept confidential automatically, as requested in amendment 34 is not acceptable as certain components of the formulation may have to be named on the product label if they are dangerous to humans or the environment. A derogation for anti-fouling products used for specific purposes is proposed in amendment 96; this is acceptable to the Commission as it recognizes the special requirements of these products. Paragraph 86 of annex VI has been amended accordingly. Amendments 1, 22 and 55 propose restricting the types of substance which can be included in biocidal products; these cannot be accepted as this would alter one of the fundamental principles of this proposal - that decisions are based on risk assessment (and not a hazard assessment). The proposal attempts to balance the decisions made at Member States level and at Community level by, as far as possible, leaving decisions on the biocidal product to Member States and taking decisions on the active substance at Community level. Amendment 33 is not acceptable as the Commission considers that the decision as to the completeness of a dossier on a biocidal product should be left to the Member State. Amendment 32 proposes an alteration in the committee procedure for the adoption of the Regulation which will deal with the review work; the Commission originally proposed, after careful consideration, an advisory committee for this work and sees no reason to change this. Other proposed procedural changes which are not acceptable are numbers 41 and 63. Amendment 41 would automatically extend the application of the safety clause to all Member States following use by a single Member State and 63 is against the Commission rules in attempting to define the composition of the Standing Committee Amendment 62 is not acceptable as it proposes that, in paragraph 92 of annex VI, only environmental and economic benefits should be considered rather than benefits in general - this would restrict the flexibility needed when deciding upon the authorization of a biocidal product. Finally amendment 26 proposes that fees be charged for the authorization of biocidal products; this principle has been accepted by the Commission and a new article 7a introduced into the text. X ORIGINAL PROPOSAL MODIFIED PROPOSAL Recital 19 Whereas Member States must be able to authorize biocidal products not complying with the above-mentioned conditions for a limited period of time, especially in case of an unforseen danger threatening man or the environment which cannot be contained by other means; whereas such authorization should be reviewed by the Commission in close cooperation with the Member States; whereas the Community procedure should not prevent from authorizing for use in their territory for a limited period of time biocidal products containing an active substance not yet entered in the Community list, provided that a dossier meeting community requirements has been submitted and the Member States believes that the active substance and the biocidal products satisfy the Community conditions set in regard to them; Member States i. e. safety in cases where for humans and Whereas Member States must be able to authorize biocidal products not complying with the above-mentioned conditions for a limited period of time, especially in case of an unforseen danger threatening man or the environment which cannot be contained by the other means; requisite the environment cannot be achieved by other means or with the aid of the products listed in Annex V of this Directive: whereas such authorization must accord with principles laid down in Point 61 of Annex VI to this Directive and should be reviewed by the Commission in close cooperation with the Member States; whereas the Community procedure should not prevent Member States from authorizing for use in their territory for a time biocidal products containing an active substance not yet entered in the Community that a dossier meeting list, provided community been requirements submitted and the Member States believes that the active substance and the biocidal products satisfy the Community conditions set in regard to them; limited period of has G Recital 20 Whereas active substances used in biocidal products may also be used in other preparations which have under other Community tested on legislation, been animals, whereas double testing on animals must close coordination should be ensured with other Community legislation and in particular with Directive 91/414/EEC on the placing on the market of plant protection products avoided; whereas, be be avoided; whereas, Whereas active substances used in biocidal products may also be used in other preparations which have under other Community tested on legislation, been animals, whereas double testing on animals must close coordination should be ensured with other Community legislation and in particular with Directive 91/414/EEC on the placing on the market of plant protection products and those Directives concerned with the protection of water, and those concerned with the contained use and release of genetically modified organism. Recital 20a (new) Whereas it is essential that this Directive helps to reduce the number of tests on animals and that testing should be made dependant on the purpose and use of a product: Recital 20b (new) Whereas the Commission is to draw up the technical notes implementation of Annex VI: for guidance on ^ Article l(2)(aa) and (ab)(new) and (b) (aa) Council directive 81/851/EEC on the approximation of the laws of the Member States to veterinary medicinal products :(1) relating the Council Directive 90/677/EEC on (ab) extending of Directive. scope 81/851/EEC on the approximation of the laws of the Member States relating to veterinary medicinal products and laying down for provisions immunological veterinary medicinal products:f2V additional (b) Council Directives 70/524/EEC and 82/471/EEC on additives and substances for exclusive use in animal feedingstuffs; (b) Council Directives 70/524/EEC and 82/471/EEC on additives and substances for exclusive use in animal feedingstuffs and Directive 77/101/EEC (3) on the marketing of straight feedingstuffs: ( l ) O JL 317. 6. 11. 1981. p. 82. (2) OJL 373. 31. 12. 1990 p. 26 ( 3 ) O J L 3 2. 3. 2. 1977 p. l Article 1. 2 (g) new (g) Council Directive 90/385/EEC on the approximation of the laws of the Member implantable medicinal States on active devices (1), (h) Council Directive 89/109/EEC of 21 December 1988 on the approximation of the laws of the Member States relating to materials and articles intended to come into contact with foodstuffs (2) and subsequent follow-up Directives, m OJL 189. 20. 7. 1990. p. 17 (2)OJL40. 11. 2. 1989. P. 38 Article l(3)(ea)(new) (galCouncil directive 84/450/EEC on the approximation of the laws, regulations or administrative provisions of the Member States relating to misleading advertising OJL 250. 19. 09. 1984. p. 17 Article 2 (l)(ea)(new) (ea) Frame-Formulations the substances of for a group of biocidal Specifications products having the same use and user type. the This group of products must contain same active same specifications and their compositions must present only variations from a previously authorized biocidal product which do not affect the level of risk associated with them and their efficacy: In this context, a variation is the allowance of a reduction in the percentage of the active substance and/or an alteration in percentage composition of one or more non the substances replacement of one or more pigments, dyes, perfumes by other presenting the same or a lower risk, and which do not decrease its efficacy. and/or active Article 3 (2) 2. Every application for authorization shall be decided upon within a reasonable period. 2. Every application for authorization shall be decided upon without undue delay, 3 Article 3 (par 4,5,6,7,8) 3. A biocidal product that has already been authorized in one Member State shall be authorized, in another Member State within 60 days of an application being received by the other Member State, providing that the active substance of the biocidal product conforms to the entry in Annex 1. deleted 4. If complying with Article 4 a Member State establishes that: (a) unacceptable resistance of the target organism to the biocidal product is proven or (b) the relevant circumstances of use, such as climate or breeding period of the target species, differ significantly from those in the Member State where biocidal product was first authorized, and an unchanged present authorization may unacceptable the or risks environment; the Member State may request that the directions for use and the dose rate referred to in Article 18(3)(e) are adjusted to the different circumstances, or, the risk cannot be prevented in any other way, the Member State may request changes to be made to the biocidal product itself so that conditions for issue of an authorization provided for in article 4 are satisfied. therefore to man if 5. Notwithstanding paragraph 4 where a Member State believes a biocidal product cannot meet the conditions set out under to article 4 and consequently proposes refuse authorization, it shall notify the Commission, other Member States and the applicant and shall provide them with an explanatory document giving details of the product and setting out the grounds on which the authorization. proposes refuse to it deleted The Commission shall prepare a proposal on these matters in accordance with Article 24 for decision in accordance with the procedure laid down in Article 25(3). that 6. Member States shall prescribe biocidal products classified, packaged and labelled in accordance with the provisions of this Directive. shall be ; 7. Authorizations shall be granted for a fixed period of 10 years from the date of first entry of the active substance onto Annex they may be renewed after verification that the conditions imposed in paragraphs 1 and 2 are still satisfied. Renewal may, where necessary, be granted only for the period necessary to allow the competent authorities of the Member States, to make such verification, where an application for renewal has been made. that 8. Member States shall prescribe biocidal products must be properly used. Proper use shall include compliance with conditions established under Article 4 and specified under the labelling provisions of this directive. Proper use shall also involve the rational application of a combination of physical, biological, chemical or other measures a s appropriate whereby the use of biocidal products the minimum necessary. Where biocidal are used at work use shall also be in accordance with requirements of directives for the protection of workers. limited to is S\ 1 Article 3 par. 3,4,5,6 new 3. Without prejudice to Articles 7 and 11 and providing that the applicant has a right subsequent to of a it. when access application for a new for authorization biocidal product is -based upon a frame- formulation, the competent authority shall take this application within a period of 60 days. a decision with regard to that 4. Member States biocidal classified, products packaged and labelled in accordance with the provisions of this Directive. prescribe be shall shall for the shall be granted to Article 6(1). 5. Without prejudice a authorizations maximum period of 10 years from the date of first or renewed inclusion of the active substance onto Annex I for the product deadline exceeding type, without specified for the active substance in Annex I. they may be renewed after verification that the conditions imposed in Article 4(1) and (2) are still satisfied. Renewal may, where necessary, be granted only for the period necessary to allow the competent authority of the Member States to make such verification, where an application for renewal has been made. shall prescribe 6. Member States that biocidal products must be properly used- Proper use shall include compliance with conditions established under Article 4 and specified under the labelling provisions of this directive. Proper use shall also involve the rational application of a combination of physical, biological, chemical or other measures as appropriate whereby the use of biocidal products is limited to the minimum necessary. Where biocidal products are used at work use shall also be in accordance with the requirements of directives for the protection of workers. f \t Article 3a (new) 1. Without prejudice to Article 11. a that has already been biocidal product authorized in one Member State shall be authorized in another Member States within 60 days of an application being received by the other Member State, provided that the active substance of the biocidal product is included in Annex I and conforms to the requirements thereof. The application shall include a summary of the dossier as required in Article 7(2)(a) and Annex 1ID. Section X and a certified copy of the first authorization granted. to The authorization may be t he p r o v i s i o ns in implementation accordance with Community law, relating to the conditions for distribution and use o\" biocidal products intended the health of the distributors, users and workers concerned. oi' other measures r e s u l t i ng to protect subject from in accordance with Article 4. a 2. 11'. Member State establishes that: (aa) the target species can be assured not to occur on its territory. (a) unacceptable resistance of organism demonstrated, or the biocidal to the product target is (b) the relevant circumstances o\" use, such as climate or breeding period of the target species, differ significantly from those in the biocidal the Member States where product was an therefore authorization may unchanged present unacceptable risks to humans or the environment. authorized, and first referred the Member States may request that certain conditions Article lS(3)(e). (f). (h). (j) and (1) be adjusted to the different circumstances, so that conditions for issue oï an authorization laid down in Article 4 are satisfied. in to >J 3. Notwithstanding paragraph 2 where a Member State believes a biocidal product cannot meet the conditions set out under to article 4 and consequently proposes the authorization under refuse or to restrict certain conditions, the shall notify it Commission, other Member States and the applicant and shall provide them with an explanatory document containing the name its specification and of the product and it setting out proposes the to authorization. the grounds on which refuse or restrict to The Commission shall prepare a proposal on these matters in accordance with Article 24 for a decision in accordance with the procedures laid down in Article 25(3). Article 4(1 )(b)(iii)and (iv) (iii) has no harmful effects itself or as a result of its residues, on human or animal health, directly or indirectly (e. g. through feed) or on drinking water, groundwater; food or (iii) has no harmful effects itself or as a result of its residues, on human or animal health, directly or indirectly (e. g. through air, drinking water, food or feed) or on groundwater and surface water; (iv) has no unacceptable effect on the environment having particular regard to the following considerations: - its fate and distribution n the environment; of water contamination particularly including drinking water and groundwater, -its impact on non-target organisms; (iv) has no unacceptable effect on the environment having particular regard to the following considerations: - its fate and distribution n the environment; of water contamination particularly including drinking water, groundwater and surface water. -its impact on non-target organisms; » H Article 4. 4 to relevant requirements 4. Where other Community provisions impose the conditions for the issue of an authorization and particularly where these are intended to the health of distributors, users, protect workers and consumers or animal health or the environment , the competent authority shall take these into account when issuing an authorization and where necessary shall and where issue necessary authorization shall subject to those requirements. authorization issue the the to relevant requirements 4. Where other Community provisions impose the conditions for the issue of an authorization and for use of the biocidal product and to particularly where these are protect the health of distributors, users, workers and consumers or animal health or the environment , the competent authority shall take these into account when issuing an authorization and where necessary shall issue the authorization subject to those requirements. intended Article 7. a new supporting Member States shall establish a system obliging those seeking to place or having placed biocidal products on the market and those active substances on Annexes I. la and lb to pay charges, globally covering the costs of all different procedures associated with the provisions of this directive. entries for Article 9(5) or technical scientific the same product 5. The inclusion of an active substance in Annex I may be refused or reviewed, if there is another active substance in Annex I type, or another for method of control exists, which in the light of knowledge presents significantly less risk to health or to the environment. When considering such a refusal, an evaluation of the alternative shall be active substances or methods common in accordance with produced principles for the evaluation of dossiers, to demonstrate they can be used with the same target organism without effect on practical and significant disadvantages to the user. The evaluation shall be circulated in accordance with the procedures in Article 10(2) for decision in accordance with the procedures laid down in Articles 24 and 25 (3). economic the or technical scientific the same product 5. The inclusion of an active substance in Annex I may be refused or reviewed, if there is another active substance in Annex I type, or another for method of control exists, which in the light of knowledge presents significantly less risk to health or to the environment. When considering such a refusal, an evaluation of the alternative active substances or methods shall be produced to demonstrate they can be used with the same effect on the target organism without significant economic an d practical disadvantages to the user; The evaluation shall be circulated in accordance with the procedures in Article 10(2) for decision in accordance with the procedures laid down in Articles 24 and 25(3). /ir Article 14(3) 3. By way of further derogation from Article 4(1), Article 7(2) and Article 7(3) and without prejudice to paragraph 4 and paragraph 6, a Member State may, for a period of 10 years from the date of entry into force of this Directive, authorize the placing on the market in its territory of a biocidal active substances not listed in Annex I that are on the market on the date of entry into force of this Directive. containing product 3. By way of further derogation from Article 3(1). Article 4(1) Article 7(2) and Article 7(3) and without prejudice to paragraph 4 and paragraph 6, a Member State may, for a period of 10 years from the date of entry into force of this Directive, authorize the placing on the market in its territory of a biocidal active substances not listed in Annex I, but which have been used in biocidal products and are on the market on the date of entry into force of this Directive. containing product Article 18(3), introduction 3. Biocidal products shall be according to the provisions of Directive 88/379/EEC In concerning addition the label must show clearly and indelibly the following: labelling. labelled 3. Biocidal products shall be labelled according to the provisions of Directive 88/379/EEC concerning labelling. Labels shall not be misleading or give an exaggerated impression of the product. In addition the label must show clearly and indelibly the following: Article 18 (4) avicides rodenticides, 4. By way of derogation from paragraph 1 and 2 and the first sentence of paragraph 3 biocidal products authorised as insecticides, acaricides, or molluscicides shall be classified, packaged and labelled in accordance with Directive 78/631/EEC on the approximation of the laws of the Member States relating to the classification, packaging and labelling of dangerous preparations (pesticides) (1) insofar as there is no other Community provision specifically covering these matters for such products. 1 OJ L 206. 29. 7. 1978. p. 13. rodenticides, 4. By way of derogation from paragraph 1 and 2 and the first sentence of paragraph 3 biocidal products authorised as insecticides, acaricides, or molluscicides shall be classified, packaged and labelled in accordance with Directive 78/631/EEC on the approximation of the laws of the Member States relating to the classification, packaging and labelling of dangerous preparations (pesticides). (l) avicides 1 OJL 206. 29. 7. 1978. p. 13. K Article 24 (3) or his applicant authorized 3. The representative may be asked by the Commission to submit remarks to it, in particular whenever unfavourable decision is envisaged. an or applicant his shall be asked by authorized 3. The representative the Commission to submit remarks to it, unless a favourable decision is envisaged. Annex II (A) (1) 1. Dossiers on active substances are required to address at least all the points listed under "Dossier requirements". Responses are required to be supported by data. 1. Dossiers on active substances are required to address at least all the points listed under "Dossier requirements". Responses are required to be supported by data. The dossier requirements must be in line with technical development. Annex 11(B) (1) 1. Dossiers on active substances are required to address at least all the points listed under "Dossier requirements". Responses are required to be supported by data. 1. Dossiers on active substances are required to address at least all the points listed under "Dossier requirements". Responses are required to be supported by data. The dossiers requirements must be in line with technical development. Annex III(A) (1) 1. Dossiers on active substances are required to address at least all the points listed under "Dossier requirements". Responses are required to be supported by data. 1. Dossiers on active substances are required to address at least all the points listed under requirements". Responses are "Dossier required to be supported by data. The dossier requirements must be in line with technical development. Annex III (B)(1) 1. Dossiers on active substances are required to address at least all the points listed under "Dossier requirements". Responses are required to be supported by data. 1. Dossiers on active substances are required to address at least all the points listed under requirements". Responses are "Dossier required to be supported by data. The dossier requirements must be in line with technical development. 1 ^ Annex VI (51) introduction 51. Testing should be carried out according to European Union guide-lines if these are available and applicable. In the absence of these other methods can be used as shown is in order of in the list below which descending preference: 51. Testing should be carried out according to European Union guide-lines if these are available and applicable. Where appropriate other methods can be used as shown in the list below which is in order of descending preference: Annex VI (59), 2nd subparagraph In the case of active substances not on the market on the implementation date of the Directive only those substances listed in Annex I of the Directive can be used in biocidal products. Deleted Annex VI (80), introduction of 80. The Member State shall not authorize a if, under the proposed biocidal product foreseeable use, conditions concentration of the active substance or of any other substance of concern or relevant metabolites or breakdown or reaction products in the groundwater exceeds the lower of the following concentrations: the of the 80. The Member State shall not authorize a biocidal product if, under the proposed foreseeable use, conditions concentration of the active substance or of any other substance of concern or relevant metabolites or breakdown or reaction surface water or the products groundwater exceeds the lower of the following concentrations: in U Annex VI (86) new there 86. The Member States shall not authorize is a a biocidal product where reasonably foreseeable possibility of aquatic organisms being exposed to the biocidal if for any active substance or product substance of concern in it: - the PEC/PNEC> 1 unless it is clearly established in the risk assessment that under field conditions the viability of aquatic organisms is not threatened by the biocidal product proposed conditions of use. according the to there 86. The Member States shall not authorize is a a biocidal product where reasonably foreseeable possibility of aquatic organisms being exposed to the biocidal if for any active substance or product substance of concern in it: - the PEC/PNEO 1 unless it is clearly established in the risk assessment that under field conditions the viability of aquatic organisms is not threatened by the biocidal product proposed conditions of use. according the to are not factor (BCF) those which the bioconcentration - is greater than 1000 for substances which are readily biodegradable or greater than 100 for readily biodegradable unless it is clearly established in the risk assessment that under field conditions no unacceptable impact, either directly or indirectly, occurs on the viability of exposed organisms after use of the biocidal product according to the proposed conditions of use. are not factor (BCF) those which the bioconcentration - is greater than 1000 for substances which are readily biodegradable or greater than 100 for readily biodegradable unless it is clearly established in the risk assessment that under field conditions no unacceptable impact, either directly or indirectly, occurs on the viability of exposed organisms after use of the biocidal product according to the proposed conditions of use. Member States may, however, authorize anti-fouling products used on sea going vessels of over 25 metres for a period of up to 10 years from the date on which this Directive enters into force. This provision shall lapse if appropriate IMP rules are adopted within that period. A-j> ISSN 0254-1475 COM(96) 312 final OCUMENTS EN 14 03 15 Catalogue number : CB-CO-96-320-EN-C ISBN 92-78-05897-1 Office for Official Publications of the European Communities L 2985 Luxembourg

Proposal for a Council Regulation (EC) laying down certain rules for the application of the special arrangements for imports of olive oil originating in Algeria

http://publications.europa.eu/resource/cellar/e67f7c98-0aba-40d3-b404-a40a16945437

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 24. 06. 1997 COM(97) 329 final 97/0183 (ACC) Proposal for a COUNCIL REGULATION (EC) laying down certain rules for the application of the special arrangements for imports of olive oil originating in Algeria (presented by the Commission) EXPLANATORY MEMORANDUM 1. Article 16 of the Cooperation Agreement between the European Community and the People's Democratic Republic of Algeria grants certain reductions in the levy on imports into the Community of olive oil other than that which has undergone a refining process. Those reductions consist of a flat-rate deduction of ECU 0. 7245/100 kg and a deduction of ECU 14. 60/100 kg provided that Algeria levies an export charge of an equal amount. 2. Annex B to that Agreement stipulates that the amount to be deducted from the amount of the levy may be increased by an additional amount under the same conditions and arrangements as laid down in Article 16. 3. Article 17 of the Agreement provides for exemption from payment of the fixed component of the levy on imports into the Community of olive oil having undergone a refining process, wholly obtained in Algeria and transported direct from that country to the Community. 4. As part of the Uruguay Round of multilateral trade negotiations, the Community has undertaken to calculate tariff equivalents for the variable levies and replace them by fixed customs duties. 5. This could have prevented application of the concessions under the current arrangements. Pending the introduction of new rules by the Council, the Commission adopted transitional rules (Regulation (EC) No 2146/95, as last amended by Regulation (EC) No 2388/96), providing for deductions from the customs duties. That transitional arrangement expires on 30 June 1997. In order to meet the Community's commitments, it is therefore necessary to introduce a new Council Regulation to implement the concessions in their updated form. 6. In addition, for the sake of administrative simplification, the Commission proposes that the Council should grant it authority to make amendments required to adapt to any future changes made to the agreements by the Council under the Management Committee procedure. 2 Council Regulation (EC) No. /97 of. laying down certain rules for the application of the special arrangements for imports of olive oil originating in Algeria The Council of the European Union, Having regard to the Treaty establishing the European Community, and in particular Article 113 thereof, Having regard to the proposal from the Commission, Whereas Articles 16 and 17 of, and Annex B to, the Cooperation Agreement between the European Economic Community and the People's Democratic Republic of Algeria1 provide for special arrangements for imports of olive oil falling within CN codes 1509 and 1510, wholly obtained in Algeria and transported direct from that country to the Community; Whereas, for olive oil falling within CN codes 1509 10 10, 1509 10 90 and 1510 00 10, the special arrangements provide for a flat-rate deduction of ECU 0. 7245 per 100 kilograms from the applicable levy, representing the reduction provided for in Article 16(1 )(a) of the Agreement; whereas, provided that Algeria levies an export charge, those arrangements provide for a further reduction of that levy corresponding to the amount of the special charge, but not exceeding ECU 14. 60 per 100 kilograms, representing the reduction provided for in Article 16(l)(b) of the Agreement and a deduction of ECU 14. 60 per 100 kilograms, representing the additional amount provided for in Annex B to the Agreement; 1 OJ No 1. 263, 27. 9. 1978, p. 2. Whereas the Agreement on Agriculture concluded during the Uruguay Round of multilateral trade negotiations2 provides that the variable levies applied to imports of agricultural products are to be replaced by fixed customs duties from 1 July 1995; Whereas continuation of the arrangements makes it necessary to adopt new implementing rules and repeal Council Regulation (EEC) No 1514/763; Whereas, in accordance with the Agreement, the special export charge should be reflected in the price of the olive oil upon importation into the Community; whereas, to ensure the correct application of the arrangements in question, the necessary measures should be adopted to ensure that the charge is paid at the latest when the oil is imported; Whereas, if the present conditions of the special arrangements provided for in the Cooperation Agreement are amended, in particular as regards the amounts, or if a new agreement is concluded, it will be necessary to adjust this Regulation to incorporate those changes; whereas provision should be made for those adjustments to be adopted by the Commission in accordance with the procedure laid down in Article 38 of Council Regulation No 136766/EEC of 22 September 1966 on the establishment of a common organisation of the market in oils and fats4, as last amended by Regulation (EC) No 1581/965; Whereas, by Regulation (EC) No 2146/95,6 the Commission introduced an autonomous system as a transitional measure expiring on 30 June 1997; whereas this Regulation should therefore apply from 1 July 1997, HAS ADOPTED THIS REGULATION: Article 1 This Regulation lays down certain rules for the application of the special arrangements for imports of olive oil originating in Algeria. Article 2 1. The rate of customs duty applicable to imports into the Community of olive oil other than that which has undergone a refining process, falling within CN codes 2 O. I No I. 336, 23. 12. 1994, p. I. •* O J N oL 169, 28. 6. 1976, p. 24. 4 OJ No 172, 30. 9. 1966, p. 3025. 5 OJ N o t, 206, 16. 8. 1996, p. II. (' (XI N o L 2 l 5, 9. 9. 1995, p. I. 1509 10 10, 1509 10 90 and 1510 00 10, wholly obtained in Algeria and transported direct from that country to the Community, shall be reduced by ECU 0. 7245 per 100 kilograms. Where Algeria levies a special export charge on that olive oil, wholly obtained in Algeria and transported direct from that country to the Community, the rate of customs duty shall be further reduced by an amount equal to the special charge but not exceeding ECU 14. 60 per 100 kilograms. The reduction in the rate of customs duty provided for in paragraph 2 shall be applied to all imports for which the importer provides proof, when importing the olive oil, that the special export charge is reflected in the import price. Article 3 The rate of customs duty applicable to imports into the Community of olive oil having undergone a refining process falling within CN code 1509 90 00. wholly obtained in Algeria and transported direct from that country to the Community, shall be reduced by ECU 4. 661 per 100 kilograms. The rate of customs duty applicable to imports into the Community of olive oil having undergone a refining process falling within CN code 1510 00 90, wholly obtained in Algeria and transported direct from that country to the Community, shall be reduced by ECU 8. 754 per 100 kilograms. 2. 3. 1. 2. Article 4 Detailed rules for the application of this Regulation shall be adopted by the Commission in accordance with the procedure laid down in Article 38 of Council Regulation No 136/66/EEC. Article 5 Where the present conditions of the special arrangements provided for in the Cooperation Agreement are amended, in particular as regards the amounts, or where a new agreement is concluded, the Commission shall adopt the resultant adjustments necessary for this Regulation in accordance with the procedure laid down in Article 38 of Council Regulation No 136/66/EEC. Article 6 Council Regulation (EEC) No 1514/76 is hereby repealed. Article 7 This Regulation shall enter into force on the day following its publication in the Official Journal of the European Communities. It shall apply from 1 July 1997. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Brussels, For the Council The President FINANCIAL STATEMENT BUDGET HEADING: Article 120 (customs duties and other duties) DATE APPROPRIATIONS: ECU 13 559. 10m TITLE: Proposal for a Council Regulation laying down certain rules for the application of the special arrangements for imports of olive oil originating in Algeria LEGAL BASIS: Article 113 of the Treaty AIMS OF MEASURE: Definitive introduction of the concessions granted in their updated form. FINANCIAL IMPLICATIONS (in ECU million) PERIOD OF 12 MONTHS CURRENT FINANCIAL YEAR (96) FOLLOWING FINANCIAL YEAR (97) 5. 0. 5. 1. EXPENDITURE CHARGED TO: - EC BUDGET (REFUNDS/INTERVENTION) - NATIONAL BUDGETS - OTHER SECTORS REVENUE - OWN RESOURCES OF THE EC - (LEVIES/CUSTOMS DUTIES) - NATIONAL 5. 0. 1. 5. 1. 1. 5. 2. ESTIMATED EXPENDITURE ESTIMATED REVENUE METHOD OF CALCULATION: 1998 1999 2000 2001 6. 0. 6. 1. CAN THE PROJECT BE FINANCED FROM APPROPRIATIONS ENTERED IN THE RELEVANT CHAPTER OF THE CURRENT BUDGET? CAN THE PROJECT BE FINANCED BY TRANSFER BETWEEN CHAPTERS OF THE CURRENT BUDGET? IS A SUPPLEMENTARY BUDGET NECESSARY? WILL FUTURE BUDGET APPROPRIATIONS BE NECESSARY? YES/NO NO 6. 2. 6. 3. OBSERVATIONS: This measure brings into force on a definitive basis the transitional arrangements introduced by the Commission under Regulation No 2146/95, as last amended by Regulation No 2388/96. There are no additional financial implications. > ISSN 0254-1475 COM(97) 329 final DOCUMENTS EN 03 11 02 Catalogue number : CB-CO-97-320-EN-C ISBN 92-78-21773-5 Office for Official Publications of the European Communities L-2985 Luxembourg <T

COMMUNICATION FROM THE COMMISSION TO THE COUNCIL, THE EUROPEAN PARLIAMENT AND THE ECONOMIC AND SOCIAL COMMITTEE on the final evaluation of the centralized action for the dissemination and exploitation of Knowledge resulting from the Community' s specific RTD programmes (VALUE II)

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eng

COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 21. 06. 1996 COM(96) 280 final COMMUNICATION FROM THE COMMISSION TO THE COUNCIL. THE EUROPEAN PARLIAMENT AND THE ECONOMIC AND SOCIAL COMMITTEE on the final evaluation of the centralized action for the dissemination and exploitation of knowledge resulting from the Community's specific RTD programmes (VALUE II) 4 EUROPEAN COMMISSION Commission Communication to the European Parliament, the Council and the Economic and Social Committee on the final evaluation of the Centralized Action for the Dissemination and Exploitation of knowledge resulting from the Community's specific RTD Programmes (VALUE H) I. INTRODUCTION H. HI. PANEL'S RECOMMENDATIONS CONCERNING THE STRATEGIC OUTLOOK AND THE COMMISSION'S COMMENTS PANEL'S COMMENTS SPECIFIC CONCLUSIONS AND THE COMMISSION'S - Network of relay centres - Information and dissemination service - Exploitation of RTD results - Research-Scientific Community and Research-Society interfaces IV. CONCLUSION End. : 1) Final evaluation of the VALUE II Programme; 2) Comments by the VALUE II Programme Management Committee. COMMISSION COMMUNICATION TO THE EUROPEAN PARLIAMENT, THE COUNCIL AND THE ECONOMIC AND SOCIAL COMMITTEE ON THE FINAL EVALUATION OF THE CENTRALIZED ACTION FOR THE DISSEMINATION AND EXPLOITATION OF KNOWLEDGE RESULTING FROM THE COMMUNITY'S SPECIFIC RTD PROGRAMMES (VALUE H) I. INTRODUCTION 1. 2. 3. The Council Decision of 29 April 1992 on the dissemination and exploitation of knowledge resulting from the specific programmes of research and technological development of the Community (VALUE H) lays down that, at the end of the action, an evaluation of the results achieved shall be conducted for the Commission by a group, of independent experts, in order to determine the extent to which the results obtained help not only to achieve the objectives of this action and of the third framework. programme (1990-1994) but also to assess the efficiency with which the action was carried out and promoted (Art. 4(2)). The Commission therefore set up a group of independent experts known as the "VALUE II final evaluation panel" to carry out the evaluation. The group, chaired by Mr K. P. Friebe, carried out the evaluation from the beginning of February 1995 until the end of July 1995 and submitted its report to the Commission departments on 31 July 1995, The dissemination and exploitation Committee (VALUE II Management Committee) expressed its observations on the final evaluation report at its meeting of 7 November 1995. H. PANEL'S RECOMMENDATIONS ON THE STRATEGIC OUTLOOK AND THE COMMISSION'S COMMENTS The panel believes that greater attention should be paid to innovation, which is not simply the product of research and technological development activities but also comprises organizational and social aspects. A major initiative with significant funding would, according to the panel, therefore be justified in the field of innovation. The Commission agrees to a large extent with this analysis and on 20 December 1995 it adopted a "Green Paper on Innovation". The basic premise behind the Green Paper is that European businesses are scientific than comparatively breakthroughs and technological achievements into innovations. their competitors less able transform to Europe must therefore take resolute action and to this end the Green Paper proposes thirteen lines of action corresponding to the main objectives as follows: gearing research to innovation, strengthening human resources, improving financing conditions and creating a legal and regulatory environment suited to innovation, whilst developing the role and means of action of the public authorities. The Green Paper on innovation is likely to be discussed widely in the first half of 1996 and the final evaluation of VALUE II may, to a certain, extent, be considered as a contribution to that debate, making it possible to define innovation priorities and the measures to be carried out. m. PANEL'S COMMENTS SPECIFIC CONCLUSIONS AND THE COMMISSION'S The panel's final evaluation contains an analysis of the activities implemented under VALUE II and recommendations regarding their future development. The VALUE II Management Committee for its part feels that with limited resources the Commission departments have developed and implemented new instruments which have considerably helped promote new attitudes regarding dissemination and exploitation under the fourth framework programme. The conclusions regarding the main activities of VALUE II are as follows: • The relay centre network: The panel concludes that, in the 1993-1994 period, the relay centres succeeded, via a broad range of services upstream and downstream, in advancing the exploitation of Community RTD results in the Member States. It also felt that the key to the success of the relay centre scheme lay in the commitment, qualities and experience of those called upon to act as efficient "brokers" between businesses and technology holders. The creation of the network of relay centres was one of the most significant new activities of VALUE H, and has served, with due regard for national contexts, to bring Community activities closer to local users' needs. By now concentrating on its role of promoting innovation, the network of relay centres should, as the panel recommended, contribute more than in the past to matching businesses' needs with the technologies available and not confine itself to promoting the results of Community RTD activities. As pointed out by the Value II Management Committee, these developments call for increased collaboration, with a view to improved rationalization of their respective activities, with the other Community networks promoting RTD activities (network of EuroInfoCentres, CRAFT network aimed at facilitating the participation of SMEs in Community RTD programmes, etc. ), national networks - in particular those serving SMEs - and the other players in the innovation system. • The information and dissemination service: Significant improvements have been made to the CORDIS information service in recent years, as the final evaluation report and the comments of the VALUE II Management Committee emphasize. CORDIS has become a widely-used, recognized tool for the dissemination of information on Community RTD activities 4 (14 000 users). Nevertheless, the panel regrets the lack of an integrated EC policy on RTD information and the risk of duplicating efforts, and would like to see the introduction of a coherent, well-defined approach. It also recommends that a study should be carried out on demand, the future development of the system and its cost. These recommendations are, to a large extent, shared by the VALUE II Management Committee. The Commission has noted the panel's recommendations, most of which it has already accommodated. It has taken steps to increase the coherence of its information instruments on RTD activities. It has set up a Working Party to promote the creation of bridges between the national and Community systems for disseminating scientific and technical information. It is also continuing its efforts to better adapt to existing or potential demand and to reduce the system's collection and operating costs. Finally, it has launched studies aimed at defining the possible future development of the system. • The utilization of RTD results The panel believes that the exploitation - projects have made a significant contribution to the programme and that the activity has been organized efficiently. It recommends that priority should be given to user-driven consortia and to projects on generic technological fields with a high spin-off potential. It is also of the opinion that the exploitation measures should not be confined to Community RTD activities but should also include all the results available from European RTD. The VALUE II Management Committee considers that these projects have a high value added and have had spin-off effects by helping to promote the development of an "exploitation" culture at Community level. The Commission to a large extent shares the opinion expressed by the panel and the VALUE II Management Committee. It is lending its support through the new Innovation Programme (4th framework programme) to technology validation and transfer projects. These projects are demand-oriented and trans-sectoral. In this respect they differ from other RTD activities and, in particular, from cooperative research projects which, while also demand-oriented, are further "upstream" and are not a priori trans-sectoral. Moreover, as recommended by the panel, the technology validation and transfer projects are no longer confined to the exploitation of Community RTD results. They arouse great interest amongst SMEs, since more than 60% of project coordinators are SMEs, and there is at least one SME in 90% of the projects selected. "Project" activity is also now granted a much higher level of funding and it should therefore be possible to better promote the innovation culture at Community level. • Legal protection of results The panel considers that the results obtained as regards intellectual property are relatively meagre, and approves the recent initiatives aimed at improving the quality of the services proposed in the field of patents. The Commission believes the issues surrounding intellectual property are very important in the context of innovation policy. The role of the Community in this respect is relatively limited for legal reasons. This is particularly true regarding shared-cost activities because of the contractual liabilities of the contracting parties in RTD projects. The financial resources allocated to this activity were also very limited under VALUE H. Nevertheless, there have been a number of recent initiatives, some of them referred to in the panel's evaluation (quick scan, patent building scheme, training of project leaders, etc. ), which should make it possible to take fuller account of these aspects in the management of projects receiving Community funding. • Promotional activities: A large number of promotional activities were carried out, but the panel felt their impact on the main target groups could have been greater. The panel therefore proposes that a more coherent overall promotion strategy should be drawn up, taking better account of the needs and perceptions of the various target groups. The Commission has noted the panel's observations. It has already taken organizational measures which should enable the adoption of a better coordinated, more targeted approach. • Research-Scientific Community and Research-Society Interfaces: The panel expressed its interest in the activities carried out, with limited resources, in these areas. It recommends that their results be promoted by means of campaigns aimed at pre-defined target groups. The Commission also attaches great importance to the social aspects of research and innovation. The work programme of the Innovation Programme accordingly provides for a line of action devoted to raising public awareness of research and technology issues and the role they play in the present society. • Relations with other Community initiatives The panel considers that the Value II Programme should maintain closer links with other Community initiatives such as those of the structural funds, or with other policies such as industrial policy or enterprise policy (particularly in favour of SMEs). Dissemination, exploitation and innovation activities take place at the interface between research and these policies or initiatives, and the Commission thus shares the panel's view. Several pilot projects have already been implemented, and these will have to be assessed and, if necessary, pursued and further developed. In particular, they may concern specific actions at regional level, actions targeted specifically at SMEs and measures to improve the terms of innovation financing. IV. CONCLUSION The Commission wishes to thank the VALUE II final evaluation panel for its comments and recommendations, some of which have already been accommodated in the measures provided for under the Innovation Programme. It also considers this report to be a valuable contribution to the debate on innovation in Europe. This communication, together with the final evaluation report, is submitted to the European Parliament, the Council and the Economic and Social Committee, in accordance with Article 4 of the Council Decision of 29 April 1992. Y- VALUE II Programme Final Evaluation 31 July 1995 Report prepared by an Evaluation Panel at the request of the European Commission's Directorate General XIII : Telecommunications, Information Market and Exploitation of Research. s CONTENTS ACKNOWLEDGEMENTS EXECUTIVE SUMMARY H BACKGROUND TO THE FINAL EVALUATION OF THE VALUE II PROGRAMME 1. 2. 3. Overview of VALUE II The Findings and Recommendations of the Mid-Term Review The Evaluation Mandate and Approach EOL FINAL EVALUATION OF VALUE II 1. 2. 3. 4. 5. 6. 7. Introduction Action line 1. 1a Action line Lib Action line 1. 2 Action Line 1. 3 Action Line 1. 4 Interfaces II & m VALUE Relay Centres Network Basic Service (CORDIS/Publications) Utilisation of Results Legal Protection of Results Promotional Activities Research-Scientific Community and Research-Society IV. STRATEGIC ISSUES 1. 2. 3. Background Strategic Considerations Recommendations ANNEXES Annex I Annex II Annex III Annex IV The Council Decision of 29 April, 1992 Final Evaluation Terms of Reference Executive Summary of the Evaluation of the VRCs Acronyms and Abbreviations ^ VALUE II Programme Final Evaluation A final evaluation of the Community's Centralised Action for the Dissemination and Exploitation of Knowledge Resulting from the Specific Programmes of Research and Technological Development (VALUE H). •O EVALUATION PANEL: K. P. Friebe (Chairman) Dr. L. Crespo Prof. Th. Durand Prof. N. Gangas Dr. F. Gonçalves Prof. P. Hills Dr. B. Svensson Ir. A. Vyverman EDITORIAL SUPPORT: Mrs. M. Victor 31 July 1995 Report prepared at the request of the European Commission's Directorate General XIII : Telecommunications, Information Market and Exploitation of Research. M) ACKNOWLEDGEMENTS The VALUE Evaluation Panel would like to express their sincere appreciation to all those interviewed throughout the Commission and elsewhere. The assistance of the VALUE Team, particularly Mr. Giulio- Cesare Grata, Director of DG XIII-D, Mr. Jean-Noel Durvy, and Mr. Constant Gitzinger is gratefully acknowledged. The views and recommendations contained in the report are, however, the responsibility of the authors alone. ,. ••4"^ L EXECUTIVE SUMMARY STRATEGIC ISSUES In relation to the strategy of VALUE, much has already been said in the Mid-Term Review about the historical strategy of the VALUE I and II programmes. The panel felt that there was no need to duplicate this and that it was more appropriate to identify the lessons from past experience and concentrate on discussing future strategies. The panel wishes to stress that -the real objective behind investing in RTD is competitiveness through innovation and that innovation is not just a spill-over of RTD. While the existence of the Third Activity recognises that it is not enough to invest in RTD. the current attention paid to innovation is clearly insufficient to leverage RTD properly. The panel insists in pointing out that innovation should be recognised as a risky business for companies, Furthermore, it is difficult to fund» While past thinking and action was inspired by a technology-push perspective, the relevant approach should be mostly around demand-led policies. RTD programmes should not be expected to generate off-the-shelf-technologies, 'Instead, RTD except for very specifier but nevertheless important cases, projects should be regarded as ways to build a wide variety of expertise available their to help firms solve the problems encountered innovation processes. in In addition, dimensions as much as technological ones. innovation encompasses organisational and social The panel strongly advocates a major to the promotion of innovation. A detailed discussion of the strategy issues is to be found on p. 53-61. This initiative should help co-ordinate the many actions of the Commission This major action has a validity of its own, beyond RTD activities. initiative dedicated Significant funding should oe allocated to this initiative. The panel considers that 10% of the RTD budget is a much more relevant order of magnitude than the amounts allocated to past actions. The panel suggests four major action lines (see p. 60-61) for promoting innovation,, encompassing a variety of approaches in order to reach SMEs and help experience-sharing across borders. The panel recommends that new thinking and thus new actions on Innovation emerge within the Union» The panel suggests strongly that this, initiative be recognised as a top priority and wishes to raise political awareness in the Community. 2. VALUE RELAY CENTRES NETWORK Al There is no doubt that the recognised difficulty in translating R&D results into marketable products/services, including the corresponding production processes, is a weakness that needs to be addressed urgently and in such a way that it should be considered a strategic issue, given the importance that variables such as "reduced time to market" and "shorter product life cycles" assume in today's supra-national competitive environment. Taking into consideration the Mid-Term Review and the recent evaluation of VRCs, the panel concludes that, in general, both the analysis and recommendations made in these documents still remain valid. The main conclusion of the aforementioned evaluation is that during their pilot operation in 1993 and 1994, VRCs succeeded, via a wide spectrum of upstream and downstream services, in advancing the valorisation of Community RTD results across the Member States. In view of this positive outcome of the detailed evaluation of the VRCs, we expand below in this report by presenting some general reflections on the Relay Centres concept which is pertinent to the currently unfolding Third Activity as well. The cornerstone of the success of any Relay Centres experiment is basically and inevitably dependent on the commitment, skills and expertise of the people involved in becoming effective brokers between business and technology. Synergies could be achieved through the utilisation by RCs of the old SPRINT networks, given the complementary nature of their activities. The VR-Service, acting as a permanent monitoring, guiding and supporting feedback system, could enhance its efforts for a more active networking of the RCs, as well as for a better cohesion in their operations across Europe. The most important asset of each RC is its own personnel. Their managerial, technical and entrepreneurial skills are the key issue of all operations. Any measures taken to secure and expand this asset are, therefore, vital for success. 3. CORDIS At the end of 1994, the recommendations formulated during the Mid- Term Review were still valid. Since then, progress has been observed. A coherent and well defined RTD information provision approach seems highly desirable in order to make any innovation policy successful. This *A5 is, of course, not the responsibility of one single DG, but must be assured at the highest EC level. Means should be found and procedures be established to shorten drastically the delay in provision of information on projects and results from EC RTD programmes and to enable the delivery of more up-to-date information. The information provided by CORDIS could be expanded in ways which we recommend in our report. It is recommended that in the medium-term an integrated in-depth study be undertaken in which the following items should be addressed. Of these issues, the first is considered to be the most important. • • • The demand side: the impact of the service should be measured and the users surveyed. Such a market study should also cover the most appropriate marketing policy to be followed in terms of money charged for services. Technological evolution: how the information provision could look like in about 5 years' time and how CORDIS could adapt to technological evolution. This study should also take into account the relationship with national or regional RTD databases. essential for the operation of CORDIS, while Cost control: maintaining high quality and service. This plan should be based on a profound assessment of the actual process for the creation and maintenance of the databases and should contain the steps to be taken in order to cope with the technological changes of the near future, to ensure a significant and lasting cost reduction over the coming years. CORDIS also has a role to play in bringing the national and regional RTD databases closer to potential users in a harmonised way. UTILISATION OF RESULTS Directly supported valorisation projects make an important contribution to the programme. The Commission have organised the aclivity effectively. Several, and probably many, projects are of high technical quality and should lead to exploitation which would have been lost without VALUE. More could be achieved, however, with a better focused and more commercially oriented approach. This would take greater account of two points: that technology transfer and innovative attitudes are best diffused via personal contacts; and that appropriate technological solutions are more likely to be generated by Aii demand from the bottom up, than by top-down dissemination. The Commission should reflect these considerations in selecting projects and setting their objectives. There should be increased emphasis, therefore, on user-driven consortia. All projects should include, as main partners, an organisation committed to exploitation if the project is successful. More weight should be placed at all levels of the programme, on demonstrating the innovative attitudes behind the projects, as well as their results. Projects should be selected wherever possible to cover generic technologies with a high spin-off potential. 5. LEGAL PROTECTION OF RESULTS The panel considers the results achieved in the IPR field within the framework of the VALUE programme to be relatively meagre both in quantitative and qualitative terms. This is supposed to be caused by lack of financial resources as well as lack of initiative on the part of DG XIII Patent Section. Among key activities in future are a "Quick Scan", which allows assessment of the novelty of technologies in collaboration with the European Patent Office in The Hague, and a "Patent Build-up Scheme", which is aiming to make contractors aware of the importance of the priority year and the opportunities for secondary filings. The panel concludes that there is a need for a radical change in the present organisation and operations of the Patent Section considering the great importance of JPR matters in connection with RTD projects. It therefore welcomes the recent initiatives which aim to offer improved patenting services in future. The evaluation is concluded by a presentation of five specific ideas that could serve as viable tools in the future operations of DG XIII Patent Section and other pertinent EC bodies involved in IPR matters. 6. PROMOTIONAL ACnvmES The panel has the impression, when surveying the large number of promotional activities undertaken, that they have resulted from a step-by- step line of action rather than from a well thought-out and well-integrated promotional strategy. A possible consequence of this is that there has developed only limited awareness among important target groups about the links between individual activities and the overall objectives and ambitions of the VALUE programme. AS The panel suggests a more powerful promotion of the Third Activity in the future based on: • • • an analysis of the needs and perceptions of different target audiences and the results of previously carried out promotional activities under VALUE a coherent promotional strategy across all three objectives of this Activity, and a strong and clearly identified connection between promotional efforts related to individual activities and the principal common elements of the overall promotional strategy. The evaluation concludes by suggesting that the promotional activities for each of the three objectives of the Third Activity should be subordinate to, or comply with the principal common elements of a coherent promotional strategy. „ 7. INTERFACES II AND III : RESEARCH-SCIENTIFIC COMMUNITY AND RESEARCH-SOCIETY Innovation, as a whole, is the outcome of a large combination of interdisciplinary activities and to be successful it requires, among other facts, social awareness, acceptance and training to lead to the desired proper use. Barriers and threshold levels for technology acceptance may vary from country to country but transnational considerations and lessons learned at a European level will be of great importance. Interfaces II & HI addressed these issues with very reduced human and budgetary resources. The panel recognises the efforts and the qualified approach of the project team as well as some relevant results. In general terms it has been a tool- oriented concept which led to some workable goods and manuals. A special mention has to be made of the awareness workshops methodology which has been very successfully used in several European cities to deal with the issue of sustainable living in urban environments. This methodology has been recognised and adopted by relevant European and national institutions. Therefore, the panel expresses its surprise and concern about the dismantlement of this activity at the end of VALUE II and the apparent abandonment of these action Unes within the Third Activity. It hopes that this situation will be reconsidered and reinstated or continued with appropriate resources and with a clearer recognition of its benefits at Commission level. The resources foreseen for accompanying measures could be used synergistically for this purpose. AC IL BACKGROUND TO THE FINAL EVALUATION OF THE VALUE H PROGRAMME 1. OVERVIEW OF VALUE II Programme title: Centralised Action for the dissemination and exploitation of knowledge resulting from the specific programmes of research and technological development of the European Union. Programme period: May 1992 - December 1994. Programme Acronym: VALUE II The Third Framework Programme stipulated that measures for disseminating knowledge and results arising from the specific and supplementary programmes shall be implemented, on the one hand, by these programmes themselves and, on the other, by means of the Centralised Action. The goal of this action, in particular, was to add specific value to the whole range of Community RTD activities which were the subject of the Third Framework Programme (1993-1994), co ordinating and supplementing the measures taken under the specific RTD programmes. More specifically, the main objective was to promote the dissemination and utilisation of the results of EU Research and Technological Development (RTD) activities with a view to attaining tire declared goal of the Framework Programme. Thus, exploitation per se of research results was not within the objectives of VALUE II. The Council Decision (see Annex 1) for the Centralised Action (or VALUE H) was adopted on 29 April 1992 and allocated to this programme a budget of 57 MECU. Later, by the Decision 93/167/Euratom, EEC, of 15 March 1993, this amount was revised to 66 MECU. Thus, the funds allocated for VALUE II are higher than those for VALUE I, but they still represent a small fraction (1%) of the financial envelope for the whole Third Framework Programme. Therefore, VALUE II was given inadequate means to promote significantly RTD results and to facilitate their effective utilisation across the EU. VALUE II both provided continuity for the measures carried out during 1989-1993 under Sub-programme I of VALUE I and introduced new topics of strategic importance for the promotion of Community RTD results and for facilitating their utilisation. These new topics brought into focus the perspectives of: • the interdisciplinarity of research; and Aif- the repercussipns of RTD activities and of their results on society as a whole. More specifically, the Council Decision specified that VALUE II should be implemented: • • in accordance with Complementarity and Subsidiarity; and the principles of Horizontality, along three interfaces; those of "Research-Industry", "Research- Scientific Community" and "Research-Society". The objectives set for each of these interfaces can be summarised as follows:- Interface I. "Research-Industry", for improving the international competitiveness of Europe's industry in accordance with the provisions of the EEC Treaty by means of specific projects designed to maximise the impact of Community R&D activities on industry as a whole. Interface II. "Research-Scientific Community", for contributing to an interdisciplinary reflection on research, its methods, problems and impact. Interface HI, "Research-Society", for identifying and studying the societal impact of the new scientific and technological knowledge acquired as a result of Community activities as well as for providing information to the public so as to ensure that changes in the contemporary approach to science are compatible with developments in society. The following tables depict the main activities carried out per action line of the programme and the corresponding funds spent or allocated until 31 December 1994. ïablfLl LINES OF ACTION OF INTERFACE I Cost (MECU) LÎâ •Lib 1. 2. 1. 3. 1. 4. I VALUE Relay Centres " ' ÏT * CORDIS and publications for dissemination Utilisation of results Protection of results Promotional activities Total Expenditure until 1 January 1994 > Above expenditure as percentage of budget > 11. 6 11. 1 0. 4 5. 3 41. 8 75 Table 2 ACTIVITIES WITHIN INTERFACE H Cost (MECU) 1 2 3 Studies, surveys, evaluations Promotion, awareness, seminars, etc. Directories, databases, documents Total Expenditure until 1 January 1994 > Above expenditure as percentage of budget > 0. 6 0. 4 0. 05 1. 05 37 Table 3 ACTIVITIES WITHIN INTERFACE IH Cost (MECU) 1 2 3 4 Studies, surveys, evaluations Promotion, awareness, seminars, etc. Directories, databases, documents Contribution to TA within the EU "~ Total Expenditure until 1 January 1994 > Above expenditure as percentage of budget > 0. 4 0. 3 0. 05 0. 3 1. 05 41 >C3 2. FINDINGS AND RECOMMENDATIONS OF THE MID-TERM REVIEW 2. 1. VALUE in Context Economic development in the whole of Europe will depend greatly in future on the application of well-defined R &D strategies, the promotion of successful innovations and the availability of appropriate technologies. These will be a pre-requisite to creating jobs and ensuring the well-being of all European citizens. R &D and the promotion of innovation are therefore essential activities in fulfilling these aims. The RTD culture is fairly well-established in Europe : EC-funded RTD currently represents about 5% of all R & D conducted within the European Union. In contrast, however, the culture of utilising the results of this RTD, i. e. the exploitation and dissemination of the outcome of RTD, is not that widespread. The VALUE Programme, which should play a decisive role in promoting the utilisation of RTD and hence in aiding the dynamic economic development of Europe in future, has a budget allocation of only 1% of all EC-funded RTD - far too small to have any real impact. VALUE I (1989-1993) and VALUE H (1992-1994) were pilot programmes during the Second and Third RTD Framework Programmes. They made it possible to design relevant methodologies and tools to help transform R & D results into real economic activities. A global policy to ensure these essential activities should now be formulated, adopting a broader strategic vision to include a far greater effort and political commitment. A major initiative, targeted at the promotion of innovation for which the funding would be clearly distinct from the funding of R & D and thus from the Fourth Framework Programme, should be considered in the medium term. In the meantime, the specific programmes should be invited to work closer with VALUE in order the promotion of RTD results. In addition, VALUE should concentrate more on SMEs via a more "demand pull" or "bottom-up" approach. Indeed, VALUE'S main task is to design appropriate processes to assist SMEs solve the technical problems that they face by calling upon the technical capabilities of R & D labs, wherever these are located ii; Europe. to improve the effectiveness of 2. 2. Strategic Perspectives 1. The major issue behind VALUE concerns the very nature of the re RTD programmes, given the overall objective of promoting innovation throughout Europe. Conventional wisdom assumes that RTD yields results which may be directly or indirectly exploitable through some Ho adaptation and development processes. However, this is unfortunately seldom the case. It must be recognised clearly that RTD programmes essentially contribute to strengthening the "existing knowledge base" in the teams conducting the work. Making the best use of RTD results thus primarily means exploiting the enriched "existing knowledge base" in order to solve problems encountered throughout the many loops of the innovation processes taking place within and among companies and R & D centres. Both VALUE I and VALUE II were designed with a big agenda without adequate political and financial support. It must be emphasised that the exploitation of RTD results, technology transfer and more generally the promotion of to European economic competitiveness and as such require significant funding, not just a small percent of RTD budgets. innovation are essential VALUE may be considered a back-up initiative, should the participants of an RTD programme not exploit their results in the usual way. However, little or no attention was paid in VALUE to "upstream" or "ex ante" integration of business perspectives into the RTD programmes, i. e. before the RTD project was funded and launched. Is it normal or inevitable that over 50% of RTD projects fall in the "Candidates for Value" category while only about 20% lead to "Autonomous" exploitation by the consortia which conducted the RTD? 2. 3. 4. VALUE fulfils a function which is directly related to other existing activities. National policies, methodologies and tools exist to promote technology transfer and innovation within most countries and at regional level. This includes exploitation of publicly funded R&D. SPRINT aims at promoting "cross-border" technology transfer and innovation. VALUE addresses community funded RTD only. VALUE might thus have been designed around existing tools stemming from national or SPRINT initiatives, as a communication action towards: existing technology transfer agents and their networks; £-1 •B* existing value added networks of information providers; the management team of the specific programmes (ESPRIT, BRITE- EURAM,. ) in the Commission. The integration of SPRINT and VALUE into a single programme should strengthen the effectiveness of both the VALUE and SPRINT initiatives. More co-operation between the specific programmes and VALUE would be appropriate. VRCs were created as a decentralised tool for VALUE. They offer a unique opportunity to promote innovation and technology transfer towards SMEs, adopting a bottom-up approach and taking into account the diversity of national and regional cultures encountered in Europe. VRCs should thus be both strengthened and optimised. Along these lines, an in- depth evaluation of the VRCs was performed. VALUE should be extended to include not only Community funded RTD results but also relevant technologies requiring transfer/exploitation throughout the multiple and complex loops of the innovation process. This would therefore require VALUE to deal also with all other types of RTD results e. g. nationally funded. SMEs should be a definite priority for Community programmes and especially for the promotion of exploitation via the VALUE Programme. VRCs have an important role to play in this process. The panel recommends that the Commission halt the continual creation of new offices, guichets or similar entities. Decentralisation is clearly appropriate but without co-ordination it leads to wasteful overlaps and duplication. The VALUE approach, initially created in a "technology push" type of mode, should become more demand-oriented or "market pull" based. From that perspective, the concepts behind the experiment currently under way between VALUE o ii the £ - uctural Funds to satisfy SME needs would seem appropriate. This clearly relates to the "ex ante-upstream" type of reasoning mentioned above. VALUE has been involved directly in exploitation projects covering activities such as marketing studies, business plans, search for industrial partners, tests under industrial conditions, prototyping, patent support, licensing, participation in exhibitions, etc. Shouldn't VALUE'S role focus on organising/integrating/promoting/linking, helping to match needs 5. *6. 7. 8. 9. &3L and skills, working more as a catalyst and designer of processes than as a direct player? Undertaking specific projects may, however, be useful to: demonstrate the exploitation mechanisms as well as utilise outstanding R &D results in Member States or Community regions having little experience in exploitation/insufficient pertinent national schemes; serve as examples of concrete outputs of the VALUE Programme whenever an illustration is required by the public (displaying function); keep the VALUE team up-to-date with respect to the difficulties of real life innovation processes; analyse across these projects, to learn from such experiments. 10. How do VALUE/SPRINT/the Fourth Framework Programme/Structural Funds relate to one another from the above viewpoint? More specifically, should not VALUE and VALUE/SPRINT be related increasingly to the structural initiatives of DG XVI, or even to the Industrial Policy of DG III or the SME actions of DG XXHI? The current pilot initiatives, e. g. with DG XVI, hint clearly in this direction. 11. From such a perspective, the purely administrative funding approach adopted recently of 1% of the specific RTD programmes supposedly devoted to dissemination activities may only be effective if co-ordinated by VALUE. 12. There is a clear need, in parallel to the RTD action, to develop an effective strategy for the promotion of innovation, technology transfer and the exploitation and dissemination of RTD results and knowledge. 2. 3. Promotional Activities 13. Under this action line scientific information arising from Community RTD activities was disseminated by means of publications, information sheets and articles. S3 14. The FLAIR-FLOW project, a co-ordinated action supported jointly by VALUE and FLAIR, was particularly effective in aiding dissemination of results from European Food R & D. Dissemination took place using various means, the most important being the one-page technical documents in layman's language which were widely circulated. 15. Other important activities under this action were the publication of "Innovation & Technology Transfer News-Letter", "Euro-abstract Catalogues" and "CORDIS Up-date". 16. Horizontal activities which proved very helpful are the RTD Help Desk and the establishment of Cooperation Network, representing a very good synergistic initiative between VALUE and other EC initiatives and funding sources, e. g. , regional funds handled by DG XVI. 2. 4. Utilisation of Results 17. Exploitation of results is a major action, lying at the heart of the VALUE Programme. 94 projects out of 373 proposals were selected for financial support of actions such as marketing studies, business plans, search for industrial partners, tests under industrial conditions, prototyping, patent support, licensing, participation in exhibitions, etc. Around 40% of the contracts are concluded with SME companies. 18. Although exploitation is a lengthy process, it is clear by now that a substantial proportion of the projects essentially supported during VALUE I could lead to significant results in the near future. The various instruments of assistance available enable VALUE to accommodate better proposers' needs. 19. 20. The source of the VALUE exploitation scheme is only a fraction of what is produced in the individual Member States of the European. Union. The exploitation action therefore should not be limited to Community RTD alone but should be expanded to include all avx^Jable European RTD results. In order for VALUE to have a major impact on the exploitation of RTD results, the budget needs to be of a different order to magnitude» However, even then, collaboration should be sought with national and intern: exploitation schemes and potential financing bodies (DG XVI, DG ; EUREKA, CRAFT, national and regional supporting organisations, etc. ). 21. The delay caused by the Commission procedures for selection and conclusion of project proposals is too long, hence inefficieht and needs to be reviewed in future. 2. 5. Methods and Tools Value Relay Centres 22. The network of VALUE Relay Centres is an interesting initiative that might become the necessary bridge between the European specific RTD programmes and users' needs, especially those of SMEs. It could have important synergistic effects with the national RTD programmes and could act as a transnational European platform for effective dissemination and cross-fertilisation of RTD efforts. 23. Its short operational history indicates a non-homogeneous situation among the different VRCs, some already producing good results while others appearing to lack clear action plans. A revision of the current situation is recommended in order to improve the performance of VRCs in some countries. CORDIS 24. CORDIS is now in its full pilot operational phase and is quite a well known EC initiative, valued by RTD people within the EC and abroad. Together with its success emerges also the need for further improvements, e. g. higher speed in data collection, continuous data updating, more coherent abstracting of primary information in order to obtain more accurate record characterisation (e. g. SIC codes) and better data quality and consistency. 25. These improvements in data presentation and consistency in both on-line and off-line CORDIS products, combined with the VALUE Management Team policy to utilise new technological options, present an opportunity for CORDIS to become very attractive also to users inexperienced with on line searches and to satisfy simultaneously the increasing demand for well-presented, easily accessible and manageable information. Multi media CD-ROMs and Context Driven Applications are examples of future technological options within the reach of CORDIS. 26. The recently launched software interface "Watch-CORDIS" demonstrates the above VALUE team policy. The merits of this new product could be enhanced significantly by enabling access through it to the CORDIS CD- ROM data as well. £V «B* 27. Much should be done in training intermediaries and end users in using CORDIS fully. A better training policy and practice is needed, given that promotion and training should be envisaged as complementary push-pull activities. 28. Publication of sub-sets of CORDIS data should not be considered an indispensable but redundant system. In fact, there is a need for re formulating the strategy for CORDIS publications from the viewpoint of their actual usefulness and promotion of CORDIS and its products. 29. Promotion of CORDIS should be increased but within an overall marketing strategy. Such a strategy should be formulated before the end of VALUE H, so as to provide a dear direction for CORDIS promotion during the next Framework Programme. 30. The usefulness of CORDIS would be increased greatly by substantially upgrading the content and quality of information on the RTD programmes, RTD projects and other pertinent databases and by incorporating additional EC documentation, e. g. synopses of submitted RTD proposals, abstracts of European Parliament papers dealing with RTD and more general issues of science and technology. Such an upgrading would give it an EC-encyclopaedic character which would have many multi-faceted beneficial effects across the EC. 31. CORDIS is already accessible via several Wide Area Networks, while there is also interest by intermediary organisations in distributing electronically sub-sets of CORDIS. However, before using new options for a more dynamic penetration of CORDIS by distributing sub-sets of CORDIS to other hosts, or even relocating CORDIS from ECHO, a multitude of major policy and technical issues require clarification. 32. In conclusion, a clear overall CORDIS strategy is urgently required, particularly given the limited funds envisaged for VALUE and SPRINT initiatives within the Third Activity* cf the next Framework Programme. This is needed not only for optimising the service but also for securing its future. The issue of decentralisation or commercialisation of CORDIS should be the cardinal consideration in such a strategy. Legal Protection of Results 33. Because of its importance and relatively low cost, the protection of RTD results is an essential part of the VALUE scheme. Patent evaluation of all JRC and some selected Framework Programme research results is executed by the VALUE patent team. Drafting of patent claims, writing patent cklo specifications and patent filing applications are undertaken by professional patent lawyers. 34. Very few patents until now have been granted on patent applications under VALUE. 72 cases have been filed, essentially from BRITE/EURAM and the life Sciences programmes. Exploitation of RTD results takes years and although no patents taken by the Commission under the VALUE programme have yet been commercialised, several cases of exploitation are under way. 35. The work of the VALUE patent team could be improved through greater involvement by the programme project officers and RTD project partners. 2. 6. Interfaces II and III 36. The activities of Interfaces II and HI are new to VALUE and could have a significant impact. However, the importance attached to them by the Commission is insufficient with respect to the magnitude of the tasks involved. 37. The Commission's strategic approach and planning have benefited the implementation of the actions. Nevertheless, a clear administrative identity is required urgently for the management team of these tasks, to facilitate its work in approaching the target groups and in developing their activities, not only outside but inside the Commission. 38. Since there is a general lack of awareness about the new issues (Research- Scientific Community/Research-Society Interfaces), the Commission should place greater emphasis on promoting these through campaigns aimed at target groups in the Commission itself as well as in the Member States. This could involve synergy with Interface I activities, e. g. using VALUE Relay Centres as "distribution networks" for various Interfaces II and III activities. 39. The Commission should consider merging Interfaces II and HI, directing more effort and resources, particularly human resources, towards Interface IE, "Research-Society" actions. £^ 3. THE FINAL EVALUATION MANDATE AND APPROACH In accordance with Article 4, paragraph 2 of the Council Decision: "At the end of the action, an evaluation of the results achieved shall be conducted for the Commission by a Group of independent experts. The Group's report, together with the Commission's comments, shall be submitted to the European Parliament, the Council and the Economic and Social Committee". s The Terms of Reference of the Final Evaluation of VALUE U, given in Annex 2, further detailed the evaluation task by stipulating that. the panel will assess the extent to which the results achieved contribute to the objectives of VALUE II and that of the Third Framework Programme; this panel will also assess the efficiency and effectiveness with which the programme has been managed and promoted. Finally, DG XIII-D asked the panel to reflect on strategic policy issues in relation to the dissemination and exploitation of RTD results and to technological innovation. The work of the panel basically comprised:- critical review of pertinent EC documentation and activity reports; interviews with DG XIII-D officials and leaders of a few VALUE demonstration projects; and extensive discussions in four plenary meetings as well as in several meetings of panel member sub-groups that focused on particular action lines of VALUE II. With respect to the evaluation approach followed, it is to be noted thah- 1. 2. In view of the exploratory character of VALUE II, its results were assessed mainly on a qualitative basis. Quantitative indicators were used only for revealing or stressing qualitative features along particular lines of actions. In view of the fact that the financial envelope of VALUE II rendered to its actions only a catalytic role, the approach for assessing the M overall programme performance has been guided by the following basic questions:- were the initiatives designed by the VALUE Management Team sound and in line with the mandates for this programme?; did the VALUE Management Team develop, within the budgetary and other operational constraints of this programme, a coherent set of activities for demonstrating new tools and mechanisms that could facilitate the innovation process at some of its critical stages?; did these tools and mechanisms prove operative or adequate, even in the limited areas and contexts in which they were tested?; is the experience gained from the exercise useful for upgrading EC measures for the valorisation of RTD results? ^ HI. FINAL EVALUATION OF VALUE H 1. INTRODUCTION The Mid-Term Review of VALUE II covered the period from programme start - May 1992 - until March 1995. The Review was made available to the EC in May 1994 and was presented to the VALUE II Management Committee in June 1994. Hence the present final evaluation looked in particular at the progress made during the last six or seven months of the programme's life. Obviously the work carried out within this closing period has been in many respects the continuation of activities launched previously. However, the findings and recommendations of the Mid-Term Review (Section II. 2 earlier) influenced progress, as can be deduced from the adjustments made by DG XHI-D to several on-going activities and the reflections of the VALUE Management Committee on corresponding issues. For reasons of coherence, clarity and completeness of the overview and evaluation of VALUE II throughout its duration, this report integrates the findings of the Mid-Term Review with those relating to the work carried out since May up until December 1994. Therefore, each action line of the programme is considered below in a unified manner. 2. ACTION LINE Lia : VALUE RELAY CENTRES NETWORK 2. 1. Introduction In this section the panel differentiates between the status of the Value Relay Centres (VRCs) of the VALUE Programme and the new Relay Centres (RCs) of the Third Activity, involved in the innovation actions under DG XHI policy. The panel believes this distinction could be useful for future innovation activities, be these ones that are made directly with entrepreneurial companies or ones which aim to create an overall climate favourable to innovation. Moreover, the panel considers that there is a great need for coherence within the various technology-related networks promoted by the Commission and believes that the current competitive atmosphere between these networks is not the optimum method of promoting innovation. It helps neither the image of the network actors nor the task of European innovation. 2. 2. Overall Comments There is no doubt that the recognised difficulty in trans! dng R&D results into marketable products/services, including th* corresponding production processes, is a weakness that needs to be adclressad urgently and in such a way that it should be considered as a strategic issue, given the importance that variables such as "reduced time to market" and "shorter product life cycles" assume in today's supra-national competitive environment. The VRCs, together with the Exploitation Projects and CORDIS, constitute the main tools developed by VALUE for addressing the aforementioned weakness. Taking into consideration the Mid-Term Review and the recent evaluation of VRCs, the panel concludes that, in general, both the analysis and recommendations made in these documents still remain valid. The Executive Summary of the VRCs Evaluation, included in this report as Annex HI, gives an overview of the methodology and performance of the VRCs. The basic conclusions of the aforementioned evaluation are that: • During their pilot operation in 1993 and 1994, VRCs carried out a 'wide range of effective and, in many cases, innovative activities. These, although of a quite experimental character, satisfied to a large extent users' expectations. ?>* VRCs offered upstream and downstream services, e. g. services for proposal preparation, search for partners, sensitising clients to exploitation options for RTD results, etc. Downstream activity, however, has been hampered by the known difficulty of financing exploitation projects. VRCs networking was rather limited, but in some cases good cross- border collaboration has developed. in advancing the valorisation of Overall, VRCs succeeded Community RTD results across the Member States, despite the rather low EC funding level for most of these' centres. This positive impact was to a large extent due to the commitment and enthusiasm shown by all people involved - both in the VRCs and in the VR-Service in Luxembourg. x In view of the findings of the detailed evaluation of the VRCs, we expand below in the present report by presenting some general reflections on the Relay Centres concept which is pertinent to the currently unfolding Third Activity as well The RCs and their network could assume a greater role in acting as the main bridge between SMEs' technological requirements and the research efforts of European, national and sectorial programmes. The horizontal nature of the network could serve as an integrating force via strong representation of SMEs' needs throughout the varying stages of the political decision-making process. At the same time the network could constitute a valuable source of information, reflecting knowledge of the field, in particular in those instances where such information might be crucial, given the diversity within regions and industries towards innovation activities. RCs could trigger RTD institutions to show more concern integrating some business orientation at an early stage in their research aims, by exposing and confronting if "downstream" activities are pursued in an effective manner, and an effort is made to approach the two types of agents. these with a "real world" image, The RCs' facilitator and catalyst role could be that of a decoding agent in both directions. Moreover, with their own dynamic inclusion in local and Community networks, they could be used as exploratory vehicles for the further design and testing of new tools. In connection with this, it should also be noted that RCs and other EC networks like EICs, etc. should take notice of each other's existence. This would avoid confusion and create synergy. ^ 23. Operational Aspects Being close to the market, the RCs are able to enhance the transectorial transfer of technology, if they adopt a truly proactive "demand-pull" approach. Furthermore, dynamic networking between RCs could improve transnational technology transfer. The RCs must adopt a pro-active attitude in the sense that the focus of their work should be innovation and technology transfer rather than dissemination and exploitation issues. The RCs must, therefore, focus more on helping SMEs to foster innovation strategies and for that VRCs will need to draw on any available source of novel technologies, not only Community ones, or even on mature technologies if these are to be used in innovative contexts. The RCs should have some of the characteristics of innovation agencies, With a European scope. This implies that RCs need to utilise the competencies of other Centres operating under different EC programmes, in order to transform the RCs into windows of opportunities for local companies to access European networks of institutions, projects and experts on innovation. In such a framework it is important that the RCs inform the other programmes about their strategic position in order to enable these programmes to take advantage of this and co-ordinate within the RC network the dissemination effort of particular research findings, in order to increase the global effectiveness of European innovation efforts. A most significant, and positive, aspect is the diversity of actions and processes that are being undertaken now by the different VRCs. This leads one to assume that an operational decentralised approach will prove of strategic advantage in fulfilling the goals of the programme and that cross- fertilisation actions will encourage each individual RC to stretch its own positioning in the near future. 2. 4. Organisational Aspects Future support is required to reinforce the autonomy and flexibility as well as the identity of the RCs to prevent absorption by the host - possible not only by draining or diverting the RC financial resources, but also by using its human resources to accomplish the tasks of the host organisation. One way to prevent this is to sustain an effective network mode of operation between the RCs, not only by means of an effective support and 'SQ induce "per se" an immediate and perceivable shift in the behaviour of relevant agents and key actors, as well as in the occurrence of generalised innovation processes. The success stories disseminated among potential users of R&D results, especially in the less developed regions, and used for demonstration purposes, were powerful motivators for industrial performance. improving RCs could play a more important mediating role in future between SMEs and producers of EC-funded RTD, as well as other national and international non-EC funded RTD generators, but they should also play a determinant role in matching the capabilities of RTD institutions with the actual needs of SMEs in terms of their problem-solving weaknesses. Through their inclusion in local and global networking activities, RCs could diffuse state-of-the-art knowledge and skills in different areas of scientific and technological knowledge, which constitutes "per se" an excellent contribution to the industrial development of regions, especially for those with weaker innovation systems. The success of exploitation projects and eventually a faster translation into marketable innovative products could be expected from those RCs that are part of a developed network and from technology-oriented regions or industries; whereas in less structured and solid innovation systems and in regions where the SMEs and local RTD institutions are less aware of these goals, vehicles and processes, the RCs' role might be initially less rewarding, fulfilling and visible but nevertheless probably of greater importance and contribution in the longer term. 2. 6. Recommendations During the current initial stage of the new RCs network the temptation to standardise procedures and especially structures must be avoided, since by their very nature, effective networks are those that can adapt and transform constantly. There is the risk that a RC could concentrate its efforts on those SMEs that have already had some experience with a VRC and these would then tend to become regular "customers", especially if some significant success was achieved or if they had a more technologically-oriented corporate culture. This would be a comfortable and successful situation from the RCs point of view, but would have the drawback of diverting the RCs efforts and available resources from those that have not yet been attracted or exposed to the purposes and processes of the programmes. Eventually, the RC might become a "centre of excellence" for a limited number of companies or RTD producers that at a given stage could and 3>r~ indeed should upgrade their connections with private agents or have established their own networking activities. A certain degree of control could be used in order to redirect the RC back to its original aims. The cornerstone of the success of any RCs experiment is basically and inevitably dependent on the commitment, skills and expertise of the people involved, in becoming effective brokers between business and technology. Synergies could be achieved through the utilisation by the RCs of the old SPRINT networks, given the complementary nature of their activities. The VR-Service acting as a permanent monitorin, guiding and supporting feedback system, could enhance its efforts for a more active networking of the RCs as well as for a better cohesion in their operations across Europe. In order to facilitate and promote an effective networking, the number of RCs should not be significantly greater than that currently in existence. The experts who assessed the performance of the VRCs detected different strategies, sets of action and orientations between VRCs. In a future evaluation, it might be possible, indeed necessary, to broaden the three attribute groupings for RCs - substantial, valuable, and useful - in order to reveal also aspects like those just mentioned. The most important asset of each RC is its own personnel. Their managerial, technical and entrepreneurial skills are the key issue of all operations. Any measures taken to secure and expand this asset are, therefore, vital to success. <->o 3. ACTION LINE Lib : BASIC SERVICE : COMMUNITY RESEARCH AND DEVELOPMENT INFORMATION SERVICE (CORDIS) 3. 1. Introduction CORDIS is an acronym for the Community Research and Development Information Service. It was initiated in 1988 with the following objectives: to satisfy the need for timely and accurate information, initially on the Framework Programme; eventually to be extended to other Community Research and Technological Development (RTD) Programmes and their results; to provide wider awareness of such Community programmes and their objectives, thus facilitating the development of Community consciousness; to allow for expanded programme benefits interaction and co-operation among the participants; through better to help promote the co-ordination of policies and programmes carried out at national level. In 1989, CORDIS was subsumed into VALUE as an essential element of the Community endeavour to disseminate and exploit results of Community research programmes. CORDIS was put at the disposal of the public as an experimental service in December 1990 with the first three databases: RTD-Programmes, RTD-Projects, RTD-Publications. Important improvements have been made during VALUE II and now CORDIS can be fully exploited. 3. 2. The Current Situation The CORDIS Databases The actual database consists of 9 individual databases in English (except for RTD News which is also available in German), which are updated according to their news value (see Table 1). At present, CORDIS covers over 137,000 documents about non-confidential matters. ࣠Table 1 : CORDIS Databases, Update and Record Count Database Name Update Record Count * RTD-NEWS RTD-ACRONYMS Dairy Fortnightly '. : RTD-œMDCKUMENTS Fortnighdy RTD-PROGRAMMES Fortnigjitly RTD-PROJECTS Fortnightly RTD-PUBLICATIONS Fortnightly RTD-RESULTS RTD-PARTNERS RTD-OONTACTS Monthly Fortnightly Fortnighdy ! 4,412 ~"~ 4,638 805 393 23,008 69,203 11,541 17,992 4,726 ~ * Total 1st March'95 | 137,788 RTD-News: the latest news announcements on all aspects of Community RTD activities. RTD-Acronyms: , RTD. acronyms and abbreviations relating to Community R T D - C O M D O C U M E N T S: the Commission's initiatives on research matters to the Council of Ministers and to the European Parliament, as part of the legislative process. comprehensive summaries of RTD-Programmes: all Community-funded research and research-related programmes. RTD-Projects: involved within the various Community-funded programmes. individual contracts and studies and the organisations R T P - P u b l i e a t i o n s: bibliographical information and abstracts on publications, reports and scientific papers arising from Community research activities as well as other scientific and technical documents published by the Commission. results and prototypes arising from Community and other RTD-Results: RTD research that are awaiting commercial exploitation as well as information on research projects needing further developments. ^ >& potential suitable partners for participation in the RTP-Partners/EOI: Community RTD programmes and projects and for participation in the commercial exploitation of RTD results. main contact points (named individuals) on both RTD-Contacts: national and European level able to provide information, advice or assistance on RTD activities. The Information Collection Process Information is collected in different ways: • • • • Regular direct contacts and collaboration agreements with specific programmes and other data providers. Use of internal databases as information sources. Use of electronic information tools. Extraction of information from various documentary sources. For this data collection, CORDIS has installed a Brussels-based CORDIS Information Collection Unit. This consists of a dedicated team of information collectors with specialists for each database. For the majority of the databases the teams have active contact with individuals and different programmes from within and outside the Commission. For some other databases, such as Comdocuments, the activities involve abstracting published documents. A number of contractors also work on the CORDIS service. CORDIS has prepared a guide called "USING CORDIS TO PROMOTE YOUR PROGRAMME", providing suggestions and detailed directives on how the RTD programmes can deliver information for CORDIS. Accessibility of CORDIS CORDIS is accessible in different ways: Off-line through a CD-ROM published quarterly and containing all CORDIS databases in compressed form (7,000 subscribers free of charge); n The on-line service (14,000 subscribers free of charge) is hosted by ECHO (European Commission Host Organisation) in Luxembourg and is accessible through: Direct Dial (PSTN): X. 25 (e. g. Datex-P, Transpac); Europanet, etc. Internet. There exist different ways of information retrieval: to Central Host; Watch-CORDIS Windows-based graphical user interface; Off-line preparation of queries; automated log-on/log-off). (Windows Access Menu system (Easy-to-use information retrieval system). CCL (Common Command Language; standardised, efficient search language). Information about CORDIS is published in several ways, the most important being CORDIS focus (extracts from RTD-news, published every two weeks); Euroabstracts (printed equivalent of RTD- Publications, published monthly); Innovation & Technology Transfer (latest information about RTD in the European Union, six issues per year), available free of charge from DG XIII on request. Publicity and demonstrations were made at different happenings like EC- programme proposers days, technology exhibitions etc. CORDIS is also promoted in periodicals like: Euromanagement News, R&D in Europe (EG Liaison), etc Users of CORDIS Among the actual 14,000 users of CORDIS one can cite: national administrations (13%); industrial companies (24%: of which 25% big companies, 25% medium sized companies, 50% very small companies); research centres (18. 5); educational institutes (26%); focal points (e. g. : VRCs) (8%); consultants, information brokers and others (10. 5%). Funding The CORDIS project was funded by the following VALUE II funds: Ï 9 9 2 :I 4,720,003 ECU 1993: Ï99* 5,887,394 ECU 2,760,683 ECU TOTAL: 13,368,080 ECU The following internal EC staff worked for CORDIS: 3 A Tades, 1 B grade, 2 C grades. CORDIS' Quality Approach To attain sufficiently high quality of the databases, CORDIS has adopted a quality procedure, through: Improved infrastructure of information collection. CORDIS data provision guidelines. Continuous review and procedures. improvement of data acquisition CORDIS data quality plan (specific scope of each CORDIS database, data quality targets for Data Collection / Data Management, achievement of data quality targets). Implementation of improved data verification tools: Problems detected early. Q-1 Regular feedback to data providers Quality measurements QUALITY PARAMETERS DIFFICULTIES Timeliness Obtain the information as soon as it becomes available at the source. Completeness Obtain all the necessary data (e. g. texts, dates, Currency Coverage Accuracy Consistency __ addresses). Never ending job. Be aware of all available information. Unequal quality of source information. Information received from variety of sources and in several forms. L ; C( X 33. Evaluation and Strategic Issues At the end of 1994 the recommendations formulated during the Mid- Term Review were still valid. Since then, progress has been observed. On top of these recommendations the panel wants to comment on the following items: Lack of an Integrated EC Policy RTD Information Provision i The lack of coherence in information handling within the EC research programmes is striking. Some examples are illustrative: There exist two public accessible databases: CORDIS and ARCADE, and it is totally unclear how far the one is complementary to the other. The least one can say is that this leads to confusion among potential users (where to go for what information) and, keeping in mind what CORDIS has cost so far, to loss of money; Not all RTD programmes have specific research results available in time. Some RTD programmes only publish general results of the total programme, others provide individual information of the total programme, others provide individual information on project results; Some programmes seem to be capable of providing information electronically to CORDIS, others only provide hard copies (which is far less cost-effective); Some DGs (like DG XH) have one main source of information (i. e. AMPERE but this is neither complete enough, nor up-to-date), in other DGs the sources are very varied. A coherent and well-defined approach seems highly desirable in order to make an information policy successful. This is of course not the responsibility of one single DG, but must be assured at the highest level. (p. 3 The Information Provided The coverage of the 3 RTD framework programmes (essentially projects and results) is very heterogeneous. In general project description is better covered than project results. In some cases a very high degree of coverage is attained (e. g. the project description for the industrially oriented programmes and mobility of the Third Framework Programme), while for other programmes it is very low (energy, life sciences, environment for the same item). On project results only 33%, 38% and 6% of the first, second and Third Framework Programme respectively are covered. This means that the major part of the results covers research done some seven years ago. Means should be found and procedures be established to shorten this delay drastically and to enable more up-to-date information to be delivered. The information provided could be expanded with: more detailed information on project results: scientific, technical, the markets it addresses, the type of products involved, patents taken, scope for transfer of technology, the importance for SMEs, etc. In this context it is suggested to expand those databases with information on patents taken within the framework of the EC research projects; information on national RTD programmes and national (or regional) RTD databases; statistics on past calls: number of projects and total budget introduced, success rates, etc financial information on accepted projects. Whether the content of the information provided by CORDIS is sufficient is not clear and could not be analysed by the panel. In order to have a clear picture on the subject a market analysis should be conducted. What information should be provided depends essentially on market demand (also see below rDRDIS in the Met'um and Long Term). The Catalytic Role of CORDIS In providing information accessible to all kinds of users, CORDIS plays a catalytic role in the dissemination of information about RTD programmes, projects and project results towards all kind of users. Information which is normally not or very difficult to find can now be retrieved within a very short time and by almost everyone with only a basic training. QV The Impact of CORDIS Although detailed information is not available, with 14,000 subscribers CORDIS is thought to have a significant impact already on RTD activity in Europe. From the limited information available we can conclude that CORDIS is used mostly in the context of EC project proposal preparation: RTD proposers check whether a given subject is already treated in the context of the EC RTD programmes. This follows clearly from the very high activity during the lanuary-February 1995 period during which the activity was three times higher man usual. It is not clear to what extent CORDIS has an impact on technological innovation in industry, essentially for SMEs. From the number of industrial subscribers to CORDIS (24%) we have to conclude that only a very limited number of European companies (3,360) use CORDIS. Although companies are in many cases assisted through information brokers, consultants, VRCs and other intermediaries, and although not all companies are able (lack of human resources, lack of skills) to use CORDIS, the 3^60 industrial subscribers is only a tiny fraction of the European industrial world. So even at last year's growth rate of 100%, much effort is still needed in order to increase substantially the number of subscribers. In view of this the promotional activity of CORDIS ?h\>uld be increased essentially towards companies, as research centres and ducation institutes already constitute the majority of users. Promotion terhno-economic journals, the use of pertinent associations, etc. as alreac stipulated during the Mid-Term Review should be increased. The User Friendliness of CORDIS The user friendliness of CORDIS has been increased enormously during the last few years through the introduction of state-of-the-art menu based retrieval procedures, such as the CD-ROM and later on-line through the introduction of the Windows based system WATCH CORDIS. Working with CORDIS can easily be learned in 1 to 2 hours as it is to a large degree self-explanatory. However, in some cases and for some kinds of people it might be advantageous to provide a tutorial with a demo, showing how information can be retrieved from the system. This could be provided on line as well, be downloaded through INTERNET, as well as on CD-ROM. It is unclear to what extent the fact that the information is provided only in English is a handicap and to what extent other languages should be introduced. Again a market study should clarify this potential problem. ?s The Quality Control of CORDIS The quality control procedure adopted by CORDIS since 1994 was a necessary step which had to be taken to ensure sufficiently timeline, complete, accurate and consistent data. The Link Between CORDIS and Other RTD Databases CORDIS only provides information about the RTD programmes of the European Commission. However, for those looking for information concerning high technology or for experts (companies, R&D institutes or universities), this is not enough, since most research in Europe is executed in national and regional R&D programmes* Databases concerning national or regional research results apparently are not easily accessible. It would therefore be extremely interesting to find in CORDIS information on national research programmes and national RTD databases and even find signposts when browsing through the CORDIS information, In this respect one could also do something on COST, EUREKA and ESA. An integration of other databases into CORDIS seems not feasible or even necessary, given the existence and accessibility of this information. CORDIS in the Medium and Long Term The viability of CORDIS in the medium and long term is of concern. The evaluation panel believes that three important elements will determine CORDIS' future: market needs; cost control; evolution of information technology; These issues are intimately linked and any medium and long term strategy for CORDIS should be based upon them. Of these issues, the first is considered to be by far the most important. Any strategy should be compatible with market demand. CORDIS should in the first place offer the kind of information the market wants. CORDIS was set up at a time when information technology and information services were still in their infancy. Consequently, CORDIS has adapted itself over the years to become,, technologically speaking, a state-of-the-art service. This approach did not, however, necessarily take into account broad market needs. The approach so far can be considered more technologically than market driven and leaves us with uncertainty about the market requirements. Ht Modem technology will, in several years' time, probably change the whole picture of information provision and information access. Electronic Document Delivery, which has already been started through the INTERNET access, is a new and exciting way and is already a step in that direction. However, the evaluation panel believes that the whole system o£ information flow from those who generate it (mostly the RTD partners) to the centralised access will be changed completely and will have a tremendous impact on the whole process. Quite a lot has been spent on bringing CORDIS up to the current operational level and its upkeep continuously requires large amounts of money. Although the amounts necessary may remain available for some time, the evaluation panel is of the opinion that a plan for cost control and cost reduction is of the highest importance. The economies made could be used for improved services, better awareness or even for other types of actions within the context of technology transfer and validation. The cost charged for CD-ROM as from the second half of 1995 can be considered a move in the direction of cost reduction, although it is questionable whether this will have an optimal result when disconnected from a more general approach. Also the free-of-charge accessibility of CORDIS through INTERNET should be reviewed in the light cf possible US charges for their databases. It is therefore recommended that in the medium tern an integrated in- depth study be made composed of the following items: the demand side: the impact of the service should be measured and the users surveyed. Such a market study should also cover the most appropriate marketing policy to be followed in terms of money charged for services. technological evolution: in order to find out how the information provision could look like in about 5 years' time and how CORDIS could adapt to it This study should also take into account the relationship to national or regional RTD databases. cost control: essentially for the operation of CORDIS, while maintaining high quality and service. This plan should be based on an in-depth assessment of the actual process for the creation and maintenance of the databases and should contain the steps to be taken in order to cope with the technological changes of the near future, to ensure a significant and lasting cost reduction over the coming years. H¥ 3. 4. Conclusion Over the last few years CORDIS has become a very important tool for the retrieval of information about the research efforts originating from the European Commission, and its usage is not limited to programmes, projects and results, as described in its 9 databases, but extends to more general research such as state-of-the-art studies, main RTD actors in a given technical field etc. This is made possible through an easily accessible system and a user-friendly enquiry system. CORDIS can be considered an example for national and regional instances of how information about research can be put at the disposal of users. However, in order for CORDIS to ensure a. efficient impact and guarantee its survival in the long term it is recommended that in-depth studies be made with a view to the medium ^^d long term, on the demand side, on the cost control and cost JVauction process, and on technological evolution. In addition, CQF^IS should increase its promotional activity to convince essentially th/3MEs to make use of the service. CORDIS also has yr*ole to play in bringing national and regional RTD In this databases closer to potential users in a harmonised way. perspective c*e could think of financial support actions to make their information available to the whole European scientific and technical commun5'/ and to create links with the CORDIS database. s- <# 4. ACTION LINE L2 : UTILISATION OF RESULTS 4. 1. Form and Purpose of the Activities This action line, which directly supports valorisation of specific research results, is designed to contribute to the main objective of the programme. This is to facilitate the exploitation of Community RTD results in the interests of improving the international competitiveness of Europe's industry. The approach is intended to compensate for the fact that, although the RTD project contracts envisage that industrial partners to those projects will exploit the results of research, three-quarters of them do not in practice do so. Even in the remaining quarter of projects they often only exploit some of the results. Opportunities for spin-off are also frequently ignored. The VALUE programme also recognises that some RTD projects do not lend themselves to immediate exploitation, though they reinforce competences which may, at a later date, be used advantageously in various innovative ways; moreover, much RTD project work takes place in organisations, such as universities, which are not oriented towards exploitation. To these ends the programme supports three main types of activity under this action line: practical training activities related to the exploitation of results and technology transfer; presentation of the results of such work at conferences, exhibitions and other public events; particular projects which valorise research results by taking them forward to the stage of demonstration or the transfer of a working technology to new users in a sector or country different from the original. The stated objectives for this part of the programme are rather general. More specific and verifiable objectives could help to focus projects on the trade-off between the demands of technical excellence, innovativeness and exploitation prospects. They would also be helpful both at the selection stage and in subsequent evaluation, For example, they should indicate the relative priority to be accorded to technological advance and commercial potential and the time-scales to be attempted. <0 4JI. Administrative Arrangements The arrangements for operating this part of the programme continue those adopted under VALUE I and through the early stages of VALUE II though there have been some detailed improvements in approach since the Mid-Term Review of the present programme. For example, the budget for supporting technology validation and transfer projects has been raised to 84 MECU for four years and technologies from any origin (not just Community-supported research) are now eligible. There have been two calls for proposals under VALUE II and another is current under the Fourth Framework Programme. These have so far given rise to 373 proposals of which 94 were accepted for support. Total budget allocated is 7. 6825 MECU. Individual project costs range from a few k ECU for preparatory expert work to several hundreds of k ECU for larger prototyping projects. As pointed out in the Mid-Term Review these are very small amounts compared with those devoted to the RTD itself, less than 5%, especially recalling that exploitation is a more expensive activity by at least one order of magnitude. We described the procedures involved in calling for and appraising proposals in our Mid-Term Review report. These have not changed significantly. So far as we can tell the Commission have operated the arrangements efficiently. We note that Commission officials regularly monitor projects. We encourage them to bear in mind that the costs of doing this are justified only to the extent that they do not exceed the amounts they save by averting failures. We are also conscious, however, that more than one project participant remarked to us that officials' advice, from the perspective of a wide experience of projects, had been extremely valuable. 4. 3. Findings We have examined several of the current projects. These have not been selected on any statistical basis. Nor have we had the opportunity to see a large enough number for them to be regarded as a representative sample or to examine them in great depth. Nevertheless, it is clear that several, and perhaps many, are of high technical quality. In the future some, though not all, should lead to important exploitation activities which would have been lost without VALUE. In some cases there is a lack of commercial realism. While it is acci. that a major justification for many of the projects is to include non commercial bodies, such as universities and state-owned institutions, it is important that at least one main participant has a truly commercial attitude and the interest to make the project's output marketable. So Successful innovation requires a combination of developmental and commercial skills which must be optimally promoted. It is important also to ensure that the IPR arrangements are designed to be as conducive as possible to exploitation. For example, patents might either be jointly owned or in the hands of the partner most likely to carry out the actual exploitation. 4. 4. Discussion There are three main evaluation issues relating to this action line. The first is whether the rationale for it is valid and whether the approach and stated objectives adopted to meet that rationale are appropriate to it. The second issue involves judging whether, assuming the broad approach is justified, it has achieved an effective impact. The third issue concerns the efficiency with which the activity has been managed. On this we have touched above. Turning to the broad rationale for the action line, it is clearly important that research should be exploited to the optimum extent, though it will not necessarily be appropriate to exploit all research within the same time- scale. Some results may, of their nature, take many years to deliver benefits. Moreover, not all the returns to research accrue from direct Some, for example, may come from more general applications. improvements in knowledge and understanding. It is possible that supporting development projects is a less cost-effective means of technology transfer than diffusing research results by direct information distribution through publications or databases. This latter approach is less costly and broader based, whereas project support involves concentrating significant amounts of money on a limited number of quite narrowly specific projects. Even if the returns on some such projects are high - which is by no means always the case - it is necessary to allow for a quite high failure rate. Moreover, the amount of support which can be provided is extremely small in relation to total expenditure on such projects. Sceptics contend that this means that such project support can have only the most marginal effect. The argument for project support rests on the assumption that it has a multiplier or gearing effect because it can be directed to key cases which will act as demonstrators as well as providing experience and learning opportunities. Moreover, on the principle that people are the best technology and innovation vectors, support to collaborative projects creates contacts which may be fruitful beyond the particular project both at the time and in the future. The reality, immediacy and depth of project based examples make them more likely to engender enthusiasm for •s-1 technological innovation than the distribution of relatively superficial and generalised information. - The evidence to resolve this controversy decisively does not exist. We are, however, impressed by two basic principles. The first of these is that technology transfer and, more especially, innovative attitudes, are best diffused via personal contacts. Secondly, appropriate technological solutions are more likely to be generated by demand from the bottom up than by top-down dissemination. We think that project support should have a place in a programme such as VALUE II because it conforms, at least to some extent, to these principles. It can create real contacts. And the work can, and should, arise from proposals by those directly connected with the market place. Moreover it is not an 'either or' issue but one concerned with the relative amounts of resources to be devoted to each kind of activity. The VALUE II programme already has information transfer components. We see no reason to extend these at the expense of project support, indeed, if anything we would change the balance in the opposite direction. But project support must be genuinely user and market led; and it must build on, and develop synergies with, the other forms of promotion. 4. 5. The Impact of the Projects In the light of the principles set out above it is essential to maximise the demonstration and technology generation effect of the projects supported. Although progress has been made in this direction, we think more might be done. At present projects are demonstrated at, for example, exhibitions and at relatively brief workshops. We welcome this, but we encourage the Commission to develop such activities in more depth. Emphasis should be placed not only on communicating project results but on the processes that have led to them. The projects might be the basis for case studies in innovation seminars lasting for a day or two rather than an hour or two. It would not be unreasonable, as a condition of support, to oblige collaborators to participate in these and to demonstrate both the particular project (preferably on site) and the benefits to be gamed from similar innovative action. The projects should be used as vehicles for demonstrating the innovation process and the innovation mentality. TL: chief benefit would be from the contacts involved, for the 'vectors' of innovation are people. It is essential, however, that the projects be set up with great care. W* w. impressed with the technical quality of most of those we have seen. This is naturally vital. But prospects of eventual exploitation are also cruricd and, although these are taken into account, we are not sure they always get S£_ so much attention when selecting and setting up projects. We have already suggested that one of the justifications for project support is that it is to some extent market generated. This implies that at least one of the partners in every case should have some commitment to exploitation if the project is successful. We recognise that emphasis on exploitability should not lead to supporting commercially safe proposals while ignoring innovative but more risky ones. The panel believes this may be achieved by the increased emphasis on user-driven consortia that we have suggested. The more precise objectives we have called for should also ensure that proper relative weights are placed on innovativeness and exploitability. Support should be carried as close to the market as the pre-competitive principle allows. Two factors could improve the opportunities for uncovenanted spin-off applications. In the first place the selection process should seek whenever possible to support technology with 'generic' potential - "technologies diffusantes". Secondly, we have been told there is already a tendency to support fewer, but larger projects. If this is necessary to maximise the opportunities for exploitation we would support some further development in this direction. 4. 6. Conclusions and Recommendations We support the concept of project support but think its nature should take more account of the specific considerations which justify it. These are, primarily, the opportunities it provides to bring researchers, innovators and potential exploiters together in a collaborative environment. It is also important that the work involved is user and market led. We, therefore, recommend that more specific, verifiable objectives be set for this part of the programme which will both guide those selecting and setting up projects and assist in focusing the projects as they proceed. To this latter end each project should also have specific verifiable objectives, relating to those for the action line and emphasising exploitation. All projects should include, as main partners, an organisation with some commitment to exploitation and the project should be set up to encourage this. With rather similar objectives in view we recommend that the tendency to supporting larger, even if necessary fewer, projects should be extended. In particular projects should be selected wherever possible to cover generic technologies likely to have a high gearing and spin-off potential. The main emphasis should be placed on demonstrating not just the results of the projects but the innovative attitudes behind them. This 53 should be borne in mind at all stages from project selection onwards and in European, national and regional contexts. 5. ACTION LINE L3 : LEGAL PROTECTION OF RESULTS 5. 1. Findings Objectives With this action line the Commission had as its main objectives: the patenting and protection of Commission owned RTD results stemming from JRC research; the protection of results stemming from Commission RTD Programmes, where the contractor is the owner and where the partners are not capable or not willing to take out patents. For budgetary reasons the latter case is most common with R&D centres and SMEs; support, advisory or financial, to partners of Community RTD projects for conducting patent screening and patent applications; and public awareness campaigns and training on methods and procedures for protection of RTD results. Past Achievements Since 1960 more than 2,400 inventions have been developed into patent applications under the auspices of DG XIQ Patent Section. Of these, 520 patent files are still in force, with about 10,000 individual patents due to secondary extensions of priority filings in all relevant countries. 463 patent applications are not yet granted and thus require continuous supervision. 17 software registrations for copyright have been deposited and 251 trademarks registered. Of the patent applications, the vast majority originates from research performed at the JRCs, but in the years 1991 to 1994, 221 inventions resulting from cost-shared actions under the VALUE programme have been filed as patent applications. Of these, 71 patents have been awarded so far. The financial support for patent applications for projects related to the VALUE programme was discontinued at the end of 1994. TH The maintenance and expansion (expansion only in the case of JRC patents, since VALUE has been disconnected) of this portfolio constitutes the daily management work of the Patent Section. Current and Future Activities Emergence of patentable inventions at the JRC institutes will be fostered within the framework of the new competitive activities of the JRC. While patent assistance under VALUE has not been reinforced in the current Third Activity programme, new initiatives have been prepared. As a pilot action, selected proposals to the Projects part (Technology Validation and Technology Transfer Projects) of the programme will all be subjected to a quick- check in collaboration with the search division at the European Patent Office (EPO) in The Hague. The new scheme has been labelled "Quick Scan" and will allow contractors to assess the novelty of their technologies on the basis of the expert check by EPO examiners. Also within the framework of the Projects scheme, a systematic Patent Build-up Scheme is elaborated. Due to ignorance or unawareness many patent applications, in the first twelve months after a priority filing, are not developed further in order to allow for a broader and more substantiated secondary filing in all important markets. It will be a key goal to sensitize contractors to the importance of the priority year and the opportunities for substantiated secondary filings. Awareness raising for utilisation of the unique patent system also as an tool (avoid re-inventing the wheel, diagnose early information technological trends, check what the competition is working on) will complement these activities. In connection with this, various training tools are being prepared together with the EPO as well as awareness actions by the Commission alone. The researchers (in particular new staff) at the JRC institutes in Ispra and elsewhere are a special focus regarding education in IPR matters. Training courses have already been designed by external experts and will be taught under supervision of the Patent Section. Education, information and awareness will be extended more decidedly towards the administrators and also the contractors of other specific programmes. Advice on IPR matters is continually given to all parties requesting it in the course of EU funded research and development. 5. 2. The Panel's Assessment The overall outcome from what has been tried out or undertaken in the IPR field within the framework of the VALUE programmes is relatively meagre. This opinion of the panel is corroborated by the following two observations: S'S" The number of patent applications filed and patents awarded (221 and 71 respectively) seems very limited in comparison with the total number of projects and RTD results stemming from the VALUE programmes. We have found very little evidence of any systematic penetration of the research community by the Patent Section, for example in the form of seminars or promotion campaigns, in order to increase general knowledge about IPR matters among researchers. In relation to the first observation a possible explanation of the low patent activity recorded is that patent applications are filed by RTD partners directly, something that the Patent* Section does not keep track of. Another explanation is of course the fact; that the Section discontinued its financial support to VALUE projects for patenting costs in the autumn of 1994. No reason for this was given to the panel, but possibly it was due to a general lack of financial resources within the Patent Section. As concerns the second remark the panel has noticed organisations by various VRCs of seminars where IPR issues have been emphasised. These seminars could be seen, however, a* separate events rather than as forming part of a well thought-out and consistently implemented strategy. The panel is inclined to interpret the absence of such a strategy as a combination of lack of initiative and lack of resources on the part of-the Patent Section. 5. 3. Conclusions and Recommendations Considering the great importance of IPR matters in connection with RTD projects there is a need for a radical change in the present organisation and operations of DG XIII Patent Section. The panel welcomes the initiatives taken recently and partly presented above (see Current and future activities), which indicate that a new, more suitable approach in relation to IPR matters is about to be launched by the Patent Section» A pre requisite, however, to these initiatives being carried out successfully is a combination of more resources, financial as well as human, and more commitment. A few specific ideas for consideration by DG XHI Patent Section and other pertinent EC bodies are presented below: 1. Awareness campaigns on the patenting and protection of RTD results should be extensive and continuous. Concise brochures and other low cost publications, distributed as widely as possible in universities, research institutions etc, represent a simple and cost- effective tool for disseminating basic facts on ÎPR issues. 5^ 2. 3. 4. 5. Making, under appropriate provisions, patent costs eligible expenses within EC RTD projects would definitely lead to a wider protection oflPR. A systematic registration and monitoring not only of patents granted, but also of patent applications, licensing agreements and other kinds of collaboration contracts emerging from EC supported RTD projects would lead to a more efficient dissemination and faster exploitation of RTD results. Obviously, such data would also be a valuable input to assessments of the innovative content of EC RTD activities. In this connection, a CORDIS database dedicated to patents, trademarks, copyrights, licences and other indicators of EC RTD results, would be a useful tool. Currently, such data are very rare in CORDIS. Several VRCs have responded to their clients' need for advice on IPR matters. The new Relay Centres of the Third Activity should expand on this decentralised activity. In addition, an Electronic Bulletin Board System or a WWW site set up by the Pa^nt Section in DG Xni could prove instrumental in aiding the exploitation of RTD results and creating a general snowb:: :1 fi t on IPR matters across the whole RC network. The incentives for patenting differ rather widely a *x *he Member States. This situation puts up barriers to the protection of RTD results by international consortia. In addition, the rather uncertain prospect of any economic benefit to the researcher from a patent leads him to choose the publication route which gives him at least. academic credit. Before solving the complex legal aspects of this problem, there could be ways and incentives in EC RTD projects for encouraging "patenting first and publishing after". Such measures would create a better and more positive environment aci oss the EU for fostering and protecting innovation. Certainly the ideas presented above are indicative and do not exhaust the issues and measures that ought to be considered by the EC for protecting and promoting innovation. S7- ACnON LINE 1. 4 : PROMOTIONAL ACTIVITIES The principal goals along this line were:- to disseminate as widely as possible information on Community supported RTD activities and their results; and to promote the specific VALUE initiatives for facilitating the valorisation and exploitation of Community RTD results. A wide spectrum of promotional activities has been undertaken to achieve jthese aims. These activities can be grouped in the following three archetypes:- publications (brochures, periodicals, information sheets, etc. ) events (organisation of participation in conferences, workshops, seminars, fairs, etc. ) services (networking, provision of information, etc. ) A few indicative examples of promotional activities are:- 1. 2. 3. 4. 5. 6. The "Innovation and Technology Transfer Newsletter", addressed to research and industrial partners, consultants on technology transfer, information brokers, decision-makers, etc. The periodical "CORDIS Focus", addressed to a wide audience of actors, intermediaries and multipliers of Community RTD. The "Euro-Abstract Catalogues", addressed researchers and documentalists. in particular to The FLAIR-FLOW project aiming at the co-ordination of the dissemination of RTD results emerging from Food RTD projects supported by VALUE and FLAIR The "VALUE Information-Press-Service" (Vips), compiling and disseminating each month to many journalists in Europe extended journalistic information and selected RTD Community results. The "RTD-Help-Desk", a service for responding to public queries about Community research activities. -cr<p In addition to the above specific examples as well as to the other centrally undertaken promotional activities, we should also mention those implemented via; the multitude of decentralised initiatives which are part of the everyday work of the 27 VRCs; and the continuous and expanding presence of CORDIS within the Union and recently worldwide too through its screen on the World Wide Web. The total amount spent on promotional activities until 1 January 1994 was 5. 3 MECU, which was equivalent to approx. 13% of the total expenditures of VALUE II so far. It appears to the panel, however, that this significant promotional effort resulted from a step-by-step line of action based on individual decisions rather than from a well thought-out and well- integrated promotional strategy. A possible consequence of this is that there has developed only limited awareness among important target groups about the links between individual activities and calls for proposals and the overall objectives and ambitions of the VALUE programme. Consequently the panel suggests a more powerful promotion of the Third Activity in the future based on: (i) target an analysis of the needs and perceptions of different audiences and the results of previously carried out promotional activities under VALUE. (ii) a coherent promotional strategy across all three objectives of this Activity, and (iii) a strong and clearly identified connection between promotional efforts related to individual activities and the principal common elements of the overall promotional strategy. -5^ 7. INTERFACES II AND ni : RESEARCH-SCIENTIFIC COMMUNITY AND RESEARCH SOCIETY 7. 1. Introduction The so-called "Interfaces II and EI" were a minor part within the VALUE II X Programme, representing approximately 13% of its budget. They were \conceived as a necessary complement to the main activity of the Programme which was to promote the application of Community RTD results by enterprises and was defined as "Interface I Research-Industry" where fee bulk of the budget was spent. The aim of Ih^?face II was to contribute to an interdisciplinary reflection in relation* to fee research environment, including methodology and other issues of a serial, financial and managerial character. Interface II activities were, among others, several studies contracted, some seminars and expert workshops, humeri of an Interfaces Bulletin and the annual Interfaces Conferences. ** * The aim of Interface EI was to identify and study the impact on society of the new scientific and technologic^ knowledge acquired as a result of Community research activities covering three main areas: Assessment of the Social Impact of S&T (mainly supporting the European T. A. infrastructure), Communication with the Public and Analysis of the Public Demand. The main outcomes of Interface IE, besides several studies contracted and seminars organised, were a very^ interesting proven and tested Awareness Scenario Workshop Methodology and a large set of material and support actions addressed to the refinement of tools and information of the European Technology Assessment expertise. Prior to any further analysis, the panel wishes to express its concern about the dismantlement of this activity at the end of the VALUE II Programme as, in its view, these lines of activities should be neither marginalised nor abandoned. To be successful, innovation definitely needs soiial adaptation, accompaniment, training, awareness to lead to final acceptance and proper use. Barriers and threshold levels for technology acceptance may vary from country to country but transnational considerations and In lessons learned at a European level will be of great importance. addition, in the field of innovation the EU's main goal of integration and cohesion requires an in-depth consideration of the various aspects (economic, social, cultural) in the different regions in Europe. Innovation is essentially combinatory and thus needs to draw upon various disciplines, sub-technologies and expertise. Not only did Interfaces II and HI address these issues with too meagre resources but such a global approach no longer even exists within the Third Activity. Go 7. 2. General Comments The ppiiel considers very relevant the objective of reconciling the general pubpc with research activities and technological development, these being also necessary to reinforce interdisciplinary activities through the various existing research communities. However, the minimal resources allocated to the Interfaces on the margins of a small programme like VALUE II could not satisfy such an important challenge. As indicated in the Mid-Term Review report the whole activity lacked a clear identity in front of one of its main target users - i. e. the European Commission. The job was mainly conceived, co-ordinated and to some extent performed by a reduced task force of only two enthusiastic Commission officials, whose dedication has to be largely recognised. They had the organisational support of an external Management Unit and the advisory support of an "ad hoc" Think Tank Group (TTG). The Council Decision took place in May 1992, the resources and staff assignment in late 1992 and the constitution of the working team in April 1993, but at the end of 1993 the first versions of the Fourth Framework Programme, including some restrictions in the scope of the Interfaces action line, obliged a significant re-tuning of their on-going activities. These time schedule considerations and the fact that the first concrete outputs of Interfaces II and HI appeared at the end of 1994 might explain why the scope and potential results of this line have not been sufficiently understood within the VALUE Management Unit and also misconceived when defining the whole Fourth Framework Programme and particularly the "Third Activity". A dear effect of this is the allocation of the so-called "socio-targeted research programme" within DG XII. The launch of this new activity took longer than expected, mainly for administrative reasons and therefore the allocated budget was not consumed during the first two years. The general restrictions on expenditure in 1994 did not take into account this fact and the VALUE II Management Committee cut the overall budget from the 7 MECU foreseen at the beginning of the programme for this task to 5. 7 MECU. 7. 3. Findings and Results The first period of activity was driven by an intensive reflection process (TTG, Experts' Working Seminars,. ). Then the whole task was conceived with a clear modular structure which allowed for quick adaptations to the recommendations of the Mid-Term Review panel (i. e. shifting the priority to Interface HI : Research-Society activities) and the orientation of the future Fourth Framework Programme. <oA '**$&*. In general terms it has been a tool-oriented concept, the outcome of which led to workable goods and manuals. Its background and goals were service-oriented, acting sometimes in a cathartic role (passive concept) and at other times in an enzymatic way (dynamic concept). The Interfaces Team had a clear vision of the importance of the methodologies for the dissemination of results and the importance of targeting clusters of opinion leaders. Altogether about 40 projects were launched, resulting in a similar number of reports although their usefulness and possibilities for application are not homogeneous. The most important outcome was about half a dozen useful tools in the fields of Technology Assessment, Awareness and Science and Technology communication issues. A very good appreciation of some of them, especially the Awareness Scenario Workshop methodology, has been confirmed by relevant European and national institutions. To complement the figures given in Chapter II. 1 earlier (Overview of VALUE II) the budget committed up to mid-1995, including the last call for proposals for studies, is 2. 45 MECU for Interface II and 3. 3 MECU for Interface HI. Of the total expenditure for Interface III, 0. 8 MECU has been used to develop the European Awareness Scenario Workshop methodology as follows: 1993: Survey, initial idea evaluation and first presentation event — 0. 15 MECU 1994: Test with European dimension (4 cities and final conference) plus first materials 027 MECU 1995: Test in a real project context (including final workshop and conference) 0. 10 MECU European training (2 pilot sessions plus material packages in EU languages) 028 MECU TOTAL 08MECU £. Before the end of this year about 15 European cities will have used this tool with a recognised impact at political, citizen and media levels, which provides certain confidence about the value of the money spent. Prospects are on-going for offering the methodology to some countries in the Far East and Latin America. <ot 7. 4. Recommendations The panel feels strongly that the social and cultural dimensions of innovation, as well as the interdisciplinary nature of technological development, are very important and judges very positively the initial approach carried out within the Interfaces II and HI action lines. The panel recommends that the research on the tools, as launched in the last two years, be continued further in order to better achieve the goals of understanding impacts, communicating research orientation and applications of results, contributing to a deeper interdisciplinary atmosphere, etc. Nevertheless, the issue of Interface III should be viewed more from a bottom-up (i. e. no innovation without taking into account the social and cultural dimensions, etc. ) rather than a top-down perspective (i. e. Science and Technology need to be explained to the general public, etc. ). The panel would encourage the Third Activity Management Team towards promoting more widely exploitation of the tools, such as the Awareness Methodology; the efficiency of this in matching social needs to technological results has been demonstrated and it has contributed to a global European culture of innovation and promotion should include, in particular, informing other EC and Member States services of the existing expertise. Finally, the panel expresses its concern for the apparent abandonment of these action lines within the Third Activity and hopes that this situation will be reconsidered and reinstated or continued with appropriate resources and with a clearer recognition of its benefits at Commission level. Resources foreseen for accompanying measures could be used synergistically for that purpose. 6^ IV. STRATEGIC ISSUES 1. BACKGROUND In relation to the strategy of VALUE, much has already been said in the Mid-Term Review about the historical strategy of the VALUE I and II programmes. The panel felt that there was no need to duplicate this and that it was more appropriate to identify the lessons from past experience and concentrate on discussing future strategies. VALUE I and II, as well as SPRINT, were clearly experimental programmes designed to spearhead new ways of dealing with RTD results dissemination, technology transfer and innovation. *' The VALUE programme objectives were the dissemination and optimisation of Commission funded RTD results. The SPRINT programme was more general, operated outside the RTD framework, and had specific objectives in the field of promotion of innovation. Yet the complementarity of the two programmes and some overlap in their means and tools were clear enough for the Mid-Term Review panel to support the idea of a merger between SPRINT and VALUE. Tftis merger was implemented for the Fourth RTD Framework Programme and the corresponding Third Activity is now under way. The integration of both programmes is a commendable step towards creating a tool better adapted to the overall goal of promoting innovation. The Commission is currently planning a Green Book on Innovation, encompassing the many challenges faced by European firms as well as the variety of experience gained throughout the Union and at Commission level in promoting innovation, technology transfer and the creation, absorption and diffusion of technologies by enterprises. This indicates clearly that innovation is regarded as a major issue. In this context, the VALUE II final evaluation panel wishes to contribute to the current policy thinking around the general issues attached to innovation, technology transfer and exploitation of RTD potential. 2. STRATEGIC CONSIDERATIONS In its efforts to improve the well-being of citizens throughout the Union, the Commission aims to implement the internal market, increasing the competitiveness of firms at both a European and global level, and reinforcing the social and economic cohesion of the Union. 6(y In so doing, strengthening European science and technology and promoting innovation, the transfer of technology and the dissemination and valorisation of RTD results are regarded as complementary means contributing to industrial competitiveness. 2. 1. It is not enough to Invest in RTD It should be stressed that past experience has shown that investments in science yield no clearly perceived direct returns in technological development and economic growth. The processes at work are rarely linear. R&D expenditures certainly help but to what extent, under what circumstances and in what time scale are still much debated questions. As an example, it is a well known fact that the creation of RTD programmes is monitored by large companies and major research organisations. SMEs are too small to be part of the corresp ending lobbies and in fact participate relatively very little in Community RTD programmes. This is in clear contradiction to the explicit objective of Commission policy defining SME competitiveness as a top priority. In any case, this clearly favours policies which pro-actively help public RTD are thus both programmes benefit industry. VALUE type scbe* legitimate and useful. Conversely, the promotion of innovation does not sim !y correspond-to active transfer of R&D results to firms. Much more is inv >lved, ind tiding creating an environment favourable to innovative activities, promoting an infrastructure of actors and means, helping firms solve the problems which they encounter throughout the many loops of the innovation process, generating adequate sources of funding, etc. 12. RTD / Innovation Policy: the Imbalance Figure 1 below shows how promotion of innovation and RTD activities are related to technology transfer and the dissemination and utilisation of RTD results. It also shows the relative importance of the resources usually allocated to innovation policy compared with those to RTD. Of course, RTD programmes also contribute to human knowledge and thus should not be justified for purely utilitarian reasons. Nevertheless, the increasing importance of industrial competitiveness and the scarcity of resources may lead to some questioning of the balance of funding and the attention given to innovation on the one hand and RTD activities on the other. 6^ Promoting Innovation 6 c Technology Transfer Dissemination / "Valorisation" of RTD results the size of the bubbles illustrates the relative attention paid to the activities The panel feels that some cultural change has already taken place in the RTD community. Some researchers still keep igncHng downstream considerations and view dissemination and valorisât n as constraints now put upon them by the specific programmes. They /en ^ orry about research money being taken away from their resear ». f c-ne others, however, have become aware of the importance of tL*» role of RTD ir nurturing innovation processes in industry through ad hoc processes. They understand that natural spill-over from research projects into the economy does not take place automatically. Nevertheless, the relative emphasis is still on RTD per se, not on innovation. 2. 3. Innovation is not just a Spill-over of RTD Innovation in a company, especially an SME, relies on the synergistic combination of a variety of factors: some perception of a market need only partially satisfied, some recognition of technologies which might be useful, some development capability, the managerial ability to run a project, the availability of a network of partners in the environment educational (suppliers, engineering, consultants, professionals, institutions, i. e. "technische Dienstleister"), the capacity to find adequate funding as well as to train existing human resources and/or hire new competence, the will to adapt the organisation accordingly, etc. This view is similar to the illustration in the SPRINT final evaluation report and shown here as Figure 2 below. m SME PARTNERS CONSULTANTS / INNOVATION POUCY PUBLIC FINANCIAL SUPPORT/ I I~ L JX \ \ TECHNICAL RESOURCE CENTRES RTO FINANCIAL SYSTEM \. ^ J / ADVISERS IN TECHNOLOGICAL INNOVATION OTHER SMEs As can be easily understood, the "technology push" approach behind VALUE can fulfil at best only a very small part of the innovation agenda. 2. 4. Recognising Innovation as a Risky Business for the Firm Innovation is a The firm is the place where innovation really occurs. means to an end, namely competitiveness. It is a risky business for the firm trying to transform a need perceived in the market place into an opportunity. Firms do not enter innovation processes for fun, nor because it would be considered smart. Innovation involves a painful and complex process for the firm pressurised by a competitive environment, especially for SMEs. Whenever an innovation policy is designed, these simple elements should be kept in mind. 2. 5. From Technology-Push to Demand-Led Policies Seen from an RTD policy perspective, the dissemination of results is an important task as it aims to make scientific and technological progress accessible to firms. the framework programme and Seen from the promotion of innovation perspective, the best way to achieve this is to adopt a demand-led approach. However, the philosophy behind thus VALUE was more "technology push" oriented. While recognising that both RTD activities and innovation promotion are necessary and complementary, the panel advocates the latter perspective of innovation promotion rather than supply of RTD results. 6ï As a matter of fact/one objective of a programme like VALUE and now the Third Activity is to contribute to changing the culture of both RTD players and firms so that they understand each other increasingly and thus join forces through collaborative ventures and projects. In this respect a small programme like VALUE could be considered as the catalyst of a change process. A good example of this is the co-ordinating role now played by the Third Activity for the specific programmes, helping RTD actors pay more attention to downstream concerns, utilisation of results and effective innovation. Moreover, this view essentially confirms in a positive manner that VALUE has been a programme with little resources and a big agenda. 2. 6. Generating a Variety of Expertise rather than "Off-the-Shelf-Technology" It should be stressed that whenever technology is the missing link, the innovating company will be looking less for "that piece of technology'' as if it were available off-the-shelf, but rather for some technical expertise to solve the problem encountered, and in a timely and cost-effective fashion. What RTD activities generate is not so much directly usable results but enhanced competence. RTD should be considered less as a supplier of technologies and more as source of scientific and technical expertise. In addition, most innovations actually combine a set of sub-technologies requiring a variety of competences. The necessary division of science into life disciplines is thus inappropriate to the jigsaw nature of real innovations. At the outset of programmes, therefore, innovation cannot be expected to follow naturally, as a simple continuation of RTD activities. This thus leads to the horizontal nature of VALUE, integrating the programmes and operating as a technology broker. 2. 7. Innovation Extends beyond Technology Whenever the promotion of innovation is related to RTD programmes, this relationship tends to identify VALUE-SPRINT/Third Activity with technological innovations; yet there is an increasing awareness of the not purely technical aspects of innovation: organisational and social dimensions tend to play a very important role in innovation. Some argue that these "soft" aspects even constitute barriers to change in many cases and thus should be treated with much more care. The panel feels that separating these aspects from the Third Activity (e. g. the targeted socio economic research programme) will result in dealing solely with the body (hardware matters) on the one hand and "soul" on the other. The panel would suggest reconciling and integrating both sets of dimensions. 64 2. 8. Adopting a Variety of Approaches and Promoting Experience Sharing Across Borders the While dissemination /valorisation of RTD results management of concrete projects and the establishment of highly visible tools (e. g. the Relay Centers), the promotion of an environment favourable to innovation and the enhancement of technology absorption by enterprises may lead to Community activities which appear less tangible but still real since they contribute mainly to managerial practice and cultural changes among RTD actors and firms. The panel thus suggests combining both approaches with real, down-to-earth projects on the one hand and more organisational contribution on the other. implies In addition, the diversity of experience gained throughout the Union and at Commission level favours experience sharing across borders and thus Commission involvement. Different regions of Europe may save much time and energy by exchanging information, etc. among themselves, including with more advanced regions and countries where national schemes have been tested over the years. These activities could therefore reinforce the economic and social cohesion of the Union. In addition, it is felt that both the aim and scope of an innovation policy should combine the local/regional level and the continent-wide perspective. 2. 9. Reaching SMEs in a Decentralised Way Furthermore, it is well known that these activities of innovation promotion benefit SMEs only when they take place in their local environment. The promotion of innovation needs to be adapted to each context. Promoting innovation is as complex a process as innovation itself. Approaches, tools and instruments should thus match the characteristics of each country, sector, type of firm, etc This leads to the adoption of a centralised perspective for such activities as well as to close co-operation with regional huriatives where ». he Community clearly has a role in promoting the exchange of best practices as well as in supporting local/experimental projects. 2. 10. Co-ordinating Initiatives Promoting innovation throughout the European social and economic fabric involves many different activities. While part of the RTD framework, the Third Activity already co-operates on regional policies in fO the context of structural funds. Industrial policy, financing or education, inter alia, are also clearly linked with this Activity. In addition, it is important to stress that the innovation process in Europe will only succeed (and therefore the competitiveness of European companies will only be upgraded) if all possible instruments (such as industrial, export, third country aid policies, etc. ) at both the EU and Member States levels are utilised, in combination with the full potential of European technology. Innovation impacts directly and indirectly in many respects on the Union's citizens, affecting their way of life, their environment, employment conditions, etc. Conversely, as discussed earlier, innovation requires a variety of ingredients, not just a supply of technologies. The panel thus strongly supports the on-going co-operations between the Third Activity and other Community initiatives as they make it possible to demultiply the resources of the Third Activity while bringing adequate expertise to the corresponding functional domains of action of the Community. 3. RECOMMENDATIONS The panel strongly advocates a major initiative dedicated to. the promotion of innovation. This initiative should not be regarded simply as an appendix to RTD activities. This initiative should work at increasing the awareness of companies throughout Europe about the potential benefits of innovation, the ways and means to proceed, the risks attached, the support that may be available in time and the best managerial and organisational practices stemming from past experience. This initiative should be awarded significant funding. The panel considers that 10% of the RTD budget is a much more relevant order of magnitude than the amounts allocated to past actions. Four major lines of action, both direct and indirect measures, should be envisaged to promote innovation throughout the Union while minimising the risks involved for individual firms: measures for facilitating innovation inside companies; measures to promote a climate favourable to (infrastructure, networks e. g. science parks, financial tools, etc. ); innovation measures to stimulate the search, scanning, identification and recognition of market needs by firms, thus creating innovative opportunities; ^ measures to help firms integrate the social and cultural dimensions of innovation, so that the social embedding of new activities into society can be pursued in an interactive, real time mode. New thinking and thus new actions on innovation need to emerge to make sure that the Union benefits from the corresponding expected gains in competitiveness. Innovation requires flexibility and speed. The panel emphasises that the management of measures designed to promote innovation should rely on flexible and time-efficient procedures. The panel suggests that the Commission consider specifically streamlined administrative procedures, adapted to the requirements of innovation. The panel points out the risk of having the Third Activity within the RTD framework as it gives the wrong impression that innovation could be considered basically a technical matter and a downstream addendum to RTD activities. The panel suggests strongly that this initiative should be recognised clearly as a top priority and wishes to raise political awareness in the Community. & ANNEXES V3 ANNEX I VALUEn Council Decision 29 AprU 1992 23. 5. 92 Official journal of the European Communities N o l H i /i li (Acts whose publication is not obligatory) COUNCIL COUNCIL DECISION of 29 April 1992 on the dissemination and exploitation of knowledge resulting from the specific programmes of research and technological development of the Community (92/272/EEC) THE COUNCIL OF THE EUROPEAN COMMUNITIES. Having regard to the Treaty establishing the European Economic Community, snû is particular Article 130q (2} thereof. Having regard to the proposal from the Commission (*), In cooperation with the European Parliament (2), Having regard to the opinion of the Economie and Social Corxunincc (3), ". t Whereas Article I30g (c) of the Treaty states that the Community, complementing the activities carried out in the Member States, the dissemination and optimization of the results of aaivirics in Community research, technological development and demonstration; to cany out activities for is Whereas the second paragraph of Article 130k of the Treaty stipulates that the Council shall define the detailed arrangements for the dissemination of knowledge resulting from the specific programmes; Whereas the Treaty establishing the European Coal and Steel Community stipulates that-thc Commission is to carry (') OJ No C 53, 28. 2. 1991. p. ?0. (*) OJ NoC 0. 2 C. 1. "0?2. p. 75;andDcdiionof 8 April 1992 out activities in die coal and steel sector which do not form part of the Framework Programme for research and technological development, the results of which must be disseminated and used by means of suitable separate activities, using the resources of the ECSC 'operating budget'; in the Whereas, by its Decision 90/221/Euratom, ££C(*), the Council adopted a third Framework Programme for Community activities field of research and technological development (1990 to 1994), specifying, inter /ilia, the activities to be pursued for developing the scientific knowledge and technical know-how needed by the Community the dctaDcd and providing arrangements for the dissemination of the knowledge gained, in particular the définition and the implementation of the centralized action, should be the subject of a Council Decision; that Whereas, pursuant to Article < and Annex 1 of Decision 90/221/Euratom, EEC, the amount deemed necessary for the whole Framework Programme includes an amount oi ECU 57 million for the exploitation and dissemination the specific R & D of knowledge resulting programmes; form Whe. rc**;. d. : f v r a i om Treaty contains detailed provision: for. xhè^disstminatiort. of. -information which apply, mu alia; to nuclear research programme*; V •s NoL 141/2 Official Journal of the European Communities 23. 5. 92 the activities undertaken by Whereas the decisions relating to the research and training programmes thermonuclear in the fields of controlled fusion (1990-1994) and nuclear fission safety (1990-1994), together with the Joint Research Centre in the field of nuclear research, envisage that the amount estimated as necessary as the contribution of these programmes to the present -centralized action for the dissemination and exploitation of results is ECU 6,57 million; Whereas the dissemination of knowledge and exploitation of results should be dealt with in a coherent manner; Whereas « is necessary to ensure the coherence of schemer, for disseminating the knowledge resulting from specific programmes in the Framework Programme; whereas such coherence must be based on general rules which guarantee the protection of the legitimate interests of the public and private contracting parties and of the rights linked to the obtaining and exploitation of the results, as well as their exploitation in conformity with the Community's interests, its economic and social in particular with respect cohesion; to into a broader context and Whereas, in order to improve the insertion of Community research to opumixe the utilization of the knowledge which results from it, it is important that the centralized action should both intensify its emphasis on the research-industry interface and widen its scope rcscarch-soacTy interfaces; rcscarch-science and the to the scientific Whereas Decision 9 0 / 2 2 1 / E u r a t o m, EEC provides that a research must be particular aim of Community to technological basis of and strengthen European industry and to encourage it to become more competitive at international level; whereas it also provides that Community research is contributes, inter alia, to -the strengthen of the economic and social cohesion of the promotion of its overall harmonious development, while being consistent with the pursuit of scienrific and technical excellence; whereas the present action is looked upon as contributing to the achievement of these objectives; the Community and justified where action to Whereas small and mcdium-sircd enterprises (SMEs) should be involved to the maximum extent possible in this action; whereas account should be taken of thcu spcoj] rcquucmcnis, without prejudice the scientific and technical quality of the programme; to Whereas, in accordance with Article 130g of the Treaty, the Community's activities aimed at strengthening the scientific and technological basis of European industry and include it encouraging technological promoting cooperation on research and development with intenudotul and organizations; whereas such cooperation may prove particularly bcnefidal for the development of this action; to become more compcuavc countries third Whereas the Sdcntific and Technical Research Commince (Crest) has delivered its opinion. Whereas it is desirable to cooperate with existing networks for the dissemination and the promotion of innovation and to encourage new networks where these do not exist; Article J HAS ADOPTED THIS DECISION: links with Whereas for downstream exploitation should also be developed, in particular with the Eureka initiative; complementary mechanisms this action, an assessment Whereas, in the context of should be made of the economic and social impact as well as of any eventual technological risks; Whereas basic research in the field of the dissemination and exploitation of R ôc D knowledge must be encouraged throughout the Community; V n c i r a s. in addition to the specific programme concerning human rcso. rces' an mobility. « «s necessary 10 encodage ,. „,t,rT,,. ~ »'•«. —««<-*( of this _i --. ,^,,-t, 1. The dissemination and exploitation of knowledge shall be carried out as part of the specific programmes and by means of a centralized action. 2. The centralized action, as defined in rjint:. ?, shall ensure overall coordination and coherence in the field covered by the Framework Programme. It is adopted for the period running from 29 April 1992 to 31 December 1994. AmcU 2 1. The amount of Community expenditure deriving irom the levies on the fu-. -ri:. estimate»! as necessary for the execution pi the~spcofte* programmes, "with a viev/ TO the implementation of the centralized action established by this Decision, including c :>rndiiorc on ssaff ar. ; adrr. jr. 'sirjnon amounting IO ECU "<» ECU 57 mill. on. is estimated ^6 2 3. 5. 92 Official Journal of the European C o m m u n i t i es No L H l /3 indicative allocation of 2. An Annex U. funds is set out in 3. If the Council takes a decision pursuant to Article 1 (4) of Decision 9 0 / 2 21 / E u r a t o m, E E C, this Decision shall be adapted accordingly. Article 3 Detailed rules for the implementation of the programme and the amout of the Community's financial contribution arc set out in Annex 111. Article 4 1. In the course of the second year of the implcmentatior of the action, the C o m m i s s i on shall review it and send : rcpon on the Europcar Parliament, the Council and the Economic and Socii Committee; die shall be accompanied, wher necessary, by proposals for amendment of the acnoc. the results of its review ot r c p on 2. At the end of the action, an evaluation of the results achieved shall be conducted ; experts. T he Croup's rcpon, Group of together with shall be comments, submitted to the European Parliament, the Council and the Economic and Social Committee. for the Commission by t he Ccmmission's independent 3. T he reports referred to in paragraphs 1 and 2 shall be established having regard to the objectives set out in Annex 1 tc this Decision and in accordance with Article 2 (4) of Decision 9 0 / 2 2 1 / E u r a t o m, E E C. Article S shall 1. The C o m m i s s i on implementation of the action. be responsible for th< 2. A work p r o g r a m me shall be drawn up tn accordar. ee in Annex 1 and updated wh. trt with the aims set o ut necessary. It shall set o ut the detailed objectives and types of finança: arrangements to be m a de for them. The Commission sr. il: make calls for proposals for projects on the basis of tr. t work p r o g r a m m e. undertaken, projects and the be to the- measures The representative of the C o m m i s s i on shall submit to the to be taken. The committee a draft of committee shall deliver its o p i n i on on the draft within a time limit w h i ch the chairman may lay d o wn according to the urgency of the matter. T he o p i n i on shall be delivered by the majority laid d o wn in Article 148 (2) of the Treaty in the case of decisions which the Council is required to adopt on a proposal from the C o m m i s s i o n. The votes of the representatives of the committee shall be weighted in the manner set out in that Article. T he Chairman shall not vote. the Member States within The Commission shall adopt the measures envisaged if they arc in accordance with the opinion of the committee. If the measures envisaged arc not in accordance with the opinion of the c o m m i t t e e, or if no opinion is delivered, the Commission shall, w i t h o ut delay, submit to the Council a proposal relating to the measures to be taken. The Couna] shall an by a qualifiée! majority. If, on the expiry of a period of three months b om referral of the matter to the Council, the latter has not acted, the proposed measures shall be adopted by the Commission. Article 7 1. T he procedure laid d o wn in Article 6 shall apply to: — the preparation and updating of the work programme referred to in Article 5 ( 2 ), — the contents of the calls for proposals. — the assessment of the projects proposed and rhe estimated a m o u nt of the Community's cooeribuboû to them, w h e re this amount exceeds ECU 150 0 0 0, — departures from the general rules set out in Annex 111, — any adaptation of the indicative breakdown of the. amount set out in Annex 11, — the measures to be undertaken to evaluate the acaorj, — measures Article 8. for implementing the rules laid down v Article 6 F*»- 0-. f e x e c u t i on of this action, insofar as it relates to the specific prc;^r»mmcs based on Article l 3 0q (2) of :'. < Treaty, the Comiy. 'ssion shall be assisted **v a conir. incc 2. Where, pursuant to the thiiw r r ' ^t of oaragiaph 1, d amount of the Communiry contribution ts- less than < equal t o, E CU 1 50 0 0 0, the Commission shall inform u committee of the projects and concerted a a i o ns andof i: Outcome of t h eu assessment. The Commission shall al I inform ilir o o m m m cc of implement anon of ihr H N oL l41/< Official Journal of the European Communion 2 3 : 5. 92 Article 8 For the execution of this action, insofar as it relates to the dissemination and exploitation of knowledge resulting from the specific programmes based o n / o r i c lc 130a (2) of the Treaty, hereinafter to as "knowledge*, the referred following rules, while respecting prc-cxisring rights, shall apply: (a) resulting from work undertaken the knowledge duecily or the cost of which is wholly supported by the Community shall in principle be the property of the Community. resulting from work under a The; knowledge shared-cost contract shall be the contractors who carry out the work. They shall agree between themselves on particular arrangements for such ownership; the properry of (b) knowledge which could be used in an industrial or commercial application, if its nature jusaiics such a measure," shall be protected in any appropriate form to the extent required in the light of the interests of the Community and its co-contractors and in accordance with any applicable legislation or convention; (c) it exploited, its co-contractors shall be the Community and required to exploit the knowledge in. their possession, or have the taking full account of Community's international the objective of compenoveness of European the and economic and social cohesion in the Community; in conformity with the industry strengthening interests and of the Community's knowledge may be subject to appropriate conditions, particularly œoeerning the payment of fees. interests. Such provision All conn-actors shall make the knowledge in then- possession, together with any information necessary for its use, available to the co-coacractors and to interested third parties under contractually defined the that conditions, provided its lcgidmatc the and Community co-contractors arc safeguarded; interests of interests of the (c) the Commission shall ensure that knowledge suitable for dissemination according to the concracrual terms is disseminated or published cither by the Commission use!! or by its co-contractors, without any restriction oihcr than those imposed by die need to safeguard imellcCTuaJ and industrial property, confidcnoaliry or IcgKimatc commercial interests. The Commission shall lay down the arrangements for implementing the rules laid down in the first subparagraph of this Article, in accordance with the procedure described in Artidc 6. Article 9 This Decision is addressed to the Member States. Done at Luxembourg, 29 April 1992. (d) knowledge belonging to the Community shall be made available to its co-cootractors and to interested third parries established in the Community w ho undertake to exploit it, or have it exploited, in conformity with For the Council The President • Luii VALENTE DE OUVEIRA n 2 3. 5. 92 Official j o u r n al of rhe E u r o p c aa Communities. No L H 1 /5 ANNEXI OBJECTIVES AND TECHNICAL CONTENT The general aim of the eennaiued anion lo< tnc dissemination and exploitation of knowledge resulting from Commumry research a ou vines, earned ow ytïdc? dits aexson. it to give spcahc added vaJue to the R ôé D activities which axe the subject of the thud Fsamework Frogrammc (or 1990 to 1994. On ibc one hand, u provider the necessary conassuiry for w mt at the. measures carried out unda the VaJuc programme; on the other, u introduces new topics cjaaccm-zà p-u-neuiariy "-nth the rcpescussions of research and technological development acovmcs and thaï toui''. oc «>Cîcr; ai i -» hole. Tins centralized anion «% to be r. onduoc<5 ^ a u o i à no *tm die following guiding principles (a) HoruuntaLty Measures to publish a_nd uolux tes-card? resuhi must apply to the whole tartge of Coramuiury R fie 0 activities, coveted by the Comtnowry Frimc-otk Pioysmmc, a?cspcaj*c of the narvrc of rrogjamracs. the persons involved and the jdjuwjiiiKiO'X authonues rcspons. -blc. Tots cru en on wJJ be implemented through coordination a/td Laivon berv^ctt- R ID *r. -cc<hc ptogrif. imcs and ine ccnualncd acuoo. (b) Internal cotnplccneoianry supplement OK meajajres ciiea under ose specific RTD Tbe cm trained a ex» on will onorthaatr int programmes. It will aJso concrctïT" oa *cr,vsti« reouuTBg spccuJ mbasmucrùrc and '. Vil It (ooenpoxcnzod tnionnaaoo vyHcms, 3 crtwofV ui Vchsy rx-'ooas", ex. ) ot spxaaJ capabilities for aansfernng know-how 10 fields of activity m other -"IjCiplmet. <c) Subsidiaries Tl. c ccntraJucd acooo wijj build on the synergies between Ooocunaki^d (public and private) and Community R &. D aenvincs and is designed, ki eonjuncrioo with other Corucaurury measure and in cooperation wtih the naaonal and regional authonocs responsible, to establish a coherent tncchanrsrn for the unjixaoon and transfer of the tccbnologies and the know-how obtained bora research and technological development, using, wherever passable, the existing structures in Member States. As far as the content of the prevent acooo is cotuemed, those measures already hunched co forge doscx links berween research and industry wiil be supplemented by other new measuia designed to forge clover links berwecn research and loacty and between research and the soenobc cotarnumry. These arc measures which rcQect the DC* scientific and sechnologica] ©bjccrivGs and coosaraiaa ter by tociery and in uuoarooca, and rise increasing interest in the mtcrdisapUnary approach to research and tedsnologkaJ devcloptacai t o m b e ». Ar thi» nage, and now that so aebviocs art more dortJoped. crus cxn a allied acnoo -«. -ÛJ tocorporatc dvese no* topics into IG conceptual and operaaonaj fraxnewofk. Detailed objecuves for the cenoaJued action, irxiuding measurable targets and rrulestones, v»ol] be devenbed in workplans, which vnij be subtnmed annually to the comnstrtcc. 1. RESEARCH-D^DUSTRY rNTERfACE The aim «s to help to «mprovc the tntemanonal cornpedriveness ot Europe's industry in accordance with the provisions of the Trary by means 00 specihc piojcas designed to t r u u m uc the impact of Commumry R Ik D activities on industry as a whole For this purpose, the networks and partnerships berween companies and laboraioncs from the different countries which result from the Community R &D programmes consonne an imponant clement of the mechanism set up for th< djsseroirkjoon and exploitanon of their results. No L K l /6 O f f i c i ai J o u r n al of t he E u r o p e an C o t i u n u o i à cs 2 3. 5. 92 1 protect their findings in certain cases w h e r e, for e x a m p l e, chcy lack the n c c c s u ry expertise and arc unable to obtain this through the usual nanonaj and commercial channels, and at the same tune help them to exploit and promote such findings. T he f o l l o w i ng measures arc proposed: 1. 1. N ew channels of iaiormaooo (a) Ncusork of telsy centres A ncrwor* of relay ceo ties will be vet up to promote the disseminaoor. and crploitaooo of Community R &D results, while taking into account, and building o n, the cacrarg srxucrurej in Member States designed for the some purpose. T he relay cencrcv will have speoal access to Community mformaoon, under the control of the C o m m i s s i o n, and will have as their mam task the tailonng and interpretation of this information to local needs, especially in relation to companies, particularly SMEs. universities and research involutes. The specific needs of ir. e more peripheral and least-favoured areas of the Community wùM alvo be taken into account. ^ h i le giving full consideration to local needs and orcumsrances. the fol)o«--. r;r activities, inter oLs may be undertaken by the relay c c n u cv — the dissemmauon of m f o r m a o on on C o m m u n i ty programmes and calls for proposals, -— identihcanoQ of opportunities for p a r n o p a n on in Comrouniry R fc D programmes, and general guidance to candidates in the preparation of proposals, — facilitating the inicrprctaoon and d i s s c m i n a o on of Community programme results for target audiences and local firms, — promotion of the exploitation of the research resula with potentially ia:crested enterprises, — assistance to organizations which have produced results in the idcnrificaoon of exploitation' opportuntoes at a European level and market research possibilities, - — providing ( protecoon of results, information on specialized agencies dealing with mtellecrual property and legal — providing information on possibilities for financial support. Competent naoonal authorities and the scientific, technical and industrial community will help the Commission to select the relay centres in the Member States and to define their specific tasks. The relay centres will, at the o u t s e t, analyse cuxrent practice on dissemination and exploitation, identify ne» approaches, where necessary, and formulate a Plan of Acnoc with specific targets. 1. 1. (b) Basic Sennce A user-friendly computerized information service colled Cordis will become available in 1 9 9 2. After 1992. and depending on the results of a detailed evaluation, the aim of the ccnoalued action will be to update and expand the Cordis informaDon service. The service could provide new functions and continue to expand using new sources of i n i o r m a o o n, harmonize and/or integrate databases, use electronic storage devices ( C D - R OM and video d i v a) and develop user-frier. dly systems for clccnooic data exchange in cooperanon with related Community programmes. Tne development of computerized m e t h o ds docs not exclude the use of more traditional methods such as the publication of bullcnns and bibliographies which will provide wider access to tnformanon s e r v i es Utilization of results This activity, which was already started in the Value programme, should be extended to the new fields covered bv the Framework Programme and developed «n line wiuS the results that txcome-available in the vcats ahead. This means utilizing the research and development results of which the Communery is the n w nn a n j. where needed. hclp«*»c «e «. I'thzc the. evults of research and development projects undertaken o« » «har: :-„c. UJSIS. »n «he latter cave. IT»C 3«m will be to help contractors v. ho do not have. s««<*ioeni expertise, in particular the universities, research i«. -". «rules and S M E s. to take advantage of ih< rcsulrs of cnidc ,1,,. C ^ r r - m ,. ^ A V D r^uU-,. _ _ i. i„ „ „. l. ,. , _. t. „. „ -. 23. 5. 92 Official journal of the European Communities - No L H l /7 The work to be undertaken could take different forms, depending on each specific o s e, as follow*; — identifying, controlling and appraising the results of research in order to develop and target utilization plans, — finding licensees, including for the JRC and, more generally, parties interested in utilizing results, — providing adequate financing support for srudics or tests and experimental developments. This word w\Ji be earned out with the help of outside experts and competent organuanons tn the Member States. 1. 3. Protectioo of results The protection of results belonging to the Community and management oi the patents portfolio that it holds wijl be continued, as in the past, through systematic cxanunaoon of the final reports and results obtained by the JRC. The activities described below, winch have already been started in the Value programme, will be developed more intensively by the centralized action. Those universines, research centres and SMJEs which do not have access to patenong expertise will, on request, be provided with aid by the cenrralued action. It will supply expertise on patents and financial support limned to the costs of searches for prior claims to novelty and first patent applications. Public awareness campaigns may also be organized on the importance of protection results for the research socnosu partieipaong in communiry R &D programmes. 1 4. Protnouonal activities Promotion on the results could take the following form: — financial support for organizations making an active contribution to the promotion of results and. iri general, for organizations within a transnaboaal network set up in order to facilitate, promote and coordinate access to Cornmunity programmes, — organxzaoon of seminars, cooicreoccs and other means of oommunicaooo, including in aosobatioo with the topecove bodies in the Member States and. in parocular, with the "relay centres', — artendance of trade fairs. Specific acbviàcs arc planned to provide economic and social cohesion in regions where dissemination 2j\â udkubon structures do not exist or arc still in their infancy. II INTERJACE BETWEEN RESEARCH AND THE SCŒNTTJF1C COMMIJNTTY The ob|ccbvc of the activities under this beading is to contribute to mtcrdisdpunary reOecnoo m relation to research, IU methods, problems and impact. Such acovibcs will be scrucnired around the following four areas: 11. 1. General context of research * The 2\rr. is to study the coosaaints and/or opporrunibes for the disscminaoon and crploitaoon of R 6c D acnvices applying the dtscipbnes of law, poliocol sciences, sooal and human soenccs. Examples of topics to be considered could be; — his:ory and comparabve analysis of public and private research structures. — aspects of avil and public law, mainly in respect of intellectual property nghrs. — intcrnanonal rules on scientific and technological infonmabon. U. 2. Cocaraunicaooo of research The obiee»^- i« i-» •_-upvc-'«. i*»e communication of research towards tes various UKU. by obiain>*~^ - oenei understanding of communication pann—v Disciplines of a voooruhuial nnuir w»1' play an o ^\ No L H I /8 OfficiaJ Journal of the European C^rrununicics 2 3. 5. ^2 11. 3. Ecooonxia of research Macrocconotnic insxrumencs and business sciences must be used to determine the optimum use of resources to be channelled into research as pan of general economic development objeenves and company objectives. Taking account also of studies conducted in other contexts, the cost/benefit aspects of the cycle of research and development, and the economic obstacles to its cxploitabon. will be examined, in particular wuh a view to main opbmal use of the financial resources allocated under the third Framework Programme. II «. Management of research The overall ob|ccovc is to promote knowledge of best practice in the management of R 6c D in order to contribute to better cxploitabon of results. Management studies will help with the orgoruzaooo of research and laboratory management. They can make a concribuboo to project management, admintsoaovc procedures and methods of management. Particular anenbon will be paid to subjects relating to decentralized management and making more efficient use of human resources ta the departments which manage research. Comparative studies will be conducted on the different management models used by universities and idustnal research insotutes. ill INTERJACE BETwT. EN RESEARCH AND SOCIETY 1 his heading covers measures designed to idenbfy and study the unpad on soocry of the new scientific and technological knowledge, acquired as a result of Community acbivines, especially where the interaction between science and technology, on the one hand, and society, on the other, is particularly critical. The aim is to spread socnnGc know-how widely through Europe in order to seek to ensure that changes in the contemporary approach to voencr arc compatible with developments in soacry. To this end, it should take its place in an efficient ùitcracbve process cenxsisong of the following stages: research, research results, pubbc perception and reaction,. assessment of. social impaa. -mociiEcaooQ of research acovibcs where necessary. In order to ensure that this procedure works effectively, close h"W will have to be forged across the board with the specific study programmes developed prior to the policy-making process. Wherever possible, acovioes will be based on the work of, and executed in close coordinaoon with, existing organizabons in the Member States. The centralized acboo will be m three parts. Ul. l. Contribution to assessment of the social impact of science and technology In coniuncoon with the mote specific abvioes provided for in the individual specific programmes and with the acb vibes of the Monitor programme, more general "technology assessment' schemes will be developed. Those areas which will be specially monitored and studied arc not only those which relate to the cxplouaoon of new tcchoologics affecting health, safety and the environment, but also ethical and legal quesnons relating to the cxploitabon of results. ill. 2. Coovmuntcauoa with the public The ceoa alued acboo will make use of channels of communicabon, particularly the mass m*dia, to provide informaoon for (he public, building on existing strucrures in Member Scares, wncrc appropriate, use could be made of the relay ccoorcs menooncd under 1. 1. (a). III. 3 Analysing pubbc demand and new rcquircroenu In coniunction wuh other programmes concerned, including the Monitor programmes ('). the centralized action will provide srudics and surveys designed to identify the latest social needs, through its direct contact with actual or potcnoal users of the knowledge resulting from R 6c D programmes. *$>% 23. 5. 92 Official Journal of the European Communities NoL M1/9 ANNEXU INDICATIVE BREAKDOWN OF EXPENDITURE I. Research•mduscry interface U. R eve arch-vQcnofic commumry interface ID. Rcvearch-soaety interface (ECU -*A«>n) 50 4 3 57('l (') Inducjnr, crprodirurr on «iff amounting to ECU •* million and admnufuative crpcndiiuic totalling ECU 5 CiJJiOO. The breakdown between different areas does not exclude the possibibry that projects could cover several areas. €^> No L 1 4 1 / 10 Official journal of the European Communities ~ 2 3. 5. 92 ANNEX «I RULES FOR IMPLEMENTINC THE ACTION 1. The Commission will implement the action on the basis of the sdcnbfic and technical content described in Annex 1. It will apply the accumulated experience and best practice of both European and internaoonal experts in this field. 2. The rules (or implementing the acboo. referred to in Article 3, comprise pro jeers, cooccncd acboos and ' accompanying measures. Sdecboo of projects must take account of the criteria listed in Annex 111 to Decision 90/221 /Euratom, EEC and of the objectives set out in Annex I to this programme. — PlOICCIS The projects will be the subject of sha/cd-cost concracrs and Community financial paniopaoon which wdJ not normally be more than 50 *L. Univcrsines and other research centres parocipaong in shared-cost projects will have the opnon of requesting, for each prO|CCt. either 50 % funding of total expenditure or 100 *A funding of the additional marginal costs. , Shared-cost projects roust, as a general rule, be carried out by participants established in the Community, for example univcrsibes. revcach organizations and industrial firms, including small and medium-sized enterprises. Concracrs relating to shared-cost projects must as a general rule be concluded following a sélection procedure based on caL's for proposals published in the Official Journal of the European Communities. — Coooencd acxiocu Concerted acboos consist of acboo by the Commumry to coordinate the individual aebvibes carried out in the Member States. Tbey may benefit from funding of up to 100 "l> of coordxnabng expenditure. — Accompanying measures The accompanying measures referred to in Article 7 will in particular be implemented through: — the organizaboo of seminars, workshops and soenbiic conferences; — internal coordiruboo through the crcaooo of integrating groups; — independent scientific and strategic evaiuaoon of the opcraoon of the projects and the acboo; — conrnbunon to studies and enquiries. Scj VALUE-n-5/DOC-i MH) TERM REVIEW OF TAB CENTRALIZED ACTION (VALUE g) The Council Decision of 29 April 1992 or: the disseminarion and exploitation of knowledge resulting from the specific programmes of research and technological development of the Community, foresees in Article 4, paragraph one tbar "in the course of the second year of the implementation of the action, a review of it by ihe Ccrsmission and foresees that a report on die results of this review be sent to the Eir:pean Pêjiiaine. p. t, the Council ?v. à ihe Economic and Social Coniiniiteè". V' Due to the faa thai VALUE II is is pin a continuation of the VALUE t programme, and th2i the final evaluation of VALUE I takes ztect cLinng ihe same period, the Commission services su£2-£$i tiiat the saine panel of independent tx"pens evaluating VALUE 1 be asked to review VALUE II activities. In compliance with Article 7, psraercph i. sixth been: of the afoR aid 'Councu Decision, Coramitîee opinion is asked on tins suggestion The proposed terms of reference for the mic-tenn review of Value II are attached (Annex Ï). The Composition of the panel is also ar^chid (Annex U). :çr ANNEX II Final Evaluation Terms of Reference £6 TERMS OF REFERENCE OF THE FINAL EVALUATION OF THE CENTRALISED ACTION (VALUE II) In accordance with Article 4, paragraph 2 of the Council Decision at the end of the action, an evaluation of the results achieved shall be conducted for the Commission by a Group of independent experts. The Group's report, together with the Commission's comments, shall be submitted to the European Parliament, the Council and the Economic and Social Committee. To conduct this final evaluation, the Commission services will be assisted by a group of independent experts, hereafter referred to as the panel. The panel will assess the extent to which the results achieved contribute to the objectives of the Centralised Action (VALUE H) and that of the Third Framework Programme (1990-1994) notably through: strengthening the scientific and technological base of European industry (including SMEs) so that it can become more competitive internationally; contributing to the dissemination and exploitation of results K of Community RTD activities thus demonstrating the added value of those RTD results; (towards SMEs in particular) contributing to the implementation of the internal market, to the reinforcement of the economic and social cohesion of the Community and to the strengthening of European science and technology; complement the action of the Member States, particularly with regard to the setting up of a network of relay centres. The panel will also assess the efficiency and effectiveness with which the programme has been managed and promoted. This evaluation will take into account for each type of activity, the results achieved and their relation to the human and financial resources allocated to it. The new activities of VALUE II (Relay Centres and Interfaces II and in) will be reviewed more in depth. Qualitative or quantitative indicator will be used whenever possible. The panel is invited to make recommendations to the Commission. E^f- ANNEX III Executive Summary of the Evaluation of the VRCs EVALUATION OF VALUE RELAY CENTRES EXECUTIVE SUMMARY In response to the recommendation of the Mid-term Review for Programme VALUE II, General Directorate XIII-D of the European Commission (EC) decided in October 1994 to proceed to a detailed evaluation of the VALUE Relay Centres (VRCs) by four external experts. The EC decision stipulated also that: 1. "the evaluation exercise should be flexible, easy to implement and have a rather qualitative than quantitative character. 2. each VRC should be visited and evaluated by one of the independent experts. 3. the heterogeneity and varied approaches used for the implementation of the Relay Centres place the same importance on all activities developed to date". The evaluation started in December 1994 and has been practically completed early February 1995. During this period, the evaluators: 1. visited all 27 VRCs and discussed with their principal staff their work; 2. studied the progress reports prepared by each VRC and collected ancillary information from the VALUE Relay Service Central Co-ordination Unit; 3. studied 1992 EC documentation on the concept and contractual tasks of VALUE Relay Centres; 4. analysed in various ways the data obtained from of the Users' Survey conducted by VALUE Relay Service Central Co-ordination Unit during the evaluation period; and 5. held few meetings for discussing extensively the approach and other aspects of the evaluation exercise. In view of the innovative character of the VRC exercise and the diversity of business environments in which this exercise unfolded during 1993 and 1994, the evaluators set themselves three principal targets: First, to reveal whether each VRC: • • formulated a coherent strategy to meet somehow this demand, identified the needs of its operational environment, and • employed effectively its human and financial resources. Second, to identify: • the essential elements of the upstream, downstream, networking and promotional activities carried out by each VRC; and • the global operational features of the VRC-Network. Executive Summary EVALUATION OF VALUE RELAY CENTRES Third, to: • give an overview of the methodologies and tools employed by all VRCs; • draw few general conclusions for the overall performance the VRCs; • recommend specific actions in relation to any major operational problems identified in the work of each VRC; and • devise a common frame of reference for presenting the level of experience attained by each VRC during their pilot operation. The outcome of the evaluators" work along the above three principal targets is presented in detail in the evaluation REPORT as well as in its confidential SUPPLEMENT, which addresses the latter two items of the above list. The present Executive Summary summarises below several main points with respect to the overall operation of all 27 VRCs. Criteria for the evaluation The evaluators attempted to deduce a rough, but still quite informative, assessment of the overall performance of each VRC. The criterion for this assessment has been the experience both gained and contributed by each VRC in implementing the challenging tasks given by the VALUE II programme at national and EC levels. Criteria for the evaluation of each VRC were the performance of the upstream and the downstream tasks according to the regulations of the contracts with the Commission. The performance can only be evaluated regarding the VRC and the host and the added VALUE of the VRC to the host's activities at the time of the analysis. The analysis of the individual VRC has been done regarding the following parameters: Mission in its environment Organization of host Organization of VRC Strategy, methodology, customers Upstream activities Downstream activities Networking Promotional activities - When starting the network two years ago, the VRC system was completely new. Even now, it is still in the stage of dynamic foundation. Therefore, the evaluation criteria included the perspective of work of the VRC in relation to its host organization. Executive Summary EVALUATION OF VALUE RELAY CENTRES General comments Start-up phase • The innovative character of the VRC concept and the different interpretations of how to employ this concept across the European Union forced each VRC to devise an optimum response to the demand placed by its own business environment. Each VRC had to devise a specific strategy and to find methods and tools to work with. • Each VRC went through a learning process in devising its methods and tools of work. • Only a few of the VRCs systematically went through a preparatory stage. Many of the VRCs started their work straight away and start-up work (for example market analysis or staff training) was not done at all. There were various reasons for this: many of the VRCs were continuing work they had begun in the previous years. Many felt they had to satisfy the demands of the users straight away, as services of the VRC network had been promoted since the beginning of 1993 already. Despite these basic limitations most VRCs proved quite imaginative while the work caried out by all of them reveals much enthusiasm and a lot of effort. The VRC organizations, their strategies, their operational tools, their learning curves up to the state of productive work in the sense of the task placed by DGXIII and their further development dynamics are rather heterogeneous. These parameters characterizing the foundation and further development of the VRCs depend on the support by their host organizations, their local environment, the VRC personnel as well as on the resources granted by DGXIII. Tasks of the VRCs On the basis of the VRC specifications drawn up by the Programme Management Committee and the DGXIII, a workprogramme was devised that includes the following five tasks: • Promotion of Community RTD activities and the dissemination and exploitation of knowledge resulting from them • Specific tasks for the start up phase • Specific tasks for the launch • Co-ordination at national level • Network activities. The first two tasks describe in some detail the main objectives set for the first 2 years. More specifically, the first task defined the core and optional VRC activities, while the second task focused on the preparatory work required for setting a VRC in motion. Executive Summary EVALUATION OF VALUE RELAY CENTRES In contrast to this, the description of the co-ordination at national level and of networking activities left ample room for initiative. In the definition of the task, no clear preference is given to upstream or downstream activities. This remark is further supported by the fact that the Operational Plans devised by each VRC, initially approved and since then periodically put under scrutiny by the VRC Service Co-ordination Unit do not demonstrate any particular emphasis on downstream activities. Therefore, it was concluded, that • during the pilot phase each VRC was given the chance to devise an action plan that. - would best suit the needs of its operational environment. • This bottom-up approach introduced a very flexible way to implement the work of the VRCs. Support bv the EC Considerable financial and practical support has been given to the VRCs by the EC. A resource of particular importance is the VR Service. The main support instruments are: Information packages for the VRCs Level II and III sheets VACRO Days Training Networking Edition of calendar of events Information on EC research Mailing lists of Specific RTD Promotional Material Day to day follow up work Reporting There are some areas, for example information on sources of financing exploitation projects others than those of VALUE II, where the information from the VRS could be improved in the future. VR Service is a major constituent of the VRC system. It has been recognized by the VRCs and become an indispensable part of their work. However, VR Service was not subject of the present evaluation study. Service fields of the VRCs The essential elements of the upstream, downstream and promotional activities carried out by each VRC can be summarised as follows; VRCs offered their services basically in the following areas: • Proposal Preparation. Executive Summary ^ 3^ • Partner Search • Sensitising Clients for RTD. Information on EC-RTD. • Information on Exploitation Options • • Detecting Exploitation Demand. • Sensitising Clients for Exploitation. • Exploitation Project Preparation VRC services have been usually provided via: • Targeted mailings. • Visits to companies. • Phone Help Line. • Venues, as e. g. , Information Days, Technology Transfer Days, etc. VRC services diffused information mainly via: • Oral presentations at various venues. • Brochures providing an overview of services offered. • Flyers giving mainly the VRC contact details and a hint of its services. • Articles in the general as well as specialised press (newspapers, etc. ). • Newsletters, published either the VRCs themselves or other organisations. • CORDIS, national or in house developed databases. Collecting and processing EC information proved a quite time c nsuming and costly business, in particular for VRCs far away from Brussels and Luxembourg. Translating of EC information material into native language turned out to be q >»te a heavy burden to small VRC teams. The VRCs have to fulfil a variety of very demanding tasks. Co-operation with the customers requires much work, technical knowledge and experience. This is even more true, the more the VRCs are involved in project work (upstream RTD project work or downstream exploitation project work). Possibilities are limited by the small number of VRC staff members. The VRCs tend to provide information activities, more upstream than downstream, rather than to do project work, be it on the proposal preparation or the exploitation project side of their tasks. This especially applies to VRCs which mainly worked in the upstream field as a host already. Increasing In this connection, the VRCs proved to be good promoters of CORDIS. demand for CORDIS is closely linked with the exploitation and dissemination of CORDIS by VRC marketing. • According to their limited resources, the VRCs have only about 6% of their capacity on an average in the field of project work for the exploitation of Community or other results. • It must be thought about how this situation can be improved. Connection of the VRCs with partners contributing technological, company-specific know-how and Executive Summary EVALUATION OF VALUE RELAY CENTRES expert knowledge is an important aspect. Only some VRC host organizations possess the experience required, in a more or less convincing manner. Consequently, relatively few concrete exploitation projects or success stories of VRCs were found. In many cases, exploitation projects had been prepared, but failed in the execution due to lacking funding. • A number of exploitation projects have certainly been pushed by the VRCs. However, further development among the project partners was not pursued. The VRCs concentrating on downstream activities are still establishing feedback to their customers and project controlling. In the field of information management, collecting and processing of EC information material has been a rather time-consuming and costly business for the VRCs. • Generally, communication with the programme managers of the Specific Programmes has to be further improved, although closer contacts to the Commission officials or their partners in the National Contact Points have already been established. The Specific Programme managers should ensure that their RTD projects are able to benefit from the VRCs' expertise and contacts. However, this can become a very demanding task. The VRCs'contribution can only be limited. This means that the VRCs have to be involved from the very beginning of RTD projects. The VRCs and their co operation partners should be involved as exploitation specialists in the evaluation procedure of Specific RTD Projects. The VRCs should also be involved in "status seminars" of these projects in order to identify as early as possible downstream options of ongoing RTD projects. In the 4th Framework Programme, the Specific Programmes will devote, 1% of their budget to the dissemination and exploitation. The programme managers should be able to use some of this money to secure services from the VRCs. Networking Work conducted by DGXIII and the VR Service for establishing a VRC network having a clear identity in the EU and a close co-operation of the VRCs proved to be of crucial importance and very successful. Nevertheless, they are still at the beginning. Networking, at national or European scale, has not been vigorous. The few notable exceptions refer to national networking. A possible reason for this situation relates to the basically competitive character of much of the VRC work, while another reason hints to the need of great organisational effort that no VRC could afford alone. There was good collaboration in some areas, notably in partner search for P^ "f'c RTD Programme proposals. Sub-networks of two or three often neighbour VRCs «. ui border-crossing close co-operation can be observed. This certainly is a positive development. Executive Summary EVALUATION OF VALUE RELAY CENTRES For the future, measures and incentives should be planned for a closer co-operation of the VRCs. Regional representation Regional representation of the VRCs is of crucial importance. The main customers are industrial firms, in particular SMEs. In the field of project work, intermediaries (e. g. consultants, financial institutions, regional and national funding organizations, information agents) are beginning to be integrated. • Those clusters of partners in innovation projects are of particular importance. They have to gather around a VRC. As few traces of these work-sharing structures can be noticed only, a system of partners sharing the work with the VRC and recognizing it as a reference and directing point should be supported in the future. • Complete competence covering the entire state is of significance for determining the number of Relay Centres to be established in the next period. It is observed that in some states the existing VRCs can only work in a spotlike manner. The regions to be taken care of and the distribution and number of the industrial customers is too large. Furthermore, the capacity of the individual VRC is much too small in most cases. Financing of the projects One of the main problems for those VRCs, which are focusing on downstream project work, is the availability of budgets for their projects and their customers. Considerable efforts are made to bring in Community or national or private financial support schemes. • With the Technology Transfer and the Technology Validation Projects the Activity III disposes of important tools to contribute to the financing of innovation projects. • The VRCs should be integrated in these projects in order to ensure better success by their knowing of good partners and closer binding of innovative partners. Methodologies and tools employed A great number of methodologies and tools is employed by the VRCs. A detailed summary is given in ANNEX E of this report. Obviously, each VRC went through a learning process in devising its methods and tools of work. However, across the divers experiments undertaken by all 27 VRCs, one recognises some common archetypes as well as few new ideas in the employed methodology and tools. Examples of detected new ideas are: Executive Summary EVALUATION OF VALUE RELAY CENTRES » The "Diagnostic Service" devised by FIST for identifying project RTD-results with a clear exploitation potential. • The "virtual team" approach of the VRC at VDIA/DE for a cost effective way of utilising the expertise and manpower available in its host organisation. • The VDIA/DE idea of a "Status Seminar" in order identify as early as possible downstream options of ongoing RTD projects. • The sectoral and inter-regional working model employed by AIRE for utilising best networks for technology transfer in specific industrial sectors. • In place of broad VACRO Days, events for smaller groups related to the same field of activity were organised. In the case of TTB, the events are hosted by companies, a fact that is particularly effective. • The employment of electronic tools (flash-information, faxbâses, multimedia presentations) as done by ANRT, CRENEST and TTB. • The preparation of technology sheets targeted towards the needs of the VRCs clients by using CORDIS as done by SGPN l+D. • The publication campaigns of technology offers as launched by ZENIT and ARC in major technical and business newspapers. • The "Technology Scouts" in Danish Universities employed by PUF. Overall performance of the VRCs From the conducted Users' Survey it can be concluded that overall the VRC performance satisfied to a large extent the users' expectations along upstream activities. For downstream work the degree of satisfaction looks numerically small. However, in view of the fact that these latter activities are very user specific and much know-how based, the evaluators believe that the downstream performance has been also satisfactory. More specifically, 71 ± 17 % of the 900 users who replied feel they benefited from the upstream activity of the VRC in their vicinity. The corresponding percentage for downstream is 36 ± 16 %. Both findings are very positive result in view of the exploratory character of the whole VRC pilot operation. ^6 EVALUATION OF VALUE RELAY CENTRES The VRCs carried out a wide range of effective and, in many cases, innovative activities. They did this despite the fact that many of them lacked a clear overall strategy. On the whole, the VRCs worked more effectively in the upstream area. Downstream, much work was done, but a lot of VRCs were hampered by their lack of know-how and experience on many aspects of the dissemination and exploitation of RTD results. The VRCs were only able to make limited progress towards becoming a coherent and cohesive network, despite the enthusiasm of the VR-Service. There was good collaboration in some areas, notably in partner searches, but most of the work was done by each VRC acting in isolation. In general, the work and image of the VRC network could have been greatly improved if more funding had been available for the VRCs themselves and for the financing of exploitation projects. An increased level of funding would also enable the VR-Service to give better support and guidance to the VRC network. Finally, during its two years pilot operation, the VRC network made overall very good progress. This was in large measure due to the commitment and enthusiasm shown by all people involved - both in the individual VRCs and in the VR-Service in Luxembourg. Outlook for the future The VRC network constitutes an extremely important element of the Third Activityin the 4th Framework Programme. It represents a completely new approach for the dissemination and exploitation of EU results and even national results in the future. The two years of 1993 and 1994 were spent for setting up the system. VRC methodologies and tools were developed. Wide, valuable experience was gathered in all member states. » For the future success of the Relay Centres it will be of decisive importance that the respective VRC finds its individual position in its environment. It should be an initiator and catalyst of innovation processes in the networks of all partners required. VRCs will be able to do their own specialized work in a spotlike manner only. They are rather experts of communication and technology marketing. At the same time they are representatives of the EU with special reference to the possibilities of support by the EU. Everywhere, the VRCs are supported by highly committed people. The work performed by them in the first two years has given rise to an increasing interest in industry, research and politics. Now, this achievement has to be further developed. The VRCs have to be regional directing and co-ordination offices, helping the customers and in particular the SMEs to find solutions for their innovation problems. They are executive offices for EC innovation politics within the framework of Activity III and bridges to all funds offered by the Commission to the member states. Executive Summary EVALUATION OF VALUE RELAY CENTRES Several recommendations on strategic, operational or even simple practical issues, amerge from the experience gained by each individual VRC as well by the whole network. A few are summarised below: • There should be closer co-operation with specific programmes in order to shift downstream work into the lifetime of an RTD project, not just after its end. • VRCs should seek more intense collaboration and networking for a better use of resources, human and other, at regional, national and EU, particularly for downstream activities. • VRCs should define a strategy for positioning themselves clearly in market niches of their business environment. • DG-XIII-D should monitor more closely the overall performance of future Relay Centres for being able to provide them with a more effective support. ^8 ANNEX IV Acronyms and Abbreviations ^ ACRONYMS AND ABBREVIATIONS BRTTE CCITT CORDIS COSINE CRAFT CRO DG DGXTI DGXm DGXVI Basic Research in Industrial Technologies for Europe Comité Consultatif International de Téléphonie et Télégraphie Community R &D Information Service Cooperation for Open Systems Interconnection Networking in Europe Cooperative Research Action for Technology Cooperative Research Organisation Directorate-General DG for Science, Research and Development DG for Telecommunications, Information Industries and Innovation DG for Regional Policy DGXVm DG for Credit and Investment DGxxm DG for Enterprise, Trade, Tourism and "Economie Sociale" EC ECU EFTA ESPRIT European Community European Currency Unit European Free Trade Association European Strategic Programme for Research and Development in Information Technology EU European Union EURAM European Research on Advanced Materials EUREKA Europe "a la carte" Cooperation in Advanced Technologies Gbit/s HEPnet IPR ISO JRC Giga (109) bits per second High Energy Physics network Intellectual Property Rights International Organisation for Standardisation Joint Research Centre yUQO Kilo (103) bits per second Mega (106) bits per second Million ECU Officiai Journal (of the European Communities) Open Systems Interconnection Research and Development Research in Advanced Communications in Europe Research Associés pour la Recherche Européenne Research and Technological Development kbit/s Mbit/s MECU OJ OSI R &D RACE RARE RTD SCREEN Internal (confidential) DG XUI database on RTD projects SME SPRINT STRIDE TCP VALUE I VALUEn Small and Medium-sized Enterprise Strategic Programme for Innovation and Technology Transfer Science and Technology for Regional Innovation and Development Transmission Control Protocol Community Programme for the Dissemination and Utilisation of Scientific and Technological Research Results Community Programme of Centralised Action for the Dissemination and Exploitation of Knowledge Resulting the Specific Programmes of Research and Technological Development from VRC Value Relay Centre A$A COMMENTS OF THE MANAGEMENT COMMITTEE In conformity with Article 7 of the Council. Decision of 29 April- 1992 _on the dissémination and exploitation of knowledge resulting from the specific programmes of RTD of the Community (VALUE IT), the Commirtee delivered a favourable opinion on the measures to be undertaken to evaluate the action at its meeting of 18 October'1994. The Committee examined the final evaluation report prepared by the evaluation panel chaired by Mr. Friebe at its meeting on 7 November 1995 as well as the specific report on the Value Relay Centres and, as a conclusion of the exchange. of views between its members, expressed the following comments : General comments : While underlining the importance of dissemination and exploitation of RTD results within the Cornrriuniry Framework programme, the Committee agrees with the panel, to consider, that innovation is not just a. spill-over of RTD. It should be regarded as a major issue for which adequate. Community activities should be implemented, building on and complementing activities carried'. out at the national level. The Value II programme, with modest resources, has developed and implemented new tools which have largely contributed to promote new attitudes towards diffusion and exploitation in'the Fourth Framework Programme. Rdav centres :. The establishment of the relay centres network was à significant new action line of Value H to be further developed. This initiative contributes to bringing Community activities closer to local users and to matching the needs of SMEs with the technology supply. '. RC in all the Member states should adapt to the national context and cooperate as much- as possible with already existing networks and actors of the innovation: system. CORDIS ; Over the last few years, CORDIS has made significant progress and it has become an important tool for the retrieval of information about the research efforts originating from me European Community. - Its evolution should be based on a coherent and well defined approach and close links should be established between CORDIS and other Community '• information systems. Synergies with other RTD databases at national or European level should also be increased and the three recommendations of the panel implemented, i. e. an integrated in- depth study should be undertaken on the demand side, technological evolution and cost controL Utilisation of results : The committee considers that the Value projects had a high added value and,side impact by developing an "exploitation" culture at Cornmunity leveL They should be continued and developed in order to contribute to the promotion of an innovation culture at European level The Committee congratulates the panel for its excellent report as well as the panel who carried out the VRC evaluation and invites the Commission to take into account the above suggestions in the communication that it is to submit to die Council, the European Parliament and the Economic and Social Committee. ^/ ISSN 0254-1475 COM(96) 280 final DOCUMENTS EN 16 Catalogue number : CB-CO-96-287-EN-C ISBN 92-78-05534-4 Office for Official Publications of the European Communities L-2985 Luxembourg

Proposal for a COUNCIL REGULATION (EC) imposing definitive anti-dumping duties on imports of unwrought pure magnesium originating in Russia and Ukraine and collecting definitively the provisional duty imposed

http://publications.europa.eu/resource/cellar/30509d2f-419c-4383-864d-f05eb18caa59

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COMMISSION OF THE EUROPEAN COMMUNITIES •Cr <r Brussels, 21. 06. 1996 COM(96) 307 final Proposal for a COUNCIL REGULATION (EC) imposing definitive anti-dumping duties on imports of unwrought pure magnesium originating in Russia and Ukraine and collecting definitively the provisional duty imposed (presented by the Commission) EXPLANATORY MEMORANDUM 1. By Regulation (EC) No 2997/951, the Commission imposed provisional anti dumping duties on imports into the Community of unwrought magnesium originating in Russia and Ukraine, falling within CN codes 8104 11 00 or 8104 19 00. 2. By Regulation (EC) No 720/962, the Council extended the validity of these duties for a period of two months. 3. Certain parties requested and were granted hearings and presented written comments which were taken into account where appropriate. The Commission continued to seek and verify all information it deemed necessary for its definitive findings. 4. At the definitive stage it was concluded that the two categories of unwrought magnesium, pure and alloyed, are distinct products. This is mainly due to differences in their use. As neither the exporters nor the Community industry sold any unwrought alloyed magnesium the proceeding should be terminated with respect to this product. 5. The definitive determination confirmed that exports originating in Kazakhstan were de-minimis. Consequently, no dumping margin was calculated with respect to these imports. The proceeding with respect to this country is terminated by separate Commission Decision. 6. The definitive determination confirmed the existence of dumping with respect to Russia and Ukraine. Decreases in individual margins compared to the provisional findings are due to downward adjustments made to the normal values following claims by the non-market economy producers. 1 2 OJ No L 312 of 23. 12. 95, p. 37 OJ No L 100 of 23. 4. 96, p. 1 7. The conclusion that the complaining industry suffered material injury is also confirmed. 8. The Commission confirmed the causal link between the dumped imports and the injury suffered by the Community industry. It is the volume of the dumped imports, their low prices and decreasing prices, a price pattern which differs significantly from the price pattern of other third country suppliers and the fact that such imports, to a significant extent went to the same channels as sales of the Community industry that led to this conclusion. 9. On Community interest, it was concluded that the interests of users will not be affected substantially in the event anti-dumping measures are introduced and that despite the fact that there is only one producer in the Community a competitive environment will prevail in this market. 10. Therefore, definitive duties should be imposed. The level at which the definitive duties should be set was determined by the dumping margins finally established which were lower than the injury level. It was considered appropriate to impose measures in the form of variable duties at a level of 2. 602 and 2. 568 ECU per ton at a CI F Community border level for imports originating in Russia and Ukraine respectively. 11. The Russian and the Ukrainian producers offered undertakings. The Commission considered these offers as acceptable because they were considered sufficient to remove injurious dumping. 12. It is therefore proposed that the Council adopts the draft Regulation annexed imposing a residual definitive anti-dumping duty on imports of unwrought pure magnesium originating in Russia and Ukraine falling within CN codes 8104 11 00 or ex 8104 19 00. Council Regulation (EC) No. / imposing definitive anti-dumping duties on imports of unwrought pure magnesium originating in Russia and Ukraine and collecting definitively the provisional duty imposed THE COUNCIL OF THE EUROPEAN'UNION, Having regard to the Treaty establishing the European Community, Having regard to Council Regulation (EC) No 384/96 of 22 December 1995 on protection against dumped imports from countries not members of the European Community3, and in particular Article 23 thereof, Having regard to Council Regulation (EEC) No 2423/88 of 11 July 1988 on protection against dumped or subsidized imports from countries not members of the European Economic Community4, as last amended by Regulation (EC) No 522/945 and in particular Article 12 thereof, Having regard to the proposal submitted by the Commission after consulting the Advisory Committee, WHEREAS : 3 4 5 OJ No L 56, 6. 3. 1996, p. 1. OJNoL209, 2. 8. 1988, p. 1. OJ No L 66, 10. 3. 1994, p. 10. I. Provisional Measures: (1. ) By Regulation (EC) No 2997/95 provisional anti-dumping measures were imposed on 23 December 19956 ("provisional duty Regulation") on imports into the Community of unwrought magnesium originating in Russia and Ukraine. By Regulation (EC) No 720/96 the validity of the provisional anti-dumping measures was extended until 24 June 19967 by the Council. II. Subsequent Procedure: (2. ) Following the imposition of the provisional anti-dumping measures the following interested parties submitted comments in writing: A. Producers in Russia: Avisma Titanium-Magnesium Works, Berezniki, Perm region ("Avisma"), Solikamsk Magnesium Works, Solikamsk, Perm region ("Solikamsk"), B. Producers in Ukraine: Concern Chlorvinil, Kalush, Ivano-Frankovsk region ("Chlorvinil")8. C. Producer in the Community: Péchiney Electrométallurgie D. Producer in the analogue country: Hydro Magnesium, Porsgrunn, Norway 6 7 8 OJ No L 312 of 23. 12. 95, p. 37 OJ No L 100 of 23. 4. 96, p. 1 This producer has changed its name to "Oriana" after the period of investigation. E. Importer in the Community: Ayrton & Partners, London, U. K. F. User in the Community: Aluminium Norf, Neuss, Germany, ("Alunorf") G. User association in the Community: Arbeitsgemeinschaft der Eisen und Metall verarbeitenden Industrie, Dusseldorf, Germany, ("AVI") (3. ) Those parties who so requested were granted an opportunity to be heard by the Commission. (4. ) The Commission continued to seek and verify all information it deemed necessary for its definitive findings. (5. ) Parties were informed of the essential facts and considerations on the basis of which it was intended to recommend the imposition of definitive anti-dumping duties and the definitive collection of amounts secured by way of a provisional duty. They were also granted a period within which to make representations subsequent to the disclosure. (6. ) The parties' oral and written comments were considered, and the conclusions altered where deemed appropriate. (7. ) Owing to the complexity of the case, in particular the determination of the appropriateness of the analogue country, the investigation overran the normal duration of one year provided for in Article 7 (9) (a) of Regulation (EEC) No. 2423/88 (hereafter referred to as the 'basic anti-dumping Regulation'). III. Product under consideration and like product: (8. ) At the provisional stage unwrought pure and alloyed magnesium, both produced in ingot form, were considered as the product concerned. (9. ) After the imposition of provisional measures, the Russian and Ukrainian producers submitted that there are differences between the two above categories of unwrought magnesium , i. e. pure and alloyed, in terms of physical characteristics, production process and end-use, warranting the treatment of these two categories of unwrought magnesium as two distinct products. (10. ) The Community industry has submitted that the Community Institutions should take into account its sales volume and value of pure magnesium in granular form in order to allow a complete assessment of injury. A. Differences between unwrought pure magnesium and unwrought alloyed magnesium in ingot form: (11. ) The final stage of the investigation has shown that the two categories of unwrought magnesium are different in their composition, in particular their magnesium content, although the latter is above 90% for both categories. At the same time the additional alloying agents contained in unwrought alloyed magnesium enhance or even alter the basic physical characteristics of this category as compared to the other category, i. e. unwrought pure magnesium. On this basis it is concluded that certain differences in physical characteristics between unwrought pure and alloyed magnesium do exist. (12. ) As already pointed out in recital (11) of the provisional duty Regulation, it has been established that the two different categories of unwrought magnesium are used in a variety of applications, mainly in aluminium alloying, in steel desulphurisation and in die-casting. Although there are applications in which the use of either of the two categories of unwrought magnesium is theoretically possible, in practical terms the use is limited to one or the other category of unwrought magnesium for technical reasons. In particular, the use of unwrought pure magnesium for die-casting is basically impossible whereas the use of certain types of unwrought alloyed magnesium in both steel desulphurisation and aluminium alloying is possible with certain technical adjustments. Given also that the two categories of unwrought magnesium are traditionally used only in certain applications, the customers also perceive differences between them. Thus, the areas of use which are common for unwrought pure and alloyed magnesium in practical and even theoretical terms are very limited and therefore the interchangeability of the two categories of products is also limited. (13. ) In the light of the above, it is concluded that unwrought pure and alloyed magnesium have to be considered as two distinct products. As neither the producers in the exporting countries nor the Community industry have produced or sold unwrought alloyed magnesium in any significant quantity, it is concluded that this product can be excluded from the scope of the present investigation. Consequently, the analysis of dumping, of injury, of causation between dumping and injury and of Community interest detailed below is exclusively based on information related to unwrought pure magnesium (hereinafter referred to as "magnesium"). Magnesium, depending on the content of impurities is classified under the Combined Nomenclature as 8104 11 00 or 8104 19 00. Magnesium in granular form: B. (14. ) At the provisional stage, the Commission for the injury determination considered the volume and value of the Community industry's sales of magnesium in ingot form. Since then, the Community industry has submitted that the Commission should also take into account for the injury determination its sales of magnesium processed in-house from ingot form into magnesium granules, subsequently sold in the open market to independent customers. It should be noted that magnesium granules are used as such in one of the main applications for magnesium, i. e. for steel desulphurisation. The sole remaining Community producer performs the magnesium grinding process in-house. In contrast, the Russian and Ukrainian producers of magnesium sell the latter in ingot form to independent grinders in the Community for processing the ingots into granules. (15. ) Given the importance of steel desulphurisation as a usage of magnesium and the relative simplicity of the grinding process, it has been concluded that the volume and value of sales of magnesium ingots transformed into magnesium granules should be taken into account, subject to an allowance for grinding costs, in determining the situation of the Community industry. IV. Dumping: A. Russia and Ukraine: 1. Normal value (16. ) The Russian producers have submitted that the analogue country, i. e. Norway, was not an appropriate choice. These producers have argued in general terms that given the difference in economic development between Russia and Norway leading to, for example, substantial labour cost differences, the latter could not be used as an analogue country. The Community industry, on the contrary, has submitted that the producer located in Norway is among the most efficient world-wide manufacturer, operating a particularly cost effective production when compared to the exporting producers concerned. In respect of this argument, it is noted that the justification for using an analogue country in anti-dumping proceedings involving non-market economy countries is the lack of reliable cost and price information in the non-market economy country concerned. Therefore, it is considered groundless to argue that certain costs prevailing in the non-market economy are lower than in the market economy analogue country and that accordingly adjustments of the normal value determined for the analogue country when applying it to the non- market country should be made. Based on the same reasoning, the Commission does not take into account costs resulting from inefficiencies in for example the use of the workforce, which would result in adjustments in the normal value to the disadvantage of the non-market economy producers, as it appears reasonable to assume that such disadvantages are the result of that form of economic system. (17. ) Furthermore, the Russian and Ukrainian producers have alleged that Norway does not represent an appropriate choice of analogue country because the producer located in this country would have an interest in the outcome of this proceeding. As mentioned in recital (68) of the provisional duty Regulation, it has been found that part of this Norwegian producer's field of activity was the Community magnesium market. The investigation conducted has ensured, however, that the conclusions reached are based on verified and thus reliable cost and sales price information for Norway. On this basis any allegation that the particular interest of the producer in question may have influenced the conclusions of the present investigations are unfounded. (18. ) As far as certain allegations made by the Russian and Ukrainian producers related to the reliability of production costs determined for the analogue country producer, it is not considered necessary to address these allegations in detail, indeed, they are based on the use of an inconsistent set of exchange rates, on the comparisons of normal values determined in anti-dumping proceedings carried out in the past by the US authorities using different methodologies and ignoring the methodology used by the Commission in order to determine the level of duty at the provisional stage. (19. ) Finally, certain allegations are based on the situation of the magnesium operations of the group to which the analogue country producer belongs which also includes magnesium operations in Canada. In this respect it should be noted that the determination of the normal value was exclusively based on the situation of the producer located in the analogue country, i. e. Norway. 10 (20. ) In conclusion, it is maintained that the information collected in respect of the analogue country producer is reliable and is actually supported by information submitted by the Russian and Ukrainian producers. 2. Export prices: (21. ) One Russian producer found, as set out in recital (30) of the provisional duty Regulation, to have sold the product concerned to a related company in Switzerland, and which had omitted to specify this relationship, did not contest after the provisional stage that the relationship existed. However, this producer claimed that it did not know the final destination of its exports and that therefore the sales to this related company should not be considered as sales destined for export to the Community. This approach cannot be accepted given the relationship between the companies concerned and also taking into account the fact that the Russian company in question did not submit any information linked to the sales to the related party (e. g. shipping documents indicating the actual shipping destination) that would demonstrate that the approach taken at the provisional stage for the determination of export sales and export prices as set out in recitals (30) and (31) of the provisional duty Regulation was incorrect. (22. ) The two Russian producers have claimed that an amount for commission from their export prices was wrongfully deducted, as this commission was paid to parties located in Russia. The Russian producers have submitted that, given the status of Russia as a non-market economy country, any costs incurred there should not be considered. The information at hand was reviewed, and it is concluded that the deduction concerned should not be made, given the status of this country as a non- market economy. It appears, as argued by the Russian producers, that the commission payments relate to activities in Russia. H (23. ) The Ukrainian producer has submitted that the export price of certain export transactions were wrongfully adjusted by twice deducting an amount for commission. Based on the information submitted, it was established that the claim of the Ukrainian producer is justified and the calculation was adapted accordingly. 3. Comparison: (24. ) The Russian producers have claimed that the production process used by the analogue country producer is partly different from the production process used in Russia, yielding extra costs of production. These claims concern one specific production step, i. e. the treatment of the feedstock and the production of certain by-products. (25. ) With respect to differences in the processing of the feedstock, it was determined that prior to the investigation period, the analogue country producer used two different production processes in order to prepare the feedstock for the production of magnesium. One of the production processes was discontinued well before the beginning of the investigation period. The claims of the Russian producers in respect of differences in the processing of the feedstock relate to this discontinued production process. Since this production process was discontinued and did not affect the situation prevailing during the investigation period, it was not considered necessary to address the question raised by the Russian producers. (26. ) With respect to certain by-products resulting from the production process, this aspect was examined carefully in order to address the question of possible inherent differences in the efficiency of the production processes used during the investigation period in the analogue country and in the exporting countries. 12 The following should be noted: On the basis of the information available, the electrolysis-process (i. e. one of the major production steps in the production of magnesium) of the analogue country producer, given that the structure of the electrolysis cells used by the analogue country producer is inherently less energy consuming when compared to the electrolysis process used in the exporting countries. In addition, the lifetime of the electrolysis cells is substantially shorter in the exporting countries concerned (i. e. around 1 year against 5 years in the analogue country). The production process used in the exporting countries yields, to a greater extent than the production process performed in the analogue country, certain by-products. From information submitted in the course of the investigation it appears that these by-products are used as inputs in the production of other products in the exporting countries. (27. ) On the basis of the above, it has been concluded that the normal value established in the analogue country should be adjusted in order to reflect that the Norwegian production process had a lower yield of by-products while being more energy efficient. Such an adjustment was done on the basis of electricity prices prevailing in the analogue country and on the basis of an estimate of the prices of the main by-products valued at prices prevailing in the Community adjusted for necessary purification treatment. 13 4. Dumping margins: (28. ) The Russian producers have claimed that the CIF EC border value used in determining the provisional dumping margin should be adapted because of the effects of the enlargement of the Community. They argued that they had exported their products during the investigation period to a port in Finland and as a consequence the export transactions should not be adjusted to bring them to a Community frontier level by adding all relevant costs to reach a CIF- Rotterdam level. The destination of the export sales made by the Russian producers during the investigation period have been verified and it is concluded that the claim is not justified. Indeed, contrary to the claim of the Russian producers, export sales to independent customers were made at a Rotterdam-harbour level in the overwhelming majority of cases. Therefore, the claim of the producers concerned is rejected. (29. ) A comparison of the adjusted normal value with the export prices revealed that the ex-national frontier prices of all export transactions from Russia and Ukraine were below normal value. The revised dumping margins were aggregated for all export transactions and when expressed as a percentage of the total CIF EC border value are as follows: Russia: Ukraine: 46. 5 % 54. 5 % B. Kazakhstan: (30. ) The conclusion concerning imports of magnesium originating in Kazakhstan reached at the provisional stage, i. e. that imports are de-minimis, was confirmed at the definitive stage. Consequently, no dumping margin has been determined with respect to imports originating in this country. 14 V. Injury: A. Volume of Community market, consumption in the Community: (31. ) The consumption in the Community market for the product concerned was determined based on market research information compiled by a market research organisation on the basis of a survey among suppliers and users. The information used does include the consumption of magnesium by companies belonging to the group of the sole remaining producer of the Community industry. It has to be noted that these companies were free to purchase magnesium from whatever supplier and therefore, the consumption determined reflects the open market for the product concerned. The resulting consumption of magnesium in the Community measured in metric tons was as follows: 1990 1991 1992 1993 46,000 42,000 47,000 41,000 B. Dumped imports from Russia and Ukraine: 1. Cumulation of imports: (32. ) The Ukrainian producer stated that imports originating in Ukraine should not be cumulated with those originating in Russia. The producer mentioned in this context, that, unlike the situation with regard to Russia it had exported neither any unwrought alloyed magnesium nor any stockpile magnesium. 15 As far as the argument related to sales of unwrought alloyed magnesium is concerned, reference is made to point III. in which the product definition was revised. (33. ) As far as the argument about exports of stockpile material is concerned, reference is made to recital (31) of the provisional duty Regulation, where it is stated that export prices and volumes for unwrought magnesium originating in Russia were made on the basis of the transactions of the two cooperating producers which, according to the information submitted by them, have not sold any stockpile material themselves. (34. ) On this basis, and taking into account the arguments raised already at the provisional stage (see recitals (43) to (45) of the provisional duty Regulation), it is considered that the cumulation of imports originating in Russia and Ukraine is appropriate. 2. Volume of imports: (35. ) The volume of dumped imports of magnesium originating in Russia and Ukraine, measured in metric tons product, show a significant increase from around 2,100 metric tons in 1991 to around 5,400 metric tons in 1992, ultimately rising to around 9,200 metric tons in the investigation period. (36. ) On the basis of the total Community consumption, this development corresponds to a rise in market share held by dumped imports from 5% in 1991 to 11% in 1992 and to 23% in the investigation period. (37. ) The price level for magnesium for the imports concerned has been determined and the following price trend for the two exporting countries concerned has been established (table given in indexed form, base in 1990: 100): 16 1990 1991 1992 1993 100 86 92 87 These prices were at a consistently low level and undercut those of the Community industry by a substantial margin. A detailed evaluation of the export prices charged during the period of investigation as compared to prices charged by the Community industry at a comparable level of trade, and taking into account where appropriate differences in the quality of the products was made. The prices of all export transactions undercut prices of the Community industry by an average margin of 35%. C. Situation of the Community industry: (38. ) A number of interested parties have pointed out that the Community industry no longer suffers injury as the demand for magnesium has changed since the end of the investigation period, leading to a supply shortage and a considerable increase in prices. However, the alleged change in demand has occurred in the market for die- casting which essentially uses unwrought alloyed magnesium. 1. Sales volume and market share of Community industry: (39. ) As mentioned in point III. B. , sales of magnesium ingots of the Community industry were analysed taking into account quantities sold in ingot form as such ("magnesium ingots") and the quantities of ingots attributable to sales in granular form ("magnesium granules"). 17 Total yearly sales volume of the Community industry to unrelated customers in the Community of magnesium ingots and magnesium granules decreased since 1990. From 1991 to 1992 the decrease was almost 40%. From 1992 to the investigation period more than 10%, i. e. on an indexed basis from 62 to 53 between 1992 and the investigation period (base 1990: 100). This decrease in sales volume resulted in a decrease in market share of the Community-industry from 20% in 1991 to 11% in both 1992 and in the investigation period. (40. ) If sales of magnesium granules are excluded from the analysis, the following, similar pattern emerges: yearly sales volume of the Community industry to unrelated customers in the Community decreased since 1990. From 1991 to 1992 the decrease was almost 40%. From 1992 to the investigation period sales fell by around 20%, i. e. on an indexed basis from 55 to 44 between 1992 and the investigation period (base 1990: 100). This decrease in sales volume resulted in a decrease in market share of the Community industry for sales of magnesium ingots from around 15% in 1991, to 8% in 1992 and 7% in the investigation period. (41. ) Finally, if sales transactions to related companies using the product concerned which were free to purchase their raw materials from independent suppliers are also included in the analysis, the total yearly sales volume again shows a decrease since 1990. From 1991 to 1992 the decrease continued and was almost 30%. From 1992 to the investigation period it was around 10%, i. e. on an indexed basis from 74 to 69 between 1992 and the investigation period (base 1990: 100). This decrease in sales volume resulted in a development of market share of the Community industry for its total sales of magnesium from around 30% in 1991, to around 20% in both 1992 and in the investigation period. 18 2. Prices of the Community industry: (42. ) The Russian producers have argued that the Community industry obtained an increase in its sales prices from 1991 through 1992 into the investigation period. (43. ) In this context it must be noted that prices of the Community industry improved from 1991 to the investigation period as a result of a market recovery. This price recovery reflects, as far as its pattern is concerned, world market price fluctuations. From the beginning of the investigation period however, these prices have declined substantially up to the end of the investigation period. As for the analysis of sales and market share, yearly price trends (in index form with the base 100 in 1990) are shown for - sales of magnesium ingots, 1990 1991 1992 1993 100 74 79 92 sales of magnesium ingots and magnesium granules, 1990 1991 1992 1993 100 76 81 91 total sales including sales to related customers. 1990 1991 1992 1993 100 75 81 91 (44. ) Prices within the investigation period decreased by about 6% between the first quarter and the last quarter for sales of magnesium ingots, by around 8% when taking account of sales both of magnesium ingots and magnesium granules and also by 8% if total sales of the Community industry are taken into account. This underlines that prices of the Community industry were under particular pressure during the investigation period. 3. Other factors: (45. ) As far as the financial situation, production, stocks, capacity, capacity utilisation and employment are concerned, no new information was received from interested parties after the imposition of provisional measures and now new information is available, therefore the provisional determinations reached concerning these factors are confirmed. D. Conclusion: (46. ) In conclusion, the substantial reduction in the Community industry's sales, production and market share, the substantial increase in stock volume and the loss of employment as well as the negative development as far as the financial results are concerned, led to the conclusion, at the definitive stage, that the Community industry has been suffering material injury within the terms of Article 4 (1) of the basic anti-dumping Regulation. 20 VI. Causation: A. Price situation of the Community industry: (47. ) The Russian producers have argued that their exports have not caused the injury suffered by the Community industry as this industry experienced a negative situation in a time period before their exports gained importance. Furthermore, the Russian producers have submitted that their argument is corroborated by the fact that the situation of the Community industry improved in terms of resale prices as imports of magnesium originating in Russia gained importance. (48. ) As already mentioned in recital (69) of the provisional duty Regulation, it has been acknowledged that dumped imports were not the sole cause of the injurious situation of the Community industry. Indeed, it was determined that the Community industry has faced negative developments because of a downturn in the market for magnesium triggered by a general downturn in the magnesium-using industries. However, it has also been established that since 1991, imports of magnesium originating in the two exporting countries concerned increased considerably, contrary to the development of consumption in the Community, and have consistently been made at prices undercutting those of the Community industry. On this basis, it can be concluded that the two developments, a market downturn and the undisputed increase in low-priced imports originating in the two countries concerned, overlap, as do their consequent effects. It was provisionally determined that the appearance of high volumes of dumped imports have jeopardised the recovery of the Community industry after a consolidation of the market and a restructuring programme which took effect toward the end of 1992. 21 (49. ) In order to distinguish between the possible effects of these two factors, the pricing pattern of the various suppliers on the Community market has been analysed. These suppliers are, in decreasing order of market share during the investigation period, Norway (around 16%), the US (around 16%) and Canada (around 3%) apart from the countries concerned by this proceeding and the Community industry. An analysis of the pricing pattern of these suppliers based on the information received from the producers located in the exporting countries concerned, from the Community industry and based on import statistics for other suppliers, together with market research information revealed that there was a world wide price slump in the years 1991 and 1992. By the middle of 1992 and at the beginning of 1993, the market recovered leading to an increase in sales prices. For imports from Russia and Ukraine, throughout the period from 1990 to the investigation period, these were made at prices consistently and substantially undercutting those of the other main suppliers. Furthermore, the year-to-year price changes of the various suppliers indicate for all of them an upward price trend in the period of 1992 to the investigation period, in line with a price increase in the world market. On the contrary however, the two exporting countries concerned decreased their prices. The Community industry has not been able to effect price increases to the same extent as those of other third country suppliers. This explains why this industry's market share has remained relatively stable, while the market share of other third country suppliers substantially deteriorated from 1992 to the investigation period. This indicates that the price increase which resulted from the world market recovery from 1992 to the investigation period was substantially hampered for the Community by the pricing of the exports concerned, which undercut those of the other suppliers substantially, leading to the Community industry having to forego price increases. 22 (50. ) Furthermore, it was established that prices of the Community industry deteriorated during the investigation period after having recovered somewhat at the beginning of it. From the first quarter to the last quarter of the investigation period alone prices decreased by between 6% and 8%. It was in this period that imports from the countries concerned increased markedly. B. Sales channels of Russian exporters and of the Community industry: (51. ) The Russian producers have stated that their sales of the product concerned could not have caused injury because these sales in the Community went into other sales channels than those of the Community industry and were destined for other uses. It was claimed that the Russian material was often off-grade material, i. e. magnesium with a higher content of impurities, which was used for steel desulphurisation purposes. The Russian producers claimed that there was very little overlap between the channels and uses for their products and for those of the Community industry as the Russian producers did not sell any unwrought alloyed magnesium to, for example, die-casters. (52. ) As regards this claim, the following should be noted: First, the present investigation deals with products which are very similar, if not identical, in their characteristics and uses. It is considered that for this reason alone, the low priced sales of the imported products have an impact on the Community industry. Second, it is undisputed that the market for magnesium is highly transparent with the effect that not only prices realised but even price offers quoted have an impact on the market overall. 23 Third, the investigation has shown that the Community industry sells magnesium in substantial quantities in the market segment and to customers in which the Russian producers have claimed to be specialised. Fourth, the investigation has not confirmed that the cooperating Russian producers have sold to any extent any off-grade magnesium. Indeed, the producers themselves have claimed that their product is of good quality, a statement confirmed during the investigation by the cooperating importers and user. C. Other imports: (53. ) The Russian producers have finally claimed that Russian exports have mainly affected the position of other countries' imports. As already mentioned in recital (68) of the provisional duty Regulation, the market share of imports of magnesium originating in countries other than those covered by the present proceeding has actually decreased over the years leading to the investigation period. However, the divergence in the trend of Community and third country market shares does not support the claim that the imports concerned have not caused injury to the Community industry. The Community industry has opted to keep its market position by increasing its prices substantially less than the other suppliers. 24 D. Purchases by the Community industry of magnesium originating in Russia and Ukraine: (54. ) It was argued that the sole remaining Community producer had purchased » magnesium originating in Russia and Ukraine and had in this respect inflicted injury on itself. In this respect it was found that the Community producer has not bought any of the product concerned originating from these sources. E. Conclusion: (55. ) It is therefore concluded that high volume, low-priced dumped imports of magnesium originating in Russia and Ukraine, taken in isolation, have caused material injury to the Community industry. 25 VII. Community interest: A. User, Aiunorf: 1. Competitive situation: (56. ) One magnesium user, Aiunorf, has submitted information. Notwithstanding the question whether Aiunorf is representative of user interests, it was examined whether the user company would be put at a disadvantage compared to competitors located outside the Community by the adoption of anti-dumping measures. In this respect it was established that there are few imports into the Community of the products which the user company and its owners manufacture, indicating that any impact that these companies might face due to competitive advantages gained by competitors located outside the Community and potentially benefiting from low priced input materials is limited. 2. Effect on cost of production: (57. ) During the investigation period Aiunorf produced aluminium-based products containing between 0 and 5% magnesium. It has been determined that the cost of magnesium as a proportion of the total cost of production were substantially below 3%. It follows that the impact of price variations in magnesium must be very small. B. Other users: (58. ) With respect to other users of magnesium, it was argued that the cost of magnesium represented a significant share of the overall cost of production, with the result that any increase in the cost of this important input would have a negative effect on this industry's competitive situation. 26 In this respect, it is acknowledged that there might be an effect on this user industry. The anti-dumping measures imposed have therefore been designed to allow the continued presence on the Community market of the suppliers located in the exporting countries. C. Conclusion: (59. ) In summary, it is considered that, on balance, it is in the Community interest to impose definitive measures in the present investigation. This view takes specifically into account the situation of one category of user industry which uses magnesium as its main raw material. The definitive measures proposed ensure that the effects on this part of the user industry will be limited. 27 VIM. ANT1 DUMPING MEASURES: A. Level of duties: (60. ) Based on the above conclusions on dumping, injury, causal link and Community interest, it was considered what form and level the anti-dumping measures would have to take in order to remove the trade distorting effects of injurious dumping and to restore effective competitive conditions on the Community magnesium market. (61. ) In the present circumstances the overall loss-making situation of the Community industry of magnesium had to be taken into account as well as the volatility of the market. (62. ) Since the level of prices at which the injurious effects of the imports would be removed was higher than the dumping margin of both exporting countries concerned, the dumping margin was used in order to determine the level of measures. B. Form of duties: (63. ) Given the material injury suffered by the Community industry in the form of financial losses being the result of a depression of sales prices, the nature of the product and possible price fluctuations resulting from demand for downstream products, a variable duty is considered the most appropriate form of duty in this case. Taking into account the adjustment made in the determination of the respective normal values at the definitive stage, such variable duties would be based on a minimum price of 2. 602 and 2. 568 ECU per ton at a CIF Community border level for imports of magnesium originating in Russia and Ukraine respectively taking into account the differences in the actual export channels used during the investigation period. 28 C. Undertakings: (64. ) Having been informed of the essential facts and considerations on the basis of which it was intended to recommend the imposition of definitive anti-dumping duties, the two Russian and the Ukrainian producers offered undertakings concerning their exports of the product concerned to the Community. After examination of these offers, the Commission considered the undertakings as acceptable since they would eliminate the injurious effects of dumping pursuant to Article 10 (2) of the basic anti-dumping Regulation. Furthermore, given the nature of the product and given the particular terms of the undertakings, in particular the fact that these undertakings cover exports of the product concerned for the Community directly invoiced to unrelated importers, it was established that these undertakings could be monitored effectively. (65. ) The Commission consulted the Advisory Committee on the acceptance of these undertakings and, since objections were raised, sent a report on these consultations to the Council. In accordance with Articles 9 and 10 (1) of the basic anti-dumping Regulation, the undertakings offered were accepted by Commission Decision (66. ) Notwithstanding the acceptance of the undertakings offered by the Russian and Ukrainian producers, a residual duty should be imposed on imports of the product concerned originating in Russia and Ukraine, in order to underpin the undertakings by avoiding their circumvention. This residual duty should be imposed in the form of a variable duty as discussed above. 29 IX. COLLECTION OF THE PROVISIONAL DUTIES: (67. ) In view of the magnitude of the dumping margins found for the exporting producers and in light of the seriousness of the injury, in particular in light of the level of price undercutting and price underselling, it is considered necessary that amounts secured by way of provisional anti-dumping duties for transactions involving the product concerned, i. e. exclusively magnesium at the definitive stage should be definitively collected for all companies, including those from which undertakings have been accepted, at the level of the definitive duties, HAS ADOPTED THIS REGULATION : 30 Article 1 1. Definitive anti-dumping duties are hereby imposed on imports of unwrought pure magnesium falling within CN codes 8104 11 00 and ex 8104 19 00 (Taric code 8104 19 00 10) and originating in Russia and Ukraine. For the purpose of the present Regulation unwrought pure magnesium is defined as unwrought magnesium unintentionally containing small amounts of other elements as impurities. The present Regulation does not cover unwrought alloyed magnesium which is unwrought magnesium containing more than 3% by weight of intentionally added alloying elements such as aluminium and zinc. 2. For the above product originating in Russia, the amount of anti-dumping duty shall be the difference between the minimum import price of ECU 2. 602 per metric tonne product and the CIF Community frontier price in all cases where the CIF Community frontier price per metric tonne product is less than the minimum import price (Taric additional code: 8899) except for imports of the product directly invoiced to an unrelated importer after the entry into force of this Regulation by the following producers located in Russia: Avisma Titanium-Magnesium Works, Berezniki, Perm region, (Taric additional code: 8898) Solikamsk Magnesium Works, Solikamsk, Perm region, (Taric additional code: 8903) which shall be exempt from the duty subject to the above conditions pursuant to the acceptance of undertakings by Commission Decision. 31 For the above product originating in Ukraine, the amount of anti-dumping duty shall be the difference between the minimum import price of ECU 2. 568 per metric tonne product and the CIF Community frontier price in all cases where the CIF Community frontier price per metric tonne product is less than the minimum import price (Taric additional code: 8902) except for imports of the product directly invoiced to an unrelated importer after the entry into force of this Regulation by the following producers located in Ukraine. Concern Oriana, Kalush, Ivano-Frankovsk region (Taric additional code: 8901). which shall be exempt from the duty subject to the above conditions pursuant to the acceptance of an undertaking by Commission Decision. 4. Unless otherwise specified, the provisions in force concerning customs duties shall apply. Article 2 The amounts secured by way of provisional anti-dumping duty under Regulation No. 2997/95 and related to imports of unwrought pure magnesium as defined in Article 1 shall be definitively collected at the duty rate definitively imposed. Amounts secured in excess of the definitive rate of anti-dumping duty and related to imports of unwrought pure magnesium shall be released. Amounts secured by way of provisional anti-dumping duty under Regulation No. 2997/95 and related to imports of unwrought alloyed magnesium as defined in Article 1 shall be released. 32 Article 3 This Regulation shall enter into force on the day following its publication in the Official Journal of the European Communities. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Brussels, 33 ISSN 0254-1475 COM(96) 307 final DOCUMENTS EN 02 il Catalogue number : CB-CO-96-316-EN-C ISBN 92-78-05853-X Office for Official Publications of the European Communities L-2985 Luxembourg

PARCOM Decision 96/1 on the phasing-out of the use of hexachloroethane in the non-ferrous metal industry

http://publications.europa.eu/resource/cellar/20c900b0-3a09-4f4e-bf0a-5f70e9b13d68

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L 96/42 ‹ EN ‹ Official Journal of the European Communities 28. 3. 98 OSLO AND PARIS CONVENTIONS FOR THE PREVENTION OF MARINE POLLUTION JOINT MEETING OF THE OSLO AND PARIS COMMISSIONS on the phasing-out of the use of hexachloroethane in the non-ferrous metal industry PARCOM DECISION 96/1 Oslo: 17 to 21 June 1996. RECALLING PARCOM Decision 92/4 on the phasing-out of the use of hexachloroethane (HCE) in the secondary aluminium industry and in the primary aluminium industry with integrated foundries; RECALLING PARCOM Decision 93/1 on the phasing-out of the use of hexachloroethane (HCE) in the non-ferrous metal industry; CONSIDERING that organohalogen compounds which are toxic, persistent and liable to bioac- cumulate are a cause of marine pollution requiring urgent measures; CONSIDERING that these substances are on the Paris Convention priority list; CONSIDERING that hexachloroethane has been used till now in the non-ferrous metal industry, mainly as a degasifier in magnesium and copper foundries; CONSIDERING that other systems and alternative substances already exist, capable of attaining similar, or even superior, technical efficiency and performance and that some of the alternative techniques involve less ecological risk; CONSIDERING that limited exemptions are necessary for some applications in the production of magnesium and aluminium alloys to give small and medium-sized foundries a reasonable period for adaptation, THE CONTRACTING PARTIES TO THE CONVENTION FOR THE PREVENTION OF MARINE POLLUTION FROM LAND-BASED SOURCES DECIDE THAT: 1. Programmes and measures 1. 1. All uses of HCE in the aluminium industry (including integrated and non-integrated foun- dries casting aluminium) shall be phased out as far as possible by 31 December 1996 and at the latest by 31 December 1997. 1. 2. All uses of HCE in other non-ferrous metal industry shall be phased out by 31 December 1997. 1. 3. As exceptions to this Decision, hexachloroethane may be used: (a) for grain refining in the production of the magnesium alloys AZ81, AZ91 and AZ92; (b) in non-integrated aluminium foundries producing specialised castings for applications requiring high quality and high safety standards and where consumption is less than 1,5 kg of hexachloroethane per day on average. The need for these exceptions will be reviewed in 1998. 1. 4. Potential alternative technologies should be assessed by competent authorities for their risks and benefits. 28. 3. 98 ‹ EN ‹ Official Journal of the European Communities L 96/43 2. Entry into force 2. 1. This Decision replaces PARCOM Decisions 92/4 and 93/1 with effect from the date when the Secretariat has received confirmation from Contracting Parties holding at least three quarters of the total number of votes in the Paris Commission that they are in a position to proceed. 2. 2. That replacement has effect for each Contracting Party from: (a) the date mentioned in subparagraph 2. 1, or (b) the date when it delivers such a notification to the Secretariat, whichever is later. 3. Implementation reports 3. 1. Implementation reports on this Decision should be made to the appropriate OSPAR working group meeting preceding the meeting of OSPAR 1999. When reporting, the format as set out in the Appendix should be used to the extent possible. L 96/44 ‹ EN ‹ Official Journal of the European Communities 28. 3. 98 Appendix Implementation reporting format for PARCOM Decision 96/1 on the phasing-out of the use of hexachloroethane in the non-ferrous metal industry Contracting Party Reservation Not applicable (4) Means of implementation (1) (2) (3) By legislation Administrative action Voluntary agreement Belgium Denmark Finland (5) France Germany Iceland Ireland Netherlands Norway Portugal Spain Sweden United Kingdom EC Luxembourg (6) Switzerland (5) (1) Give information on specific measures taken to give effect to this Decision. (2) Provide information on any special difficulties encountered, such as practical or legal problems, in the implementation of this Decision. (3) The reasons for not having fully implemented this Decision should be spelt out clearly and plans for full implementation should be reported. (4) State why this Decision is not applicable. (5) Contracting State to the OSPAR Convention. (6) Signatory to the Paris Convention and the OSPAR Convention

PROPOSAL FOR A COUNCIL REGULATION (EC, EURATOM, ECSC) laying down the weightings applicable from 1 Jannuary 1996 to the remuneration of officials of the European Communities serving in third countries

http://publications.europa.eu/resource/cellar/9baaf232-5ec7-4ab5-8f6c-f31843bb9a39

eng

COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 21. 06. 1996 COM(96)291 final PROPOSAL FOR A COUNCIL REGULATION (EC, EURATOM, ECSQ No. J,. laying down the weightings applicable from 1 Januaiy 1996 to the remuneration of officials of the European Communities serving in third countries (presented by the Commission) EXPLANATORY NOTE On 5 October 1987, by Regulation No 3019/87, the Staff Regulations were amended by the addition of an Annex X laying down special and exceptional provisions, including special arrangements for emoluments, applicable to officials of the European Communi ties serving in third countries. Articles 11, 12 and 13 of Annex X deal with the remuneration of officials posted in countries outside the European Union. Remuneration is payable in Belgian francs in Belgium but there is also provision for all or part of an official's remuneration to be paid in the currency of the country of employment. In that event, the portion of remuneration paid in local currency is subject to a weighting. Article 13 of Annex X requires the Council of the European Union to determine the weightings for third countries every six months. This proposal relates to the adjustment of weightings applicable in third countries with effect from 1 January 1996. The budgetary impact is negligible compared with the total operating costs of the delegations. II. Council of the European Union Regulation (EEC, Euratom, ECSC) No 2175/88 of 18 July 1988 laid down the initial weightings applicable from 10 October 1987. Since then these weightings have been adjusted by the Council of the European Union every six months, most recently by Regulation No 579/96 of 25 March 1996 which took effect on 1 July 1995. The remuneration system for staff serving in countries outside the Community is based on equivalent purchasing power for Brussels and the various places of employment. Application of this principle is based on the calculation of purchasing power parities (PPPs) for local currencies in relation to the Belgian franc. The weighting is the factor obtained by dividing the PPP by the exchange rate. This means that implementation of a weightings system primarily involves calculating purchasing power parities for Brussels and the various places of employment. The exchange rates selected for accounting purposes are those for December 1995. Table A shows for each place of employment the economic parity calculated by the Statistical Office of the European Communities (SOEC) for January 1996, the exchange rate selected and the resulting weighting, applicable from 1 January 1996. The SOEC has calculated the economic parities for each country shown in Table B. The parities used apply from 1 January 1996. I COUNTRY OF EMPLOYMENT ALBANIA ALGERIA ANGOLA ANTIGUA AND BARBUDA ARGENTINA AUSTRALIA BANGLADESH BARBADOS BELIZE BENIN BOLIVIA BOTSWANA BRAZIL BULGARIA BURKINA FASO BURUNDI CAMEROON CANADA CENTRAL AFRICAN REPUBLIC CHAD CHILE CHINA COLOMBIA COMOROS CONGO COSTA RICA CYPRUS CZECH REPUBLIC DJIBOUTI DOMINICAN REPUBLIC EGYPT EQUATORIAL GUINEA «ERITREA ETHIOPIA * EX-YUGOSLAVIA FIJI GABON GAMBIA GEORGIA GHANA GRENADA GUINEA GUINEA-BISSAU GUYANA HAITI HONG KONG HUNGARY INDIA INDONESIA ISRAEL IVORY COAST JAMAICA JAPAN (TOKYO) JORDAN KAZAKHSTAN KENYA LEBANON LEFT BANK - GAZA STRIP LESOTHO LIBERIA MADAGASCAR MALAWI MALI MALTA * Not. Available. TABLE A Local currency equivalent BFR 1 Economic parities for January 96 2. 0. 314311. 0. 0. 0. 0. 0. 0. 11. 0. 0. 0. 1. 12. 7. 15. 0. 18. 12. 10. 0. 20. 10. 15. 3. 0. 0. 6. 0. 0. 12. 0. 0. 0. 0. 20. 0. 0. 17. 0. 30. 423. 2. 0. 0. 3. 0. 58. 0. 14. 0. 5. 0. 0. 1. 14. 0. 0. 0. 65. 0. 13. 0. 1903673 0000000 3777222 0818084 0303723 0336363 7655115 0542266 0442119 0015854 0000000 0615265 0235615 0093960 8795765 3613583 2964991 0296385 4438123 9709347 3075303 2040793 5261468 7909771 7860173 9080027 0123582 5344534 6744924 3064184 0626497 5969367 0000000 0723778 0000000 0316580 2738560 2466327 0238421 0622787 0802535 4047707 8739671 5688870 0000000 2417259 3661882 4427156 6549661 1012395 9792769 5592908 3872991 0140387 0341787 1517938 3701764 0000000 0694067. 0000000 ,1404963. 1804042. 2986821. 0088942 Exchange rates for Weightings for January 96 December 95 Brussels = 100 3. 1. 222717. 0. 0 0 1. 0, 0. 16, 0, 0, 0, 2, 16, 9, 16. 0, 16, 16. 13. 0. 32, 12, 16. 6. 0. 0. 6. 0, 0. 16. 0, 0. 0. 0. 16, 0. 0. 47. 0. 33. 685. 4. 0, 0, 4. 1, 79, 0, 16, 1 3 0 0 1 54 0 0 0 139 0 16 0 1012560 7128860 1492200 0914160 0338581 0451325 3610998 0677140 0677140 6666667 0000000 0968148 0324781 3515579 6666667 2515496 6666667 0459791 6666667 6666667 9037582 2814523 8428797 5000000 6666667 5189048 0153844 9002521 0172092 4389623 1145738 6666667 0OO0OOO 2133060 0000000 0496179 6666667 3323805 0338581 0145745 0914160 7700932 3070175 7065468 6160291 2640961 6448976 2034853 5165394 1042492 6666667 3482904 4366623 0244828 0338581. 9124847 ,9510935. 0000000. 1239803. 0338581. 7038279. 5265375. 6666667. 0119513 70. 63 0. 00 141. 13 89. 49 89. 70 74. 53 56. 24 80. 08 65. 29 66. 01 0. 00 63. 55 72. 55 42. 92 77. 28 79. 57 91. 78 64. 46 110. 66 77. 83 74. 13 72. 51 62. 50 86. 33 94. 72 59. 95 80. 33 59. 37 110. 92 69. 81 54. 68 75. 58 0. 00 33. 93 0. 00 63. 80 121. 64 74. 20 70. 42 36. 29 87. 79 90. 03 61. 85 54. 58 0. 00 91. 53 72. 47 36. 79 73. 76 97. 11 89. 88 41. 48 156. 76 57. 34 100. 95 60. 22 26. 15 0. 00 55. 98 0. 00 46. 63 34. 26 79. 79 74. 42 COUNTRY OF EMPLOYMENT MAURITANIA MAURITIUS MEXICO MOROCCO MOZAMBIQUE NAMIBIA NETHERLANDS ANTILLES NEW CALEDONIA NIGER NIGERIA NORWAY PAKISTAN PAPUA NEW GUINEA PERU PHILIPPINES POLAND REPUBLIC OF CAPE VERDE ROMANIA RUSSIA * RWANDA * SAO TOME AND PRINCIPE SENEGAL SIERRA LEONE SLOVAKIA SLOVENIA SOLOMON ISLANDS * SOMALIA SOUTH AFRICA (LE CAP) SOUTH AFRICA (PRETORIA) SOUTH KOREA SRI LANKA SUDAN SURINAM SWAZILAND SWITZERLAND SYRIA TANZANIA THAILAND TOGO TONGA TRINIDAD AND TOBAGO TUNISIA TURKEY UGANDA UKRAINE UNITED STATES OF AMERICA (NEW YORK) UNITED STATES OF AMERICA (WASHINGTON) URUGUAY VANUATU VENEZUELA VIET NAM WESTERN SAMOA * ZAIRE ZAMBIA ZIMBABWE * Not available. TABLE A Local currency equivalent BFR 1 Economic parities for January 96 Exchange rates for Weightings for January 96 December 95 Brussels = 100 * 3. 1862674 0. 4170911 0. 1088641 0. 1913329 172. 3523951 0. 0829878 0. 0451143 3. 7289771 12. 9645148 0. 9639221 0. 2609347 0. 6237122 0. 0371799 0. 0604353 0. 4866718 673. 8407103 2. 0722557 30. 9244495 0. 0392958 0. 0000000 0. 0000000 12. 2659947 20. 6999249 0. 5820311 3. 3956947 0. 0949800 0. 0000000 0. 0872878 0. 0825164 23. 0305179 0. 0000000. 8058846. 0865458. 0595003. 0474496. 8897015. 8406226. 5902233 12. 9561294 0. 0336350 0. 1001847 0. 0191206 1134. 8042519 20. 6423765 0. 0310945 0. 0297076 0. 0254642 0. 1992887 3. 3807727 3. 7417611 126. 7742486 0. 0558539 0. 0000000 20. 8535320 0. 1386476 4. 0, 0, 0, 342, 0, 0, 3 16, 3 0 1, 0, 0, 0 832, 2, 86, 0, 10, 0, 16, 31, 0. 4, 0, 88, 0. 0. 25. 0. 2. 13. 0. 0. 0. 19. 0. 16. 0. 0. 0, 1840, 35. 0. 0. 0. 0 3 5 372 0 538 32 0. 6617873. 6184292 ,2583379. 2827175. 5830764. 1239803. 0602664. 0303030. 6666667. 0066146. 2143715. 1774957. 0520508. 0784006. 8840170. 9168749 ,6329647. 2366333 ,0338581. 6465660. 0000000. 6666667. 4732635 ,9891197 ,1972718 ,1200336. 7075313 ,1239803 ,1239803 ,9006967. 0000000 ,7425061 ,9157540. 1239803 ,0393592. 9006575. 5748346. 8443806. 6666667 ,0467968 ,2007871 ,0317017. 1295451. 2187082. 0338581 ,0338581. 0338581. 2354825. 8633905. 7557269. 8143757. 0871612. 2131324. 5446676. 3173092 usi * BFR 1 68. 35 67. 44 42. 14 67. 68 50. 31 66. 94 74. 86 123. 06 77. 79 32. 06 121. 72 52. 97 71. 43 77. 09 55. 05 80. 90 78. 70 35. 86 116. 06 0. 00 0. 00 73. 60 65. 77 58. 84 80. 90 79. 13 0. 00 70. 40 66. 56 88. 92 0. 00 29. 38 50. 92 47. 99 120. 56 98. 78 40. 05 69. 90 77. 74 71. 87 49. 90 60. 31 61. 67 58. 61 91. 84 87. 74 75. 21 84. 63 87. 51 65. 01 34. 00 64. 08 0. 00 64. 08 43. 69 COUNTRY OF EMPLOYMENT Economic parities for January 96 TABLE B 2 0 314311. 0. 0. 0. 0. 0. 0. 11. 0. 0. 0. 1. 12. 7. 15. 0. 18 12. 10 0 20 10 15 3 0 0 6 0. 0. 12. 0. 0. 0. 0. 20. 0, 0, 17, 0, 1903673 0000000 3777222 0818084 0303723 0336363 7655115 0542266 0442119 0015854 0000000 0615265 0235615 0093960 8795765 3613583 2964991 0296385 4438123 9709347 3075303 2040793 5261468 7909771 7860173 9080027 0123582 5344534 6744924 3064184 0626497 5969367 0000000 0723778 0000000 0316580 2738560. 2466327. 0238421. 0622787. 0802535. 4047707. 8739671. 5688870. 0000000. 2417259. 3661882. 4427156. 6549661. 1012395. 9792769. 5592908. 3872991. 0140387. 0341787. 1517938. 3701764. 0000000. 0694067. 0000000. 1404963. 1804042. 2986821. 0088942. 1862674. 4170911. 1088641. 1913329. 3523951. 0829878 30 423 2 0 0 3 0 58 0 14 0 5 0 0 1 14 0 0 0 65 0 13 0 3 0 0 0 172 0 ALBANIA «ALGERIA ANGOLA ANTIGUA AND BARBUDA ARGENTINA AUSTRALIA BANGLADESH BARBADOS BELIZE BENIN «BOLIVIA BOTSWANA BRAZIL BULGARIA BURKINA FASO BURUNDI CAMEROON CANADA CENTRAL AFRICAN REPUBLIC CHAD CHILE CHINA COLOMBIA COMOROS CONGO COSTA RICA CYPRUS CZECH REPUBLIC DJIBOUTI DOMINICAN REPUBLIC EGYPT EQUATORIAL GUINEA ERITREA ETHIOPIA * EX-YUGOSLAVIA FIJI GABON GAMBIA GEORGIA GHANA GRENADA GUINEA GUINEA-BISSAU GUYANA * HAITI HONG KONG HUNGARY INDIA INDONESIA ISRAEL IVORY COAST JAMAICA JAPAN (TOKYO) JORDAN KAZAKHSTAN KENYA LEBANON LEFT BANK LESOTHO LIBERIA MADAGASCAR MALAWI MALI MALTA MAURITANIA MAURITIUS MEXICO MOROCCO MOZAMBIQUE NAMIBIA GAZA STRIP * Not available. C COUNTRY OF EMPLOYMENT Economic parities for January 96 TABLE B NETHERLANDS ANTILLES NEW CALEDONIA NIGER NIGERIA NORWAY PAKISTAN PAPUA NEW GUINEA PERU PHILIPPINES POLAND REPUBLIC OF CAPE VERDE ROMANIA RUSSIA * RWANDA * SAO TOME AND PRINCIPE SENEGAL SIERRA LEONE SLOVAKIA SLOVENIA SOLOMON ISLANDS * SOMALIA SOUTH AFRICA (LE CAP) SOUTH AFRICA (PRETORIA) SOUTH KOREA SRI LANKA SUDAN SURINAM SWAZILAND SWITZERLAND SYRIA TANZANIA THAILAND TOGO TONGA TRINIDAD AND TOBAGO TUNISIA TURKEY UGANDA UKRAINE UNITED STATES OF AMERICA (NEW YORK) UNITED STATES OF AMERICA (WASHINGTON) URUGUAY VANUATU VENEZUELA VIET NAM WESTERN SAMOA « ZAIRE ZAMBIA ZIMBABWE * Not available. __ 0. 0451143 3. 7289771 12. 9645148 0. 9639221 0. 2609347 0. 6237122 0. 0371799 0. 0604353 0. 4866718 673. 8407103 2. 0722557 30. 9244495 0. 0392958 0. 0000000 0. 0000000 12. 2659947 20. 6999249 0. 5820311 3. 3956947 0. 0949800 0. 0000000 0. 0872878 0. 0825164 23. 0305179 0. 0000000. 8058846. 0865458. 0595003. 0474496. 8897015 7. 8406226 0. 5902233 12. 9561294 0. 0336350 0. 1001847 0. 0191206 1134. 8042519 20. 6423765 0. 0310945 0. 0297076 0. 0254642 0. 1992887 3. 3807727 3. 7417611 126. 7742486 0. 0558539 0. 0000000 20. 8535320 0. 1386476 c Proposal for a COUNCIL REGULATION (EC, EURATOM, ECSQ No. /. of. laying down the weightings applicable from 1 January 1996 to the remuneration of officials of the European Communities serving in third countries THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing a Single Council and a Single Commission of the European Communities, Having regard to the Staff Regulations of officials of the European Communities and the conditions of employment of other servants of the Communities laid down by Regulation (EEC, Euratom, ECSC) No 259/681, as last amended by Regulation (EC, Euratom, ECSC) No 2963/952 and in particular the first paragraph of Article 13 of Annex X, Having regard to the proposal from the Commission, Whereas account should be taken of changes in the cost of living in countries outside the Community and weightings applicable to remuneration payable in the currency of the country of employment to officials serving in third countries should be determined with effect from 1 January 1996; Whereas, under Annex X of the Staff Regulations, the Council sets the weightings every six months; whereas it will accordingly have to set new weightings for the coming half-years; Whereas the weightings to apply with effect from 1 January 1996 in respect of which payment has been made on the basis of a previous regulation could lead to retrospective adjustments to remuneration (positive or negative); Whereas provision should be made for back-payments in the event of an increase in remunerations as a result of these weightings; 'OJ No L 56, 04. 03. 1968, p. 1. 2O J N oL 310, 22. 12. 1995, p. 1. - 2 Whereas provision should be made for the recovery of sums overpaid in the event of a reduction in remunerations as a result of these weightings for the period between 1 January 1996 and the date of the Council decision setting the weightings to apply with effect from 1 January 1996; Whereas, however, in order to mirror the weightings applicable within the European Community to remuneration and pensions of officials and other servants of the European Communities, provision should be made for any such recovery to apply solely to a period of no more than 6 months preceding the decision and for its effects to be spread over a period of no more than 12 months following the date of that decision; HAS ADOPTED THIS REGULATION: Article 1 With effect from 1 January 1996, the weightings applicable to remuneration payable in the currency of the country of employment shall be as shown in the Annex. The exchange rates for the calculation of such remuneration shall be those used for implementation of the general budget of the European Communities for the month preceding the date referred to in the first paragraph. Article 2 In accordance with the first paragraph of Article 13 of Annex X of the Staff Regulations, the Council shall set weightings every six months. It shall accordingly set new weightings with effect from 1 July 1996. The institutions shall make back payments in the event of an increase in remuneration as a result of these weightings. For the period between 1 January 1996 and the date of the Council decision setting the institutions shall make weightings applicable with effect retrospective downward adjustments to remuneration in the event of a reduction as a result of these weightings. from 1 January 1996, the - 3 Retrospective adjustments involving the recovery of sums overpaid shall, however, concern only a period of no more than 6 months preceding the decision and this recovery shall be spread over no more than 12 months from the date of that decision. Article 3 This Regulation shall enter into force on the day following its publication in the Official Journal of the European Communities. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Brussels, For the Council The President ? COUNTRY OF EMPLOYMENT Weightings applicable with effect from the 1st January 1996 ALBANIA ALGERIA ANGOLA ANTIGUA AND BARBUDA ARGENTINA AUSTRALIA BANGLADESH BARBADOS BELIZE BENIN BOLIVIA BOTSWANA BRAZIL BULGARIA BURKINA FASO BURUNDI CAMEROON CANADA CENTRAL AFRICAN REPUBLIC CHAD CHILE CHINA COLOMBIA COMOROS CONGO COSTA RICA CYPRUS CZECH REPUBLIC DJIBOUTI DOMINICAN REPUBLIC EGYPT EQUATORIAL GUINEA ERITREA ETHIOPIA EX-YUGOSLAVIA FIJI GABON GAMBIA GEORGIA GHANA GRENADA GUINEA GUINEA-BISSAU GUYANA HAITI HONG KONG HUNGARY INDIA INDONESIA ISRAEL IVORY COAST JAMAICA JAPAN (TOKYO) JORDAN KAZAKHSTAN KENYA LEBANON LEFT BANK - GAZA STRIP LESOTHO LIBERIA MADAGASCAR MALAWI MALI MALTA MAURITANIA MAURITIUS MEXICO MOROCCO MOZAMBIQUE NAMIBIA Not available. 70. 6300000 0. 0000000 141. 1300000 89. 4900000 89. 7000000 74. 5300000 56. 2400000 80. 0800000 65. 2900000 66. 0100000 0. 0000000 63. 5500000 72. 5500000 42. 9200000 77. 2800000 79. 5700000 91. 7800000 64. 4600000 110. 6600000 77. 8300000 74. 1300000 72. 5100000 62. 5000000 86. 3300000 94. 7200000 59. 9500000 80. 3300000 59. 3700000 110. 9200000 69. 8100000 54. 6800000 75. 5800000 0. 0000000 33. 9300000 0. 0000000 63. 8000000 121. 6400000 74. 2000000 70. 4200000 36. 2900000 87. 7900000 90. 0300000 61. 8500000 54. 5800000 0. 0000000 91. 5300000 72. 4700000 36. 7900000 73. 7600000 97. 1100000 89. 8800000 41. 4800000 156. 7600000 57. 3400000 100. 9500000 60. 2200000 26. 1500000 0. 0000000 55. 9800000 0. 0000000 46. 6300000 34. 2600000 79. 7900000 74. 4200000 68. 3500000 67. 4400000 42. 1400000 67. 6800000 50. 3100000 66. 9400000 U COUNTRY OF EMPLOYMENT Weightings applicable with effect from the 1st January 1996 NETHERLANDS ANTILLES NEW CALEDONIA NIGER NIGERIA NORWAY PAKISTAN PAPUA NEW GUINEA PERU PHILIPPINES POLAND REPUBLIC OF CAPE VERDE ROMANIA RUSSIA * RWANDA * SAO TOME AND PRINCIPE SENEGAL SIERRA LEONE SLOVAKIA SLOVENIA SOLOMON ISLANDS * SOMALIA SOUTH AFRICA (LE CAP) SOUTH AFRICA (PRETORIA) SOUTH KOREA SRI LANKA SUDAN SURINAM SWAZILAND SWITZERLAND SYRIA TANZANIA THAILAND TOGO TONGA TRINIDAD AND TOBAGO TUNISIA TURKEY UGANDA UKRAINE UNITED STATES OF AMERICA (NEW YORK) UNITED STATES OF AMERICA (WASHINGTON) URUGUAY VANUATU VENEZUELA VIET NAM WESTERN SAMOA ZAIRE ZAMBIA ZIMBABWE Not available. 74. 8600000 123. 0600000 77. 7900000 32. 0600000 121. 7200000 52. 9700000 71. 4300000 77. 0900000 55. 0500000 80. 9000000 78. 7000000 35. 8600000 116. 0600000 0. 0000000 0. 0000000 73. 6000000 65. 7700000 58. 8400000 80. 9000000 79. 1300000 0. 0000000 70. 4000000 66. 5600000 88. 9200000 0. 0000000 29. 3800000 50. 9200000 47. 9900000 120. 5600000 98. 7800000 40. 0500000 69. 9000000 77. 7400000 71. 8700000 49. 9000000 60. 3100000 61. 6700000 58. 6100000 91. 8400000 87. 7400000 75. 2100000 84. 6300000 87. 5100000 65. 0100000 34. 0000000 64. 0800000 0. 0000000 64. 0800000 43. 6900000 (f FINANCIAL STATEMENT Proposal for a Council of the European Union Regulation laying down the weightings applicable from 1 January 1996 to the remuneration of officials of the European Communities serving in third countries L. Budget item A 6000 Legal basis Budgetary impact: Articles 12 and 13 of Annex X to the Staff Regulations provisional real expenditure for 1996 ECU 72 247 000 (i. e. ECU 6 020,583 per month) (1) estimate of effect of January 1996 weightings estimated expenditure for six months {(2) x (6)} - ECU 49 652 (2) ECU 297 912 effect in relation to provisional real expenditure {(2) : (1)} 0. 82% This budigetary impact does not take account of the adjustment of the weightings laid down each month by the European Commission. (1 ISSN 0254-1475 COM(96) 291 final DOCUMENTS EN _. oi Catalogue number : CB-CO-96-300-EN-C ISBN 92-78-05677-4 Office for Official Publications of the European Communities L-2985 Luxembourg u

Proposal for a COUNCIL REGULATION (EC) amending Annex I to Council Regulation (EEC) No 2658/87 on the tariff and statistical nomenclature and on the Common Customs Tariff for certain processed agricultural products covered by Regulation (EC) No 3448/93

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 21. 06. 1996 COM(96) 290 final Proposal for a COUNCIL REGULATION (EC) amending Annex I to Council Regulation (EEC) No 2658/87 on the tariff and statistical nomenclature and on the Common Customs TarifTfor certain processed agricultural products covered by Regulation (EC) No 3448/93 (presented by the Commission). ' ' '; h. Explanatory memorandum The Community's offer in the multilateral Uruguay Round negotiations led to increases in some of the duties applicable to certain goods not covered by Annex II to the Treaty and subject to the trade arrangements applicable to certain goods resulting from the processing of agricultural products laid down by Council Regulation (EC) No 3448/93. Some of these increases are due to peculiarities of these goods which were not taken into account in the Community's offer. Accordingly, the duties which have applied to certain goods since 1 July 1995 no longer correspond to the principles established in Regulation (EC) No 3448/93. It is therefore proposed to reinstate for these goods, on an autonomous basis, the method for calculating the duties that was used up to 30 June 1995, with effect from 1 July 1995. 1 Proposal for a COUNCIL REGULATION (EC) amending Annex I to Council Regulation (EEC) No 2658/87 on the tariff and statistical nomenclature and on the Common Customs TarifTfor certain processed agricultural products covered by Regulation (EC) No 3448/93 THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 28 thereof, Having regard to the proposal from the Commission, Whereas the goods referred to in Annex B to Council Regulation (EC) No 3448/93 of 6 December 19931 laying down the trade arrangements applicable to certain goods resulting from the processing of agricultural products were subject until 30 June 1995 to the application of a variable component; whereas a tariff has been established for these variable components and they are now replaced by specific amounts which were the subject of the Community's offer in the multilateral negotiations of the Uruguay Round; Whereas for certain goods the previous arrangements, which were more favourable than those covered by the Community's offer, should be maintained; Whereas particularly as regards sweet corn as covered by CN codes 0710 40 00 071190 30, 200190 30, 200190 40, 2004 90 10, 2005 80 00, 2008 99 85 and 2008 99 91 the variable components were calculated on the basis of the net drained weight; whereas the specific amount should likewise be applied to the net drained weight; whereas, as regards extracts, essences and concentrates of roast coffee substitutes under CN code 2101 30 99, the ad valorem duty of 14% must be maintained so long as the rates agreed in the agreements concluded in the Uruguay Round lead to a higher rate of conventional duty; whereas this also applies to sorbitols containing more than 2% D-mannitol, falling within CN codes 2905 44 19, 2905 44 99, 3824 60 19 and 3824 60 99, to which an ad valorem duty of 9% applies autonomously; whereas yeast is a product essentially obtained from molasses and this connection should continue to be taken into account, so the amount of the agricultural component calculated on the earlier basis should not be applied, since this amount is less than ECU 2/100 kg; Whereas the abovementioned duties are higher than the rates which were in force before 1 July 1995 without there being any need for such an increase; whereas the corrected rates should therefore be applied with retroactive effect from 1 July 1995, when the rates in question were introduced, OJ No L 318, 20. 12. 1993, p. 18. 3 HAS ADOPTED THIS REGULATION: Article 1 Annex I to Regulation (EEC) No 2658/87 shall be amended as follows: 1. A reference to the following footnote shall be added to subheadings 0710 40 00, 0711 90 30, 2001 90 30, 2001 90 40, 2004 90 10, 2005 80 00, 2008 99 85 and 2008 99 91, in column 4 (conventional rates of duty): "the specific amount is charged, as an autonomous measure, on the net drained weight" Under subheading 2101 30 99, footnote (2) in column 3 (autonomous rates of 2. duty) shall be reproduced in column 4 (conventional rates of duty). This measure shall apply so long as the conventional rate is higher than 14%. 3. Under subheadings 2905 44 19, 2905 44 99, 3824 60 19 and 3824 60 99, footnote (:) in column 3 (autonomous rates of duty) shall be reproduced in column 4 (conventional rates of duty). Under subheadings 2102 10 31 and 2102 10 39, footnote (') in column 3 4. (autonomous rates of duty) shall be replaced by the following note: "O Duty suspended at the level of the ad valorem conventional duty for an indefinite period. " Article 2 This Regulation shall enter into force on the third day following its publication in the Official Journal of the European Communities. It shall apply as from 1 July 1995. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Brussels, For the Council K FINANCIAL STATEMENT BUDGET HEADING: Art. 10 Item 1000 DATE: APPROPRIATIONS: ECU 864 000 000 TITLE: Council Regulation amending Annex I to Council Regulation (EEC) No 2658/87 on the tariff and statistical nomenclature and on the Common Customs Tariff for certain processed agricultural products covered by Regulation (EC) No 3448/93. LEGAL BASIS: Article 28 of the Treaty. AIMS OF PROJECT: autonomous reduction of duties in order to maintain specific components of the previous arrangements applicable to certain goods mentioned in Annex B to Regulation (EC) No 3448/93. FINANCIAL IMPLICATIONS PERIOD OF 12 MONTHS CURRENT FINANCIAL YEAR () FOLLOWING FINANCIAL YEAR () 5. 0. EXPENDITURE CHARGED: - TO THE EC BUDGET (REFUNDS/INTERVENTION) - NATIONAL ADMINISTRATION -OTHER REVENUE - OWN RESOURCES OF THE EC (LEVIES/CUSTOMS DUTIES) max. -5 857 000 (duties not levied) ESTIMATED EXPENDITURE ESTIMATED REVENUE METHOD OF CALCULATION: maximum loss: calculated on the part of average imports for 1993 and 1994 concerned by the project: sweet corn: 76 000 tonnes with an average reduction of ECU 62/tonne = ECU 4 712 000; extracts, essences and concentrates of roast coffee substitutes: 1. 9% of ECU 2 697 000, or ECU 51 300; yeasts: ECU 595/tonne for 1165 tonnes + ECU 175/tonne for 2125 tonnes = ECU 1 065 000. Sorbitols: 2. 6% of ECU 949. 500 = ECU 24. 687 The increase in duties from 1 July 1995 has affected the level of imports and hence of Community revenue; however, it cannot be determined on an annual basis for the time being. The proposal should help to restore the level of traditional trade in volume terms. CAN THE PROJECT BE FINANCED FROM APPROPRIATIONS ENTERED IN THE RELEVANT CHAPTER OF THE CURRENT BUDGET? CAN THE PROJECT BE FINANCED BY TRANSFER BETWEEN CHAPTERS OF THE CURRENT BUDGET? IS A SUPPLEMENTARY BUDGET NECESSARY? WILL FUTURE BUDGET APPROPRIATIONS BE NECESSARY? YES/NO YES/NO Y-ES/NO YES/NO The aim of the proposal is to reinstate the method of calculating import duties according to the arrangements in force until 30 June 1995. This should help restore the volume of trade, and hence also of revenue, to its level prior to that date. Given the lack of sufficient data on trade since. 1 July 1995, it is not possible to determine the extent to which imports have been affected by the increase in duties and so calculate the precise impact on Community revenue compared with the duties currently in force. _^M-«P-a-g«-«----_--»-^»«d_-wM-_--. -»_-«w--»-_-M»«_^ i i i i i i i w p _ _ _ - -lp Ml_ _ - _ _ _i i , i i. ii. i. ii ••iii. B___-i. -,_M--T--1-n-^p_-1 r«-_,1 T M--_-. 6. 2. 6. 3. OBSERVATIONS: 5. 1. 5. 0. 1. 5. 1. 1. 5. 2. 6. 0. 6. 1. ISSN 0254-1475 COM(96) 290 final DOCUMENTS EN 03 02 17 Catalogue number : CB-CO-96-297-EN-C ISBN 92-78-05644-8 Office for Official Publications of the European Communities L-2985 Luxembourg c

Proposal for a COUNCIL REGULATION (EC) modifying Regulation (EC) 3059/95 opening and providing for the administration of Community tariff quota for certain agricultural and industrial products

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 20. 06. 1996 COM(96) 283 final Proposal for a COUNCIL REGULATION (EC) modifying Regulation (EC) 3059/95 opening and providing for the administration of Community tariff quota for certain agricultural and industrial products (presented by the Commission) EXPLANATORY MEMORANDUM 1. 2. Subsequent to requests made by various Member States, the Services of the Commission have examined, in conjunction with the Government experts concerned, the question of increasing in 1996 the tariff quota for Ferro- chromium. Following this examination, which took place during the "Economic Tariff Questions" group meetings, it has been determined that the increase of tariff quotas for this product could have the Agreement of the Member States without disturbing the markets for such products, I Proposal for a COUNCIL REGULATION (EC) No. / of modifying Regulation (EC) 3059/95 opening and providing for the administration of Community tariff quota for certain agricultural and industrial products THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 28 thereof, Having regard to the proposal from the Commission, HAS ADOPTED THIS REGULATION: Article I Whereas production in the Community of Ferro-chromium containing by weight more than 4 % of carbon will remain in (he course of 1996 unable to meet the specific requirements of the user industries in the Community; whereas, consequently, Community supplies of this product will depend to a considerable extent on imports from third countries; whereas the most urgent Community requirements for the product in question should be met immediately on the most favourable terms; Whereas by Regulation (EC)n°3059/951 the Council opened, for 1996 Community tariff quotas for certain agricultural and industrial products; whereas the volume of the quota for Ferro- chromium (Order Nr. 09. 2711) should be increased; In the Regulation (EC) n° 3059/95 the tabic shown in the Annex is replaced, for the order n° 09. 2711 by the tabic shown in the Annex of this Regulation. A rlick 2 This Regulation shall enter into force on the 7th day following its publication in the Official Journal of the European Communities. It shall be apply from 1 January 1996. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Brussels, For flic ( 'ouncil The President 1 O. J. n° L 326, 30. 12. 1995, p 19, as amended by Regulation (EC) No. /96 (OJ n° L , p. ) 3 ANNEX Orcter Number 09. 2711 CN Code Taric Code Description Amount oi Quota Quota f>uty ! Quota psrtod 7202 41 10 7202 41 91 7201 41 99 Ferro-chromium containing by weight more than 4 % of carbon 650 000 T i 0 1. 1. 1996- 31. 12. 1996 i ,. ,. —t J l. -„ K FINANCIAL RECORD 1. Budget line concerned : Chap. 12 Art. 120 2 3. 4. 5. Legal basis : Art 28 of the Treaty Title of the tariff measure concerned : Proposal for a Council Regulation modifying Regulation (EC) 3059/95 opening and providing for the administration of Community tariff quota for certain agricultural and industrial products. Objective : To ensure an adequate supply for Community processing-industries. Method of calculation : Description Variation on Quantities (Unit) Variation on price (Ecus/unit) Ferro-Chromium + 100 000 T (initial volume : 550 000 T) 0 (initial price 1 478) Variation on normal Duty rate -1,6 (duty rate in 1995: 7,2 in 1996: 5,6) Variation on Quota duty (%) Assessed variation on Duty loss against the preceding Quota period 0 (Ecus) 8 276 800 Total loss of duty against the preceding Quota period : 8 276 800 Ecu Fight against fraude : The provisions concerning the management of tariff quotas stipulate the necessary measures to assure prevention and protection against fraude and irrégularités. S ISSN 0254-1475 COM(96) 283 final DOCUMENTS EN 02 03 10 Catalogue number : CB-CO-96-291-EN-C ISBN 92-78-05578-6 Office for Official Publications of the European Communities L-2985 Luxembourg £

ANNUAL REPORT OF THE COMMISSION TO THE COUNCIL ON THE IMPLEMENTATION OF THE PROGRAMME FOR THE RESTRUCTURING OF THE SYSTEM OF AGRICULTURAL SURVEYS IN GREECE - YEAR 1994 - (Article of Council Decision 85/360/EEC of 16 July 1985)

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 20. 06. 1996 COM(96) 287 final ANNUAL REPORT OF THE COMMISSION TO THE COUNCIL ON THE IMPLEMENTATION OF THE PROGRAMME FOR THE RESTRUCTURING OF THE SYSTEM OF AGRICULTURAL SURVEYS IN GREECE (Article 5 of Council Decision 85/360/EEC of 16 July 1985) I. INTRODUCTION 1. The plan for the restructuring of agricultural statistics in Greece was adopted in 1985 (Council Decision 85/360/EEC of 16 July 1985, as last amended by Council Decision 92/582/EEC of 14 December 1992 - cf. Annex 1), with the following objectives: - - - - to create a technical and administrative infrastructure at central, regional and provincial level capable of dealing with all operations relating to agricultural statistics now and in the years to come; to obtain improved bases for sampling, particularly by creating a register of agricultural holdings; to introduce computerized inputting, checking and processing of data at central, regional and subregional level; to bring about the gradual introduction of the Community programme of agricultural surveys and statistics with a view to providing the Community with the information (statistical data) required for the implementation of the Common Agricultural Policy. As laid down in Article 5 of Decision 85/360/EEC, the Commission each year submits a report to the Council on the implementation of the programme. This outlines all the applications introduced, the activities undertaken and the measures adopted during 1994 by the competent authorities (Statistical Service and Ministry of Agriculture) and which were required to attain the objective of the programme. II. PROGRESS 1. - This report takes account of the comments made at the last meeting of the "Agricultural statistics" group of the Council (held on 5 December 1995 in Brussels); one suggestion made was that this document should, as far as possible, be shorter that the previous reports. 2. The work undertaken during 1994 - in particular the use of the new register of agricultural and livestock holdings and the redesigning of all the surveys - achieved significant results and provided the basis for more in-depth reflection on further improvements to the new system. 3. In general, the statistical activities planned in the 1994 programme (presented in Luxembourg in 1993 at the meeting of the working group and the SCAS - cf. Annex 2) match the data in this report. Nonetheless, there is a significant difference in terms of the level of expenditure shown in the table in Annex 3: thus, the programme made provision for DR 1 709 000 000 (about ECU 5. 7 million) whereas the report of work undertaken, presented by the Greek authorities in 1995, shows a total of DR 927 306 932 (about ECU 3. 1 million). This difference can be attributed to the fact that the processing of the results of the agricultural surveys conducted in 1994 was only carried out in 1995 (for the reasons mentioned in point 1. 1 of Annex 2), whereas the programme had scheduled this for 1994. 4. Although computerization has been completed at central and regional levels, the same is not true of the administrative infrastructure (staff), particularly at regional level. In order to decentralize the data processing of all surveys, it is vital for all the regional offices to have an adequate number of staff qualified to use modern technologies. The Greek authorities responsible for the application of the programme have promised repeatedly to take steps to overcome this problem, but even now, two years before the end of the programme, the situation is far from satisfactory. 5. The authorities should also focus attention on developing data banks and on designing a general plan for interconnection and communication between the computer system of the Ministry of Agriculture and that oftheNSSG. 6. In the timetable of activities for 1993-1996, presented by the Greek authorities during the procedure leading to the second amendment of the Council Decision, the measures planned for 1994 included: - the development of the geographic information system (GIS); - completion of the transfer of the survey of slaughterings from the Ministry of Agriculture to the NSSG. To our knowledge, little progress has been made with regard to the first measure, while the second is planned for January 1996. A N N EX 1 TIMETABLE Originally, the aim was to put the plan into effect over a period of five years (1986-1990), starting with the region of Thrace-Macedonia in 1986 and ending with the island of Crete in 1990. However, Greece has twice obtained an extension of the deadline under Council Decisions 90/386/EEC and 92/582/EEC, and the completion date has thus been postponed to 1996. The new timetable is set out below: 1986 - first year 1987 - second year 1988 - third year 1989 - fourth year 1990 - fifth year 1991 - sixth year 1992 - seventh year 1993 - eighth year 1994 - ninth year 1995 - tenth year 1996 - eleventh year Macedonia; Macedonia, Thrace, Thessaly and Epirus; Macedonia, Thrace, Thessaly, Epirus, Central Greece and the Ionian Islands; Macedonia, Thrace, Thessaly, Epirus, Central Greece, the Ionian Islands and the Péloponnèse; Macedonia, Thrace, Thessaly, Epirus, Central Greece, the Ionian Islands, the Péloponnèse and Crete; Macedonia, Thrace, Thessaly, Epirus, Central Greece, the Ionian Islands, the Péloponnèse, Crete and the Aegean Islands (North and South); first trial of the new system in the whole of Greece; creation of a sampling frame based on the results of the 1991 general survey of agriculture; extension of remote sensing to cover the whole of the mainland and the island of Crete; exploitation of the synergies between the central and regional technical and administrative infrastructures set up by the Statistical Office and respectively, when implementing the programme of surveys undertaken by the Statistical Office; introduction of the new system for the whole of Greece; monitoring and critical analysis of the results obtained during the first year of actual implementation. the Ministry of Agriculture, In November 1997, the Commission will present to the Council a report on the implementation of the programme which will outline the results achieved. A N N EX 2 IMPLEMENTATION OF THE PLAN OF RESTRUCTURING IN 1994 1. Statistical applications 1. 1. NSSG During 1994, all the sample surveys, taking the agricultural holding as unit, were redesigned on the basis of the new register created in 1993 using data from the 1991 census of agriculture. lsl As a result, new programmes for processing data and extracting results from the 1994 surveys have had to be designed. Given the magnitude of this task, it was decided to entrust the design and implementation of a new system of agricultural statistics encompassing all the surveys in the agricultural sector to a private organization. The design and implementation of the new system were completed during the first quarter of 1995, thereby enabling all the data from the 1994 surveys to be processed in this way. Eurostat received the results of these 1994 surveys between October and November 1995. Apart from the traditional statistical activities (i. e. survey of the structure of agricultural holdings, of livestock, of fruit trees, of vineyards, of cereals and the annual agricultural survey), the following statistical surveys were also conducted in 1994: - Survey of slaughterhouses: Although this survey remains the responsibility of the Ministry of Agriculture, the NSSG conducted it for the first time on a pilot basis in 1993 and has been handling it on a regular basis since 1994. As from January 1996 the plan is that the NSSG will transmit the results of the surveys of slaughterhouses on a regular basis and that the Ministry of Agriculture will cease to conduct these surveys. - Survey of yields by Area Frame Sampling: The survey of cereals production, based on a sample obtained by Area Frame Sampling using the remote-sensing agricultural statistics survey (conducted by the Ministry of Agriculture), was carried out in 1993 by the NSSG in cooperation with the Ministry in the Thessaly region. In 1994 this was extended to Crete and Epirus. The aim of this pilot survey is, firstly, to enable the NSSG to study the survey of yields by direct interview, via the existing mechanism for conducting surveys, and secondly, to enable the Ministry to study the implementation of the survey of crop areas, with the aid of the sample obtained by area frame sampling. 1. 2. Ministry of Agriculture The main activity undertaken in the field of statistical applications since 1991 relates to the statistical estimates made with the aid of area frame sampling. In 1994, the programme was extended to Crete and Epirus, thereby covering almost the whole of Greece with the exception of the small islands. In addition to the field enumeration method used to date, the points methods was tested on a restricted area with a view to obtaining comparative date. The other statistical activities undertaken related to: • statistics on milk and dairy products; • statistics on plant production; • monthly estimates of slaughterings - forecasts of animal production (meat); • monthly statistics on production and trade in eggs for hatching and annual statistics on the structure and utilization of incubators; • FADN. 2. Computerization 2. 1. NSSG The process of acquiring the technical hardware and software needed to cover current requirements for all the various agricultural statistical applications at both central and regional levels has been completed. Simultaneously, the "KLISTHENIS" programme (Commission Decision C(94) 1422 of 29 July 1994 - Modernization of government departments) guarantees the extension, replacement and correct functioning of the equipment to cover future needs. While connection between the centre and the province is possible at the level of the regional development services and the nomi, there is a shortage of specialist staff to ensure the correct functioning of the network. This is only fully operational when staffing permits. In terms of computer equipment, the following measures were undertaken. • 9 RISC systems, used in a pilot phase by the central service as client servers, were installed in 1994; • in order to increase its capacity, the central system was extended to incorporate the databases of the farm census and the register installed to process and analyse the surveys; • A juke box optical disk system was purchased for use in storing information and disseminating it to the various regional centres. 2. 2. Ministry of Agriculture As in 1993, 1994 saw continued support for the computerization of statistical applications via the network of the Ministry of Agriculture. A call for tenders was launched at the end of 1994 to supplement the overall software and hardware package, primarily with a view to the successful completion of the geographical analysis of samples using satellite images and digitized slides. 3. Staff/training 3-L MM The previous report (1993) mentioned the one-year extension of the contracts of 419 persons with fixed-term private-law contracts. In February 1995, these staff became permanent. A large majority of these persons work exclusively on agricultural statistics. The need for specialized staff has been met by reemploying the staff (150 persons) who worked on a contract basis until 1990 and who are now gradually being reintegrated into the various NSSG departments. All the above staff have begun to attend special training programmes designed to meet the immediate needs arising from the installation of the new equipment and the use of modern technologies. Simultaneously, courses aimed at the entire staff of the NSSG were held in 1994; these dealt with the problems linked to the survey methodology, data processing, etc. These courses were financed from other sources and involved officials from all the competent directorates. 3,2. Ministry of Agriculture During the first half of 1994, the programme called on the services of 52 contract staff (users and programmers). During the second half of 1994, these staff became permanent, thereby ensuring continued back-up for the programme after 1996. these were aimed at staff of the Many further training courses were held; "informatics", "policy" and "agriculture" directorates who are generally involved in implementing the "Greek Plan". These courses were both in-house and external (via the office of the Minister attached to the Prime Minister) and were not charged to the budget for the programme of restructuring of agricultural statistics. ANNEX 3 INFORMATION ABOUT THE FINANCIAL ASPECTS OF THE PLAN OF RESTRUCTURING The table on the next page shows overall expenditure in 1994. It should be noted that, pursuant to Article 1(5) of Council Decision 90/386/EEC amending Decision 85/360/EEC, the level of Community participation in the programme is two-thirds of overall expenditure since 1991, instead of the one-third which applied up to 1990. Ministry of Economic Affairs - Secretariat General of the NSSG Ministry of Agriculture Category of expenditure Amounts in Dr 254 850 087 466 753 728 154 675 994 70618715 84 057 279 100174 093 885 000 99 289 093 33 053 150 33 053 150 EXPENDITURE ON INFRASTRUCTURE Computerization SECRETARIAT-GENERAL OF THE NSSG Purchase of hardware and software Soil ware support I. 1. a) i) ii) iii) Auxiliary equipment and consumables iv) Maintenance v) Network charges vi) 18% VAT on i, ii, iii, iv and v Purchase of hardware and software Software support b) MINISTRY OF AGRICULTURE i) ii) iii) Auxiliary equipment and consumables iv) Maintenance v) Network charges vi) 2. 18% VAT on i, ii, iii, iv and v Accommodation (i) Secretariat-General of the NSSG (ii) Ministry of Agriculture Office equipment (i) Secretariat-General of the NSSG (ii) Ministry of Agriculture Training equipment (i) Secretariat-General of the NSSG (ii) Ministry of Agriculture Vehicles (i) Secretariat-General of the NSSG (ii) Ministry of Agriculture 3. 4. 5. 6. Other technical and administrative 145 423 588 7. 8. II. a) (i) Secretariat-General of the NSSG (ii) Ministry of Agriculture Staff skill enhancement (training) (i) Secretariat-General of the NSSG (ii) Ministry of Agriculture Staff skill enhancement (training) (i) Secretariat-General of the NSSG (ii) Ministry of Agriculture EXPENDITURE ON STATISTICAL APPLICATIONS SECRETARIAT-GENERAL OF THE NSSG 1. 2. 3. 4. 5. Cereals Surveys of livestock Surveys of trees Annual agricultural survey Survey of vineyards 6. 7. 8. Restructuring of agricultural statistics Structure of agricultural holdings Survey of yields b) MINISTRY OF AGRICULTURE 1, Statistical applica'^u'v: Remote sensing GRAND TOTAL (DRACHMAS) 102 971 557 42 452 031 30 862 552 2 564 351 14 665 152 32 704 131 38 268 991 81 271 639 43 343 036 1 603 939 1 918 350 574 000 63 161 873 183 042 093 \0 33 426 903 214 349 238 460 553 204 246 203 966 927 306 932 ISSN 0254-1475 COM(96) 287 final DOCUMENTS EN 17 03 Catalogue number : CB-CO-96-293-EN-C ISBN 92-78-05600-6 Office for Official Publications of the European Communities L-2985 Luxembourg h

Proposal for a COUNCIL REGULATION (EC) amending Council Regulation (EC) No 3089/95 allocating, for 1996, certain catch quotas between Member States for vessels fishing in Polish waters

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iV4*#*i"* COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 20. 06. 1996 COM(96)288 final Proposal for a COUNCIL REGULATION (EC) amending Council Regulation (EC) No 3089/95 allocating, for 3996, certain catch quotas between Member States for vessels fishing in Polish wa ers (presented by the Commission) EXPLANATORY MEMORANDUM In accordance with the Act of Accession of Austria, Finland and Sweden, the fisheries agreements concluded by these countries with third countries shall be managed by the Community. The Community, on behalf of Sweden, has held consultations with Poland resulting in agreements defining fisheries arrangements for 1996. In accordance with these reciprocal fisheries arrangements, the quotas obtained by the Community in the Polish zone have been allocated to Member States by Council Regulation (EC) No 3089/95. Further consultations between the Parties have resulted in an additional exchange of quotas. The purpose of this proposal is to amend the above mentioned Council Regulation accordingly. z Proposal for a COUNCIL REGULATION (EC) No /96 amending Council Regulation (EC) No 3089/95 allocating, for 1996, certain catch quotas between Member States for vessels fishing in Polish waters THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, Having regard to Council Regulation (EEC) No 3760/92 of 20 December 1992 establishing a Community system for fisheries and aquaculture (l) and, in particular, Article 8 (4) thereof, Having regard to the proposal from the Commission, Whereas, in accordance with Article 124 of the 1994 Act of Accession, fisheries agreements concluded by the Kingdom of Sweden with third countries are managed by the Community; Whereas Council Regulation (EC) No 3089/95 <2) allocates, for 1996, certain catch quotas between Member States for vessels fishing in Polish waters; Whereas, in accordance with the procedure provided for in Article III of the Agreement on Fisheries of 1 February 1978 between the Kingdom of Sweden and the Republic of Poland, the Community have held further consultations concerning on their reciprocal fishing rights for 1996, resulting in the allocation of 150 tonnes of cod to the Community; Whereas to ensure efficient management of the catch possibilities available in Polish waters they should be allocated among Member States as quotas in accordance with Article 8 of Council Regulation (EEC) No 3760/92; HAS ADOPTED THIS REGULATION: Article 1 In the Annex to the Council Regulation (EC) No 3089/95, the figures relating to the allocation of Community catch quotas in Polish waters for 1996 are hereby replaced by those set out in the Annex to this Regulation. (l) ,:) OJ No L 389, 31. 12. 1992, p. 1. Regulation as amended by the 1994 Act of" Accession. OJ No L 330, 21. 12. 1995, p. 106. '. \ Article 2 Tiis Regulation shall enter into force the day after its publication in the Official Journal. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Brussels, 1996. For the Council The President u ANNEX Allocation of Community catch quotas in Polish waters for 1996 (in metric tonnes, fresh round weight; for salmon: numbers of individual fish) Species Herring Salmon Sprat Flatfish Cod ICES division Community catch quotas Quotas allocated to Member States Hid Hid Hid Hid Hid 1,000 1,350 15,000 50 150 Sweden Sweden Sweden Sweden Sweden 1,000 1,350 15,000 50 150 ISSN 0254-1475 COM(96) 288 final DOCUMENTS EN 03 11 Catalogue number : CB-CO-96-294-EN-C ISBN 92-78-05611-1 Office for Official Publications of the European Communities L-2985 Luxembourg

Amended proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE amending Council Directive 93/6/EEC of 15 March 1993 on the capital adequacy of investment firms and credit institutions and Council Directive 93/22/EEC of 10 May 1993 on investment services in the securities field

http://publications.europa.eu/resource/cellar/e12a2690-56ca-496f-8872-990d3d1d029d

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 20. 06. 1996 COM(96) 292 final 95/0188 (COD) Amended proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE amending Council Directive 93/6/EEC of 15 March 1993 on the capital adequacy of investment firms and credit institutions and Council Directive 93/22/EEC of 10 May 1993 on investment services in the securities field (presented by the Commission pursuant to Article 189 a (2) of the EC-Treaty) EXPLANATORY MEMORANDUM On 9 May 1996 the European Parliament approved on first reading the proposal for a directive setting up the Securities Committee1. The European Parliament voted in favour of four amendments. Three of these amendments were concerned with changing the committee procedure from procedure III variant (a) to procedure II variant (b) as set out in the relevant Council Decision2. The other amendment added a recital referring to an agreement ("modus vivendi")3 between the European Parliament, the Council and the Commission concerning the implementing measures for acts adopted in accordance with the procedure laid down in article 189b of the EC Treaty. The Commission indicated to Parliament that it could accept the addition of the recital relating to the "modus vivendi". However it stated that it could not accept the proposed change in committee procedure, and therefore rejected the three amendments in question. The aim of this amended proposal is therefore to add the relevant recital to the text of the original proposal. The recital which has been so added is underlined. 1 Proposal for a European Parliament and Council Directive amending Council Directive 93/6/EEC of 15 March 1993 on the capital adequacy of investment firms and credit institutions and Council Directive 93/22/EEC of 10 May 1993 on investment services in the securities field, OJ No C 253, 29. 9. 95, p. 19. 2 Council Decision 87/373/EEC of 13 July 1987 laying down the procedures for the exercise of implementing powers conferred on the Commission, OJ No L 197, 18. 7. 1987, p. 33. 3 OJNoC293, 8. 11. 1995, p. 1. A Amended proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE amending Council Directive 93/6/EEC of 15 March 1993 on the capital adequacy of investment firms and credit institutions and Council Directive 93/22/EEC of 10 May 1993 on investment services in the securities field THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular the first and third sentences of Article 57(2) thereof, Having regard to the proposal from the Commission1, Acting in accordance with the procedure referred to in Article 189b of the Treaty2 Whereas Council Directive 93/6/EEC on the capital adequacy of investment firms and credit institutions3 and Council Directive 93/22/EEC on investment services in the securities field4 were adopted on 15 March 1993 and 10 May 1993 respectively, Whereas implementing measures are necessary for the application of Council Directives on securities, securities markets and securities intermediaries, particularly in view of the need to adapt the Directives to new developments in the financial sector; Whereas in Article 10 of Directive 93/6/EEC and in Article 29 of Directive 93/22/EEC the Council retained for itself the powers to adopt implementing measures pending the adoption of a subsequent act designed to enable the Commission to exercise those powers; 1 OJ No C 152, 21. 6. 1990, p. 6 and OJ No C 50, 25. 2. 1992, p. 5; OJ No C 43, 22. 2. 1989, p. 7 and OJ No C 42, 22. 2. 1990, p. 7; and 2 3O J N oL 141, 11. 6. 1993,p. l. 4 OJ No L 141, 11. 6. 1993, p. 27. Whereas, in accordance with the provisions of Article 145, third indent of the Treaty, the Council confers on the Commission powers for the implementation of the rules which the Council lays down; Whereas, on its second reading of the proposals for the directives on capital adequacy and investment services the European Parliament had called for those powers to be conferred on the Commission; Whereas it is necessary for this purpose to establish a Securities Committee to assist the Commission in these areas; Whereas it is appropriate that implementing measures shall be taken in accordance with the procedure laid down in Article 2, procedure III, variant (a), of Council Decision 87/373/EEC of 13 July 1987 laying down the procedures for the exercise of implementing powers conferred on the Commission5; Whereas an agreement on a modus vivendfc between the European Parliament, the Council and the Commission concerning the implementing measures for acts adopted in accordance with the procedure laid down in Article 189b of the EC Treaty was reached on 20 December 1994: Whereas Directives 93/6/EEC and 93/22/EEC should therefore be amended, the aforementioned Articles 10 and 29 being replaced by new articles establishing the Securities Committee and giving the Commission, assisted by that Committee, responsibility for adapting the said Directives to technical progress; Whereas the creation of the Securities Committee necessitates a number of other amendments to Directives 93/6/EEC and 93/22/EEC in order to modify certain of their provisions put in place pending the establishment of the said Committee; Whereas the examination of matters concerning securities, securities markets and securities intermediaries makes the exchange of views between the competent authorities and the Commission desirable; whereas it is appropriate to entrust this task also to the Securities Committee, HAVE ADOPTED THIS DIRECTIVE: 5OJNoL 197, 18. 7. 1987, p. 33. 6O J N o C 2 9 3. 8. 11. 1995. p. 1 Article 1 Article 10 of Directive 93/6/EEC is hereby replaced by the following three articles: "Article 10 The technical adaptations to be made to this Directive in the following areas shall be adopted in accordance with the procedure laid down in Article 10a: — clarification of the definitions in Article 2 in order to ensure uniform application of this Directive throughout the Community, — clarification of the definitions in Article 2 to take account of developments on financial markets, — alteration of the amounts of initial capital prescribed in Article 3 and the amount referred to in Article 4(6) to take account of developments in the economic and monetary field, — the alignment of terminology on and the framing of definitions in accordance with subsequent acts on institutions and related matters. Article 10a 1. The Commission shall be assisted by a Securities Committee, hereinafter in this Article referred to as the 'Committee', composed of representatives of the Member States and chaired by a representative of the Commission. 2. The representative of the Commission shall submit to the Committee a draft of the measures to be taken. The Committee shall deliver its opinion on the draft within a time limit which the Chairman may lay down according to the urgency of the matter. The opinion shall be delivered by the majority laid down in Article 148(2) of the Treaty in the case of decisions which the Council is required to adopt on a proposal from the Commission. The votes of the representatives of the Member States in the Committee shall be weighted as laid down in that Article. The Chairman shall not vote. The Commission shall adopt the measures envisaged if they are in accordance with the opinion of the Committee. If the measures envisaged are not in accordance with the Committee's opinion or if no opinion is delivered, the Commission shall, without delay, submit to the Council a proposal relating to the measures to be taken. The Council shall act by a qualified majority. If, on the expiry of a period of three months from the date of referral to it, the Council has not acted, the proposed measures shall be adopted by the Commission. Article 10b 1. The Committee may, at the request of its Chairman or of one of its members, examine any question relating to the application of Community provisions concerning securities, securities markets and securities intermediaries. 2. The Committee shall not consider specific problems relating to individual cases. " Article 2 Article 29 of Directive 93/22/EEC is hereby replaced by the following three articles: "Article 29 The technical adaptations to be made to this Directive in the following areas shall be adopted in accordance with the procedure laid down in Article 29a: — expansion of the list in Section C of the Annex, — adaptation of the terminology of the lists in the Annex to take account of developments on financial markets, — the areas in which the competent authorities must exchange information as listed in Article 23, — clarification of the definitions in order to ensure uniform application of this Directive in the Community, — clarification of the definitions in order to take account in the implementation of this Directive of developments on financial markets, — the alignment of terminology and the framing of definitions in accordance with subsequent measures on investment firms and related matters, — the other tasks provided for in Article 7(5). Article 29a 1. The Commission shall be assisted by the Securities Committee established in Article 10a of Directive 93/6/EEC, hereinafter in this Article referred to as "the Committee", composed of representatives of the Member States and chaired by a representative of the Commission. 2. The representative of the Commission shall submit to the Committee a draft of the measures to be taken. The Committee shall deliver its opinion on the draft within a time limit which the Chairman may lay down according to the urgency of the matter. The opinion shall be delivered by the majority laid down in Article 148(2) of the Treaty in the case of decisions which the Council is required to adopt on a proposal from the Commission. The votes of the representatives of the Member States in the Committee shall be weighted as laid down in that Article. The Chairman shall not vote. The Commission shall adopt the measures envisaged if they are in accordance with the opinion of the Committee. If the measures envisaged are not in accordance with the Committee's opinion or if no opinion is delivered, the Commission shall, without delay, submit to the Council a proposal relating to the measures to be taken. The Council shall act by a qualified majority. If, on the expiry of a period of three months from the date of referral to it, the Council has not acted, the proposed measures shall be adopted by the Commission. Article 29b 1. The Committee may, at the request of its Chairman or of one of its members, examine any question relating to the application of Community provisions concerning securities, securities markets and securities intermediaries. 2. The Committee shall not consider specific problems relating to individual cases. " Article 3 Article 7(1) of Directive 93/22/EEC shall be replaced by the following: "1. The competent authorities of the Member States shall inform the Commission: a) of the authorization of any firm which is the direct or indirect subsidiary of a parent undertaking governed by the law of a third country. The Commission shall inform the Securities Committee accordingly; b) whenever such a parent undertaking acquires a holding in a Community investment firm such that the latter would become its subsidiary. The Commission shall inform the Securities Committee accordingly. When authorization is granted to any firm which is the direct or indirect subsidiary of a parent undertaking governed by the law of a third country, the competent authorities shall specify the structure of the group in the notification which they address to the Commission. " Article 4 1. In Article 2(12), fifth paragraph, Annex 111(9) and Annex VI(9) of Directive 93/6/EEC, the words "the Council and" shall be deleted. 2. In Article 7(3) of Directive 93/6/EEC the words "the Council and the Commission" shall be replaced by "the Securities Committee". This Directive is addressed to the Member States. Articles Done at Brussels For the European Parliament The President For the Council The President ISSN 0254-1475 COM(96) 292 final DOCUMENTS EN 09 10 Catalogue number : CB-CO-96-298-EN-C ISBN 92-78-05655-3 Office for Official Publicadons of the European Communities L-2985 Luxembourg

Proposal for a COUNCIL REGULATION (EC) amending Council Regulation (EC) No 3088/95 laying down, for 1996, certain measures for the conservation and management of fishery resources applicable to vessels flying the flag of Poland

http://publications.europa.eu/resource/cellar/6c4da5f6-531f-40ba-9b8e-f26791cf0016

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 20. 06. 1996 COM(%) 289 final Proposal for a COUNCIL REGULATION (EC) amending Council Regulation (EC) No 3088/95 laying down, for 1996, certain measures for the conservation and management of fishery resources applicable to vessels flying the Hag of Poland (presented by the Commission) EXPLANATORY MEMORANDUM In accordance with the Act of Accession of Austria, Finland and Sweden, the fisheries agreements concluded by these countries with third countries shall be managed by the Community. The Community, on behalf of Sweden, has held consultations with Poland resulting in agreements defining fisheries arrangements for 1996. In accordance with these reciprocal fisheries arrangements, Polish vessels were authorised to fish the quotas allocated to them by Council Regulation (EC) No 3088/95. Further consultations between the Parties have resulted in an additional exchange of quotas. The purpose of this proposal accordingly. is to amend the above mentioned Council Regulation £ Proposal for a COUNCIL REGULATION (EC) No /% amending Council Regulation (EC!) No 3088/95 laying down, for 1996, certain measures for the conservation and management of fishery resources applicable to vessels flying the flag of Poland THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, Having regard to Council Regulation (HliC) No 3760/92 of 20 December 1992 establishing a Community system for fisheries and aquaculture (l) and, in particular, Article 8 (4) ihereof. Having regard to the proposal from the Commission, Whereas, in accordance with Article 124 of the 1994 Act of Accession, fisheries agreements concluded by the Kingdom of Sweden with third countries are managed by the Community; Whereas Council Regulation (EC) No 3088/95 (2) allocates, for 1996, certain catch quotas to vessels flying the flag of Poland in Community waters; Whereas, in accordance with the procedure provided for in Article III of the Agreement on Fisheries of 1 February 1978 between the Kingdom of Sweden and the Republic of Poland. the Community have held further consultations concerning on their reciprocal fishing rights for 1996, resulting in the allocation of 130 tonnes of cod to Poland; Whereas it is for the Council to lay down the specific conditions under which such catches must be taken, HAS ADOPTED THIS REGULATION: Article I The Annex I to Council Regulation (EC) No 3088/95, the figures relating to Polish catch quotas for 1996 in the fishing /one of Sweden are hereby replaced by those set out in the Annex to this Regulation. (" <:) OJ No I. 389, 31. 12. 1992, p. I. Regulation as amended by the 1994 Act of Accession OJ No L 330, 21. 12 1995, p. 99 i This Regulation shall enter into force on the day after its publication in the Official Journal. Article 2 This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Brussels, 1996. For the ( ouncil The President U ANNEX Polish catch quotas for 1996 Fishing zone of Sweden (1) Species Herring Sprat flatfish Cod Area within which fishing is authorised Quantity (tonnes) Number of licences ICES Hid ICES Hid ICES Hid ICES Hid 10,000 3,000 50 130 50 (1) 5 '" t2) Swedish waters south of 59°30'N in the Baltic Sea. A maximum of three non-fishing mother ships may also be used simultaneously ISSN 0254-1475 COM(96) 289 final DOCUMENTS EN 03 11 Catalogue number : CB-CO-96-295-EN-C ISBN 92-78-05622-7 Office for Official Publications of the European Communities L-2985 Luxembourg

Proposal for a COUNCIL REGULATION (EC) extending the 1995/96 milk year

http://publications.europa.eu/resource/cellar/1defbca7-217e-41e0-8ad8-cd369cff8583

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 20. 06. 1996 COM(96) 294 final Proposal for a COUNCIL REGULATION (EC) extending the 1995/96 milk year (presented by the Commission) I •. y y. * is it EXPLANATORY MEMORANDUM Council Regulation (EEC) No 1539/95 fixes the target price for milk and the intervention prices for butter and skimmed-milk powder for the period from 1 July 1995 to 30 June 1996. In order to avoid any ambiguity and in the interest of consistency, the attached draft Regulation provides for the extension of the 1995/96 milk year until 30 June 1996. 1 COUNCIL REGULATION (EC) No of extending the 1995/96 milk year THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, Having regard to Council Regulation (EEC) No 804/68 of 27 June 1968 on the common organization of the market in milk and milk products1, and in particular Article 2 thereof, Having regard to the proposal from the Commission, Whereas the target price for milk and the intervention prices for butter and skimmed-milk powder were fixed by Regulation (EC) No 1539/95' for the period from 1 July 1995 to 30 June 1996; whereas the 1995/96 milk year should therefore be extended until 30 June 1996; whereas, in order to avoid any uncertainty, the measure should apply from 1 April 1996, HAS ADOPTED THIS REGULATION Article The 1995/96 milk year shall end on 30 June 1996 and the 1996/97 milk year shall begin on 1 July 1996. 1 2 OJ No L 148, 28. 6. 1968, p. 13. Regulation No 293 1/95 (OJ No L 307, 20. 12. 1995, p. 10. ). O J No L 148, 30. 6. 1995, p. 19. last amended by Regulation (EC) 3 Article 2 This Regulation shall enter into force on the day of its publication in the Official Journal of the European Communities. It shall apply from 1 April 1996. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Brussels, For the Council The President 4- FINANCIAL STATEMENT BUDGET HEADING. B1-2069 APPROPRIATIONS: ECU 27 million TITLE: Council Regulation extending the 1995/96 milk year LEGAL BASIS: Article 2 of Regulation (EEC) No 804/68 AIMS: To extend the milk year FINANCIAL IMPLICATIONS: 5. 0. EXPENDITURE - CHARGED TO THE EC BUDGET (REFUNDS/INTERVENTION) - NATIONAL AUTHORITIES - OTHER 5 1. REVENUE - OWN RESOURCES OF THE EC (LEVIES/CUSTOMS DUTIES) - NATIONAL PERIOD OF 12 MONTHS (ECU million) FOLLOWING FINANCIAL YEAR (ECU million) CURRENT FINANCIAL YEAR (96) (ECU million) +2 1998 1999 2000 2001 ESTIMATED EXPENDITURE ESTIMATED REVENUE METHOD OF CALCULATION: Aid to Portuguese producers (Regulation (EEC) No 739/93) 450 000 t x ECU (15-10)/t = (A) ECU 2. 25 million x 1. 010 (DR) = (B) ECU 2. 27 million CAN THE PROJECT BE FINANCED FROM APPROPRIATIONS ENTERED IN THE RELEVANT CHAPTER OF THE CURRENT BUDGET? YES/NO Ij CAN THE PROJECT BE FINANCED BY TRANSFER BETWEEN CHAPTERS OF THE CURRENT BUDGET? WILL A SUPPLEMENTARY BUDGET BE NECESSARY? WILL FUTURE BUDGET APPROPRIATIONS BE NECESSARY? ¥fiS/NO YES/NO j| i 5. 0. 1. 5. 1. 1. 5. 2. 6. 1. 6. 2. 6. 3, ii OBSERVATIONS b ISSN 0254-1475 COM(96) 294 final DOCUMENTS 03 EN / Catalogue number : CB-CO-96-301-EN-C ISBN 92-78-05688-X Office for Official Publications of the European Conununities L-2985 Luxembourg c

Proposal for a COUNCIL DIRECTIVE amending Directive 93/53/EEC introducing minimum Community measures for the control of certain fish diseases

http://publications.europa.eu/resource/cellar/9b219fc8-0a8f-4b3f-ad28-0d95010d80c0

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 19. 06. 1996 COM(96) 279 final 96/0157 (CNS) 96/0158 (CNS) Proposal for a COUNCIL DIRECTIVE amending, with regard to Gyrodactylus salaris, Directive 91/67/EEC concerning the animal health conditions governing the placing on the market of aquaculture animals and products Proposal for a COUNCIL DIRECTIVE amending Directive 93/53/EEC introducing minimum Community measures for the control of certain fish diseases (presented by the Commission) KXPT. ANATORY MKNIOUANPUM The creation of the internal market resulted in the establishment of Community rules concerning animal health questions governing the placing on the market of aquaculture animals and products1, and minimum measures for the control of certain fish diseases''. The aim of the present proposals is to amend the existing Community rules in order: to organise trade in salmonid fish in such a way as to prevent the introduction of the parasite salaris parasite; Gyrodactylus into regions declared officially free of that to introduce a certification requirement in order to infectious prevent haematopoietic necrosis (IHN) and viral haemorrhagic septicaemia (VHS); diseases spread the the of to bring EC rules more in line with the requirements established by the "Office International des Epizooties" (OIE-World Organisation for Animal Health) to limit the scope of Directive 93/53/EEC to viral fish diseases. The first three objectives are achieved by amending Council Directive 91/67/EEC: a) Gyrodactylosis Directive 91/67/EEC contains the Community rules for organising the trade in aquatic animals in order to prevent the spread of serious diseases ("List II diseases"). The diseases currently covered by these rules are IHN and VHS which have a major economic impact on fish farming when introduced into a region previously free of these diseases. Movement of aquaculture animals is only possible from zones or certain farms with a high health status (free of IHN and VHS) towards zones or farms with a lower health status. Recent reports have shown that gyrodactylosis, a disease of salmonids caused by the freshwater parasite Gyrodactylus occurs mainly in Scandinavia (Sweden, Finland,Norway). It has also been reported, but not officially confirmed, in certain causes widespread other Member States. Gyrodactylus salaris salaris, Council Directive 91/67/EEC of 28 January 1991 (OJ N" L 46 of 19. 02. 1991, p. 1), as last amended by Directive 95/22/EEC (OJ N" L 243 of 11. 10. 1995, p. 1) 2Council Directive 93/53/EEC of 24 June 1993 (OJ N* L 175 of 17. 9. 1993, p. 23) losses in riverine stocks of Atlantic salmon. Other salmonids, and in particular Baltic salmon (a strain of Atlantic salmon), brown trout and rainbow trout may act. as non sympl onuii u- carriers, and thus transfer the disease by commercial transfers or through migration within and possibly between rivers. Infection can be controlled in farmed stocks by chemotherapy, but it is virtually impossible to control it in the wild. It is therefore important to prevent the spread of the disease towards zones in the Community for which there is proof of absence of the disease. Gyrodactylosis has thus all the caracteristics for being considered as a list II disease for which Community measures should be applied in the same way as is the case for IHN and VHS, The proposed measure therefore aims to categorise gyrodactylosis as a list II disease and defines the rules under which a zone (water catchment area) or certain farms can be declared free of and for which the same movement patterns Gyrodactylus apply as for other list II diseases. salaris, b) Certification for IHN and VHS It appears necessary to introduce a certification requirement for fish, eggs and gametes placed on the market in a non approved zone (not officially declared free of IHN and VHS). Experience has shown that, in the absence of such requirement, fish from infected sites have been moved and contaminated non infected farms situated in these zones, which has led to severe financial losses. The amendment requires that in future consignments must be accompanied by a certificate issued by the competent authority, certifying that the fish, eggs or gametes originate in a farm not infected with either IHN or VHS. c) Sampling requirements In accordance with current EC legislation, a zone can obtain the approved status free of disease after a period of intensive sampling and testing of 4 years. The requirements adopted by OIE for obtaining approved status are that free status can be obtained after a two year period of sampling and testing. The present proposal aims to aline the EC requirements with the OIE requirements The last objective is achieved by amending Directive 93/53/EEC and is a consequence of grading gyrodactylosis as a list II disease. This would render the requirements of Directive 93/53/EEC applicable to Gyrodactylus However, these measures are designed for the control of virus diseases, and should not therefore be applied as such to the parasite The scope of Directive 93/53/EEC must Gyrodactylus therefore be limited to viral diseases only. salaris. salaris. P r o p o s al f or a COUNCIL DIRECTIVE of ^ j o i S T- ( C K S) amending, with regard to Gyrodactylus salaris, Directive 91/67/EEC concerning the animal health conditions governing the placing on the market of aquaculture animals and products THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 43 thereof, Having regard to the proposal of the Commission1, Having regard to the opinion of the European Parliament2, Having regard to the opinion of the Economic and Social Committee3, Whereas Gyrodactylus is a fresh water parasite of salmonids which is able of causing serious mortalities in Salmo salar (Atlantic salmon); salaris Whereas the disease has a serious economic impact would it occur in regions containing wild riverine stocks of Salmo salar previously free of the disease; Whereas experience has shown that the disease can spread from infected regions through commercial transfers of salmon and other salmonids; Whereas it is therefore necessary to prevent the spread of the disease from regions in the Community where the absence of the disease can not be certified, towards regions with a documented history of absence of the parasite; Whereas prevention of spread of the disease can be achieved under the procedures applicable to diseases of list II of Annex A of Directive 91/67/EEC concerning the animal health conditions governing the placing on the market of aquaculture animals and products4, as last amended by Directive 95/22/EC5; X0J N' C 20J N" C 30J N' C 40J N° L 46, 19. 02. 1991, p. 1 5OJ N° L 243, 11. 10. 1995, p. l 4 Whereas Gyrodactylus Salmo salar salaris, being the species most susceptible to the measures must apply to that species; Whereas however the parasite can be transferred by other salmoiiid species and measures must therefore be extended to such species; Whereas the criteria to certify the absence of salaris must be established, Gyrodactylus Whereas it is necessary to ensure that the placing on the market of fish from a non approved zone does not prejudice the health status of non infected farms situated in a non approved zone; whereas this can be achieved through certification of consignments, Whereas it is necessary to adapt the sampling and testing requirements for fish diseases to international standards; HAS ADOPTED THIS DIRECTIVE: Article 1 Directive 91/67/EEC is amended as follows: 1. In Article 7: a) the introductory sentence of paragraph 1 is replaced by the following text: "1. The placing on the market of live fish belonging to the species susceptible to IHN and VHS as listed in Annex A, column 2, list II, their eggs and gametes, shall be subject to the following additional guarantees :" b) the following paragraph is added to paragraph 1: 11 (c) where they are to be introduced into a non approved farm situated in a non approved zone, they must be accompanied, in accordance with article 11, by a movement document corresponding to a model to be drawn up in accordance with the procedure laid down in article 26, certifying that they comply with the requirements of article 3 and come from a farm which is not infected with IHN or VHS, or they come from an approved zone with regard to IHN and/or VHS, or they come from an approved farm situated in a non approved zone with regard to IHN and/or VHS. " c) paragraph 2 is replaced by the following paragraphs: "2. The placing on the market of live fish belonging to the species susceptible to gyrodactylosis as listed in Annex A, column 2, list II shall be subject to the following additional guarantees: a) b) where they are to be introduced into an approved zone with regard to Gyrodactylus they must, in accordance with Article 11, be accompanied by a movement document corresponding to a model to be drawn up in accordance with the procedure laid down in article 26, certifying that they come from an approved zone with regard to Gyrodactylus salaris, salaris; where they are to be introduced into a farm which, although not situated in an approved zone, fulfils the conditions set out in Annex CI, they must in accordance with Article 11, be accompanied by a movement document corresponding to a model to be drawn up in accordance with the procedure laid down in Article 26, certifying that they come from an approved zone or from an approved farm with regard to Gyrodactylus salaris. 3. The Commission may, in accordance with the procedure laid down in Article 26, adapt or delete the additional guarantees referred to in paragraphs 1 and 2, depending on the evolution of the animal health situation in the Community or in accordance with scientific evolution. " 2. In Article 9, the first sentence of point 1 is replaced by the following text: "Fish susceptible to IHN and VHS must be slaughtered and eviscerated prior to dispatch. " 3. In Annex A: a) the following is added to columns 1 and 2 of list II under the heading "fish": "Gyrodactylosis salaris)" (Gyrodactylus salar (Atlantic "Salmo salmon) and other salmonid species" b) in list III, under "Fish", the words salaris" in column 1 are deleted. "Gyrodactylus 4. In Annex B, point I,B is replaced by the following text "B. Grant of approval 1. In order to obtain approved status with regard to IHN and/or VHS, a continental zone must meet the following requirements : a) b) all fish are free for at least four years from any clinical or other sign of IHN and/or VHS. all farms in the continental zone are placed under the supervision of the official services. Two health inspections per year for two years must have been carried out. The health inspections must have been carried out at the times of the year when the water temperature favours the development of these diseases. The health inspection must at least consist of: an inspection of fish showing abnormalities, the taking of samples in accordance with a programme established under the procedure provided for in Article 15, which are to be sent as quickly as possible to an approved laboratory to be tested for the pathogens in question. However, zones having a historical record of absence of IHN and /or VHS, may obtain approved status if: i)their geographical situation does not permit easy introduction of disease; ii)an official disease control system has been in place for an extended period of time of at least ten years, during which: there has been regular monitoring of all farms, a disease notification system has been applied, no case of disease has been reported, under the rules in force, only fish, eggs or gametes from non-infected zones or farms subject to official checks and presenting equivalent health gurantees,were able to be introduced into the zone. The period of 10 years referred to above may be reduced to five years as a result of the testing carried out by the official service of the requesting Member State, provided that, in addition to the requirements referred to in the first subparagraph, the regular monitoring of all farms referred to above has included at least two health inspections per year involving at least : an inspection of fish showing abnormalities, a taking of samples of at least 30 fish at each visit. c) d) e) Member States wishing to benefit from the provisions relating to historical records must submit their request no later than 31 December 1996. if there is no farm in a continental zone to be approved, the official services must have subjected fish from the lower part of the catchment area to a health inspection twice a year for four years, in accordance with paragraph b; the laboratory examinations of fish taken during health inspections have produced negative results as regards the pathogens in question. Where a Member State has requested approval for a water catchment area originating in a neighbouring Member State , or common to two Member States , the following provisions shall apply: the two Member States concerned shall simultaneously submit a request for approval in accordance with the procedures laid down in Articles 5 or 10, the Commission, in accordance with the procedure laid down in Article 26, after examining and checking the request and evaluating the health situation, shall, if need be, lay down any other provisions necessary for granting such approval. The Member States, in accordance with Directive 89/608/EEC6 shall grant each other mutual assistance for the application of this Directive, and in particular of this paragraph; 2. In order to obtain approved status with regard to a continental zone must meet approval Gyrodactylus conditions established in accordance with the procedure provided for in Article 26. salaris, However, where a Member State considers that its territory or part of its territory is free from Gyrodactylus salaris, it may submit to the Commission appropriate justifications, 6 OJ n* L 351, 2. 12 1989, p 34; 8 setting out in particular: i) the results of surveillance testing carried out over an extended period of time, and based on the identification of the parasite and the fact that the disease is compulsorily notifiable to the official service, ii) the period over which the surveillance was carried out, Based on the above information, and in accordance with the procedure provided for in Article 26, it may be decided to grant the approved status to the territory or a part thereof of the applying Member State. 5. In Annex B,I,C point 2 is replaced by the following text : "2. a) each farm must undergo, with regard to IHN and/or VHS, two health inspections annually in accordance with point B,l(b); however, samples will be taken by rotation in 50% of the fish farms in the continental zone each year; b) the surveilance programme for maintenance of approved status with regard to gyrodactylosis is established in accordance with the procedure provided for in Article 2 6. " 6. In Annex B,II, paragraph B is replaced by the following text : "B. Grant of approval. In order to obtain approved status with regard to IHN and/or VHS, a coastal zone for fish must meet the requirements laid down for continental zones referred to in point IB, first paragraph. Where necessary, the requirements for obtaining the approved status with regard to gyrodactylosis for coastal zones are laid down in accordance with the procedure provided for in Article 2 6. " 7. In Annex C,I,A point 4 is replaced by the following text: "4. it must comply, mutatis mutandis, with the requirements set out in Annex B,I,B. Furthermore, where approval with regard to IHN and/or VHS is requested on the basis of a historical record with an official control system for a 10-year period, it must have been submitted, at least once a year, to a clinical inspection and the taking of samples to be tested for the pathogens in question in an approved laboratory;" 8. In Annex C,I point B is replaced by the following text: "B. Maintenance of approval Maintenance of approval shall be subject to the requirements set out in Annex B I C. However, sampling with regard to IHN and/or VHS must be carried out once a year Article 2 1. Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive before 1 July 1997. They shall forthwith notify the Commission thereof. When Member Sates adopt these measures, they shall contain a reference to this Directive or shall be accompanied by such reference on the occasion of their official publication. The methods of making such reference shall be laid down by the Member States. 2. Member States shall communicate to the Commission the text of the main provisions of national law which they adopt in the field governed by this Directive. Article 3 This Directive shall enter into force 20 days after its publication in the Official Journal of the European Communities. Article 4 This Directive is addressed to the Member States. Done at Brussels, For the Council 10 P r o p o s al f or a COUNCIL DIRECTIVE amending Directive 93/53/EEC introducing minimum Community measures for the control of certain fish diseases \ ^k oiSS x (CKS) J THE COUNCIL OF THE EUROPEAN UNION Having regard to the Treaty establishing the European Community, and in particular Article 43 thereof, Having regard to the proposal of the Commission1, Having regard to the opinion of the European Parliamant2, Having regard to the opinion of the Economic and Social Committee3 Whereas Council Directive 91/67/EEC OF 28 January 1991 concerning animal health conditions governing the placing on the market of aquaculture animals and products4 as last amended by Directive 95/22//EC5 lays down the animal health conditions for the placing on the market of aquaculture fish susceptible to the diseases listed in its Annex A; whereas this list includes viral diseases such as IHN and VHS, as well as gyrodactylosis caused by the parasite Gyrodactylus salaris; Whereas Council Directive 93/53/EEC of 24 June 1993 introducing minimum Community measures for the control of certain fish diseases6, as amended by the Treaty of accession of Austria, Finland and Sweden, lays down control measures for infectious salmon anemia(ISA), infectious haematopoietic necrosis(IHN), and viral haemorrhagic septecemia (VHS); Whereas the measures provided for in Directive 93/53/EEC are designed for the control of viral diseases; whereas those measures are not appropriate for gyrodactylosis; 'OJ N° 20J N* 30J N° 40J N* L 46 of 19. 2. 1991, p 1 50J N' L 234 of 11. 10. 1995, p. l 60J N" L 175 of 19. 7. 1993,p 23 11 HAS ADOPTED THIS DIRECTIVE: Article 1 Directive 93/53/EEC is amended as follows: 1. Article 1 is replaced by the following text: " Article 1 This Directive defines the minimum Community measures for the control of the fish diseases referred to in Article 2, points 1 and 2. " 2. In Article 2, point 1 is replaced by the following text: "1 List I diseases: infectious salmon anaemia as referred to in Annex A, list I to Council Directive 91/67/EEC;" 3. In Article 2, point 2 is replaced by the following text: "2. List II diseases: infectious haematopoietic necrosis and viral haemorrhagic septicaemia, as referred to in Annex A, list II to Directive 91/67/EEC;" Article 2 1. Member States shall bring into force laws, regulations and administrative provisions necessary to comply with this Directive before 1 July 1997. They shall forthwith notify the Commission thererof. When Member States adopt these measures, they shall contain a reference to this Directive or shall be accompanied by such reference on the occasion of their official publication. The methods of making such reference shall be laid down by the Member States. 2. Member States shall communicate to the Commission the text of the main provisions of national law which they adopt in the field governed by this Directive. Article 3 This Directive shall enter into force 20 days after its publication in the Official Journal of the European Communities. This Directive is addressed to the Member States. Article 4 Done at Brussels, For the Council 12 ISSN 0254-1475 COM(96) 279 final DOCUMENTS EN 03 10 Catalogue number : CB-CO-96-286-EN-C ISBN 92-78-05523-9 Office for Official Publications of the European Communities L-2985 Luxembourg 13

Proposal for a COUNCIL DIRECTIVE amending, with regard to Gyrodactylus salaris, Directive 91/67/EEC concerning the animal health conditions governing the placing on the market of aquaculture animals and products

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 19. 06. 1996 COM(96) 279 final 96/0157 (CNS) 96/0158 (CNS) Proposal for a COUNCIL DIRECTIVE amending, with regard to Gyrodactylus salaris, Directive 91/67/EEC concerning the animal health conditions governing the placing on the market of aquaculture animals and products Proposal for a COUNCIL DIRECTIVE amending Directive 93/53/EEC introducing minimum Community measures for the control of certain fish diseases (presented by the Commission) KXPT. ANATORY MKNIOUANPUM The creation of the internal market resulted in the establishment of Community rules concerning animal health questions governing the placing on the market of aquaculture animals and products1, and minimum measures for the control of certain fish diseases''. The aim of the present proposals is to amend the existing Community rules in order: to organise trade in salmonid fish in such a way as to prevent the introduction of the parasite salaris parasite; Gyrodactylus into regions declared officially free of that to introduce a certification requirement in order to infectious prevent haematopoietic necrosis (IHN) and viral haemorrhagic septicaemia (VHS); diseases spread the the of to bring EC rules more in line with the requirements established by the "Office International des Epizooties" (OIE-World Organisation for Animal Health) to limit the scope of Directive 93/53/EEC to viral fish diseases. The first three objectives are achieved by amending Council Directive 91/67/EEC: a) Gyrodactylosis Directive 91/67/EEC contains the Community rules for organising the trade in aquatic animals in order to prevent the spread of serious diseases ("List II diseases"). The diseases currently covered by these rules are IHN and VHS which have a major economic impact on fish farming when introduced into a region previously free of these diseases. Movement of aquaculture animals is only possible from zones or certain farms with a high health status (free of IHN and VHS) towards zones or farms with a lower health status. Recent reports have shown that gyrodactylosis, a disease of salmonids caused by the freshwater parasite Gyrodactylus occurs mainly in Scandinavia (Sweden, Finland,Norway). It has also been reported, but not officially confirmed, in certain causes widespread other Member States. Gyrodactylus salaris salaris, Council Directive 91/67/EEC of 28 January 1991 (OJ N" L 46 of 19. 02. 1991, p. 1), as last amended by Directive 95/22/EEC (OJ N" L 243 of 11. 10. 1995, p. 1) 2Council Directive 93/53/EEC of 24 June 1993 (OJ N* L 175 of 17. 9. 1993, p. 23) losses in riverine stocks of Atlantic salmon. Other salmonids, and in particular Baltic salmon (a strain of Atlantic salmon), brown trout and rainbow trout may act. as non sympl onuii u- carriers, and thus transfer the disease by commercial transfers or through migration within and possibly between rivers. Infection can be controlled in farmed stocks by chemotherapy, but it is virtually impossible to control it in the wild. It is therefore important to prevent the spread of the disease towards zones in the Community for which there is proof of absence of the disease. Gyrodactylosis has thus all the caracteristics for being considered as a list II disease for which Community measures should be applied in the same way as is the case for IHN and VHS, The proposed measure therefore aims to categorise gyrodactylosis as a list II disease and defines the rules under which a zone (water catchment area) or certain farms can be declared free of and for which the same movement patterns Gyrodactylus apply as for other list II diseases. salaris, b) Certification for IHN and VHS It appears necessary to introduce a certification requirement for fish, eggs and gametes placed on the market in a non approved zone (not officially declared free of IHN and VHS). Experience has shown that, in the absence of such requirement, fish from infected sites have been moved and contaminated non infected farms situated in these zones, which has led to severe financial losses. The amendment requires that in future consignments must be accompanied by a certificate issued by the competent authority, certifying that the fish, eggs or gametes originate in a farm not infected with either IHN or VHS. c) Sampling requirements In accordance with current EC legislation, a zone can obtain the approved status free of disease after a period of intensive sampling and testing of 4 years. The requirements adopted by OIE for obtaining approved status are that free status can be obtained after a two year period of sampling and testing. The present proposal aims to aline the EC requirements with the OIE requirements The last objective is achieved by amending Directive 93/53/EEC and is a consequence of grading gyrodactylosis as a list II disease. This would render the requirements of Directive 93/53/EEC applicable to Gyrodactylus However, these measures are designed for the control of virus diseases, and should not therefore be applied as such to the parasite The scope of Directive 93/53/EEC must Gyrodactylus therefore be limited to viral diseases only. salaris. salaris. P r o p o s al f or a COUNCIL DIRECTIVE of ^ j o i S T- ( C K S) amending, with regard to Gyrodactylus salaris, Directive 91/67/EEC concerning the animal health conditions governing the placing on the market of aquaculture animals and products THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 43 thereof, Having regard to the proposal of the Commission1, Having regard to the opinion of the European Parliament2, Having regard to the opinion of the Economic and Social Committee3, Whereas Gyrodactylus is a fresh water parasite of salmonids which is able of causing serious mortalities in Salmo salar (Atlantic salmon); salaris Whereas the disease has a serious economic impact would it occur in regions containing wild riverine stocks of Salmo salar previously free of the disease; Whereas experience has shown that the disease can spread from infected regions through commercial transfers of salmon and other salmonids; Whereas it is therefore necessary to prevent the spread of the disease from regions in the Community where the absence of the disease can not be certified, towards regions with a documented history of absence of the parasite; Whereas prevention of spread of the disease can be achieved under the procedures applicable to diseases of list II of Annex A of Directive 91/67/EEC concerning the animal health conditions governing the placing on the market of aquaculture animals and products4, as last amended by Directive 95/22/EC5; X0J N' C 20J N" C 30J N' C 40J N° L 46, 19. 02. 1991, p. 1 5OJ N° L 243, 11. 10. 1995, p. l 4 Whereas Gyrodactylus Salmo salar salaris, being the species most susceptible to the measures must apply to that species; Whereas however the parasite can be transferred by other salmoiiid species and measures must therefore be extended to such species; Whereas the criteria to certify the absence of salaris must be established, Gyrodactylus Whereas it is necessary to ensure that the placing on the market of fish from a non approved zone does not prejudice the health status of non infected farms situated in a non approved zone; whereas this can be achieved through certification of consignments, Whereas it is necessary to adapt the sampling and testing requirements for fish diseases to international standards; HAS ADOPTED THIS DIRECTIVE: Article 1 Directive 91/67/EEC is amended as follows: 1. In Article 7: a) the introductory sentence of paragraph 1 is replaced by the following text: "1. The placing on the market of live fish belonging to the species susceptible to IHN and VHS as listed in Annex A, column 2, list II, their eggs and gametes, shall be subject to the following additional guarantees :" b) the following paragraph is added to paragraph 1: 11 (c) where they are to be introduced into a non approved farm situated in a non approved zone, they must be accompanied, in accordance with article 11, by a movement document corresponding to a model to be drawn up in accordance with the procedure laid down in article 26, certifying that they comply with the requirements of article 3 and come from a farm which is not infected with IHN or VHS, or they come from an approved zone with regard to IHN and/or VHS, or they come from an approved farm situated in a non approved zone with regard to IHN and/or VHS. " c) paragraph 2 is replaced by the following paragraphs: "2. The placing on the market of live fish belonging to the species susceptible to gyrodactylosis as listed in Annex A, column 2, list II shall be subject to the following additional guarantees: a) b) where they are to be introduced into an approved zone with regard to Gyrodactylus they must, in accordance with Article 11, be accompanied by a movement document corresponding to a model to be drawn up in accordance with the procedure laid down in article 26, certifying that they come from an approved zone with regard to Gyrodactylus salaris, salaris; where they are to be introduced into a farm which, although not situated in an approved zone, fulfils the conditions set out in Annex CI, they must in accordance with Article 11, be accompanied by a movement document corresponding to a model to be drawn up in accordance with the procedure laid down in Article 26, certifying that they come from an approved zone or from an approved farm with regard to Gyrodactylus salaris. 3. The Commission may, in accordance with the procedure laid down in Article 26, adapt or delete the additional guarantees referred to in paragraphs 1 and 2, depending on the evolution of the animal health situation in the Community or in accordance with scientific evolution. " 2. In Article 9, the first sentence of point 1 is replaced by the following text: "Fish susceptible to IHN and VHS must be slaughtered and eviscerated prior to dispatch. " 3. In Annex A: a) the following is added to columns 1 and 2 of list II under the heading "fish": "Gyrodactylosis salaris)" (Gyrodactylus salar (Atlantic "Salmo salmon) and other salmonid species" b) in list III, under "Fish", the words salaris" in column 1 are deleted. "Gyrodactylus 4. In Annex B, point I,B is replaced by the following text "B. Grant of approval 1. In order to obtain approved status with regard to IHN and/or VHS, a continental zone must meet the following requirements : a) b) all fish are free for at least four years from any clinical or other sign of IHN and/or VHS. all farms in the continental zone are placed under the supervision of the official services. Two health inspections per year for two years must have been carried out. The health inspections must have been carried out at the times of the year when the water temperature favours the development of these diseases. The health inspection must at least consist of: an inspection of fish showing abnormalities, the taking of samples in accordance with a programme established under the procedure provided for in Article 15, which are to be sent as quickly as possible to an approved laboratory to be tested for the pathogens in question. However, zones having a historical record of absence of IHN and /or VHS, may obtain approved status if: i)their geographical situation does not permit easy introduction of disease; ii)an official disease control system has been in place for an extended period of time of at least ten years, during which: there has been regular monitoring of all farms, a disease notification system has been applied, no case of disease has been reported, under the rules in force, only fish, eggs or gametes from non-infected zones or farms subject to official checks and presenting equivalent health gurantees,were able to be introduced into the zone. The period of 10 years referred to above may be reduced to five years as a result of the testing carried out by the official service of the requesting Member State, provided that, in addition to the requirements referred to in the first subparagraph, the regular monitoring of all farms referred to above has included at least two health inspections per year involving at least : an inspection of fish showing abnormalities, a taking of samples of at least 30 fish at each visit. c) d) e) Member States wishing to benefit from the provisions relating to historical records must submit their request no later than 31 December 1996. if there is no farm in a continental zone to be approved, the official services must have subjected fish from the lower part of the catchment area to a health inspection twice a year for four years, in accordance with paragraph b; the laboratory examinations of fish taken during health inspections have produced negative results as regards the pathogens in question. Where a Member State has requested approval for a water catchment area originating in a neighbouring Member State , or common to two Member States , the following provisions shall apply: the two Member States concerned shall simultaneously submit a request for approval in accordance with the procedures laid down in Articles 5 or 10, the Commission, in accordance with the procedure laid down in Article 26, after examining and checking the request and evaluating the health situation, shall, if need be, lay down any other provisions necessary for granting such approval. The Member States, in accordance with Directive 89/608/EEC6 shall grant each other mutual assistance for the application of this Directive, and in particular of this paragraph; 2. In order to obtain approved status with regard to a continental zone must meet approval Gyrodactylus conditions established in accordance with the procedure provided for in Article 26. salaris, However, where a Member State considers that its territory or part of its territory is free from Gyrodactylus salaris, it may submit to the Commission appropriate justifications, 6 OJ n* L 351, 2. 12 1989, p 34; 8 setting out in particular: i) the results of surveillance testing carried out over an extended period of time, and based on the identification of the parasite and the fact that the disease is compulsorily notifiable to the official service, ii) the period over which the surveillance was carried out, Based on the above information, and in accordance with the procedure provided for in Article 26, it may be decided to grant the approved status to the territory or a part thereof of the applying Member State. 5. In Annex B,I,C point 2 is replaced by the following text : "2. a) each farm must undergo, with regard to IHN and/or VHS, two health inspections annually in accordance with point B,l(b); however, samples will be taken by rotation in 50% of the fish farms in the continental zone each year; b) the surveilance programme for maintenance of approved status with regard to gyrodactylosis is established in accordance with the procedure provided for in Article 2 6. " 6. In Annex B,II, paragraph B is replaced by the following text : "B. Grant of approval. In order to obtain approved status with regard to IHN and/or VHS, a coastal zone for fish must meet the requirements laid down for continental zones referred to in point IB, first paragraph. Where necessary, the requirements for obtaining the approved status with regard to gyrodactylosis for coastal zones are laid down in accordance with the procedure provided for in Article 2 6. " 7. In Annex C,I,A point 4 is replaced by the following text: "4. it must comply, mutatis mutandis, with the requirements set out in Annex B,I,B. Furthermore, where approval with regard to IHN and/or VHS is requested on the basis of a historical record with an official control system for a 10-year period, it must have been submitted, at least once a year, to a clinical inspection and the taking of samples to be tested for the pathogens in question in an approved laboratory;" 8. In Annex C,I point B is replaced by the following text: "B. Maintenance of approval Maintenance of approval shall be subject to the requirements set out in Annex B I C. However, sampling with regard to IHN and/or VHS must be carried out once a year Article 2 1. Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive before 1 July 1997. They shall forthwith notify the Commission thereof. When Member Sates adopt these measures, they shall contain a reference to this Directive or shall be accompanied by such reference on the occasion of their official publication. The methods of making such reference shall be laid down by the Member States. 2. Member States shall communicate to the Commission the text of the main provisions of national law which they adopt in the field governed by this Directive. Article 3 This Directive shall enter into force 20 days after its publication in the Official Journal of the European Communities. Article 4 This Directive is addressed to the Member States. Done at Brussels, For the Council 10 P r o p o s al f or a COUNCIL DIRECTIVE amending Directive 93/53/EEC introducing minimum Community measures for the control of certain fish diseases \ ^k oiSS x (CKS) J THE COUNCIL OF THE EUROPEAN UNION Having regard to the Treaty establishing the European Community, and in particular Article 43 thereof, Having regard to the proposal of the Commission1, Having regard to the opinion of the European Parliamant2, Having regard to the opinion of the Economic and Social Committee3 Whereas Council Directive 91/67/EEC OF 28 January 1991 concerning animal health conditions governing the placing on the market of aquaculture animals and products4 as last amended by Directive 95/22//EC5 lays down the animal health conditions for the placing on the market of aquaculture fish susceptible to the diseases listed in its Annex A; whereas this list includes viral diseases such as IHN and VHS, as well as gyrodactylosis caused by the parasite Gyrodactylus salaris; Whereas Council Directive 93/53/EEC of 24 June 1993 introducing minimum Community measures for the control of certain fish diseases6, as amended by the Treaty of accession of Austria, Finland and Sweden, lays down control measures for infectious salmon anemia(ISA), infectious haematopoietic necrosis(IHN), and viral haemorrhagic septecemia (VHS); Whereas the measures provided for in Directive 93/53/EEC are designed for the control of viral diseases; whereas those measures are not appropriate for gyrodactylosis; 'OJ N° 20J N* 30J N° 40J N* L 46 of 19. 2. 1991, p 1 50J N' L 234 of 11. 10. 1995, p. l 60J N" L 175 of 19. 7. 1993,p 23 11 HAS ADOPTED THIS DIRECTIVE: Article 1 Directive 93/53/EEC is amended as follows: 1. Article 1 is replaced by the following text: " Article 1 This Directive defines the minimum Community measures for the control of the fish diseases referred to in Article 2, points 1 and 2. " 2. In Article 2, point 1 is replaced by the following text: "1 List I diseases: infectious salmon anaemia as referred to in Annex A, list I to Council Directive 91/67/EEC;" 3. In Article 2, point 2 is replaced by the following text: "2. List II diseases: infectious haematopoietic necrosis and viral haemorrhagic septicaemia, as referred to in Annex A, list II to Directive 91/67/EEC;" Article 2 1. Member States shall bring into force laws, regulations and administrative provisions necessary to comply with this Directive before 1 July 1997. They shall forthwith notify the Commission thererof. When Member States adopt these measures, they shall contain a reference to this Directive or shall be accompanied by such reference on the occasion of their official publication. The methods of making such reference shall be laid down by the Member States. 2. Member States shall communicate to the Commission the text of the main provisions of national law which they adopt in the field governed by this Directive. Article 3 This Directive shall enter into force 20 days after its publication in the Official Journal of the European Communities. This Directive is addressed to the Member States. Article 4 Done at Brussels, For the Council 12 ISSN 0254-1475 COM(96) 279 final DOCUMENTS EN 03 10 Catalogue number : CB-CO-96-286-EN-C ISBN 92-78-05523-9 Office for Official Publications of the European Communities L-2985 Luxembourg 13

Proposal for a COUNCIL DECISION authorizing the Federal Republic of Germany to conclude with the Czech Republic two agreements containing measures derogating from Articles 2 and 3 of the Sixth Council Directive (77/388/EEC) of 17 May 1977 on the harmonization of the laws of the Member States relating to turnover taxes

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•it £ COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 19. 06. 1996 COM(%) 277 final Proposal for a (X)UN(TI DECISION AUTHORIZING T HE FEDERAL R E P U B L IC OF GERMANY TO CONCLUDE WITH T HE C Z E CH R E P U B L IC T WO AGREEMENTS CONTAINING MEASURES DEROGATING FROM A R T I C L ES 2 AND 3 OF THE SIXTH COUNCIL DIRECTIVE (77/388/EEC) OF 17 M AY 1977 ON THE HARMONIZATION OF THE LAWS OF THE MEMBER STATES RELATING TO TURNOVER TAXES (presented by the Commission) Explanatory memorandum received by letters officially the Secretariat-General of By the Commission on 22 August 1995 and 26 March 1996, the German Government requested authorization, on the basis of Article 30 of the Sixth Council Directive, to conclude two agreements with the Czech Republic containing derogations from Articles 2 and 3 of that Directive (Sixth Council Directive 77/388/EEC of 17 May 1977 on the harmonization of the laws of the Member States relating to turnover taxes - Common system of value added tax: uniform basis of assessment1 ). In accordance with Article 30, the other Member States were informed of Germany's request by letter dated 25 April 1996. The first agreement concerns the construction of a frontier bridge across the Rehlingbach linking the German A6 motorway, which runs between Waidhaus and Rozvadov eastwards from Nuremberg, with the Czech D5 motorway, which runs westwards from Plzen. The agreement provides that, in so far as they extend onto the sovereign territory of the Czech Republic, the area of the construction site for the frontier bridge and, after its completion, the frontier bridge itself are to be treated as forming part of the sovereign territory of the Federal Republic of Germany as regards supplies of goods or services intended for the construction of the frontier bridge or for its repair and renewal. The second agreement concerns the construction of a frontier bridge between Schônberg and Vojtanov extending the E49 motorway. This agreement provides that, in so far as they extend onto the sovereign territory of the Federal Republic of Germany, the area of the construction site for the frontier bridge and, after its completion, the frontier bridge itself are to be treated as forming part of the sovereign territory of the Czech Republic as regards supplies of goods or services intended for the construction of the frontier bridge or for its repair and renewal. The two agreements also stipulate that, with the exception of customs duties, no import tax is to be charged on goods imported from the sovereign territory of one Contracting State into the sovereign territory of the other Contracting State, provided that ihosc goods are used for the construction of the frontier bridges in question or for their icpair and renewal. This provision does not apply to goods imported by public authorities In accordance with the principle of territorial application laid down by the Sixth Directive, the bridge construction, repair and renewal work carried out on German sovereign territory would be subject to value added tax in Germany, while such work carried out on Czech sovereign territory would lie outside the scope of the Sixth Directive. If these provisions were applied, it would be necessary to break down transactions on the basis of the territory on which they were carried out. In addition, each importation into Germany from the Czech Republic of goods used for the construction of the bridges or for their repair or renewal would be subject to value added tax in Germany. OJ No L 145, 13. 6. 1977, p. 1, as last amended by Directive 95/7TEC (OJ No L 102, 5. 5. 1995, p. 18). I The Contracting States are of the opinion that application of these rules would involve onerous tax complications for the contractors responsible for the work in question They therefore take the view that the tax provisions of the draft agreement are justified in order to simplify the contractors' tax obligations. It should also be noted that, pursuant to Article 30 of the Sixth Directive, the Council has already authorized the Federal Republic of Germany to conclude a number of agreements with the Republic of Poland concerning construction work in the frontier area which contain tax provisions similar to those set out in the present agreements. The Commission agrees that the uniform taxation of construction, repair and renewal work, and the waiving of collection of value added tax on imports of goods intended for use in such work, simplify matters for the contractors compared with application of the normal rules of taxation. In addition, given that the tax provisions of the two agreements balance out, their application will have only a negligible - but, in any event, positive - effect on the European Communities' own resources accruing from value added tax According to information provided by the German authorities, the taxable turnover on work in Germany under the derogations provided for by these agreements is slightly higher than that which would be subject to value added tax in Germany if the normal rules of the common system of value added tax were to be applied. Accordingly, the Commission takes the view that the Federal Republic of Germany should be authorized to conclude the proposed agreements. Proposal for a COUNCIL DECISION AUTHORIZING THE FEDERAL REPUBLIC OF GERMANY TO CONCLUDE WITH THE CZECH REPUBLIC TWO AGREEMENTS CONTAINING MEASURES DEROGATING FROM ARTICLES 2 AND 3 OF THE SIXTH COUNCIL DIRECTIVE (77/388/EEC) OF 17 MAY 1977 ON THE HARMONIZATION OF THE LAWS OF THE MEMBER STATES RELATING TO TURNOVER TAXES THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, Having regard to the Sixth Council Directive (77/388/EEC) of 17 May 1977 on the harmonization of the laws of the Member States relating to turnover taxes - Common system of value added tax: uniform basis of assessment,1 and in particular Article 30 thereof, Having regard to the proposal from the Commission, Whereas, under Article 30 of the Sixth Directive, the Council, acting unanimously on a proposal from the Commission, may authorize any Member State to conclude with a non-member country or an international organization an agreement which may contain derogations from the said Directive; Whereas, by letters officially received by the Secretariat-General of the Commission on 22 August 1995 and 26 March 1996, the German Government requested authorization to conclude two agreements with the Czech Republic which contain derogations from Articles 2 and 3 of the Sixth Directive as regards the construction, repair and renewal of two frontier bridges between the Contracting States; Whereas the other Member States were informed on 25 April 1996 of the German request; OJ No L 145, 13. 6. 1977, p. 1, as last amended by Directive 95/7/EC (OJ No L 102, 5. 5. 1995, p. 18). Whereas, in the absence of derogations, the construction, repair and renewal work carried out on German territory would be subject to value added tax in Germany while that carried out on Czech territory would lie outside the scope of the Sixth Directive and whereas, in addition, each importation from the Czech Republic into Germany of goods used for the construction, repair and renewal of the frontier bridges would be subject to value added tax in Germany; Whereas the purpose of these derogations is to simplify the rules of taxation for the contractors carrying out the work in question; Whereas the derogations will have only a negligible effect on the own resources of the European Communities accruing from value added tax, HAS ADOPTED THIS DECISION: Article 1 The Federal Republic of Germany is hereby authorized to conclude two agreements with the Czech Republic containing measures derogating from the Sixth Council Directive (77/388/EEC) of 17 May 1977. The first agreement concerns the construction of a frontier bridge across the Rehlingbach between Waidhaus and Rozvadov linking the German A6 motorway, which runs eastwards from Nuremberg, with the Czech D5 motorway, which runs westwards from Plzen. The second agreement concerns the construction of a frontier bridge between Schônberg and Vojtanov extending the E49 motorway. The derogations provided for by these agreements are spelt out in Articles 2, 3 and 4. Article 2 By way of derogation from Article 3 of the Sixth Directive, in so far as they extend onto the sovereign territory of the Czech Republic, the area of the construction site for the frontier bridge referred to in the second paragraph of Article 1 and, after its completion, the frontier bridge itself shall be treated as forming part of the sovereign territory of the Federal Republic of Germany as regards supplies of goods or services intended for the construction of the frontier bridge or for its repair and renewal. Article 3 By way of derogation from Article 3 of the Sixth Directive, in so far as they extend onto the sovereign territory of the Federal Republic of Germany, the area of the construction site for the frontier bridge referred to in the third paragraph of Article 1 and, after its completion, the frontier bridge itself shall be treated as forming part of the sovereign territory of the Czech Republic as regards supplies of goods or services intended for the construction of the frontier bridge or for its repair and renewal. 6 Article 4 By way of derogation from point 2 of Article 2 of the Sixth Directive, the importation of goods into Germany from the Czech Republic shall not be subject to value added tax in so far as those goods are used for the construction, repair or renewal of one of the bridges referred to in the second and third paragraphs of Article 1. However, this derogation shall not apply to goods imported by a public authority for the same purpose. This Decision is addressed to the Federal Republic of Germany. Article S Done at Brussels 1996 For the Council The President Financial statement The proposed Decision, when adopted, will have only a negligible effect for the collection of Community own resources. 8 ISSN 0254-1475 COM(96) 277 final DOCUMENTS EN 09 11 Catalogue number : CB-CO-96-285-EN-C ISBN 92-78-05512-3 Office for Official Publications of the European Communities L-2985 Luxembourg 3

COMMUNICATION FROM THE COMMISSION TO THE COUNCIL - TOWARDS AN INTERNATIONAL FRAMEWORK OF COMPETITION RULES

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 18. 06. 1996 COM(%) 284 final COMMUNICATION FROM THE COMMISSION TO THE COUNCIL TOWARDS AN INTERNATIONAL FRAMEWORK OF COMPETITION RULES COMMUNICATION TO THE COUNCIL TOWARDS AN INTERNATIONAL FRAMEWORK OF COMPETITION RULES CONTENTS I. a) b) c) d) e) INTRODUCTION A global perspective on competition rules: why international rules are needed. The competition perspective. The trade perspective. Jurisdictional issues : avoiding unilateral measures. Historical background and recent developments. II. WHICH FORUM ? III. INTERNATIONAL RULES ON COMPETITION - ISSUES FOR CONSIDERATION a) b) c) d) Adoption of domestic competition structures Agreement on common rules Establishment of instruments of cooperation between competition authorities Dispute settlement IV. RELATED ISSUES a) b) c) d) Who should participate? The interest of developing countries. The relation to trade defense instruments. The relation to the Community legal order and Member States. V. CONCLUSIONS ANNEX: POSSIBLE ELEMENTS OF AN INTERNATIONAL FRAMEWORK OF COMPETITION RULES a) b) c) d) Adoption of domestic competition structures Agreement on common rules Establishment of instruments of cooperation between competition authorities Dispute settlements Ù. COMMUNICATION TO THE COUNCIL TOWARDS AN INTERNATIONAL FRAMEWORK OF COMPETITION RULES This Communication is about the international aspects of competition law. It examines whether public international law, and especially the WTO, should be complemented by a specific framework to support competition law enforcement \ The concepts and proposals set out in this paper build on the report of the group of experts established by Commissioner van Miert in June 1994. That report, entitled "Competition Policy in the New Trade Order: Strengthening International Cooperation and Rules", was published in July 1995. The experts' report covered both bilateral and multilateral cooperation in the field of competition. Their parallel development was considered to be complementary and mutually supportive. Thus, although the emphasis of this Communication is on multilateral aspects, the further development of bilateral cooperation agreements is equally important and would have a favourable impact on work in a multilateral setting. I. INTRODUCTION: a) A global perspective on competition rules: Why international rules are needed Two developments have characterised international economic activity in recent decades: liberalisation and globalisation. Eight negotiating Rounds since GATT was established in 1947 have brought import tariffs down to historically low levels: from around 35% to below 4%2. This has led to a massive growth in the volume of trade in goods and services, doubling every seven to eight years and growing from around $200 billion in the early sixties to exceed $5000 billion in 1994. Foreign direct investment has grown at an 1 The scope of this Communication is limited to anticompetitive practices of enterprises. There arc many governmental practices that have an effect on competition, such as subsidies, which are grouped together with private practices in the EC Treaty's chapter on competition rules. These are by and large already covered by rules under the World Trade Organisation (WTO). This is the trade-weighted average of industrial tariffs that will apply in developed countries once the reduction commitments of the Uruguay Round have been fully implemented. 40% of European imports will even be duty free. Developing countries generally committed themselves in the Round to bind their duties in a horizontal way for the first time, with highest levels mostly around 20-35%. Remaining quantitative restraints on imports, in specific sectors such as agriculture or textiles, but also with regard to generic practices such as voluntary export restraints, are to be phased out by all WTO Members. even more spectacular rate - by a factor of thirty in less than twenty five years. National economies are more open to foreign competition today than ever before. At the microeconomic level firms have adopted global strategies. Liberalisation and technological progress have driven them to adopt new production methods: exploiting the comparative advantage of countries, improving their mobility, shifting factors of production, moving into new markets etc. Firms often need to be present on different markets at the same time to stay competitive. As a result countries have become interdependent and the markets of many goods and services have become regional or even global. The number and size of transnational firms has increased. There are more commercial practices that have an international dimension than ever before. These can lead to an increase in cross-border anti-competitive practices: cartels with international effects, is to exclude (foreign) competitors in an unfair way, agreements whose effect international abuses of a dominant position, or international mergers with anticompetitive effects. Such practices can limit competition and undermine the benefits of liberalisation. These developments call into question the domestic nature of competition rules and the absence of binding rules at the international level. Many countries or regions have implemented comprehensive competition policies, but lack appropriate instruments to apply domestic competition rules to anti-competitive practices with an international dimension, as well as to obtain relevant information outside their jurisdiction. A framework is then necessary to enhance the effective enforcement of competition rules. In the Community anticompetitive practices are effectively dealt with in an even-handed and non-discriminatory way across Member States. Competition policy is a cornerstone of the Community legal order. But there are no competition rules at the global level, and in many foreign markets the means for redress against anticompetitive practices that undermine the efforts of our companies trying to compete are inadequate. There are then four main reasons why the adoption of international rules on competition should be considered: • • • as part of the Community's strategy on market access: anticompetitive practices are keeping our firms out of third country markets but they cannot, in the absence of proper enforcement measures in those third markets, be tackled effectively without international rules. European firms also face a competitive disadvantage if they have to compete on world markets with foreign producers operating from home markets that are subject to less vigorous competition policies. Multilateral rules would promote more equal conditions of competition world-wide; to avoid conflicts of law and jurisdiction between countries and to promote a gradual convergence of competition laws. There is a real need to minimise the jurisdictional conflicts and resulting trade conflicts that can arise, not only from extraterritorial application of certain competition laws, but also from the application of competition law to anti-competitive practices conceived abroad but implemented within one's jurisdiction. Convergence and conflict avoidance would also increase the legal security of firms operating in different jurisdictions, as well as reduce their costs of compliance with competition laws; to increase the effectiveness and coherence of the Community's own competition policy enforcement. As it is in many countries, competition policy is a key factor in 3 supporting the competitiveness of European industry, in protecting a sound functioning of our market economies and in maximising consumer welfare. It needs instruments of cooperation to take account of the effects of globalisation. • Enhanced commitment to competition policy enforcement would strengthen the trading system along the lines of our legal systems and market economies, of which competition law is a basic feature. These concepts are further developed below. b) The competition perspective Within the Community the elimination of trade barriers and the application of competition law have gone hand in hand. This approach is unique in the world. The competition policy of the Community has, in its development over thirty-five years, grown to full maturity and is rigorous and neutral in its application. 3 Consequently, the Community has become a highly integrated market, with the competition provisions of the Treaty protecting the integrity of the common market. In a larger perspective, however, the Community's competition policy and instruments have remained essentially domestic, inward-looking and limited to conduct implemented within the common market and affecting trade between our Member States. Absence of an instrument to deal with transborder cases Many countries or regions which have implemented comprehensive competition policies nonetheless lack the necessary instruments to apply domestic competition rules to anti competitive practices with an international dimension. For example, information central to the investigation may be located outside their jurisdiction and thus be beyond their reach. Absent the necessary proof of anti-competitive conduct, competition authorities are unable to take remedial action. Avoidance of conflict of law and remedies The 1980s and 1990s have seen a significant increase in international mergers, strategic alliances, joint ventures, licensing agreements etc. These arrangements may face examination by different authorities at the same time with a potential for a conflict in the law or remedy applied to the same case. In an extreme example, divergences in the laws applicable to the same set of facts may result in conflicting conclusions as to the legality of the behaviour under review. However, even where there is a common view as to the anti-competitive nature of the conduct, the remedies imposed in each jurisdiction may be incompatible. Greater convergence of laws and cooperation between competition authorities would reduce the likelihood of such conflicts and promote greater legal certainty for business. Avoiding unnecessary duplication of work and costs The review of commercial practices involves considerable work and costs, both for competition authorities and for the businesses whose conduct is subject to review. If the same commercial practice fails within several jurisdictions the costs increase accordingly. In parallel, those member States who did not have competition authorities prior to the establishment of the Community, have enacted legislation and set up enforcement structures at national level 4 Greater cooperation and the elimination of unnecessary duplication of effort, can reduce costs to competition authorities and business alike. Export cartels Certain practices are difficult to tackle under present rules by any agency. For example, export cartels4 have, for trade reasons (the wish of countries to improve their terms of trade) not been subject to competition law in exporting countries. For legal and practical reasons too, competition law has not been applied. Absent an effect on the exporting country's markets, the competition authority has no jurisdiction over export cartels. For the importing country, export cartels have an effect on the market and so jurisdiction can be established, but the evidence needed to prove the existence of the cartels is located outside the importing country's jurisdiction. In all these cases the instruments at the disposal of the Community and its Member States are inadequate. More generally, in today's liberalised world the Community cannot be without an external dimension to its competition policy. The Community interest is to seek the same commitment to competition enforcement from our partners in their markets as we apply to operators, irrespective of their origin, on ours. c) The trade perspective Balance of access opportunities Anticompetitive practices affect the balance of access opportunities negotiated between WTO Members. They belong to the next barriers to trade in a liberalised world. The application of competition law contributes to creating accessible markets and to assuring the overall openness and stability of the trading system. Community efforts in this area need to be matched by our partners. Competition policy is now clearly trade-related, and the application of competition law principles on export markets will help level the playing field and promote equal conditions of competition for our firms competing on international markets. While governments today are subject to very strict international disciplines in respect of the laws they make or the measures they apply, as soon as these have an effect on trade, no rules exist at the international level to control anti-competitive commercial practices. Such practices can replace formal governmental barriers that have been reduced or eliminated. Arguably, the incentive for firms to engage in anticompetitive behaviour impeding market access, (such as cartels combined with boycotts, exclusionary abuse of a dominant position, exclusionary vertical restraints) increases with the reduction of tariffs and other barriers. Also, as industrial structures in emerging economies increase in sophistication, so will the devices used by firms to protect the market from foreign competition. Finally, governments whose freedom of action to support domestic industries through administrative measures has been curtailed by international rules, may be tempted to maintain lax standards of competition regulation or enforcement, or to grant exceptions, to protect specific industrial sectors. Export cartels are a specific problem insofar as their negative effects are only felt in the market of the importing country, while the relevant information is situated in the exporting country. The latter of course has neither an interest, nor the jurisdiction to take action. 5 Although competition rules do exist on many of our export markets, anticompetitive practices are often impossible to tackle without active enforcement by the domestic competition authority. In the absence of international rules our firms have to rely exclusively on the commitment and tenacity of third country agencies to have their concerns addressed5. Recent developments confirm that real or perceived anticompetitive practices can generate trade friction and that the trading system has been unable to effectively resolve disputes in the absence of agreed rules of conduct6. Trade instruments The inadequate application of competition principles on different markets can have other trade effects. Cartellization or similar restrictive behaviour in a foreign country can enable firms to make supracompetitive profits at home and then sell products on export markets below cost price. This may trigger the use of legitimate trade instruments such as antidumping duties by the importing country. But the use of trade instruments will not address the activity on the exporting country's market and may also have negative side effects. From an economic perspective it is therefore less efficient than tackling the conduct on the exporting firm's home market. Even where there is no evidence of dumping, the protection afforded to companies through an inadequate application of competition rules on their home markets may place them in an advantageous position when competing on foreign markets. d) Jurisdictional issues: avoiding unilateral measures Some competition authorities pursue policies to address market access problems, caused by anti-competitive practices on foreign markets, by extending the territorial scope of their national competition rules. This raises concerns of jurisdiction7 and sovereignty, and can lead to conflicts between countries. Moreover, there are limits to the effectiveness of such a policy given the legal and practical obstacles to seeking information outside one's jurisdiction. Note, however, that in the US the enforcement system is geared towards private action in civil courts : private parties are actively encouraged to bring cases by the possibility of winning treble damages. The competition provisions in the EC Treaty and national legislations can also be invoked by private parties before national courts. Domestic courts in third countries are often not, however, as easily accessible. Note, however, that in May 1995 Kodak filed a petition with the US Government (USTR) under Section 301 of the US Trade Act, alleging that there are anticompetitive barriers restricting open access to the Japanese market for consumer photographic film and paper. On 13 June 1996 Acting USTR Barshefsky made a determination of "unreasonable practices" and initiated dispute settlement in the WTO, on the grounds of "nullification and impairment" of expected GATT benefits and violation of GATS commitments. Consultations will also be conducted under the 1960 GATT Decision on restrictive business practices. See The 1995 US international antitrust enforcement guidelines. US attempts to impose its law beyond its jurisdiction led Canada, France, Germany, the UK, the Netherlands and Switzerland to adopt blocking legislation. Section 301 of the 1974 Trade Act also allows trade action to be taken to counter the toleration by foreign governments of anticompetitive practices. Enhanced international cooperation would limit competition authorities' need to resort to extraterritorial action. There are compelling advantages to solving problems through cooperation, especially the anticompetitive behaviour can be eliminated. if such cooperation likelihood improves that the e) Historical background and recent developments There have been many initiatives to establish rules on anticompetitive conduct in the past. The Havana Charter was based on the concept of comprehensive rules covering both public and private practices and devoted a whole chapter to restrictive business practices8. The Charter was not ratified however and was succeeded by the more modest GATT, which examined the trade-competition interface a number of times in the 1950s and 1960s, but with no clear result 9. In the 1970s a full Competition Code was finally negotiated in the framework of UNCTAD10 at the request of developing countries. Its provisions are not binding. The OECD has carried out significant work in the international competition area for many years. It has adopted a Recommendation that includes a non-binding but functioning notification instrument between Agencies, which has been revised a number of times11. The WTO contains limited tailor-made rules on competition in each of its three "pillar" Agreements 12. The General Agreement on Trade in Goods (GATT) has an annexed Agreement on Trade Related Investment Measures (TRIMs) which provides for a review, to be conducted within five years of its entry into force, to consider whether the Agreement should be complemented with provisions on competition policy13. The See its Chapter V. The 1947 Charter foresaw the establishment of an International Trade Organisation to oversee world trade. The Organisation was mandated to act against anticompetitive practices: it would have had an investigative capacity and be entitled to issue recommendations on remedial measures. The Charter, which also included rules on investment, was not adopted and a number of its provisions were bundled together in the less ambitious GATT Treaty that was, in turn, superseded by the WTO on 1 January 1995. 9 See GATT BISD 7S/29, 9S/28,170. The Set of Multilaterally Agreed Equitable Principles and Rules for the Control of Restrictive Business Practices was adopted by the UN General Assembly in December 1980. (UN Doc. A/35/48 (1980)). 11 12 13 Amended in 1995. This Recommendation includes a voluntary dispute settlement procedure, which has never been used. (C (95) 130/final). The WTO has three "pillar" Agreements, covering trade in goods (GATT), trade in services (GATS) and the trade-related aspects of intellectual property rights (TRIPs). The Agreement establishing the WTO itself as well as the integrated Dispute Settlement Understanding overarch the three separate Agreements. The WTO also includes a number of Plurilateral Agreements, which are binding between the signatories only. The GATT Agreement on trade in goods contains a provision to ensure commercial conduct of enterprises that have been granted special or exclusive rights (Article XVII GATT - which docs not function very well). It has been argued that anticompetitive conduct could be tackled through a so-called "non-violation" complaint. Multilateral rules on investment are currently being negotiated in the OECD and the WTO may start Agreement on the trade-related aspects of intellectual property rights (TRIPs) contains provisions on the control of anti-competitive practices or conditions in contractual licenses, relating to the transfer of technology or of other proprietary information. It also recognises the right of countries to regulate such practices through their domestic laws, and it provides for consultations and exchange of information between governments where there is reason to believe that licensing practices or conditions constitute an abuse and have an adverse effect on competition in the relevant market. Likewise, the General Agreement on Trade in Services (GATS) contains provisions on consultation and exchange of information, similar to those in the TREPs Agreement, and requires countries to ensure that monopoly services providers do not abuse their position in activities outside the scope of their monopoly privilege. However, the scope of these provisions remains very limited for the effective control of anticompetitive practices at the international level. More importantly, the lack of more comprehensive multilateral principles and standards for the application and enforcement of competition policies, may undermine past and present international trade liberalisation efforts. Parallel to the above developments an increasing number of countries have negotiated bilateral agreements on cooperation between their competition authorities. Such Agreements have been negotiated in the Union both at the Community and the national level. At Community level, for example, a cooperation agreement has been concluded with the US. Amongst others it provides for notification of enforcement activities by one party that may effect the important interests of the other; information exchange in certain circumstances; consultation and cooperation and avoidance of conflicts over enforcement activities. The so-called positive comity instrument stands out14, because it permits a party whose important interests are affected by anticompetitive practices within the other party's territory to ask the latter to examine them and take appropriate measures. In general, the substance of these treaties has also evolved and their contents are more developed today than before. Notwithstanding the wide consensus on the promotion of deeper bilateral cooperation among competition authorities, bilateral cooperation agreements, similar to OECD efforts, remain limited in scope and in effect. In scope, because although increasing, only the EU and a limited number of countries which are very actively involved in enforcing competition policies, have entered such agreements; and, in effect, because these agreements do not contain substantive rules or principles. Another question is whether, next to the above, the proliferation of sector-specific trade agreements that include competition provisions which each have their own specific characteristics, can be kept coherent. This becomes more significant as the interrelationship between trade in goods, services and foreign investment increases, and as respective geographic markets overlap. At best, firms will press governments to ensure that their policies are streamlined and consistent. At worst, they will seek to exploit the provisions of such agreements for narrow corporate advantage through forum- shopping. work in this field soon. Competition rules may contribute to ensuring that (foreign) investments are only made under sound and competitive conditions. 14 SeeArticleV. A more coordinated policy grouping together a number of countries and straddling all sectors of the economy then needs to be considered. II. WHICH FORUM ? There are four alternative fora to house an international framework: the OECD, UNCTAD, the negotiation of a separate, stand-alone agreement, or the WTO. The OECD has been involved in the area of international competition rules for a long time and is serviced by an independent Secretariat. It has the organisational capacity to cater for the negotiation of an agreement on international competition rules. However the OECD has three disadvantages: it does not have a track record of dealing with binding commitments and dispute settlement, it does not provide the disciplines on competition- related trade measures (which are dealt with in the WTO), and, importantly, it has a limited Membership. UNCTAD developed a full Competition Code in the 1970s which has been regularly revised. However, many of the same objections that apply to the OECD also apply to UNCTAD, i. a. the absence of a tradition of dealing with binding commitments and the lack of an overlap with competition-related trade disciplines (which are dealt with in WTO). It may be difficult to gather the necessary political momentum in different countries for an independent, stand-alone agreement, and its functioning would likely have higher overhead costs. The WTO is the prime candidate for a framework of competition rules: it has a near universal membership15. The WTO can provide a balanced response sensitive to the varying interests and concerns of both developed and developing countries. The WTO is the recognised institution for trade related international economic rules. Many of its present rules are closely related to competition issues (especially those on subsidies, state enterprises and intellectual property). Some of its Agreements already have a number of specific provisions to address anticompetitive practices (see under I. e above). The institutional infrastructure of the WTO includes a system of transparency and surveillance through notification requirements and monitoring provisions. These are common to many WTO/GATT Agreements. The WTO also provides a forum for continuous negotiation and consultation, where its Members could bring their trade- related competition concerns. Furthermore, the Organisation has a reinforced and legalised dispute settlement system between governments. This can back-up agreed rules and provide means for conflict resolution. The WTO also caters for the possibility of negotiating an Agreement with specific Over twenty five former state trading economy countries, amongst which China and Russia, are currently negotiating their accession to the WTO. disciplines between a limited number of signatories (thereby creating a so-called Plurilateral Agreement under Annex IV of the WTO Agreement). III. AN INTERNATIONAL FRAMEWORK OF RULES ON COMPETITION - ISSUES FOR CONSIDERATION A premise of this Communication is that the creation of an International Competition Authority, with its own powers of investigation and enforcement, is not a feasible option for the medium term. Countries would at this stage be unwilling to accept the constraints on national sovereignty and policies that such a structure would impose. The proposals set out below and in the annex therefore reflect a more modest approach, built on commitments binding governments and providing intergovernmental procedures. This is also the model on which the international trading system has been built since the Second World War. Work on a framework of international competition rules is most likely to make headway if a progressive approach is adopted. The objective would be to strengthen competition policy coordination in steps (building-blocks approach). This could be achieved through the creation of a working group in WTO, whereby initial work might be limited to those areas where consensus can be mustered at an early stage, and more ambitious objectives would be tackled later. The main steps can be identified as follows: a) Adoption of domestic competition structures A first step could be taken by WTO Members committing themselves individually to assuring the existence of domestic competition structures. The core elements of such a structure would be : having basic competition rules in domestic laws to address anti-competitive practices, covering restrictive agreements of companies, abuse of dominant position, and mergers; having or creating domestic enforcement structures to guarantee an effective implementation of those rules, including proper investigatory instruments and appropriate sanctions; ensuring access for private parties to the domestic enforcement authorities, including national courts, on equitable, transparent and non-discriminatory terms. b) Adoption of common rules In parallel WTO Members could seek to identify a core of common principles, and work towards their adoption at international level. This would : promote equal conditions of competition world-wide; facilitate closer cooperation between competition authorities and pave the way for 10 the coordination of international enforcement activity; promote a gradual convergence of competition laws. Common principles or rules can be developed progressively and step by step. It may be opportune, in a first stage, to concentrate on horizontal restraints (price or output fixing or market sharing cartels, bid-rigging, group boycotts, export cartels). Work on other practices (abuse of a dominant position, certain vertical restraints such as exclusive distribution or supply agreements) could start in parallel, but may take more time. c) Establishment of an instrument of cooperation between competition authorities Transparency is an essential element of a framework of competition. Provisions could be developed on notification, information exchange and cooperation between competition authorities. These could include provisions regarding cooperation procedures, for example when agencies are launching parallel investigations into the same practice. Negative and positive comity instruments could also be developed further16. d) Dispute settlement Apart from its natural role as a permanent forum for negotiation adapting or strengthening agreed rules and obligations, the WTO also provides a compliance mechanism to help settle disputes between governments when a country claims that agreed WTO rules have been breached. Private parties do not have access to the WTO's dispute settlement system. The WTO mechanisms could be applied if a country for example fails to set up a domestic competition structure or if it fails to react in a specific case to a request for enforcement action lodged by another WTO Member. The relevant rules could be adapted, if necessary, to the specificities of competition law and policy, and could be applied in a progressive way. The above concepts are further developed in the annex. IV. RELATED ISSUES a) Wb9 should participate? An international agreement on competition rules would bring benefits to all nations of the trading community. All countries could participate in an agreement to incorporate competition law provisions in their domestic laws. At the same time the application of the cooperation and enforcement provisions would require, of participating countries, that they have a sophisticated administration capable *" These could be inspired by OECD provisions as well as those in bilateral agreements. The principle of negative comity implies that a Party will take into account the important interests of another Party before action is taken. Through the positive comity instrument (see also above page 7), a Party may request another to act on the basis of its own powers, to investigate activities which adversely affect the important interests of the first Party. 11 of handling sensitive information and of assessing commercial practices in a dynamic context. Many developing countries do not yet have this administrative machinery. It is therefore realistic to expect that, if adopted, cooperation provisions of a competition agreement would, in a first stage, apply only between a limited number of signatories with mature antitrust agencies. Provisions could group together developed and advanced developing countries to start with, and gradually come to include more countries. Any country able to shoulder the obligations of the agreement could be eligible to participate. A different intensity of cooperation, for example in the field of information exchange, could apply between different countries. b) The interest of developing countries Private anticompetitive practices have long been a concern for developing countries. As the turnover of many multinationals has come to surpass the GDP of middle size developing countries, developing countries have seen a growing need for a minimum of discipline on private conduct in their markets. It was in response to this that UNCTAD developed its competition Code in 1980. It would certainly be consistent with this stance for developing countries to support a further strengthening of international rules, certainly if these would come to cover practices, such as export cartels, that today escape effective control 17. Even if developing countries might not, in a first stage, participate in the provisions on cooperation between competition authorities (see under HI a. above), they would be beneficiaries of enhanced control over anticompetitive practices with an international dimension. They would also, like other WTO Members, have access to the dispute settlement provisions if agreed basic rules and enforcement structures had not been properly implemented by other countries. Moreover, they would benefit from the acceptance by developed or newly industrialised countries of MFN obligations in the competition field, even if their own obligations were lighter (eg. in respect of transitional periods). Finally, all WTO Members, including developing countries, would benefit from possible dispute settlement judgements which might create new market access opportunities. Insofar as competition rules can ensure that investments are made under sound and fair conditions, effective competition structures can support liberal investment regimes. The establishment of appropriate competition structures is a complex task and requires substantial resources and training. A framework on competition should include provisions on technical assistance for those countries requesting it. c) The relation to trade defence instruments 17 Note, however, that a competition framework cannot be a panacea for the difficulties faced by developing countries as a result of their limited domestic instruments and capacities of investigation. This reinforces the need for developing countries to be able to benefit from technical assistance. 12 The relation between the elaboration of a competition framework and the functioning of existing trade instruments is a key issue in the trade-competition debate. It is true that the incorporation of competition provisions into trade law and/or more comprehensive and effective enforcement of competition policies international cooperation, would lessen the need to have recourse to instruments of commercial defence. However, competition instruments cannot be seen as substitutes for trade instruments. The latter only lose their raison d'être in the context of fully integrated markets. A framework of competition rules would, therefore, complement present trade law and create a new instrument to tackle anticompetitive behaviour in markets which are not integrated. Thus the development of new instruments would complement, not supplant, present instruments. increased through The above is illustrated by practice within the EC itself. Antidumping action is excluded on intra-Community trade, as this is a fully integrated market 18. This integration has meant, for Member States: the elimination of all tariffs, the elimination of measures of equivalent effect to tariffs (which is a wider concept than GATT's national treatment obligation) and the adoption of the four freedoms (goods, services -including establishment, capital - including investment, and labour). The single market programme and relative currency stability have been added to this. Competition law has been applied effectively, amongst others with an explicit objective to integrate the markets of Member States, by an authority with autonomous powers of investigation and enforcement. All of these elements are absent in present day world trade. Finally the framework explored under H. above falls well short of EC competition structures, and would have to prove its worth. d) The relation to the Community legal order and Member States A basic assumption of this Communication is that a framework of competition rules, negotiated in WTO, would be compatible with EC competition law, in particular the provisions of the EC Treaty. The WTO instrument would, as is traditional in GATT/WTO, apply to governments and not be self-executing or have direct effect. It would also be much more general than the relevant provisions under EC law, and the emphasis would in the first stages be on procedural obligations. For these reasons alone it is highly unlikely that there should be any friction between a WTO panel report on the rules agreed in the WTO, and ECJ case law on Articles 85 and 86 and related legislation19. Moreover firms are already, including within the Community, subject to different competition regimes, and an objective of an international framework is exactly to promote equivalent and rational application of competition principles on different markets. 18 The EEA Agreement between the EC and EFTA countries follows the same approach: anti-dumping is excluded in those area's where the "acquis communautaire" has been taken over. In trade between the Community and the countries of central and eastern Europe, however, anti-dumping action can still be taken, as well as between the US, Canada and Mexico in the NAFTA context. The same applies between the EU and Turkey: anti-dumping action remains a possibility despite the customs union agreement. 19 A case where a WTO instrument and a corresponding EC regulation are even closer than in the competition field is anti-dumping. In this case the latter is even an implementation of the former, yet friction between panel reports based on the WTO instrument, and ECJ judgements based on the EC regulation, has so far been avoided. 13 A second issue concerns the question of participation in an international framework. As competition is not an exclusive Community competence, international cases might involve either the Community (if trade between Member States were affected) or a single Member State (if it alone were affected). A framework of rules would have to take account of both cases, while preserving the unity of Community action in the trade field. V. CONCLUSIONS The Commission requests the Council to take note of this Communication. Noting that by pursuing stronger multilateral efforts the benefits of greater convergence and improved competition standards and enforcement would be realized world-wide; Considering that an international framework of competition rules can promote a level in playing field and could therefore reduce the costs, distortions and conflicts international trade arising from differing domestic competition regimes; Recognising that, alongside continued bilateral cooperation with principal partners stronger multilateral cooperation in the field of competition is desirable and feasible at this time, and would contribute significantly to a more efficient, stable, and integrated global economy, from which both the Community and its Member States, as well as all WTO Members, would benefit; Recognising that the possible development of an international framework of competition rules is in the interest of all trading nations, irrespective of their level of development; Considering that the Community has a sound experience in applying uniform competition principles across different countries. The Commission suggests the Council to conclude along the following lines: • The Community should prepare a position for the WTO Ministerial meeting in Singapore in December 1996; this should propose to WTO Members that the Organisation establish a Working Party to conduct exploratory work, from 1997 onwards, on the development of an international framework of competition rules; • • • Such a framework could include, in particular: a commitment by all countries to adopt domestic competition rules and enforcement structures and, for a limited number of countries, an instrument to allow information to be exchanged between competition authorities, an instrument to request action on foreign markets, and an intergovernmental dispute settlement mechanism; that the European business community should be consulted and appropriately associated as progress in this area is made; that the Community should take the lead on this issue and initiate efforts to build international consensus and encourage other WTO Members to support multilateral work in this field; 14 to request the OECD and UNCTAD to pursue their work on trade and competition taking account of developments in WTO. 15 ANNEX This annex outlines the main concepts set out under Part HI of the Communication. Many of the concepts have been extracted from OECD documents and other sources, and are included on an exploratory basis: a) Adoption of Domestic Competition Structures The process towards an international framework of competition rules could be carried out in a progressive way. A first step could be to ensure that each country provides for competition rules in its national législation, covering restrictive agreements, abuse of dominant position and mergers. This would include the provision of a set of equitable procedures ensuring an effective application of the rules, including investigatory instruments and appropriate penalties, as well as access to the judicial system, transparency and non-discrimination. Although an increasing number of countries have a sophisticated competition law for the effective control of restrictive business practices, some (developing) countries have yet to introduce such rules. An added advantage of agreement by all countries to enact competition laws is that domestic courts would become an integral part of enforcement procedures, as they are in most industrialised countries already20. Firms could not then be obliged to respect agreements which were forbidden: these would be unenforceable before national courts. Another important issue is sectoral comprehensiveness. A recent OECD study has revealed that even in OECD countries substantial gaps exist in the coverage of competition laws; most countries exclude sectors of the economy from their competition law application21. A first step in addressing this could be taken by a listing of these sectors and a commitment to stand-still and gradual reduction by all countries22. Competition rules should likewise apply to all economic operators. Public enterprises, and companies with special or exclusive rights should be covered, except for that part of their activities where their public task overrides the interests of competition law application. b) Agreement on Common. Rules There is general recognition of the negative effects on competition of horizontal restrictive practices: cartels, market sharing, boycott of foreign firms, price fixing, bid rigging, collective exclusive dealing. It should be possible to formulate international provisions at an early stage to combat these practices. Relevant provisions should also 20 21 A similar approach was adopted in the Uruguay Round negotiations on the respect of intellectual property rights (TRIPs). Overview on Coverage of Competition Laws and Policies by Prof. B. Hawk. 22 See OECD work in this respect. JL cover export cartels. These are exempted from the applicability of competition law in exporting countries. Although such cartels are covered by the legislation of most importing countries23, they are hard to tackle due to a lack of information in the importing country. An international agreement to outlaw export cartels would put an end to these "beggar thy neighbour" policies. Vertical restrictions, such as exclusive distribution or supply agreements, should also be considered, but a longer period may be required to reach consensus, and countries may wish to maintain a greater degree of latitude in their assessment of the effects on competition of vertical restraints24. A common approach to vertical restrictions could be found by concentrating on restrictions which create barriers to market access. The working group could examine to what extent competition authorities could take into account the international dimension and weigh the effects on domestic competition of market access restrictions, when a complaint is lodged through the provisions of the international framework (see later). Such a review by a competition authority would reflect the fact that no adequate assessment of competition cases can be made without careful examination of the international context: competition policies cannot be identical in different countries, and that each market needs to be assessed in its own context, in consideration of the economic conditions and structures influencing the openness, and thus the competitive situation, of that market. In their review of practices, competition authorities would, as many already do, give weight to factors such as: the effect of trade barriers (tariffs and non-tariff barriers), regulatory barriers (i. e. divergent standards, restrictions on distribution or supporting services), foreign investment barriers, the import and foreign investment ratio, and the corporate groupings structure. Competition authorities would continue to base their decisions on the efficiency goals that are fundamental to competition policy. But the principle, that the international dimension needs be taken into account in international cases, would be incorporated into common rules with respect to all anti-competitive practices25: As a market would be assessed to be more closed, greater weight would be given to the importance of foreign competition to balance entry barriers. This approach might also be useful in working towards agreement on abuse of dominant It is generally agreed that exclusionary practices; hindering of access to position. essential facilities; practices with possible foreclosure effects such as fidelity rebates or tying arrangements; and production limitation can all amount to abuse of dominant 23 E. g. Wood Pulp - judgement of the European Court of Justice of 27 September 1988, 1988 ECR 5193. 23 Partly due to differences in underlying objectives and principles the Community and some trading partners have different approaches: the Community is relatively strict on vertical restrictions that interfere with market integration - export bans and some territorial restrictions; the US take a more tolerant view. An exception is resale price maintenance which is prohibited in most juridictions. 25 This approach is similar to the one taken in the Havana Charter (Article 46), where an abscnsc of government action to prevent a limitation of access to markets could constitute a violation of its provisions. The jurisprudence of the European Court of Justice follows similar lines, i. e. that a practice should be assessed in its economic and legal context, and to the weight traditionally given to the objective of ensuring market access, although only between Member States. E. g. Henninger (Delimitis) - judgement of the ECJ of 28 February 1991. 2 1} position. As European competition policy enforcement has shown, these practices are capable of affecting trade and creating access barriers. Other practices would require further consideration: excessive pricing, predatory pricing, some vertical arrangements. There has been a great increase in the number of international mergers. It would be premature to suggest international substantive rules in this area. At the same time firms are today having to notify the same merger to several different competition authorities. Procedural harmonisation would avoid unnecessary duplication of efforts of firms and agencies and, in encouraging cooperation, would limit the potential for contradictory decisions26. A first step could be taken by harmonising notification filing forms and deadlines27. c) Establishment of Instruments of Cooperation between Competition Authorities Meaningful information exchange is a key element of cooperation between competition authorities. At the same time business information is subject to strict legal protection in all jurisdictions and it is difficult to imagine confidential documents being exchanged between competition authorities as a routine matter28. Information exchange would have to be developed cautiously. In a general sense the will of agencies to cooperate will certainly be the greatest when they are investigating a same case and intend to apply similar enforcement criteria. Exchange becomes more difficult when different solutions are being envisaged. At the extreme there may be a situation where one agency seeks clear enforcement measures while a counterpart has no intention of taking action. Although the last example is the most difficult, it is then that the need for exact information may be the most acute. An important first step towards the development of rules on information exchange could be to catalogue the types of information that are considered confidential in different countries, and what forms of legal protection apply. An international framework could, in the beginning, provide for the exchange of non confidential business information between a group of core participating countries. A further step might be taken, if this mechanism is felt to function well, by considering 26 The 1990 Merger Regulation has extrajurisdictional effects: it includes competence for the Commission to examine mergers of firms headquartered outside the EC, if they have a turnover of 5 billion Ecu or more and where two of the undertakings concerned have a turnover within the EC of at least 250 million Ecu. As more Agencies scrutinise mergers it is possible that one Agency may forbid it, while another imposes conditions such as divestiture of certain parts or alternatively may see no objection at all. 27 28 The OECD 1993 Whish/Wood "Merger Process Convergence Report" has made a number of proposals to harmonise international procedures in the field of merger notifications. It should be recalled that extensive international information exchange possibilities do exist in certain sectors, for example between authorities controlling securities trade. And different levels of information exchange have already been agreed in the competition field: the EEA Agreement for example provides for a sharing of information between the Commission and the EFTA Surveillance Authority. Although the EC/US Cooperation Agreement does not provide for the exchange of confidential information, US Congress in 1994 did pass new legislation to enable the antitrust agencies to pursue reciprocai arrangements for the purpose of exchanging confidential information, even in cases where sanctions that may be taken are different to those under US law. 3 whether certain authorities are ready to exchange information of a more detailed nature bilaterally on the basis of consent. Clearly, such an exchange of confidential information would have to be made subject to a set of criteria and guarantees. It is conceivable that agencies would wish to make exchange subject to the fulfilment of certain conditions (e. g. guarantees on confidentiality or limits to the use of the supplied information): in particular the receiving authority would have to commit to refrain from taking In any case, full exchange extraterritorial action on the basis of that information. obligations are likely to be a longer term objective. Clearly the European business community should be consulted and closely associated as options and conditions regarding the exchange of confidential information are explored. In antidumping investigations officials actually have extra jurisdictional information gathering possibilities - they are usually given direct access to the files of the firms they investigate in third countries. A similar element could be considered in competition cooperation by enabling officials to assist their colleagues in third countries when investigations are being pursued. The cooperation procedures that apply in internal Community cases between DGIY and Member State authorities is one example of such procedures. Another key element of cooperation between authorities is the positive comity instrument, which has already been included in recent bilateral competition agreements29. Options need to be explored to further develop this concept and to incorporate provisions that will generate enforcement by third country agencies, while respecting each others' autonomy. In particular it could be considered whether and under which conditions competition authorities could, within reasonable limits, be obliged to investigate on behalf of one another, and to have to indicate to a requesting counterpart within an agreed time-limit whether enforcement action is envisaged30. A decision not to act would have to be reasoned and supported by relevant factual material. d) Dispute Settlement The gains of international cooperation have been set out earlier. It is clear, however, that the advantages would be the greatest if countries can be committed to abide by agreed rules. That would generate a commitment to enforcement. A framework should therefore have a binding character. A central question concerning the development of a dispute settlement system, which would apply between governments, relates to the standard of review that an international panel could apply. At a first stage, review by a panel might concentrate on procedural aspects: whether a country has enacted a domestic competition structure as agreed; if a country is subject to information exchange obligations, whether these have been complied with; and, if a country has commitments in this area, whether the transparency ™ See also above in footnote 16. 30 This has implications for the allocation of resources of antitrust agencies. It may be necessary, in a first stage, to put a maximum on the amount of complaints one agency could lodge to another within a framework per year, or to have a threshold (e. g. turnover in the product concerned) below which the mechanism would not apply. 4 /f motivation and timetable requirements of the positive comity instrument have been met in a specific case. The dispute settlement system could be extended to include review of whether the statement of the reasons for the national decision was adequate, whether the facts have been accurately stated, whether there has been any "manifest error of appraisal" of the facts or whether there has been a "misuse of powers". An important issue would be the deadlines applied to resolution of international disputes. This is because firms confronted by anticompetitive practices in many cases have the option of asking for application of a protective trade measure. These can be activated at short notice. Clearly a framework to tackle anti competitive practices through competition instruments will have to function with short deadlines if it is to offer a credible alternative. Another key issue relates to remedies when a country is condemned by an independent panel. Countries could be authorised, in the absence of corrective action by a foreign agency and under specified conditions, to take extra jurisdictional action through use of their own domestic competition laws. In cases where this is not viable, (for example if there are no subsidiaries of the targeted firm or firms in one's jurisdiction), measures usually foreseen in the trade context, such as the withdrawal of tariff concessions31, are likely to be more acceptable than competition sanctions, e. g. international fines, as a next step32. Insofar as an agreement on competition might include binding elements, it is possible that a derogation clause of some kind may be considered necessary. This would cater for cases where the essential interest of a party is felt to outweigh the enforcement interest of a trading partner requesting action, for example if the latter has invoked the positive comity instrument. Such an exceptional situation could arise if an authority allows restructuring agreements with restrictive effects. Such issues have been resolved in trade law cases by allowing GATTAVTO Members, in exceptional cases, to derogate temporarily from their obligations and take safeguard action to protect their domestic industries. A similar approach in competition cases, provided measures taken are time- limited, justified, non-discriminatory and transparent, might need to be considered. 3 * The WTO system is geared towards conflict resolution and the withdrawal of trade concessions is only used as a measure of last recourse. In WTO the resolution of conflicts has a sliding scale starting with (1) agreement of the parties at any point during proceedings through consultations; (2) after determination by a panel of a violation of WTO rules, a request to bring the incriminating measure or practice into conformity with the WTO; (3) if this is not possible, the offering of compensation (by means of new or enlarged market access opportunities, for example through tariff reductions or other liberalising commitments), and finally, if neither (1), (2), or (3) are possible; (4) the authorisation to suspend an equivalent amount of concessions. 32 From a competition angle the withdrawal of trade concessions may seem to contradict the objective of increasing competition, as its effect would be to lessen access opportunities to a market. In GATTAVTO practice, however, the ability to withdraw trade concessions has actually had a liberalising effect, and has pressed countries to bring their practices into line with GATT law. Countermeasures have only been authorised once. 5 ISSN 0254-1475 COM(96) 284 final DOCUMENTS EN 08 Catalogue number : CB-CO-96-304-EN-C ISBN 92-78-05721-5 Office for Official Publications of the European Communities L-2985 Luxembourg

WRITTEN QUESTION No. 1380/96 by Jesús CABEZÓN ALONSO , Juan COLINO SALAMANCA to the Council. Spanish fruit destroyed by French farmers

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11. 3. 98 EN Official Journal of the European Communities C 76/1 I (Information) EUROPEAN PARLIAMENT WRITTEN QUESTIONS WITH ANSWER (98/C 76/01) WRITTEN QUESTION E-1380/96 by Jesu·s Cabezo·n Alonso (PSE) and Juan Colino Salamanca (PSE) to the Council Subject: Spanish fruit destroyed by French farmers (18 June 1996) In the final days of May this year, groups of French farmers again attacked European lorries transporting Spanish fruit in transit for European Union countries. They also destroyed Spanish fruit already in French markets. What action has the Council taken to prevent any recurrence of these extremely serious incidents? Is it aware that in the last three years, 60 lorries have been attacked? Is it aware that in 1995, the losses incurred amounted to PTA 6000 million? (98/C 76/02) WRITTEN QUESTION E-2022/97 by Joan Vallve· (ELDR) and Carles-Alfred Gaso‘liba i Bo¤hm (ELDR) to the Council Subject: Further attacks on Spanish lorries by French farmers (18 June 1997) Since the middle of May 1997 French farmers in various parts of southern France have been making repeated serious attacks on Spanish lorries transporting fruit and vegetables and on distributors(cid:146) warehouses. What steps has the Council taken and does it intend to take to prevent a repetition of these attacks, which violate the right of free movement, a basic principle of the European Union? Do these measures include suspending Community aid to French agriculture? Joint answer to Written Question Nos E-1380/96 and E-2022/97 (25 September 1997) The Council is aware of the acts of vandalism carried out by French farmers in April/May 1996 and May 1997 against lorries carrying fruit and vegetables from Spain to Member States of the European Union. Those acts are illegal under ordinary criminal law and are designed to impede the free movement of Community products which is one of the European Community(cid:146)s basic principles. They are therefore strongly condemned

Proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE relating to the quality of the petrol and diesel fuels and amending Council Directive 93/12/EEC

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 18. 06. 1996 COM(96) 248 final 96/0163 (COD) 96/0164 (COD) COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL on a future strategy for the control of atmospheric emissions from road transport taking into account the results from the Auto/Oil Programme Proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE relating to the quality of petrol and diesel fuels and amending Council Directive 93/12/EEC Proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE relating to measures to be taken against air pollution by emissions from motor vehicles and amending Council Directives 70/156/EEC and 70/220/EEC (presented by the Commission) COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL on a future strategy for the control of atmospheric emissions from road transport taking into account the results from the Auto/Oil Programme 1. BACKGROUND EU Legislation on vehicle emission standards Directive 70/220/EEC(]) was the first directive to lay down emission limits for passenger cars. Over the past two decades subsequent amendments to Directive 70/220/EEC and the adoption of legislation on emission standards for light commercial^ and heavy duty vehicles(3) have strengthened and extended Community policy in this area. When the emission standards. for passenger cars laid down in Directive 94/12/EC(4) (the latest amendment of the 1970 base directive) comes into effect in 1996/97, emissions of regulated pollutants from new passenger cars will be reduced by over 90% as compared to the standards which prevailed in the early 1970s. These improvements in standards are illustrated below in Figure 1. Figure 1 Evolution of Community Passenger Car Emission Standards •5 O S 3 03 OJ t 0- 100 m % co m % HC & NOx (1) (2) (3) (4) Directive 70/220/EEC; OJ No L 76, 6. 4. 1970, p. 1. Directive 93/59/EEC; OJ No L 186, 28. 7. 1993, p. 21. Directive 91/542/EEC; OJ No L 295, 25. 10. 1991, p. 1 Directive 94/12/EC; OJ No L 100, 19. 4. 1994, p. 42. However, despite these considerable achievements with regard to the emission reduction of individual vehicles, increased traffic activity (increased numbers of vehicles, increased kilometres travelled) are likely to counteract these improvements and to militate against overall emissions being reduced to a level consistent with the attainment of future air quality objectives. Given the reductions already achieved, further action to reduce vehicle emissions necessitated a reassessment of the existing policy approach since the emission reduction potential offered by further improvements in vehicle technology, was limited and possibly very costly in comparison to other potential solutions. The Commission, in October 1992 therefore organized a conference with all relevant interest groups to discuss the» issue of vehicle emission standards for the year 2000 and beyond. The major conclusion from this conference was that future emission standards should be based on an integrated approach and should have as their objective the achievement of air quality targets. In this context it was recognized that further steps would be needed not least because of increased traffic activity (increased numbers of vehicles and increased kilometres travelled). This new approach was outlined in the legislative proposals the Commission submitted to Council and Parliament in 1992. It is reflected in Article 4 of Directive 94/12/EC "which was adopted by Council and Parliament in 1994 under the co-decision procedure. The main elements of Article 4 are outlined below: "In these proposals [future proposals for emission standards to apply from 2000] the Commission shall take the following approach: the measures shall be designed to produce effects to meet the requirements of the Community's air quality criteria and related objectives, an assessment of the cost effectiveness of taking each measure shall be undertaken; in this global assessment full account shall be taken, inter alia, of the contributions that: traffic management, costs appropriately, for example by spreading the environmental enhanced urban public transport, new propulsion technologies (e. g. electric propulsion), • the use of alternative fuels (e. g. biofuels), could make to improving air quality, the measures shall be proportional and reasonable intended objectives. in the light of the The proposals, taking account of the methodology outlined above and aimed at a substantial reduction of pollutant emissions as regards the vehicles covered by this Directive, shall comprise in particular the following elements: 1. Further improvements in the requirements of this Directive: based on the assessment of the potential of the Traditional engine and post-combustion technology, possible improvements in the test procedure, e. g. cold-start, starting in low or wintry tests), evaporative emissions, temperatures, durability conformity (e. g. the in measures at the level of type-approval supporting strengthened inspection and maintenance requirements, including, for example, on-board diagnostic systems, the possibility of checking the conformity of vehicles in circulation, the proportional need for: (i) specific limits for HC and NOx in addition to a cumulative limit value, and (ii) measures to cover pollutants not yet regulated. 2. Complementary technical measures in the framework of specific Directives, including: improvements in fuel quality as far as vehicle emissions of dangerous substances (in particular benzene) are concerned, strengthening of the requirements of the inspection and maintenance programme. The reduced limit values which will be the subject of the new Directive shall not apply before 1 January 2000 for new type-approvals. The Council shall decide on the conditions for granting tax incentives on the basis of these limit values. " While Directive 94/12/EC was only adopted in 1994, Article 4 of that Directive is the formal expression of the framework within which the Commission carried out its preparatory work for the development of future legislative proposals directed at the reduction of emissions from road transport to be effective from the year 2000. 2. THE AUTO/OIL PROGRAMME In recognition of the fact that the future Community policy on the control of vehicle emissions should be based on an integrated and comprehensive approach and taking into account the potential of a wide variety of different measures for bringing about cost-effective solutions, the Commission, in 1992, invited the European oil and automobile industries to participate in a collaborative programme with the intention of developing a solid technical foundation upon which the Commission could build its future strategy: this programme subsequently became known as the Auto/Oil Programme. (A short summary of the technical analysis carried out in the Auto/Oil Programme is included as Annex 1 to this Communication. A more detailed explanation of the programme can be found in a consolidated technical report). The Auto/Oil Programme was a ground-breaking initiative in which the resources and expertise of two major industries were combined in collaboration with the services of the Commission and focused on the challenge of developing a rationale basis for future legislative action. The programme is an example of the principle of partnership identified in the fifth Environmental Action Programme. The Commission would like to record its thanks and appreciation to both industries in demonstrating their commitment to the goal of-sustainable development in such a tangible manner. In particular the extensive research programme known as the European Programme on Engines Fuels and Emissions (EPEFE) has provided a unique insight into the relationship between engine technology/fuel quality and vehicle emissions. The rationale of the Auto/Oil Programme was to quantify both the cost and the emission reduction potential of a variety of different measures which could contribute to reducing vehicle emissions and the attainment of air quality targets. The measures which were included in the analysis included not only advances in vehicle technology and fuel quality but also the benefits of improvements to the regular inspection and maintenance procedures as well the potential contribution of non-technical measures such as road pricing, improved public transport and scrappage schemes. The objective of the auto/oil analysis was to identify cost effective packages of measures sufficient to reduce vehicle emissions to the level compatible with the achievement of rigorous air quality standards throughout the Community. 3. CLEAN AIR: THE MOTIVATION FOR REDUCING VEHICLE EMISSIONS review process as well as Article 4 of Directive 94/12/EC requires that measures to reduce emissions from road traffic shall be designed to meet the requirements of the Community's air quality criteria and related objectives. The existing Community legislation on air quality objectives and dealing inter alia with nitrogen di-oxide, sulphur dioxide and particulate matter, lead and troposheric ozonze are currently being revised. In order to take account of the latest information emerging from that the existing World Health Organization air quality guidelines, the Commission and the two industry partners in the Auto/Oil Programme agreed to explore a number of air quality objectives: these objectives and the way they were used in the Auto/Oil Programme are described in summary form in the Annex to the present Communication and in greater detail in the consolidated air quality report from the Auto/Oil Programme. The critical air quality objectives which were eventually used as the basis for designing the package of measures to reduce road transport emissions are presented in Table 1. the ongoing work revise to Table 1 Air Quality Targets Pollutant: Urban N02 Air Quality Targets: 200 ug/m3 As maximum hourly value Urban Carbon Monoxide 10 mg/m3 As maximum hourly value. Urban Benzene Urban Particulates Tropospheric Ozone 10 ug/m3 As an annual mean 50 ug/m3 As a24 hour rolling average 180 ug/m3 As a one hour 99 percentile value. 4. REDUCING EMISSIONS FROM ROAD TRANSPORT STRATEGIES: SHARED RESPONSIBILITY INTEGRATED The Auto/Oil Programme focused exclusively on the control of emissions from the road transport sector. While for the majority of atmospheric pollutants road transport constitutes the single most important source of emissions other sources such as power stations, Industry and individual households also make a significant contribution. The implementation of the measures arising out of the Auto/Oil Programme will ensure that emissions from road transport are reduced to a level compatible with the attainment of rigorous air quality standards. However, in order that the air quality standards are achieved it will require equally significant and parallel reductions in emissions from other man made sources. In particular the results from the Auto/Oil Programme have demonstrated that reductions of man made emissions of both Volatile Organic Compounds (VOCs) and oxides of nitrogen (NOx) of the order of 70+% as compared to today's levels will be required if air quality iargets for tropospheric (low-level) ozone are to be achieved. ~ The attainment of satisfactory air quality throughout the Community should be based on an integrated, balanced and cost-effective approach to the reduction of emissions. Clearly, there are significant differences in the air quality to be found in the different cities and regions throughout the Community. The most cost-effective solution with regard to transport related emissions, will not be based on the assumption that Community wide technical measures should be expected, on their own, to resolve the pollution problems in the worst affected cities/regions. Air quality standards are laid down in Community legislation and Member States are required as a minimum to ensure that these standards are respected. This basic legal obligation placed upon the Member States constitutes the ultimate legal safeguard that the emission reduction measures taken at Community, national and local level will result in the achievement of the necessary air quality standards. In the Auto/Oil Programme and in the package of measures to be put forward by the Commission the underlying rationale was that technical measures, such as emission standards, fuel quality and improved inspection and maintenance regimes, will be applied at a certain intensity across the Community and will result in a widespread and significant reduction in emissions and consequent improvements in air quality. However, these Community-wide measures will have to be complemented and supplemented, as appropriate, by local and national measures such as road pricing, the expansion of the public transport system, emission related vehicle taxes and scrappage schemes applied to old vehicles. As a minimum, these national and local measures would need to be applied in localities/regions where, in the absence of such targeted actions, the Community-wide technical measures would not, on their own, ensure that the air quality standards required under Community legislation are achieved and respected. In addition, those Member States and localities that wish to achieve air quality standards higher than the minimum standards required under Community legislation, are of course free to introduce whatever national and local measures they see fit in order to reduce emissions from vehicles on condition that such measures are compatible with the Treaty such as the provisions on the free movement of goods and in particular the provisions of the Directives accompanying the present Communication. While decisions with regard to the appropriate choice of geographically restricted-measures aimed at reducing atmospheric pollution should be taken at the national, regional and local level, in the context of shared responsibility, there is a role for the Community to inform, promote and enable in order to ensure that Community policies have a positive influence. To this end the Commission has issued a Green Paper concerning public passenger transport and entitle "The Citizens Network" which suggests ways in which public transport can be made more attractive and usable. The Commission is also involved in a number of other initiatives and collaborative projects including inter alia the Car Free Cities Network which now has over 50 participating cities ,the networks addressing transport, energy efficiency and air quality involved in JOULE-THERMDE projects (the POLIS network on transport telematics applications, the EUROCITEES, TELECITIES and POLIS networks on the European Digital Cities project, city networks in environment telematics projects and the CITELEC). The interdependence of the various elements in the Commission's strategy applies not only to the relationship between actions taken at the Community/national/regional and local levels but also to the various technical measures. The increased severity of the vehicle emission standards applies at the time when a vehicle is type approved for marketing in the. Community; manufacturers are then required to ensure that all examples of that model which are produced conform to these standards and to ensure that the emission performance will not deteriorate significantly during the life of the vehicle; once the vehicle is on the road its emission performance will be influenced by the quality of the fuel and the behaviour of the driver; electronic sensors which monitor the emissions of the vehicle will also inform the driver of any defects and signal the need for repair; finally regular inspection and maintenance tests combined with road side checks and re-call schemes will also ensure that vehicles maintain a high level of emission performance throughout their life. The message which has to be underlined in relation to the control of vehicle emissions is the interdependence of all the elements 'in the systems. The technical components need to be compatible and the administrative systems need to inter-lock and be mutually supportive. In addition vehicle manufacturers and oil companies need to comply with their obligations. Finally and very importantly , individual vehicle owners have a major role to play in reducing vehicle emissions: responsible driving behaviour has a significant effect on fuel consumption and emissions; poorly maintained vehicles contribute a disproportionate amount to the total pollution load from the vehicle fleet. The Auto/Oil Programme and the Commission's future strategy on the control of vehicle emissions is based on the concept of shared responsibility and burden sharing between the Community, national and local governments, Industry and the individual citizen: such an approach is entirely consistent with the principle of sustainable development which requires that all stake-holders have a role to play in the protection of the environment. 5. FROM AUTO/OIL PROGRAMME TO LEGISLATIVE PROPOSALS The Auto/Oil Programme provides the technical foundation upon which the Commission will, build its strategy with regard to the control of vehicle emissions. In developing its proposals for the legislative actions which form a central part of that strategy the Commission took account of a number of considerations over and above the exclusively technical input provided by the programme: Uncertainty In recognition of the uncertainty inherent in any scientific investigation , particularly one a complex as the Auto/Oil Programme, the Commission's proposals are based on a precautionary approach. This means that the severity of the legislative proposals is such that even making conservative assumptions regarding the efficiency of non-technical measures it is confidently to be expected that the necessary air quality objectives will be respected throughout the Community. An integrated package As explained in section 3 the Commission's strategy is based on an integrated approach relying on action at a number of levels and the shared responsibility of all stakeholders. The Commission's legislative proposals must therefore be seen as a package - all the elements in the package are required to be adopted for the strategy to be effective. In addition and in accordance with the underlying premises of the Auto/Oil Programme, the different elements must be implemented concurrently to ensure maximum effectiveness. Feasibility The Commission's proposals also take account of the technological feasibility of introducing the measures according to the specified deadlines. For example in the case of the emission standards for diesel vehicles the proposals are based on the assumption that the de-NOx catalyst will not be in commercial production by the year 2000. The Commission's proposal does, however, take account of the need to provide an incentive for the continued development of this important technology as well as a commitment to guarantee that when vehicles equipped with these technologies arrive on the market, fuels of the a quality sufficent to ensure the effective performance of the new technologies are also available. The integrity of the internal market The economic benefits deriving from the creation of an internal market of over 350 million inhabitants were extremely important considerations for the Commission in developing its legislative proposals. The Commission has endeavoured to achieve an effective balance between one the one hand the need for flexibility in order to respond to the different air quality situations in the Community and on the other hand, the desire to ensure thejntegrity of the internal market. Coherence in legislative policy The Commission's proposals also took into account the history and the balance in the existing legislative regime. For example, in relation to the emission standards applied to different classes of vehicles the Auto/Oil Programme indicated that severe emission limits should be applied to light commercial vehicles and only light to moderate limits on passenger cars. In recognition of the fact that the same engines are often used in both categories of vehicle the Commission will propose that similar and co-ordinated emission limits are applied to each. Expectations of the Member States and the Parliament On the basis of frequent meetings with technical experts and written statements, the Commission has been kept informed of the position of the Member States with regard both to the Auto/Oil Programme and the legislative proposals arising from it. In addition the Parliament has on several occasions expressed itself in favour of environmentally ambitious measures to reduce emissions from road transport. The views of the Member States and the Parliament have been taken into account by the Commission in preparing its legislative proposals. 6. THE LEGISLATIVE PACKAGE ARISING FROM THE AUTO/OIL PROGRAMME In order to facilitate a clearer understanding as to how the Commission's proposals correspond to the framework established under Article 4 of Directive 94/12/EC, a short description of these proposals is given below: 6. 1 Vehicle-related measures 6. 1(a) Passenger Cars (this proposal to Directive 70/220/EEC The emission standards for passenger cars will be tightened by means of a proposed modification the present Communication). A summary of the new emission standards to come into force in 2000 and an indication of the percentage improvement as compared to current standards is given in Table 2 (designated as proposal A in the Table) Also shown in Table 2 are the indicative values which the Commission proposes should come into force in 2005 (designated as proposal B in the Table). These very stringent standards are referred to as the "second step" standards and will be subject to review and confirmation by the Council and Parliament in 1998. The rationale behind the establishment of a second step is provided in section 7 (Table 2 also shows for comparison the LEV and ULEV standards from the U. S. A. ) is attached to The Commission's proposal also contain provisions to ensure that the emission control systems in the car work effectively throughout the life of the vehicle. In particular there is now a requirement for passenger cars to be equipped with technology to monitor the emission performance and to indicate malfunctions to the driver: this technology is known as on board diagnostics (OBD). In addition, the Directive on passenger cars will also introduce arrangements for the in-use testing and eventual re-call of vehicle models after they have been placed on the market. Together with the strengthening of the periodic technical inspections (see below), OBD and re-call provisions should ensure that the emission performance should not deteriorate significantly during the life of the vehicle. As a means to reduce the amount of volatile organic compounds (essentially petrol fumes) which are lost to the atmosphere due to evaporation, a more rigorous test procedure for evaporative losses will be incorporated into the requirements for the type approval of gasoline passenger cars. One of the conclusions from the Auto-oil study was that already existing measures will result in significant reductions in vehicle related emissions of carbon-monoxide (CO) such that CO air quality standards will be respected. It was therefore concluded that the introduction of a cold start test procedure as part of the type approval requirements was not in fact necessary. Finally, in relation to passenger cars, the Commission's proposals (see Table 2) also include separate emission limits for NOx and hydrocarbons as was requested in Article 4 of Directive 94/12/EC. Table 2 Comparison of Passenger Car Limit Values Limit Values Mass of Carbon Mass of Mass of Oxides of Combined mass of Monoxide Hydrocarbons Nitrogen (CO) L, (g/km) (HC) L2 (g/km) (NOx) L3 (g/km) hydrocarbons and oxides of nitrogen (HC+NOx) L2 + L 3 (g/km) Petrol Diesel Petrol Diesel Petrol Diesel Petrol Diesel Mass of particulates (PM) L4 (g/km) Diesel 0. 05 Proposal A (2000) Proposal B* (2005) Current U. S. Federal Standards C. A. R. B. TLEV** C. A. R. B. LEV*** C. A. R. B. ULEV **" 2. 3 0. 64 0. 20 1. 00 0. 50 0. 10 - - 0. 15 0. 50 0. 08 0. 25 2. 1 2. 1 0. 25 0. 25 0. 25 0. 25 2. 1 2. 1 1. 7 2. 1 2. 1 1. 7 0. 08 0. 08 0. 25 0. 05 0. 05 0. 12 0. 02 0. 02 0. 12 0. 25 0. 12 0. 12 - - - _ _ - 0. 56 0. 30 '- 0. 025 -. _ - 0. 05 _ _ - Indicative limit values C. A. R. B. ( Califomian Air Resources Board)standards will be progressively introduced in a number of U. S. States in addition to California over the next ten years. C. A. R. B. Standards are: Transient Low Emission Vehicle Standard Low Emission Vehicle Standard Ultra Low Emission Vehicle Standard These standards specify emissions for Non Metane Organic Gases (NMOG) rather than Hydrocarbons (NMOG being a major fraction of HC). The test cycle used in the USA differs to that used in the EU, and so limit values are not directly comparable. 10 6. 1(b) Light commercial vehicles to Directive 70/220/EEC By the end of 1996, the Commission will come forward with a proposal for a further modification light commercial this vehicles. Indicative emission reductions for pollutant emissions to be incorporated into the type approval procedures for this category of vehicle as from the year 2000 are shown in Table 3: at present the exact values of the emission standards are still to be finalized and the values in Table 3 are therefore expressed as percentage reductions as compared to current standards. in relation time to In addition to the revised emission standards, the Commissions proposal for an amendment to Directive 70/220/EEC with regard to light commercial vehicles will also include many of the additional provisions which are foreseen for passenger cars e. g. OBD, re-call, an improved test procedure for evaporative emissions of volatile hydrocarbons and separate emission limits for NOx and hydrocarbons. Indicative Emission Reductions to Light Commercial Vehicle Emission Standards Table 3 Percentage Reduction from Current Standard Gasoline LCVs Diesel LCVs CO 30% 40% HC 4. 0% 65% NOx 40% 20% PM _ 35% 6. 1(c) Heavy duty vehicles By the beginning of 1997, the Commission will come forward with a proposal to amend Directive 88/77/EEC which concerns diesel engines used principally in heavy duty vehicles. The Commission's proposal will include stricter emission limits for regulated pollutants (see Table 4). As was the case with the light commercial vehicles, the precise values of the emission limits are not yet finalized and therefore the figures given in Table 4 are expressed as approximate percentage improvements as compared to current standards. In addition to the improved emission standards the Commission's proposal may also include the introduction of a new test cycle for measuring emissions as part of the type approval procedure (the effects of the new driving cycle will also need to be reflected in establishing the new emission limits). This new test cycle is intended to represent the real world driving pattern for these type of engines more effectively than the current procedure. Indicative Emission Reductions to Heavy Duty Engine Emission Standards Table 4 ^ 1 Diesel HDVs & Buses | Percentage Reduction from Current Standard NOx - 30% PM - 30% | | 11 6. 1(d) Alternative propulsion systems Although Article 4 of Directive 94/12/EC did require that the potential of alternative, propulsion systems should be evaluated by the Commission this issue was not addressed as part of the Auto/Oil Programme. However, the Commission is convinced that such systems, may achieve a significant role in the 21st century, recognizing that even more stringent emissions targets may have to be introduced as the effects of automotive emissions on health and global warming become better understood, and to meet the growing threat of global competition in the field of clean propulsion technologies. To this end the Commission has established a Task Force The Car of Tomorrow' (see section 8 below) which has as its objective the coordination of research on future technologies with a particular focus on advanced propulsion systems and more rigorous, broad-based comparative assessment of their performance relative to conventional propoulsion. 6. 2 Improved fuel quality The Auto/Oil Programme confirmed that improved fuel quality can have a significant impact upon pollutant emissions from vehicles. The Auto/Oil Programme also identified improved fuel quality standards as being a component part of a cost effective package of Community wide technical measures which would also contribute to the achievement of stringent air quality objectives. At the present time there exist relatively few Community provisions dealing with the quality of fuel used in road transport (lead and benzene in petrol (Directive 85/210/EEC); oxygenate levels in petrol (Directive 85/536/EEC) and sulphur levels in diesel (Directive 93/12/EEC)). These provisions will now be replaced by a comprehensive set of specifications to come into force in 2000 for both petrol and diesel and set out in the new fuel quality Directive. The impact upon the fuel quality on the European market in the year 2000 which will result from the Commission's proposal for a fuel quality Directive are shown in Tables 5 and 6. Predicted Market Average Fuel Quality in 2000 and Effect of Proposal - Petrol Table 5 Parameter Unit Market Average Without proposal Market Average with Proposal __ 58 53 84 11 37 1. 6 1 150 0. 005 RVP Summer E. 100 E. 150 Olefins Aromatics Benzene Oxygen Sulphur Lead kPa % v/v % v/v % v/v % v/v % v/v % m/m ppm ^ 68 53 84 11 40 2. 3 0. 6 300 0. 005 12 Predicted Market Average Fuel Quality in 2000 and Effect of Proposal - Diesel Table 6 Parameter Cetane Number Density Unit - kPa Poly-aromatics % Vol T95 Sulphur °C ppm Market Average without proposal Market Average with Proposal 51 843 9 355 450 53 835 6 350 300 Article 4 of Directive 94/12/EC made specific reference to the need to address the problem of the benzene content of petrol. In the proposal for a framework Directive on fuel quality, the Commission's position is that the maximum content of benzene should be reduced from 5% as is currently the case under Directive 85/210/EEC, to 2%. Article 4 of Directive 94/12/EC also required that the Commission should take into account the potential of alternative fuels in developing its future legislative proposals. Alternative fuels such as compressed natural gas (CNG) and liquid petroleum gas (LPG) were considered in the Auto/Oil Programme as potential alternatives to diesel fuel to be used for buses and other 'captive fleets' - waste disposal lorries, taxis etc - in cities (see below under local measures). The Commission's proposed fuel quality framework directive also includes a commitment to explore further the potential of CNG, LPG, biofuels and other alternative fuels and if appropriate to put forward amendments to the Directive. 6. 3 Inspection and maintenance Periodic - annual or bi-annual - inspection and maintenance checks are effective in ensuring that the emission performance of a vehicle does not deteriorate significantly during its life. The Auto/Oil Programme identified all measures targeted at the improved durability of emission control systems - OBD, recall (see section 6. 1a above) and improved inspection and maintenance - as being highly cost effective in reducing pollutant emissions indeed such measures were estimated as having the potential to contribute over a third of the emission reduction targets for some pollutants. The Community already has basic requirements for inspection and maintenance as laid down in Directive 92/55/EEC. In the light of the conclusions from the Auto/Oil Programme and the results of an extensive study due to be finalized in 1996, the Commission will, during the course of 1997, come forward with proposals to strengthen the requirements laid down in Directive 92/55/EEC. These-proposals to be implemented in 2000, will include improvements to the tests for roadworthiness in order to make these tests more representative of real world conditions and to ensure that the gross polluters in the vehicle fleet( it has been estimated that over 50% of vehicle emissions are produced by 10% of the fleet) are consistently identified. The Commission will also take steps to encorage Member States to implement road-side inspections as a further step towards ensuring that motor vehicles maintain their emission performance throughout their life. Finally, and as explained in section 3, the individual vehicle owner has an important role to play in reducing polluting emissions from road vehicles and the responsibility to keep a vehicle well maintained is a fundamental obligation for all road users. 13 7. THE TWO-STEP APPROACH At the time of adoption of Directive 94/12/EC it was recognized that when the Commission came forward with its proposals for measures to apply after the year 2000, it might also be necessary to put forward target values involving a further substantial reduction in emissions (14th "whereas" clause). In the Commission's proposals relating to the emission standards for passenger cars there are two sets of emission limits. The first set of emission limits will be obligatory and apply as from the year 2000: it is based on the results of the Auto/Oil Programme. The second set of emission limits which is considerably more ambitious than the first, will come into force in 2005. However, these limits will be reviewed by the end of 1998 with regard to their industrial feasibility, taking account of air quality requirements and the availability of improved fuels. The second set of emission limits (the second step) is an essential part of the Commission's policy on reducing vehicle emissions. The Member States will be able to offer fiscal incentives in order to encourage the marketing of vehicles respecting both the first and second set of emission standards (see below for a more detailed discussion on fiscal incentives). This means that manufacturers will have an incentive to continue to invest in the development of pollution abatement technologies. The second step is therefore designed to encourage the early introduction into the market of cleaner vehicle technologies developed by vehicle manufacturers. To illustrate the benefit of the second step it is informative to look at the example of the diesel passenger car. Diesel engines are relatively high emitters of particulate matter and oxides of nitrogen (NOx). At present, considerable resources are being invested in the development of new technologies (particulate traps and de-NOx catalysts) which have the potential to significantly reduce the emissions of these pollutants without negative effects on other emissions. However, it is generally accepted that these technologies will not be in large scale commercial production by 2000 and the Commission's proposal for the emission limits for diesel cars for the year 2000 reflects these expectations. In the absence of a second step, manufacturers would have no incentive to push ahead with the development and introduction into the market place of the new pollution abatement technologies. The Commission also believes that the existence of the second step will provide the Industry with a degree of security concerning the regulatory environment within which it will have to operate over the next 10-15 years. Finally, by establishing challenging standards in the Community with a market of over 350 million people the Commission believes that this will provide the platform for a strong export potential for Community products. In particular the export markets in Asia and North America, will offer opportunities for low emission, fuel efficient vehicles. It is therefore in the Community's economic interest to be at the forefront of technical development: the promulgation of ambitious, technology-challenging standards is an effective instrument to ensure that European Industry remains competitive in the international market place. TZT With regard to fuels, the Commission intends to come forward with proposals to revise the specifications for petrol and diesel fuels and that these improved specifications should come into effect in 2005 at the same time as the "second step" emission standards for vehicles referred to above. , The Commission's proposal will take into account that improvements to fuel quality have a direct and significant impact on emissions of particulate matter, volatile organic compounds and oxides of nitrogen. All of these pollutants either directly, or as a result of their contribution to ozone formation, result in important impacts on human health and the environment. 14 In addition, to the direct benefits that improved fuel quality has on vehicle emissions, there is a clear interaction between fuel quality and vehicle technology. With regard to the development of new pollution abatement technologies, such as the de-NOx catalyst, there is evidence that fuels of a certain quality, particularly low sulphur fuels, may well be required if such technologies are to achieve optimal and long-lasting levels of performance. Accordingly, the Commission foresees that its future proposal to revise the specifications of petrol and diesel fuels should comprise a significant reduction in the content of sulphur for both fuels. Current research and development indicates that a sulphur limit in the order of 50 ppm could be needed for the optimal functioning of the new, vehicle-based pollution abatement technologies as well as contributing to improving emissions from the existing car pare. While for the reasons outlined above, the Commission is persuaded of the need to revise the fuel specifications for petrol and diesel fuels, it nevertheless considers that it would be premature, given the current state of knowledge, to lay down today the fuel specifications which should apply in the Community in the year 2005. The Commission, therefore, intends to bring forward by the end of 1998, a proposal for a revision of the present fuel quality Directive which will include inter alia a revision of specifications for petrol and diesel which are laid down in the Directive. These revised specifications will come into effect in 2005. The Commission's proposals will be based on a comprehensive cost-effectiveness assessment and review (see below). The determination of the precise value of a revised sulphur specification for petrol and diesel fuels will of course be subject to the outcome of this assessment. To take account of the possibility that vehicles equipped with new pollution abatement technologies such as the de-NOx catalyst are developed and introduced into the market before 2005, the Commission has also included in its proposal a commitment to bring forward, if appropriate, proposals to ensure that when vehicles equipped with such technologies are placed on the market, fuels of a quality sufficient to guarantee the necessary level of performance of the technology will be widely available. In bringing forward such proposals the Commission will give due regard to considerations of air quality, cost-effectiveness and proportionality. The Commission will also take into account: (i) (ii) the latest information on the interaction between fuel quality and the performance of the new pollution abatement technologies; the situation with regard to the development and production of these technologies and the forecasts concerning the marketing of vehicles equipped with such technologies; (iii) the need to ensure that the measures proposed will neither disrupt the free movement of persons and goods nor unduly distort competition. The review process The strategy for the control of vehicle emissions which is described in the present Communication, is based on the methodology of the Auto/Oil Programme. The strategy is designed to produce effects to meet the requirements of Community air quality standards and related objectives at least cost. However, in a domain where knowledge is evolving so rapidly, the strategy cannot be static: it must evolve in response to developing knowledge. For this reason, the Commission has also announced its intention to carry out a comprehensive assessment and review of the strategy taking into account the following considerations: trends in air quality; noxious pollutant emissions in Europe from transport and non-transport sources and the contribution that existing, pending and potential measures to control emissions from all sources, could make to improve air quality; 15 technical developments with regard to: * * vehicle technologies as well as new propulsion technologies (e. g. electric propulsion, fuel cells); refinery technology; the potential of alternative fuels such as compressed natural gas (CNG), Liquid Petroleum Gas (LPG), and Dimethyl Ether (DME) and biofuels to reduce vehicle emissions; possible improvements in the test procedures for the type approval of vehicles, in particular the addition of a new test procedure at at low temperatures; the potential of technical, non-technical and local measures to reduce emissions: in this context, the contribution of transport and other policy measures such as traffic management, enhanced urban transport and vehicle scrappage schemes should be evaluated; the contribution that selective and differentiated fiscal measures could make to reducing emissions , whilst not negatively impacting on the functioning of the internal market; the effects of any measures on C02 emissions; the strategies followed by third countries to improve air quality and the emission values applied therein; the situation with regard to the supply and quality of crude oil available to the Community. On the basis of the comprehensive assessment described above the Commission will, not later than 12 months following the adoption of the two proposals accompanying this Communication and in any event not later than 31 December 1998, bring forward: a proposal for a further tightening of the emission standards for passenger cars. This proposal shall establish , inter alia whether the " second step" emission standards for vehicles (see above) and which in the present proposal for the amendment to Directive 70/220/EEC are given as indicative values, should be confirmed as the regulatory limit values to be applied from 1 January 2005; a proposal for a revision of the Directive on the quality of petrol and diesel fuels. This proposal should include further improvements to the specifications for petrol and diesel fuels (in particular, a significant reduction in the sulphur content of both petrol and diesel fuels) and will also come into effect on 1 January 2005. ~ Auto/Oil H Programme In order to carry out the comprehensive assessment upon which it will base its future proposals to be made at the latest by the end of 1998, the Commission considers that it will be necessary to build upon, improve, and extend the concept of the Auto/Oil Programme. With this in mind the Commission will take contact with Industries, Member States and NGOs with a view to setting up the Auto/Oil II Programme. 8. RESEARCH AND DEVELOPMENT, THE CAR OF TOMORROW In 1995 the Commission created a task force dedicated to the theme of the Car of Tomorrow, drawn up after extensive consultation with various stakeholders, including representation from the automotive and oil industries, public authorities, transport operators, and utilities. The 16 aims of this task force include a better focusing of R&D initiatives aimed at the next generation of road vehicles and in particular vehicles which are clean, safe, energy efficient and intelligent. These R&D initiatives will also aim at giving further insights into the development of air quality standards and improving the assessment of risks to health and the environment from vehicle emissions. Arising out of the work of the Task Force the Commission services have developed an Action Plan for the Car of Tomorrow. The Commission considers that the work of the task force and the recent action plan are directed at initiatives which will take the emission performance of road vehicles up to and far beyond the second step identified in the vehicle emission proposals and will lead ultimately to the development of near zero and zero emission vehicles. The task force will aim to achieve these goals through stimulation of RTD and demonstration of promosing clean propulsion technologies, utilising cleaner fuels. These efforts will be integrated with telematics systems and new technologies for reducing vehicle weight and drag. The RTD will be underpinned by a broad based comparative assessment process based on a life cycle approach, to identify more cost effective routes to reducing harmful vehicle emissions and energy consumption. 9. ECONOMIC INSTRUMENTS 9. 1 Fiscal instruments All taxes influence behaviour. This is independent of whether that is their intended purpose, or whether they are simply a means for raising revenues. A purchase tax, for instance, makes new cars more expensive, and will therefore lead consumers to buy fewer or different cars than. otherwise, or may induce them to hold on to their old vehicle for longer. A fuel tax affects a different aspect of transportation. As it increases the fuel costs for each mile driven, people may drive less or use more fuel efficient cars. One can therefore take advantage of this behavioural effect to design the tax system so that is has the effect of reducing vehicle emissions. To various degrees, Member States already apply a variety of taxes and fees as a means of changing transport behaviour in a desired direction. For instance, gasoline taxes are used to decrease fuel consumption. By analogy, fiscal instruments can encourage emission reductions by steering transport behaviour into a desired direction. Transport emissions will decrease when people buy cars with clean technology, keep them well-maintained, scrap old and dirty cars, burn cleaner fuels, drive less, participate in car pools, etc. Regulations concerning vehicle emissions and fuel specifications which are designed to harmonize Member States' legislation at a high level of environmental protection can address only a limited number of these behavioural factors. A policy limited to these technological aspects has little impact on behaviour. Therefore, important leverage points to achieve emission reduction would be left out. Economic instruments, by contrast, can have an influence on these behavioural aspects by making undesired behaviour more expensive than desired behaviour. This could be done either by increasing taxes on polluting activities, or by using tax incentives, i. e. by providing tax rebates to activities that decrease emissions. There are a variety of economic instruments that can be used to do this. 'For example, vehicle purchase or registration taxes can be differentiated in such a way that dirtier cars are taxed higher than cleaner ones. Similarly, one could differentiate annual circulation taxes according to emission characteristics. The impact of this instrument would not only be limited to new vehicles but it would also affect vehicles already in circulation, which contribute to a significant share of the transport emissions. Potentially, therefore, a structured circulation tax could be a cost-effective measure to complement emission standards, as it could reduce emissions from this part of the vehicle fleet. Scrappage subsidies could also help getting old and dirty vehicles off the road. 17 Tax differentiation for leaded and un-leaded gasoline, and for high and low sulphur fuels in some countries has shown the effectiveness of fiscal instruments in the fuel market. Driving behaviour can be influenced by increasing kilometre-dependent charges, for instance, through road taxes. For most of these measures the administrative structure is already in place. What is necessary is only to alter the rate structure to obtain the desired behavioural effect. A number of initiatives in the indirect taxes area are under way or scheduled for the near future where environmental concerns, such as emission levels, may be relevant. These initiatives cover both fuel taxes and vehicle taxes. All motor fuels are subject to excise duty. Within the excise system, a number of Member States have sought and been granted derogations from the normal rules, under a procedure which requires the approval of the Commission and all Member States (Aticle 8(4) of Directive 92/81/EEC). In some instances, the derogations are related to fuel quality. For example, Denmark, Finland, Greece & Sweden have been granted derogations allowing them to apply reduced rates on environmentally friendly diesel. Finland can apply reduced excise duty rates on reformulated unleaded and leaded petrol. Denmark can apply differential rates of duty between petrol distributed from petrol stations equipped with a return system for petrol fumes and petrol distributed from other petrol stations. A number of applications from other Member States are being processed at present. Some of the derogations granted under Article 8(4) of Directive 92/81/EEC expire at the end of this year, and all fall to be reviewed in the course of 1996. This review is necessary to ensure continuity and to deal with the evolving situation whereby various Member States wish to introduce rate differentiation, often on environmental grounds. The review will thus provide an opportunity for this aspect to be considered more fully in the short term. Minimum rates of excise duty are laid down at Community level, with a requirement that they be reviewed every two years in the light of the functioning of the internal market, the real value of the duty rates and the wider aspects of the Treaty. The first review did not make any proposals for change, pending a wide ranging consultation process which was to take account, inter alia, of the wider Treaty aspects. That process is now nearing completion, and the second review is due to be carried out later this year. The Commission's proposal for a framework Directive on fuel will result in a significant improvement in the average quality of fuels sold in the Community. However, it is probable that some Member States, particularly those which have used fiscal measures in the past (see above), may wish to encourage the use of even cleaner fuels as part of their overall strategy to improve air quality. The Commission notes that Directive 92/81/EEC provides a framework within which Member States may apply fiscal incentives. Discussions on a Commission proposal for a carbon/energy tax failed to reach agreement in the Council. In the absence of agreement, the ECOFIN Council of U March 1996 invited the Commission to bring forward new proposals for the taxation of energy products^A large number of Member States have expressed the wish that any such proposals should build on the existing excise structure. Given the obvious link between the requirement to review minimum rates of excise duty and the intention to bring forward new proposals for taxing energy products, it is likely that these two activities will be combined, and it is expected that new proposals will be brought forward by the end of 1996. It is clear that environmental aspects should be an important influence on these proposals. On the question of vehicle taxation, it is important to note that the tax treatment of vehicles varies enormously from one Member State to another, not just in terms of tax burden but also in terms of mix of tax type. Furthermore, the factors which influence fiscal policy for vehicles also vary significantly between Member States, often drawing on traditional, social and cultural elements in addition to the more obvious economic and industrial concerns. 18 The Commission has recently commenced a detailed study of vehicle taxation in the Member States. This study will analyse the Member States. It will also examine vehicle taxation from a Community perspective, with a view to ascertaining what Community measures are necessary, or appropriate, in the interests of improving the functioning of the internal market and advancing other policy objectives, including environmental concerns. the various approaches followed in 9. 2 Fiscal incentives used in relation to vehicle emission limits Article 4 of Directive 94/12/EC does not include any specific reference to fiscal/tax incentives (e. g. tax reductions) among the measures which should be taken into account by the Commission in the preparation of future legislative proposals. It is however stated in Article 4. 2 that the Council will decide upon the conditions for granting tax incentives with regard to the future emission standards on the basis of the emission limits proposed by the Commission. Since the adoption of Directive 89/548/EEC, Community decisions relating to the environmental aspects of motor vehicle emissions have contained a framework for the granting of fiscal incentives to encourage the early application of the new limit values. In these directives a balance has been struck between , on the one hand, the need to encourage the introduction of new technologies as quickly as possible, and, on the other hand, the need to avoid fragmenting the Single Market with diverse fiscal incentive programmes incentivizing different limit values with the consequence that, de facto , there would be simultaneously a multitude of regulatory limit values existing on the market. The principle adopted in the framework set out in Article 3 of Directive 94/12/EC have been to permit fiscal incentives only for vehicles complying with the Directive and provided that they comply with trie provisions of the Treaty and that they are: non-discriminatory; limited in time and that they terminate when the limit values become mandatory; of an amount lower than the additional cost of the technical solutions introduced to ensure compliance with the new limit values and the cost of their installation on the vehicle. its proposals for vehicle emission standards arising out of the In developing Auto/Oil Programme the Commission has declared its intention to explore a more flexible approach to the use of fiscal incentives. Accordingly, the Commission's proposals relating to vehicle emission standards and arising from the Auto/Oil Programme will include two sets of emission standards (see section 6. 1). Member States will be able to use fiscal incentives to encourage the introduction of vehicles conforming to both sets of emission limits. As compared to the present situation, the use of fiscal incentives in the context of artwo-step approach has considerable advantages as the emission limits in the second step will be sufficiently ambitious as to ensure that fiscal incentives applied in relation to this step will constitute a genuine encouragement to innovation. It is possible, despite the two-step approach and the greater freedom allowed in relation to the use of fiscal incentives, that some Member States may object to the principle of Community legislation based on Article 100a, imposing restrictions on their freedom with regard to the use of fiscal/tax incentives. However, the Commission continues to believe that a Community framework for the application of emission related fiscal incentivesis necessary to ensure the integrity of the internal market which could be jeopardized by the proliferation of incentive schemes in the different Member States. Thus, while the Commission is in favour of introducing greater freedom into Community policy on vehicle emissions it would be totally opposed to initiatives which could seriously undermine the principle of the single market and the advantages associated with it. 19 Pollutant, Urban NOx Urban Particulates Urban Benzene Total VOCs Total NOx 10. The emission reduction benefits and the costs associated with the Commission's package of measures on vehicle emissions The package of legislative actions due to come into force in 2000 and described in section 6 will result in considerable reductions in the emissions from road transport over and above those which would be expected from already agreed measures (see Table 7 below). Effect on Road Transport Emissions of Auto Oil Package of Measures Table 7 Emissions in 1990 Emissions in 1995 Emissions in 2010 without Auto Oil 1000 Tonnes/yr Percent of 1990 Level 1000 Tonnes/ yr Percent of 1990 Level 1000 Tonnes/ yr Percent of 1990 Level 1 936. 68 100 1 940. 58 100 1 207. 77 62 Emission in 2010 with' Auto Oil Package 1000 Tonnes/ yr 748. 817 Percent of 1990 Level 38. 7 124. 663 100 137. 029 110 69. 383 Urban CO 25 189. 17 100 100 20 224. 04 13. 88 80 87 1 1961. 25 7. 78 15. 91 56 47 49 42. 324 34 5 980. 625 4. 0456 23. 7 25. 4 4 105. 72 100 3 688. 83 90 1 811. 33 44 996. 232 24 5 864. 84 100 5 581. 33 95 3 053. 25 52 1 984. 613 33. 8 While these Community measures may in some localities need to be complemented by targetted local initiatives (see section 3) the Commission is confident that by 2010 and assuming parallel actions to reduce emissions from other sources, that the air quality targets referred to in Table 1 will be respected thfoughout the Community. While the benefits in terms of human health (mortality, morbidity and quality of life) and the environment (crop production and ecosystem damage) are difficult to quantify, it is clear from the available evidence that these benefits will be considerable. In addition to the significant emission reduction benfits associated with the measures due to come into force in 2000 further reductions will clearly be associated ^with the implementation of the second step for vehicle emissions and the future proposal on fuel quality (see section 7). 20 The Costs(S) of the Commission's package of legislative measures Tnsts to industry Measures to become effective from 2000 Passenger car producers Van /light commercial vehicle producers Heavy duty vehicle producers Refining Industry National governments associated with improved inspection and maintenance ECU 3 094 million per annum ECU 373 million per annum ECU 675 million per annum ECU 765 million per annum ECU 555 million per annum TOTAL ECU 5 461 million per annum. Measures proposed for vehicles for 2005 'the Second Step* Passenger car/light commercial vehicle producers ECU 2 500 million per annum ECU 500 million per annum Heavy duty vehicle producers Cost to the consumer Measures which become effective from 2000 Fuel Additional cost per litre/1 000 litres Petrol: Diesel: ECU 0. 002 per litre: ECU 0. 0018 per litre: ECU 2 per 1 000 litres ECU 1. 8 per 1 000 litres Additional cost on the fuel bill of the average motorist ECU 2. 3 (assuming 12 600 km per year and 8. 61 1/100 km) Petrol Car: Diesel Car: ECU 1. 7 (assuming 12 600 km per year and 7. 61 1/100 km) Increased new vehicle costs Petrol passenger car Diesel passenger car Small Medium Large ECU 200 per new car ECU 225 per new car ECU 290 per new car Medium ECU 380 per new car ECU 520 per new^ear Large Light commercial vehicles: ECU 145-290 per vehicle Heavy duty vehicles: ECU 530-1 620 per vehicle Increased maintenance costs ECU 7. 5 - 10 per annum for passenger cars. Measures proposed for vehicles for 2005 'the Second Step' Between ECU 150 and 200 per new car as an average (5) All costs are in 1995 ECU 21 REPORT ON THE AUTO/OIL PROGRAMME ANNEX 1. THE EUROPEAN AUTO/OEL PROGRAMME 1. 1 Phase I - Establishing the framework In keeping with its commitment to develop a more comprehensive approach to reducing emissions from road transport, the Commission decided at the end of 1992 to initiate a work programme to provide a solid technical foundation upon which to base its future legislative proposals. In accordance with the principle of 'shared responsibility' expressed in the 5th Environmental Action Programme, the Commissioners for Environment, Industry and Energy, invited the European associations of the car (ACEA) and oil (EUROPIA) industries to make available their considerable know-how and expertise and to collaborate in the realization of this work programme. The two industries responded positively to this invitation and together with the Commission designed, planned and executed the programme which subsequently became known as the Auto/Oil Programme. The objective of the Auto/Oil Programme were defined as: to provide policy-makers with an objective assessment of the most cost-effective package of measures including vehicle technology, fuel quality, improved durability and non-technical measures, necessary to reduce emissions from the road transport sector to a level consistent with the attainment of the new air quality standards being developed for adoption across the European Union. 1. 2 Work programme The work programme was divided into a number of inter-related components as follows: (i) (ii) (iii) (iv) the prediction of future air quality in the Community and in the case where future air quality was predicted to fall below an acceptable standard, the identification of appropriate emission reduction targets for road transport; the collation and, where necessary, the generation of data concerning the potential of the various measures inter alia engine technology, fuel quality, increased durability requirements and complementary measures, to reduce emissions from road transport; the collation and, where necessary, the generation of data concerning the cost of introducing the measures identified under ii (above); ^ on the basis of the data generated in steps ii and iii above to identify the most cost effective package of measures necessary to achieve the emission reduction targets identified under step i). 1. 3 Organizational framework (a) Cooperation Commission/industry A management group and a number of technical working groups were established comprised of representatives of the Commission and ACEA and EUROPIA. The management group met on a regular basis and was responsible for the oversight and planning of the work programme with regard to content and time. The technical working groups were established for issues requiring further investigation. 22 At the level of the Commission services a number of Directorates General (principally DGs II, IE, XI and XVII with support from DGs VII and XII) were involved in the implementation of the Auto/Oil Programme. In addition to the involvement in the programme of staff from the Commission and the two industries, external consultants/consultancy companies were commissioned to carry out certain parts of the programme. Their work was specifically related to fuel quality, emissions/air quality and cost-effectiveness issues. (b) Information Provision Auto/Oil Programme to interested parties not directly involved in the (i) European Parliament In 1995 a number of technical briefings with members of various committees of the Parliament were held in order to keep Members of the European Parliament and their staff informed as to the progress of the Auto/Oil Programme. (ii) Member States A national expert group on "environmental fuel specifications" (EFEG) was established early in 1993 to follow and to discuss on a regular basis the progress invited being made with Member States to provide technical advice and support in areas of specific interest to them. the Auto/Oil Programme. The Commission In addition the Motor Vehicle Emissions Group (MVEG) was consulted and informed on various aspects related to vehicle technology and ^ improved durability requirements. In the course of 1995 the Commission held four combined EFEG/MVEG meetings in order to give full account of the progress and results of the programme. EFEG/MVEG meetings also provided a forum for a number of industries and non-government environmental organizations. In this way access to information on the programme was also guaranteed to a range of interest groups likely to be effected by future legislation. 2. ABR QUALITY MODELLING 2. 1 Introduction The following atmospheric pollutants were investigated as part of the Auto/Oil Programme: Carbon Monoxide (CO) - in cities Particulate matter (PM) - in cities Benzene - in cities Nitrogen dioxide (N02) - in cities Tropospheric Ozone (03) - principally at the regional level A short description of each of these pollutants, their effects on human health and the environment as well as the contribution of road transport to total emissions is to be found in Box 1. 23 Pollutants Investigated in the Auto Oil Programme BOX1 Carbon Monoxide (CO) Colourless, odourless, and tasteless gas. It replaces Oxygen in the blood and thus causes asphyxiation in high concentrations. It is transformed to Carbon Dioxide - a "green house" gas - in the Atmosphere. Soared of all CO Emissions In EU in 1990 Road Transport Carbon Monoxide Emission Sourcts Apfcvlton Nat«n 1H Nitrogen Monoxide / Nitric Oxide (NO) (Transforms mainly to N02) Nitrogen Dioxide ( N 02- N 02& NO together are known as NOx) A reddish-brown gas, it causes a variety of respiratory conditions, especially in vulnerable groups (e. g. children & asthmatics). Contributor to the problem of Acid deposition, and decreases plant growth their Effects and Sources Particulate Matter (PM) / Black Smoke (BS) Any fine particle, the effect of which is dependent on the type of particulate, although there is some evidence that the smaller fractions are, in general, carcinogenic. However, black smoke may not contain the smallest size fractions now associated with carcinogenic effects. Furthermore, many components, e. g. heavy metals, are toxic. Ozone ( 03) A secondary pollutant formed by the reactions of mainly NOx and VOCs in the presence of sunlight. A strong oxidising agent it induces eye, nose, and throat irritation, chest discomfort, coughs and headaches. It also damages materials and inhibits plant growth. Hydrocarbons (HC) The complete range of organic compounds - usually gasses - this term includes both VOCs and Benzene. Volatile Organic Compounds (VOCs) Any organic compound sufficiently volatile to cause significant emissions into the air via evaporatioa The complex interaction of many of the VOCs cause the formation of "secondary" pollutants such as Ozone (see below). VOCs also contribute to the problem of acidity and ethylene is a serious plant growth inhibitor. Contains some Carcinogenic compounds -See Benzene Below. Sources of all VOC Emissions in EU In 1990 — Road Transport VOC Emission Sources 'TV V«kklei B «M * * * *" 7H J *. —**- L%k« C M U M K UL VAfclM, 1IH Sourcts of all NOx (as N02) Emissions in EU in 1990 Road Transport NOx Emission Sources B«n« Twa Wheal» BnrMUonA •xilfUh * Otter MrtCa W i rf treatment 13H. __ l**"*t»7 Othar Mai Sivrcea 1 2* Colourless liquid or gas - smells of almonds Benzene is known to be both toxic and a carcinogen. Benzene (CéH«) •Antwx tn Cammunimfirm • The Auto Oil Programme 24/05/1996 page 4 2. 2 Air quality in cities Population density, industrial activity and traffic intensity in urban environments can frequently give rise to acute problems of air pollution. In order to investigate the problem of atmospheric pollution in cities, seven European cities - Athens, the Hague, Cologne, London, Lyon, Madrid and Milan - were chosen for detailed study. These cities were considered as being representative in terms inter alia of their air quality, geographic location and the characteristics of their vehicle fleets(1). On the basis of information on the emissions of pollutants from various sources and the relationships between emissions and air quality, computer models were used to predict the air quality in the seven cities in the year 2010( \ Unfortunately, in the case of particulate matter, the quality of the data was not good enough to permit the prediction of air quality in 2010 in each of the cities. For this reason pollution by particulate matter was dealt with separately (see section 3. 3 below) In order to decide whether the predicted air quality in respect of the three pollutants carbon monoxide, benzene and oxides of nitrogen were satisfactory, air quality standards were defined for each pollutant. In the case of N02 and CO air quality standards already exist, laid down either, in Community legislation (N02: Directive 85/23/EEC) or in WHO guidelines. However, in recognition of the fact that the WHO guidelines for both N02 and GO were in the process of being reviewed and that initial recommendations for revised values from scientific expert groups were already available, it was decided to use two air quality standards for the purposes of the Auto/Oil Programme: a less severe standard based on current air quality standards; a more severe standard based on the initial recommendations of the expert groups currently reviewing the WHO guidelines. In the case of benzene there are no existing Community standards and the WHO does not set limit values for substances such as benzene which are regarded as carcinogenic. In the light of existing scientific evidence and recommended the Member States, the Auto Oil partners agreed upon a less severe and a more severe standard as they had done for CO and N02. However, in recognition of the fact that certain Member States have also expressed aspirations to achieve extremely low 'target values ' in terms of benzene concentrations the Commission also insisted upon the inclusion of a third very severe standard in relation to this pollutant. limit values which exist in A summary of the air quality standards used for CO, N02 and benzene is given in Table 1. A summary of the emission reduction requirements determined to be necessary in each of the seven cities in order to achieve these air quality standards is given in Table 2. (i) (2) To enable the Auto/Oil Programme to base air quality predictions on the most reliable data on the future development of the EU vehicle fleet, the Commission made available the FOREMOVE model. The commission funded this model which contains details of vehicle fleets in each Member State (vehicle categories, age, and distance travelled) and generates information concerning the total and percentage emission of major pollutants by each category of vehicle. FOREMOVE also contains assumptions concerning the development of the vehicle fleet in each country over the next 25 years and the predicted effect of current and agreed new legislation on vehicle emissions. The year 2010 was chosen as reference year because the programme was designed to identify measures which would take effect from 2000. Measures introduced in 2000, such as emission standards for new vehicles, will only have a gradual effect on air quality as the existing vehicle fleet is replaced. By 2010, it will be possible to judge their impact. 25 2. 3 Particulate material As indicated in Section 2. 2 it was not possible to model pollution by particulate material in the same way as the other urban pollutants. There is a lack of basic information concerning the relationship between emissions and air quality and a lack of consistency in the way that particulate matter is measured. However, results are just beginning to emerge which allow some provisional conclusions concerning the likely effects of particulate pollution on human health, tentative air quality standards and the need for emission reductions. There is increasing evidence that particulate material may contribute significantly to patterns of morbidity and mortality on western Europe. There is also an emerging consensus that the particulate material which causes health effects is to be found in the smaller size fractions: these smaller size fractions are now measured using a parameter called PM10 which means those particles with a size of 10 microns or less. With regard to the establishment of an air quality standard sufficient to protect human health, there is as yet no international consensus. However, the UK Government's Expert Panel on Air Quality Standards has recently recommended a value of 50ug/m3 measured as a 24 hour running average and in the absence of alternative standards this figure will be used for the purposes of the present report. 26 Table 1 Air Quality Target Values Used in Air Quality Modelling Pollutant N02 Standard* Less severe standard = 200ug/m3 as 98 percentile** of hourly values More severe standard*** = 93 u g/m3 as a 98 percentile of hourly values. CO Less severe standard = 10mg/m3 as a 98 percentile of 8 hourly values. More severe standard **** = 5 mg/m3 as a 98 percentile of 8 hourly values Benzene Less severe standard = 16 ug/m3 as an annual mean More severe standard = 10 ug/m3 as an annual mean Very severe standard ***** = 2. 5 ug/m3 as an annual mean To Equate values for the different averaging periods used to determine these standards it was necessary to undertake a statistical analysis of European air quality data using the Commission's Air Pollution Information Service (APIS) database enhanced with additional data from Member States obtained by CONCAWE. a 98th percentile value means that only 2% of all values recorded during the year would be above this value. Therefore in the case where measurements are taken on an hourly basis, in any one year there will be a total of 365 x 24 (=8760) separate values. The 98th percentile figure would correspond to the value below which lie 8585 of the hourly readings. Expressed in another manner the 98th percentile value is the value which may be exceeded on 175 hours each year, i. e. a total of 7 days. ***98th percentile value corresponding to a maximum value of 200 ug/m3 (recommended new standard emerging from WHO working groups). The relationship between maximum values and 98 percentiles was obtained from european air quality records. """98th percentile value corresponding to a maximum value of 10 mg/m3 (recommended new standard emerging from WHO working groups). The relationship between maximum values and 98 percentiles was obtained from european air quality records """Benzene is of particular concern in a number of Member States who have reflected-this by setting very low, long term target values. Recognizing the aspirational nature of these target values, it was agreed that the necessary reductions to achieve a value of 2. 5ug/m3 would be investigated. 27 Table 2 Air Quality Modelling - Summary of the Emission Reductions N02*/ NOx CO Benzene CITY Percentage Emissions Reduction necessary to achieve air quality targets: Percentage Emissions Reduction necessary 'to achieve air quality targets: Percentage Emissions Reduction necessary to achieve air quality targets: Less severe standard More severe standard Less severe standard More severe standard Less severe standard More severe standard Very severe standard Athens Cologne The Hague London Lyon Madrid Milan (N/A - Not Available) 0 0 0 0 0 0 0 50 20. 5 0 31. 5 22. 5 39 45 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 50 0 0 0 20 35 15 * Nitrogen di-oxide is a pollutant with demonstrated direct and indirect effects upon human health and the environment. Air quality standards are therefore expressed in terms of concentrations of N02. However, emissions from vehicles and other sources consist of a mixture of nitrogen di oxide and nitrous oxide (NO). For the purposes of establishing emission limits these two gases are combined under one heading - NOx. Therefore, while the air quality concentrations given in Table 2 are expressed in terms of N02 the emission reduction targets are expressed in terms of NOx. 28 Reliable measurements of ambient air concentrations of particulate matter using the PM10 parameter have only recently started to come available. Some data are available from the UK and additional information has been generated from a major research project undertaken in the context of the European Community's Research Programme: results from the UK and the EU programme are presented in Table 3 below. It would appear from the data summarized in Table 3, that maximum daily mean values for PM10 concentrations in many european cities are within the range 100-150 ug/m3. This would imply thai reductions in the range of 50-65% are required in order to meet the air quality standard of 50ug/m3. In trying to convert these estimates into tentative conclusions as to the likely magnitude of emission reductions great care must be exercised as the contribution of different sources to the total particulate load is only poorly understood and shows significant variation between regions. Nevertheless it was decided in the Auto/Oil Programme to use the range of 50-65% of 1995 levels as an emission reduction target for 2010(3). 2. 4. Regional Tropospheric Ozone Tropospheric ozone is referred to as a secondary pollutant, this means that it is formed as a result of the interaction between primary pollutants, principally nitrogen oxides and Volatile Organic Compounds (VOCs). The chemical reactions leading to the formation of-ozone are accelerated in warm conditions and in the presence of sunlight: ozone is therefore often referred to as 'summer smog'. Tropospheric ozone is a regional, transboundary problem: high concentrations of ozone frequently being found considerable distances (100s of kilometres) away from the major urban centres which are the principal source of the precursor pollutants, NOx and VOCs. In order to explore the regional aspects of ozone formation, the Auto Oil partners relied heavily on the EMEP model which has been developed to support the various protocols which have been established in the context of the 1979 Geneva Convention on transboundary air pollution. On the basis of data relating to emissions of primary pollutants, the detailed chemistry of ozone formation and factors such as temperature, wind speed, intensity of solar radiation etc, the EMEP model can be used to predict ozone concentrations throughout Europe. Having taken into account the expected trends in emissions of primary pollutants the predicted air quality values were then compared with the air quality objectives for tropospheric ozone as laid down in Directive 92/72/EC (see Table 4). If one considers the benefits of improvements which could be expected as a result of across the board decreases in emissions from all sources, some of the results generated from the EMEP model are given in Table 5. These results are expressed as the percentage of the Community's land area in compliance with the various air quality objectives. (3) Already agreed measures will reduce particulate emissions across the EU to nearly a half of those in 1995. Therefore the additional emission reductions required in 2010 to achieve the target reduction of 50-65% compared to 1995 levels is equivalent to approximately one-third off the predicted 2010 emissions. 29 Summary of Data from UK and EU Studies on Urban PM Concentrations. Table 3 APHEA Project data: ,1 ». City Measurement Winter (December, January, February) Summer (June, July, August) Athens Black Smoke Barcelona TSP or PMx Helsinki TSP or PMx Cologne TSP or PMx London Black Smoke Lyon Milan Paris PM13 TSP or PMx 187. 9 TSP or PMx Rotterdam Black Smoke Min. * 64. 0 137. 5 33. 4 70. 3 24. 1 48. 6 36. 4 15. 6 Max. ** 141. 4 232. 2 121. 8 83. 8 94. 5 87. 8 199. 7 67. 3 29 Min. * 41. 8 117. 2 41. 9 72. 1 7. 2 29. 8 81. 7 37. 6 9. 4 Max. ** 102. 4 177. 7 91. 7 83. 4 15. 9 55. 7 85. 1 47. 8 20. 4 PEACE Project: Country City Finland Kupio Germany Berlin Germany Zerbst Greece Athens Italy Italy Pisa Torre del Lago NL Amsterdam Sweden Mal mo 1 Max. PM10 Winter (ug/m3) UK data: City Dailv mean PM10 (Mg/m3) 60 117 95 201 131 149 123 59 Belfast BirminghamA BirminghamB Bristol Cardif Edinburgh Hull Leeds Liverpool 191 113 106 83 96 65 84 114 84 * Mean from the station giving the minimum annual measurements levels for each city. **Mean from the station giving the maximum annual measurements levels for each city. (Mean figure from above data is: 112. 6) 30 Table 5 also indicates the predicted impact of 50%, 60%, 70%, and 80% emission reductions in both NOx and VOCs from all anthropogenic sources as compared to 1990 The nature of ozone formation is such that dramatic reductions from all sources for all precursors are required before complete compliance with air quality standards can be expected. Indeed it is only when an 80% emission reduction (compared to 1990) of precursors from all sources is achieved that over 90% of the EU land area is predicted to have a 1 hour maximum ozone concentration below 180ug/m3. With regard to the 99 percentile 1 hour mean 180 ug/m3 standard, across the board reductions in ozone precursor emissions of 60% and to a percentage land area compliance of 95 and 99% respectively. It was 70% correspond decided that for the Auto/Oil Programme an overall emission reduction target for ozone precursors in 2010 would be 70% of 1990 levels(4). Table 4 Comparative Values: reactive pollutant modelling Guidelines Directive 92/72/EEC Directive 92/72/EEC Air Quality Standard 110 ug/m3 8-hour average 180 ug/m3 1-hour average WHO Air Quality Guidelines 1995 120 ug/m3 8 hour average Relevance Health protection threshold Threshold level over which information / warnings have to be issued by the authorities to the general public. Protection of health threshold (4) Already agreed measures will reduce ozone precursor emissions across the EU to nearly a half of those in 1990. Therefore the additional emission reductions required in 2010 to achieve the target of 70% reductions compared to 1990 is equivalent to approximately one-third off the predicted 2010 emissions. 31 Compliance with Ozone Air Quality Standards Table 5 EU Percentage of EU Land Area (measured in EMEP grid squares) in Compliance with Standards 1 h mean 100 percentile % > 180 ug/m3 1 h mean 99 percentile % > 180 ug/m3 37 53 62 73 81 92 73 87 89 95 99 100 8 h mean 100 percentile % > 120 ug/m3 not known 5 8 11 18 26 8 h mean 99 percentile % > 120 ug/m3 10 19 25-_ 28 37 46 Scenario 1990 basecase 2010 Basecase 1990 basecase -50% 1990 basecase - 60% 1990 basecase - 70% 1990 basecase - 80% 32 The following are the conclussions from the Auto Oil Study with respect to each of the pollutants which were investigated: (1) Carbon Monoxide; the impact of already agreed measures (in particular the increasing penetration of the three way catalyst) will already, by 2005 reduce urban background concentrations in all the cities studied to below the level of the most stringent air quality standard. On the basis of these results regulating for further reductions in vehicular emissions of this gas would not be a priority. (2) Benzene; the results indicate that as with carbon monoxide, the impact of the three way catalyst will result in a marked improvement of urban background concentrations over the coming years. Only in the case where an air quality standard of 2. 5 ug/m3 is used as a basis for comparison are emission reductions foreseen to be necessary in a number of the most polluted cities. (3) Oxides of Nitrogen; the air quality modelling results clearly demonstrate lhat if one uses the more stringent air quality standard for nitrogen dioxide as a basis for comparison it will still be necessary in 2010 to make further reductions in emissions of between 0 and 50% dependent upon the city. (4) Particulates; emission reductions of particulate matter from road transport in urban environments in the range 50-65% as compared to todays levels were considered necessary in order to achieve suitable air Quality targets. (5) Regional Ozone Pollution; the most important messages to be taken from this analysis are: - that the emission reductions resulting from already agreed measures will by 2010 bring about a considerable improvement with regard to regional ozone pollution; - that to reduce ozone pollution beyond that achieved by already agreed measures will require significant emission reductions of NOx and VOCs emissions of the order of 70-80% as compared to 1990; - that further emission reduction measures applied to traffic will, in the absence of parallel measures applied to other sources particularly sources of VOCs , have at most a marginal impact. - that for the purpose of the Auto/Oil Programme an emissions reduction target of at least 70% compared to 1990 levels of both total NOx and totai VOCs across the EU would be used. 33 3. THE COSTS AND POTENTIAL BENEFITS OF MEASURES TO REDUCE POLLUTANT EMISSIONS FROM VEHICLES. 3. 1. The European Programme on Environmental Fuels and Engines (EPEFE) One of the first steps taken in the Auto/Oil Programme was to review all available data concerning the relationships between vehicle emissions fuel properties, and engine technologies: this review included the results of the US Auto/Oil Programme. The conclusions from this review were published in 1994 in the report entitled "Effect of Fuel Qualities and Related Vehicle Technologies on European Vehicle Emissions"(5). In reviewing existing information on the relationship between fuel quality, engine technology and exhaust gas emissions it became apparent that gaps existed concerning certain fuel and vehicle interactions. As such knowledge was vital for the completion of the Auto/Oil Programme, the European Oil and Vehicle industries collaborated in the realization of an extensive research initiative designed to generate the missing data. This research programme was known as the "European Programme on Emissions, Fuels and Engine Technologies" (EPEFE) The EPEFE programme was extremely successful and has allowed important insights into the relationships between fuel quality and emissions. These relationships are complex, indeed it was observed that in some cases changing certain fuel parameters would decrease emissions of one pollutant while increasing emissions of another. Such insights are of vital importance when selecting fuels with the object of attacking priority pollutants. The EPEFE programme is one of the most ambitious studies of this type ever carried out. It has assisted in the quantification of the relationship between certain important fuel parameters (e. g sulphur content, aromatics content, distillation characteristics for gasoline; cetane number, density, polyaromatics content, and distillation characteristics in the case of diesel) and pollutant emissions. The EPEFE programme represented a significant investment on the part of the industrial partners in the Auto/Oil Programme and it is unlikely that such an ambitious undertaking would have taken place without the impetus of the Auto/Oil Programme. The results of the EPEFE programme have been published by the Industry(6). The individual test results from the tens of thousands of measurements taken during the EPEFE programme are also available upon request. 3. 2 Fuel quality changes - Costs and potential benefits Combined with already existing data, the EPEFE programme constituted a solid foundation upon which to make reliable estimates of the effects of changing fuel quality upon vehicle emissions. This allowed the Auto Oil partners to design fuels and to be confident in predicting the impact each fuel would have on the emission profiles of different classes of vehicles. In order to cany out a cost analysis it was necessary to combine the information concerning the effects of different fuel qualities on engine emissions (the benefits) with information concerning the additional costs of producing fuels corresponding to new, environmentally driven, specifications. (5) (6) This report - the report of "sub-Group 1" - is available on request from the European Commission. European Programme on Emissions, Fuels and Engine Technologies, Final Report. ACEA/EUROPIA, 9. 10. 1995. 34 On the basis of information provided by the Industry and the evaluation carried out by the independent contractor engaged by the Commission, the cost to the Industry of making changes to the composition of the gasoline and diesel fuels produced by EU refineries was assessed. A summary of some of the data concerning the benefits (emission reductions) and costs of cleaner gasoline and diesel fuels is presented in Tables 6 and 7 below. Complete details of the costs and benefits of fuel reformulations are to be found in the consultants report and the summary report of the Auto/Oil Programme. Table 6 Costs and Emissions Benefits of Cleaner Fuels - Gasoline: Emissions Reduction Potential for vehicles equiped with a 3-way catalyst. Cost to Industry per annum** Cost per litre Cost to the * motorist*** NOx* 7. 12% tl -6. 36% VOCs 18. 62% tl 4. 31% CO 17. 16% t l" 5. 36% ECU 327 - 1 450 million/year ECU 0. 003478/litre - ECU 0. 010964/litre ECU 3. 77 per year - ECU 11. 89 per year Negative emissions reduction for NOx in cases where fuel reformulation would cause an increase in emissions (from catalyst equipped vehicles) compared to current average fuel quality. Costs in Net present value in millions of 1995 ECU, discounted over period 1996 - 2015 at 7% per annum. Average costs assuming fuel use of 8. 611 / 100km and annual travel of 12, 000km. 35 Table 7 Costs and Emissions Benefits of Cleaner Fuels - Diesel in Passenger Cars and LCVs: Emissions Reduction Potential per vehicle Cost to industry per annum* Cost per litre Cost to the motorist** NOx 1. 8% ti 0. 5% VOCs 34. 3% tl 10. 7% CO 36. 1% ti 10. 6% PM 30% tl 10% ECU 260 - 1742 million/year ECU 0. 001761/litre - ECU 0. 01301/litre ECU 1. 69 per year -• ECU 12. 47 per year All costs expressed as Net present value in milhons of 1995 ECU, discounted over die period 1996-2015 at 7% per annum. Average costs assuming fuel use of 7. 611 / 100km and annual travel of 12, 000km. 36 3. 3 Changes to vehicle technology - Costs and potential benefits European vehicle manufactures were asked to provide estimates of the additional costs involved in equipping their vehicles with the technology necessary to achieve progressively more severe emission reductions. The manufacturers were invited to provide this information for a total of 16 different sub-categories e. g Gasoline cars - small, medium and large; heavy duty diesel vehicles - small, medium and large etc. The information provided by the manufacturers was evaluated by the independent contractors engaged by the Commission and was also cross-checked against information obtained from component manufacturers. A summary of some of the data concerning the emissions reduction benefit and associated costs is presented in Tables 8 and 9 below. Complete details of the costs and benefits of improved vehicle technology are to be found in the consultants report and the summary report of the Auto/Oil Programme. With regard to the potential of diesel engines to achieve further emission reductions, the figure used in the analysis are based on the assumption that the de-NOx catalyst will probably not be available for production models by the year 2000. Clearly if such technology were available in a reliable form, the potential for NOx emission reductions would be increased significantly. 37 Table 8 Costs and Emissions Benefits of Improved Vehicle Technology - Gasoline Passenger Cars Emission Reduction Benefits as compared to existing standards: NOx 65% tl 20% HC* 65% tl 20% CO 45% tl 20% Costs: Additional Cost per vehicle Percentage of Purchase Price Annual Cost to Industry Small ECU 43 - 237 Medium ECU 42 - 256 Large ECU 7 2 - 3 41 0. 5 - 2% ECU 574 - 3 262 million - HC = Hydro-Carbons - a high proportion of which will be VOCs Table 9 Costs & Emissions Benefits of Improved Vehicle Technology - Diesel Passenger Cars Emission Reduction Benefits as compared to existing standards: PM Costs: 50% tl 20% NOx 20% tl 20% HC* 65% tl 10% CO Additional Cost per vehicle Percentage of Purchase Price Medium ECU 203 - 367 Large ECU 227 - 402 0. 5 - 2. ! 5% HC = Hydro-Carbons - a proportion of which will be VOCs 50% tl 25% Annual Cost to Industry ECU345 «*605 million 38 3. 4 Improved durability of Emission Control Systems - Costs and potential benefits As a vehicle gets older its performance including that of the emission control system deteriorate. Significant reductions in vehicle emissions can potentially be achieved by reducing the rate of detioration in the emission control systems. There are several mechanisms by which such improvements can be achieved. increased severity and frequency of compulsory inspection and maintenance checks; manufacturers liability for the performance of the emission control systems extended from 80 000 km to 160 000 km; electronic sensors installed on the vehicle to monitor the performance of the emission control systems -referred to commonly as on-board diagnostics; re-call procedures whereby models can be re-called and re-fitted if their emission performance deteriorate beyond an acceptable level; improved mechanisms for the remote-roadside detection of vehicles emitting above acceptable levels. As part of the Auto/Oil Programme data were collected with regard to the cost and the emission's benefit of the various mechanisms designed to reduce the rate of detioration of the emission control systems. A summary of some of the data concerning the emissions reduction benefit and associated costs of improved durability of emission control systems is presented in Table 10 below. Table 10 Costs and Emissions Benefits of Improved Emission Control System Durability Emission Reduction Potential: Total NOx 15. 9% tl 0% Total VOCs 30% tl 0% Urban PM* 10% tl 0% Costs*": ECU 290 million/year -» ECU 1 112 million/year Emission reductions from diesel vehicles assumed to apply only to particulate emissions. Costs expressed as Net Present Value in 1995 ECU, discounted at 7% between 1996 and 2015. 39 4. COMPLEMENTARY LOCAL TECHNICAL AND NON-TECHNICAL MEASURES - COSTS AND POTENTIAL BENEFITS Article 4 of Directive 94/12/EC required that the Commission when developing future proposals should also take into account the potential of complementary non-technical measures such as traffic management and enhanced public transport as well as the use of alternative fuels. Non-technical instruments are geared towards changing the behaviour of transport users. As the analysis carried out by the Commission showed (see below), such behavioural changes are needed especially in cities with severe air quality problems where more stringent vehicle emission control, better fuel quality and improved durability of emission control systems alone are not sufficient to meet air quality targets. Many of these complementary measures would, of course, be applied at the Member State, regional or local level and decided by the corresponding authorities. The Commission has acknowledged the importance of these measures by promoting research, development and demonstration projects relating especially to urban transport through a number of channels (e. g. the THERMIE and SAVE II Programmes) and by fostering the exchange of experience between European cities in order to promote "best practice" in local transport planning (e. g. through the Commission's Urban Environment Expert Group and the Sustainable Cities Campaign). Most recently, the Commission presented two Green Papers on the Citizen's Network and the use-of pricing mechanisms in the transport area to stimulate the discussion on these issues at the European level. The instruments looked at included both local measures (traffic bans, speed regulation, cheaper public transport, alternative fuels), certain non-fiscal economic instruments (road pricing, scrappage subsidies) and the use of fuel taxes, vehicle purchase taxes and annual vehicle circulation taxes to influence transport users. In the final analysis, road pricing, traffic bans, the subsidy of public transport, scrappage subsidies and the conversion of urban buses to alternative fuels (LPG, CNG) were included. Information on the costs and the effectiveness of these instruments were collected, drawing on the experience in their application in different countries. The EUCARS passenger transport model developed by the Commission (Directorate-General II) was used to estimate the behavioural responses associated with the different instruments(7). Besides the investment and operating costs associated with some of the measures, non-monetary costs to society ("welfare costs") were taken into account which arise from the behavioural changes imposed on European citizens (e. g. their loss of freedom to drive by car into the city centre) and changes in tax revenues. Citizens adapt their behaviour in different ways in response to the non-technical measures studied, for example through reduced car usage, the purchase of less polluting vehicles or the better maintenance of vehicles. As compared to the evaluation of technical improvements, the assessment of non-technical measures is compounded by a number of difficulties. The responses of transport users cannot be predicted exactly and are often determined by local factors; the definition of measures is not as precise which makes it more difficult to assess their costs and effectiveness; many of the measures are interdependent and their costs and benefits are affected by-external influences (e. g. economic development). Therefore, the quantification of the costs and benefits of local transport measures and economic instruments entails considerable uncertainties. The analysis done showed that the non-technical measures considered had very different investment, operating and welfare costs. The analysis pointed to the fact that a reform of vehicle-related taxation in line with environmental criteria could make a cost-effective contribution to the reduction of transport-related air pollution. Under certain conditions, road pricing could even yield additional benefits beyond that of emission reduction by increasing (7) European Commission (Directorate-General II), "A Welfare Cost Assessment of Various Measures to Reduce Pollutant Emissions from Passenger Road Vehicles for the Year 2010" (Final Report, 12. 10. 1995) See also the consultants report from the cost effectiveness analysis. 40 the overall efficiency of the transport system. With due consideration to the uncertainty inherent in the assessment of these measures, it was concluded that local technical (LPG/CNG buses) plus non-technical measures (road pricing, cheaper public transport, traffic bans and scrappage subsidies, but excluding taxation instruments) can reduce urban NOx emissions by 10 to 25% beyond the reductions achieved through fuel quality changes, changes to vehicle technology and improved durability of emission control systems. The potential contribution of local technical and non-technical measures to emission reduction of other pollutants was not assessed in the same detail as for urban NOx but is likely to be of a similar magnitude. 5. COST-EFFECTIVE SOLUTIONS TO ACHIEVE AIR QUALITY TARGETS The most important step in the Auto/Oil Programme involved the exploitation of the data compiled on the costs and benefits of the various emission reduction measures (sections 4 and 5) in order to identify the most cost effective solutions to achieve the emission reduction targets identified in section 2 (see Figure 2). In the original concept of the Auto/Oil Programme it was foreseen that emission reduction targets would be generated in a consistent manner for all pollutants and that least cost solutions would be generated simultaneously in order to satisfy these multiple- emission reduction objectives. However, as described in sections 2. 3, it was not possible to determine precise emission reduction targets for particulate matter in each of the seven cities although a tentative objective of a reduction in the range of 50-65% as compared to present levels was identified. Similarly reduction targets for total NOx and total VOCs as precursors of regional ozone were difficult to establish: again tentative reduction targets in the range 70-80% for both pollutants compared to 1990 were identified. In the absence of compatible emission reduction targets for all pollutants, the analysis was conducted in a step wise manner looking first at the three pollutants- NOx, CO and Benzene - for which it had been possible to identify precise emission reduction targets in the 7 cities. Subsequently, strategies for reducing urban particulate emissions were explored. Finally, approaches for reducing emissions of total NOx and total VOCs as contributors to regional ozone were examined. With regard to the attainment of the emission reduction targets for urban pollutants, one important consideration was the achievement of an effective balance between on the one hand EU wide, largely technical, measures such as emission standards, fuel quality and inspection and maintenance and on the other hand local, largely non-technical measures such as road pricing, increased public transport, scrappage schemes and the replacement of diesel buses and trucks with LPG/CNG fuelled vehicles. The objective was to identify the most cost-effective series of interlocking measures such that a certain proportion of the background levels of pollution would be removed by EU wide technical measures and that as and where appropriate these technical measures would be supplemented by national and/or local measures in localities with elevated levels of-pollution - the objective being to achieve the desired emission reductions at the least cost for the Community as a whole. The details of the technical procedures used to identify the least cost combination of measures are described in the^ consultants report on the cost-effectiveness study and the consolidated report of the Auto/Oil Programme. 41 EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE 96/0163 (COD) Proposal for a relating to the quality of petrol and diesel fuels and amending Council Directive 93/12/EEC 42 EXPLANATORY MEMORANDUM 1. BACKGROUND in reducing vehicle emissions. The European Union has a long standing history Directive 94/12/EC(1) is the latest amendment of base Directive 70/220/EEC(2), laying down new emission standards for passenger cars. When the provisions of Directive 94/12/EC come into effect in 1996/97, emissions of regulated pollutants from new passenger cars will be reduced by over 90% as compared to the standards which prevailed in the early 1970s. However, despite these considerable achievements with regard to the emission reduction of individual vehicles, increased traffic activity (increased numbers of vehicles, increased kilometers travelled) are likely to counteract these improvements thereby preventing the emission reductions necessary to achieve future air quality objectives. The likelihood of further action to reduce vehicle emissions necessitated a reassessment of the existing policy approach; it being apparent that the emission reduction potential offered by further improvements in vehicle technology was limited and possibly very costly in comparison to other potential solutions. In the light of the above considerations a new, comprehensive and integrated approach was developed. Directive 94/12/EC, Article 4 outlines the main elements of this new approach: "In these proposals [future proposals designed to reduce emissions from traffic which the Commission is requested to submit] the Commission shall take the following approach: * * the measures shall be designed to produce effects to meet the requirements of the Community's air quality criteria and related objectives; an assessment of the cost-effectiveness of taking each measure shall be undertaken; in this global assessment full account shall be taken, inter alia, of the contributions that: traffic management, for example by spreading the environmental costs appropriately, enhanced urban public transport, new propulsion technologies (e. g. electric transmission), the use of alternative fuels (e. g. biofuels), could make to improving air quality, * the measures shall be proportional and intended objectives. " reasonable in the light^ of the Article 4 of Directive 94/12/EC stipulates that measures to be assessed with regard to their benefits and costs shall include improved vehicle technology, more appropriate mechanisms to reduce the in-use deterioration of emission control systems and "improvements in fuel quality as far as vehicle emissions of dangerous substances (in particular benzene) are concerned". (1) (2) OJ No L 100, 19. 4. 1994, p. 42. O J N oL 76^ 6. 4. 1970, p. l. 43 The importance of fuels with regard to the release of atmospheric pollutants such as lead, benzene and sulphur dioxide from vehicles has been recognized for some time. EU-wide legislation aimed at limiting the detrimental health and environmental effects of these pollutants already exist. The in limit values currently Directive 85/210/EEC(3) concerning the lead and benzene content of petrol and the sulphur content of diesel fuels is regulated under Directive 93/12/EC(4). in place are laid down The use of fuels for transportation purposes is however also linked to the release of other air pollutants such as volatile organic compounds (NOx), carbonmonoxide (CO) and particulate matter (PM) which directly or as precursors of ozone can have detrimental health and environmental effects. (VOCs), nitrogen oxides Therefore, assessment of the cost-effectiveness of fuel quality changes as a measure to reduce vehicle emissions must include a wider range of fuel components than those already legislated for. 2. THE EUROPEAN AUTO/OIL PROGRAMME In keeping with its commitment towards the development of a more comprehensive approach to reducing emissions from road transport and in conformity with the principles set out in Article 4 of Directive 94/12/EEC the Commission, at the end of 1992, decided to initiate a technical work programme for the purpose of providing a solid technical foundation upon which to base its future legislative proposals. In accordance with the principle of 'shared responsibility' expressed in the 5th Environmental Action Programme, the Commissioners for Environment, Industry and Energy, invited the European associations of the car (ACEA) and oil (Europia) industries to make available their considerable know-how and expertise and to collaborate in the realization of this technical programme. The two industries responded positively to this invitation and together with the Commission designed, planned and executed the programme which subsequently became known as the Auto/Oil Programme. The content and the structure of the Auto/Oil Programme is described in the Communication which accompanies this proposal. A short description of the programme and the conclusions derived from it is presented below. The objective of the Auto/Oil Programme was defined as: to provide policy-makers with an objective assessment of the most cost-effective package of measures to reduce emissions from the road transport sector to a level consistent with the attainment of the new air quality standards being developed for adoption across the European Union. The Auto/Oil Programme explored cost-effective combinations of measures sufficient to achieve, by 2010, stringent air quality standards with respect to the following pollutants: ~ZT * * * * * oxides of nitrogen (NOx) in cities benzene in cities carbonmonoxide (CO) in cities particulate matter (PM) in cities tropospheric ozone and thereby emissions of total NOx and Volatile Organic Compounds (VOCs). (3) (4) OJNoL96, 03. 4. 1985, p. 25. OJNoL74, 27. 3. 1993, p. 81. 44 The Auto/Oil Programme demonstrated that in the absence of futher measures to significantly reduce emissions from road transport, concentrations of nitrogen oxides, particulate matter and tropospheric ozone would constitute a continuing threat to human health and the environment into the next millenium. In contrast, the impact of already agreed measures was predicted to reduce concentrations of carbonmonoxide and benzene to acceptable levels. The Auto/Oil Programme explored the cost and the emission reduction potential of a variety of different measures inter alia improved vehicle technology, inspection and maintenance schemes, changes in the quality of fuels and a number of non-technical measures such as scrappage schemes and road pricing. Drawing on the results of the Auto/Oil Programme the Commission has decided upon a package of legislative proposals to be submitted to the European Parliament and the Council. a proposal on a moderate reformulation of petrol and diesel fuels (this proposal); to strengthen a proposal for passenger cars the existing emission (Directive 70/220/EEC, as last amended by Directive 94/12/EC (accompanying this proposal); limits a proposal light duty vehicles (Directive 70/220/EEC as last amended by Common Position No 3/96, [in 1997])(5) ; the emission strengthen limits for to a proposal (Directive 88/77/EEC(6) as last amended by Directive 91/542/EEC7)); the emission strengthen limits to for heavy duty vehicles. a proposal with regard to the strengthening of the current legislation on inspection and maintenance (Directive 92/55/EC^ [in 1997]). The proposals enumerated above foresee the simultaneous entry into force of a series of measures as from 1 January 2000. The Commission estimates that the measures coming into effect in 2000 will, in 2010, reduce emissions from the road transport sector by: urban NOx = urban CO = urban benzene 39% 51% = 48% urban particulates total NOx total VOCs = = = 39% 35% 46% as compared to what the emissions would have been in the absence of the measures. 3. EMISSION REDUCTION FROM OTHER THAN MOBILE SOURCES The package of measures is part of an integrated Commission strategy to reduce atmospheric emissions from all sources and which was developed on the basis of the 5th Environmental Action Programme. While emission reductions from mobile sources are an important contribution to the achievement of future air quality targets they will not be sufficient to solve the problem of ozone pollution and acidification. (5) (6) (7) (8) O J N oC 37, 9. 2. 1996, p. 23. O J N oL 36, 9. 2. 1988, p. 1. O J N oL 295, 25. 10. 1991, p. 1. O J N oL 225, 10. 8. 1992, p. 68. 45 The Commission is therefore pursuing complementary measures aimed at emission reduction from stationary sources such as power plants, industrial installations, households, etc. The revision of the large combustion plant directive*9' and the proposed directive on Integrated Pollution Prevention and Control0* are steps in this direction. Further action, especially with regard to the reduction of volatile organic compounds as a precursor for ozone formation, are needed to complement the beneficial effects gained from traffic related measures. 4. THE EUROPEAN MARKET FOR PETROL AND DIESEL FUELS The Community's total energy demand is covered by several sources of which almost half is supplied by liquid fuels. The annual turnover is approximately ECU 40 billion/year. In 1990, energy demand for transport activities amounted to about 30% of total final energy consumption. More than 83% of the energy needed for transport is consumed by road transport in the form of fuels. The principal fuels are petrol and diesel with other fuels such as Liquified Petroleum Gas (LPG) and Compressed Natural Gas (CNG) only taking up a small share of the market. According to the latest oil industry figures gasoline and diesel consumption in 1995 amount to around 170 000 respect. 120 000 million litres. The consultancy company AD. Little has estimated that over the period 2000-2015, EU consumption of petrol and diesel fuels will amount to 2 540 respectively 2 572 thousand million litres. These forecasts are likely to be overestimated in view of the Commission's aim of bringing forward policy measures to reduce C07 emissions from cars. Market Share of Leaded and Unleaded Gasoj 0Leaded Figure 1 • Unloaded FfetiHtd Qftmany [jjKtmbourg aeijiuni ftwtoo 0% 10% 20% 30% 40% 50% 60%i 70% 80% 80% 100% Percentage Market Share (9) (10) Revision of Directive 88/609/EEC: OJ No L 336, 7. 12. 1988, p. 1 COM 96/C87/02 46 Leaded v unleaded petrol The market for petrol is divided into leaded and unleaded petrol, of which the latter has gained an increasing market share over the last years. In 1995 the average market share of unleaded petrol in the EU reached about 68%». However, this figure does not reflect the wide difference of the use of unleaded petrol in the Member States. While in countries like Austria, Finland and Sweden 100% of the petrol pool consists of unleaded petrol, in Spain, Greece and Portugal the latter only represents 30-40%. An overview of the share of leaded and unleaded petrol in the market in 1995 is provided in Figure 1. With the introduction of the catalytic converter the market share of unleaded petrol will increase further with an estimated growth rate of approx. 8% of the 1995 market share per year. Unleaded petrol is provided in the market as 'unleaded regular1 (91/92 RON [Research Octane Number]), 'unleaded premium/super' (RON 95) and 'unleaded super plus' (RON 98) Table 1 is the oil industry's estimate of the market share of each type calculated as percentage of total unleaded petrol and as percentage of total petrol. Table 1 (Estimate Europia 1995) TYPE unlead. % of total unleaded petrol % of total petrol pool RON 91/92 RON 95 RON 98 Fuel quality 1 3^ 68. 5 18. 0. 9 47 12 The quality of unleaded petrol and diesel fuels in Europe is subject to European standards as laid down by the European Committe for Standardisation (CEN) [see chapter 12, p. 22]. Requirements specified by the CEN standards are set with a view to improved performance of the engine/vehicle. While the establishment of European standards has led to a certain degree of harmonization current data on fuel quality in the market show that there are considerable variations with regard to locations (north, south, central) and seasons (winter/summer). The predicted average fuel quality of petrol and diesel fuels by the year 2000 and in the absence of any legislative action is shown in Tables 2 and 3 below. 47 Table 2: Predicted Average Values for Fuel Parameters of Market Fuel (unleaded petrol) Parameter RVP Summer E. 10Q E. 150 Olefins Aromatics Benzene Oxygen Sulphur Lead Unit kPa % v/v % v/v % v/v % v/v % v/v % m/m gpm g/1 Predicted Market Average in the year 2000 without new measures 68 53 84 U 40 23 (^6 300 0. 005 Table 3: Predicted Average Values for Fuel Parameters of Market Fuels (diesel) Parameter • Cetane Number Density Poly aromatics T95 Sulphur Units : kg/m3 vol% ^Ç ppm Predicted Market Average in the year 2000 without new measures 51 843 9 355 450 48 5. THE EMISSIONS BENEFITS AND COSTS OF CHANGES IN FUEL QUALITY The Auto/Oil Programme demonstrated clearly that changes of fuel components such as sulphur, aromatics and benzene content and vapour pressure for gasoline and sulphur, cetane number, density and polyaromatic content of diesel can have a significant benefit in terms the of reducing emissions of priority pollutants from vehicles. In Auto/Oil Programme the relationship between the benefits in terms of reduced emissions and the costs were explored for unleaded petrol and diesel fuels modified to increasing degrees of severity. the context of The Commission's proposal As described in Chapter 2. the Auto/Oil Programme identified moderate changes in the quality of petrol and diesel fuels as part of a cost-effective integrated package of measures. The fuel specifications proposed by the Commission for petrol and diesel fuel and foreseen to come into force in 2000 are shown in Tables 4 and 5. The specifications are expressed as maximum and minimum for various parameters of environmental relevance. The tolerances of the refinery production process mean that in order to ensure that the product complies with the prescribed specifications the average quality of the fuel placed on the market will be better than the specifications. Tables 4 and 5 also indicate the Commission's estimates of the market average fuel quality which will result from the application of the proposed specifications. A comparison with the predicted average market values for petrol and diesel fuels by the year 2000 in the absence of legislation (see Tables 2 and 3 on pages 6 and 7) shows improvements with regard to Reid Vapour Pressure (RVP), aromatics, benzene and sulphur in petrol and with regard to cetane number, density, poly aromatics, T95 (distillation) and sulphur in diesel fuel. Table 4: Proposed Fuel Specifications for Petrol to Come into Effect in 2000 and the Corresponding Predicted Market Average Values Parameter Unit Average Market Values of Proposed Fuel Package Limit Values of Proposed Fuel Package Minimum Maximum RVP Summer E. 100 E. 150 Olefins Aromatics Benzene Oxygen Sulphur Lead kPa % v/v % v/v % v/v % v/v % v/v % m/m ppm g/1 58 53 84 11 37 1. 6 1 150 0. 005 _ 46 75 - - - _ _ - 60 _ _ Ts* 45 2 2. 3 200 0. 005 [* Except for unleaded petrol regular for which the maximum olefin content shall be 2 1% v/v. ] 49 Table 5: Proposed Fuel Specifications for Diesel to Come into Effect in 2000 and the Corresponding Predicted Market Average Values Parameter Unit Average Market Values of Proposed Fuel Package Limit Values of Proposed Fuel Package Minimum Maximum Cetane Number Density - kPa Poly-aromatics % Vol. T95 Sulphur °C ppm 53 835 6 350 300 51 • _ _ - _ 845 11 360 350 Emission reductions The emission reductions which are achieved by the proposed petrol and diesel specifications foreseen in 2000 are shown in Table 6. Table 6: Emission Reductions Achieved From Different Vehicle Classes by Expected Petrol and Diesel Fuel Quality Changes Pollutant % emission reduction achieved by the proposed change in petrol % emission reduction achieved by the proposed change in die:elfuel (LDVs)* % emission reduction achieved by the proposed change in diesel fuel (HDVs)* NOx VOCs CO PM - 7. 12 - 8. 44 - 8. 89 Benzene -20. 7 - 0. 53 - 10. 68 - 10. 60 - 9. 95 — -2. 15 -2. 20 -0. 39 -3. 22 * The difference in emission reduction between light duty (LDVs) and heavy duty vehicles (HDVs)inrdue to the difference in the test cycle which reflects the different engine technologies of the two vehicle categories and the different loads under which they operate. In addition to the proposed Community-wide measures, supplementary emission reduction measures might be taken by Member States at national, regional or local level in order to achieve established EU or national air quality standards everywhere in the Community (see also 'Fiscal Measures' below). 50 Leaded petrol The Auto/Oil Programme only investigated the cost and emission effects of unleaded petrol, grades. With the increasing number of cars equipped with catalytic converters the share of leaded petrol in the total pool will diminish significantly. While today the share of leaded petrol is around 30% of the total pool the estimated growth rate of the market share of unleaded petrol (see chapter 4, p. 5) suggests that by the year 2000 only a very small amount of leaded petrol (2%) will be in the market. In addition, it is estimated that by the year 2000 the entire car fleet will be able to run on unleaded petrol except the socalled 'Oldtimers'. These cars can be run on unleaded petrol containing a lead substitute which can be added to the petrol tank. These lead substitutes are already available at the petrol station where they can be purchased and added by the consumer. In the light of the above and in recognition of the significant human health risk associated with lead pollution, the Commission has proposed a general ban on the marketing of leaded petrol as from 1. January 2000. However, in recognition of the fact that for certain Member States such a rapid phase- out may result in severe socio-economic problems, the Commission's proposal also provides for a limited, two year derogation. Benzene the benzene content in petrol is 5% as regulated under EC The current limit value of Directive 85/210. With a number of Member States producing petrol containing benzene levels well below this limit, the European average market value today is about 2. 3% (see Chapter 4, p. 6). Air quality modelling results obtained as part of the Auto/Oil Programme have shown that by the year 2010 atmospheric benzene levels will be sufficiently low even without the application of additional measures if this average value is being maintained. However, the Commission is aware that atmospheric benzene pollution is likely to persist in the short to medium term, in areas with high traffic density (inner cities, cross-roads, etc. ). For this reason countries like Austria, Finland, Germany, Italy and Sweden have in an Environment Council meeting in December 1994 demanded that a reduction of the benzene level in petrol to 1% be introduced at European level as the most effective measure to mitigate existing benzene pollution in those problem areas. Directive 94/12/EEC, Article 4 requires the Commission to particularly investigate the emission effects with regard to a change in benzene content. Austria, in the accession negotiations, was allowed to maintain its national benzene limit value of 3% for a transitional period. Sweden and Finland were permitted to continue a tax incentive scheme with which the benzene content of petrol has been redueed to 3% and 1%> respectively. The Commission in its response to Member States' concern on atmospheric benzene levels is taking a positive stance when proposing a considerable reduction of the current benzene limit value from 5%;to 2%. However, in view of the air quality from the Auto/Oil Programme and summarised in chapter 2. , the Commission does not see the need to mandate for a EU-wide benzene limit value of 1%. Review Process Within 12 months of the adoption of the Directive and in any event not later than 31 December 1998 the Commission will bring forward proposals to revise the provisions of the Directive. This proposal will be based on the comprehensive assessment to be carried out in conformity with the requirements of Article 4 of the proposed amendment to Directive 70/220/EEC. The purpose of that assessment is to develop a strategy designed to 51 produce effects to meet the requirements of Community air quality standards and related objectives, at least cost. In developing such a strategy, the Commission will take full account of: trends in air quality; noxious pollutant emissions in Europe from transport and non-transport sources and the contribution that existing, pending and potential measures to control emissions from non-transport sources , could make to improve air quality; technical developments with regard to: * * vehicle technologies as well as new propulsion technologies (e. g. electric propulsion, fuel cells), refinery technologies; the potential of alternative fuels such as compressed natural gas (CNG), Liquid Petroleum Gas (LPG), and Dimethyl Ether (DME) and biofuels to reduce vehicle emissions, possible improvements in the test procedures for the type approval of new vehicles, in particular the addition of a new test procedure at low temperatures; the potential of technical, non-technical and local measures to reduce emissions: in this context, the contribution of transport and other policy measures such as traffic management, enhanced urban public transport and vehicle scrappage schemes should be evaluated; the contribution that selective and differentiated fiscal measures could make to reducing emissions, whilst not negatively the internal market; the functioning of impacting the effects of any measures on C02 emissions; the strategies followed by third countries to improve air quality and the emission values applied therein; the situation with regard to the supply and the quality of crude oil available to the Community. The proposal to revise the provisions of the Directive based on a comprehensive assessment and as an integral part of the strategy described above, will include, inter alia, a revision of this the specifications for petrol and diesel fuels as laid down in Annexes I and frof Directive. These revised specifications would come into effect on January 1, 2005. The Commission's proposal will take into account that improvements to fuel quality have a direct and significant impact on emissions of particulate matter, volatile organic compounds and oxides of nitrogen. All of these pollutants either directly, or as a result of their contribution to ozone formation, result in important impacts on human health and the environment. In addition to the direct benefits that improved fuel quality has on vehicle emissions there is a clear interaction between fuel quality and vehicle technology. With regard to the development of new pollution abatement technologies such as the de-NOx catalyst there is evidence that fuels of a certain quality, particularly low sulphur fuels, may well be required if such technologies are to achieve optimal and long-lasting levels of performance. 52 Accordingly, the Commission foresees that its future proposal to revise the specifications of petrol and diesel fuels should comprise a significant reduction in the content of sulphur for both fuels. Current research and development indicates that a sulphur limit of the order of 50 ppm could be needed for the optimal functioning of the new vehicle-based pollution abatement technologies as well as contributing to improving emissions from the existing car pare. While this proposal does not specify a limit value for the sulphur content in petrol and diesel fuels for 2005 the establishment of these values will of course be based on the outcome of the cost-effectiveness assessment to be carried out prior to the development of the Commission's future proposal. To take account of the possibility that vehicles equipped with new pollution abatement technologies such as the de-NOx catalyst are developed and introduced into the market before 2005, the Commission has also included in its proposal a commitment to bring forward, if appropriate, proposals to ensure that when vehicles equipped with such technologies are placed on the market, fuels of a quality sufficient to guarantee the necessary level of performance of the technology will be widely available. In bringing forward such proposals the Commission will give due regard to considerations of air quality, cost-effectiveness and proportionality. The Commission will also take into account: (i) (ii) the latest information on the interaction between fuel quality and the performance of the new pollution abatement technologies; the situation with regard to the development and production of these technologies and the forecasts concerning the marketing of vehicles equipped with such technologies. (iii) the need to ensure that the measures proposed will neither disrupt the free movement of persons and goods nor unduly distort competition. Fiscal Measures While the Commission's proposal will result in a significant improvement in the average quality of fuels sold throughout the Community, it is likely that some Member States, particularly those in which. fiscal incentives have been applied in the past, may wish to encourage the use of even cleaner fuels as part of their overall strategy to improve air quality. The Commission would not wish to impede national or local initiatives aimed at improving air quality on condition that such initiatives were compatible with the provisions of Directive 92/81/EEC dealing with mineral oil structures. According to Directive 92/81/EEC(11), mineral oils used as a motor fuel shall be taxed at a single rate per product category. The excise duty rate for each product is to be decided by the individual Member States provided they respect the Community minimum rates as outlined in the Mineral Oils Rates Directive 92/82/EEC(12). Should Member States wish to use fiscal incentives and apply differential rates, other than those provided for in article 8(2) of Council Directive 92/81/EEC, they have the-possibility to request a derogation from the general regime according to Article 8(4) of the same Directive. Such requests must be authorized by the Council. For motor fuels, Denmark, Finland, Greece and Sweden have been granted derogations allowing them to apply reduced rates on environmentally friendly diesel. Finland can apply reduced excise duty rates on reformulated unleaded and leaded petrol. Denmark can apply differential rates of duty between petrol. distributed from petrol stations equipped with a return system for petrol fumes and petrol distributed from other petrol stations. A number of applications from other Member States are presently being evaluated. (11) (12) OJ No L 316, 31. 10. 1992, p. 12. OJ No L 316, 31. 10. 1992, p. 19. Derogations - Special Fuels Notwithstanding the possibilities open to Member States to encourage the marketing of cleaner fuels through fiscal measures, there may be specific locations such as large urban areas where atmospheric pollution constitutes or may reasonably be expected to constitute a serious and recurrent problem for human health and/or the environment. In such locations Member States may consider it appropriate to require the marketing of special fuels as part of a strategy to combat air pollution. The Commissions proposal therefore foresees the possibility for Member States to be granted a derogation in order to require the use of such special fuels. The Commission's proposal also foresees that Member States wishing to make use of this derogation will be required to motivate their proposed measures on the basis of air quality measurements and the improvement in air quality that the measures are expected to bring. The Member State should also provide evidence that the proposed measures respect the principle of proportionality with particular attention being given to their impact upon the internal market and competition. 6. THE EUROPEAN REFINING INDUSTRY The European Union (15) has 106 refineries with a total distillation capacity of In the past, refineries have been categorized in three types: 13 212 833 barrels per day. simple, catalytic cracking and full upgrading. However, these categories no longer represent the range of refineries operational in Europe. Over the last three to five years, some refiners have upgraded their installations in response to tighter product specifications such as the reduction of lead in petrol and the lowering of the sulphur content in gas oil and diesel fuel. The currently existing refinery types are best categorised as follows: * * * * * Simple - including thermal operations & some vaccum distillation Fluid Catalytic Cracking (FCC) with or without feed pretreatment with or without C6-Isomerisation Hydrocracking Fluid Catalytic Cracking (FCC) and hydrocracking Others (e. g. lube oil production, etc. ) ~ The latter category is without importance for petrol and diesel production and will therefore be excluded from the further analysis. The refinery type most common in Europe is the fluid catalytic cracking (FCC) type (with or without pretreatment and with or without C6-Isomerisation but not including the combination FCC plus Hydrocracker) accounting for around 61% of total atmospheric distillation capacity in the European Union. Table 7 provides an overview of European refinery types and their percentage share of total European distillation capacity. Figure 3 shows the types of refinery existing in each country and their total distillation capacity. 54 Table 7: European Refinery Types and Their Share of European Distillation Capacity (1994) Refinery Type Simple without thermal or C6 Isomenzation Simple without thermal but with C6 Isomenzation Simple with thermal but without C6 Isomenzation Simple with thermal and C6 Isomenzation Hydrocracker without C6 Isomerisation Hydrocracker with C6 Isomenzation FCC without Pretreatment or C6 Isomenzation FCC without Pretreatment but with C6 Isomerisation FCC with Pretreatment but without C6 Isomerisation FCC with Pretreatment and C6 Isomerization FCC and Hydrocracker without pretreatment or C6 Isomerization FCC and Hydrocracker without Pretreatment but with C6 Isomerization Other Number of Refineries Total Atmospheric Distilliation Capacity (b/cd) % of European Capacity in Each 18 3 10 9 7 3 19 17 8 3 4 2 3 969 030 244 000 737 118 696 700 881 160 494 000 3 218 500 2 793 000 7. 3% 1. 8% 5. 6% 5. 3% 6. 7% 3. 7% 24. 4% 21. 1% 1 454 025 11. 0% 598 300 737 000 390 000 4. 5% 5. 6% 3. 0% 0 0% Total in Europe 106 13 212 833 55 Figure 2 European Refinery Types per Country (1994) H Hydro D FCC and Hydro without Pretreatment m FCC with Pretreatment • FCC Without Pretreatment • Simple It can be seen from Figure 2 that in Austria, Belgium, France, Italy, the Netherlands, the UK and Spain the various types of FCC refineries predominate. Greece's distillation capacity is divided between simple and FCC refineries however, one of the FCC refineries also has some hydrocracking capacity which increases its flexibility with regard to the fuel quality changes required. the biggest hydrocracking capacity of all EU Member States. Finland has a simple and a FCC/hydrocracking refinery. Denmark and Ireland only operate simple refineries. Sweden's distillation capacity is nearly equally divided between the simple and the FCC refinery type. One of the latter however has some hydrocracking capacity. German refineries have — The refinery configuration has a major influence on the oil industry's ability to meet product specifications and is the key indicator as to the technical capacity of an individual refinery to cope with tighter specifications as a consequence of European environmental legislation. In general tighter limit values for diesel specifications and for petrol specifications such as sulphur and olefin content can more easily be met by simple and hydrocracking than by other refinery types. FCC and combined FCC/hydrocracker refineries are better suited to the tightening of certain petrol components such as benzene and aromatics. 56 Projected costs of legislative fuel specifications to the refining industry The financial implications incured by the proposed specifications are presented in Table 8 for the European refining industry (EU 12). They provide an overview of the estimated total costs over 15 years expressed as the net present value, indicate the overall capital investment costs and the yearly incured fixed operating and energy costs. Table 8: Cost Implications* for Proposed Petrol and Diesel Fuel Specifications in 2000 ŒU12) CECXJ) million Net present Value (over 15 years) Total Capital Investment Costs Fixed operating Costs/Year Energy Costs/Year 11 380 7 223 291 146 The costs are based on the value of the ECU in 1995 and a project life of 15 years from 2000 onwards. Not included in this cost analysis are the financial implications for the refinery industries in Austria, Finland and Sweden since they were not members of the European Union at the time when the Auto/Oil Programme began. However, all three new Member States have already undertaken action with regard to a change of certain parameters of pefol and diesel fuels. This is particular so for Sweden and Finland where a number of fuel specifications are much stricter than those proposed in this Directive. It can be expected that costs for the Swedish and Finnish refinery sector will not increase as a result of the forthcoming European legislation. For Austria however, some costs will occur. While the aggregated total costs for EU-12 do not reflect individual refinery and regional variations, these aspects have nevertheless been studied. It can be expected that the results for individual refineries and for regions show a wide difference. However, the variation is not uniform because the impact of the quality parameter changes depends on both feedstock and refinery configuration. Therefore, it is likely that the Mediterranean region with its higher sulphur feedstock will face higher costs than the aggregate for removal of sulphur. North West Europe and the atlantic region on the other hand will have to pay more than the aggregate costs for removal of benzene and aromatics because their feedstock contains a high amount of these compounds. It is expected that the aggregated costs can vary between ± 25% depending on refinery type and region. 7. TRADE IMPLICATIONS In order to produce a range of fuels and satisfy local demand it is often necessary for a refiner to trade in feedstock and/or a certain amount of their refinery products. This enables refiners to balance refinery configuration and design against fuel demand and the nature of, the crude oil supply. trade occurs among Member States and between Member States and This non-European countries. 57 Petrol Over the last ten years the EU trade balance of petrol has been positive with total exports to third countries increasing from 6. 7 to 15. 0 million tonnes. The U. S. A. and Canada are one of the major export markets of the EU for petrol. While in 1992 and 1993 exports were low because additional MTBE production in those countries replaced some of the previously imported petrol, in 1994 exports started to recover and rose to about 6. 8 million tonnes. Figure 3 shows the contribution of individual Member States towards these exports. It is difficult to predict the future development of these exports since they are influenced not only by the forthcoming changes of fuel quality in the EU but also by the evolution of the 'reformulated gasoline' programme in the USA. FigttrrS 1994 Petrol Exports to USA and Canada Source: E T S U/ High and Watt Associates, 1995. Gasoil/diesel fuel The EU- trade balance of gas/diesel oil between 1985 and 1994 has turned from negative to positive with net exports to third countries totalling about 1 million tonnes in 1994. Of the total imports the biggest share of 30% is coming from Russia. Another important supplier of gas/diesel oil is Egypt with 20%. No statistics on the breakdown of imports between diesel and other gas oil are available. However, the diesel share of total gas oil production increases. The rise has been from 49% in 1993 to 50% in 1994. For 1995 the share of diesel is projected to be 53%. Changes in diesel fuel quality as proposed in this Directive will make it more difficult to meet sulphur and density specifications in diesel and are likely to lead to an increasing demand on low sulphur (sweet), crudes. In the mid and long term North West Europe and the Atlantic region will become short on their reserves of low sulphur crude oil. It is therefore reasonable to expect the price differential to widen between low sulphur (sweet) and high sulphur (sour) crudes and imports of low sulphur crudes into the Community to rise. These developments will favour the North African crude oil suppliers while the Russian and most West African crudes are generally higher in sulphur. 58 8. IMPLICATIONS FOR THE CONSUMER The incurred European-wide costs for a change in the quality of fuel as illustrated in Chapter 5. will ultimately be borne by the consumer. For her/him the additional costs per litre at the pump will be around ECU 0. 002 for a petrol or diesel car for measures to be introduced in 2000. For a motorist who drives around 12 600 km/year this amounts to additional costs of around ECU 2/year for a petrol or diesel car. This increase in price is well below price changes which occur on a regular basis for other market reasons (e. g. changes in crude oil and feedstock products). 9. IMPACT ON EU-WIDE CO, EMISSIONS Changes in fuel quality require the use of additional energy which in turn increases C02 emissions. It is estimated that C02 emissions per year will rise by 6 million tonnes across the EU (12) when the proposed fuel quality changes will become mandatory for 2000. These 6 million tonnes represent around 0. 2% of total C02 emissions and 0. 8% of C02 emissions from transport sources in 1993. 10. SUBSIDIARITY 10. 1 What are the Objectives of the Proposed Measure in Relation to the Obligations Placed Upon the Commission? The objectives of the measure are to achieve a basic level of harmonization of the considerable market of transport fuels (about 290. 000 million litres in 1995). Despite the existance of norms laid down by the European Committee for Standardization (CEN) for certain fuel components, the majority of the petrol and diesel fuel marketed is characterized by numerous permissible levels for a number of fuel components (e. g. sulphur, aromatics, benzene). The proposal asserts an increased level of harmonization to replace the existing range, thus ensuring the proper functioning of the internal market. Harmonization will be even more important in the future as environmental concerns may lead many Member States to introduce new restrictions on some of the above mentioned fuel components. Unilateral measures could produce differences in product specifications in the various Member States thereby hindering the free flow of goods. The role of transport fuels with regard to their potential of reducing vehicle emissions has been discussed in Chapter 5. For the purpose of considerable emission reductions necessary to achieve future urban and regional air quality objectives, changes in fuel quality have proven to be a cost-effective means. Only legislative -action on Community level can ensure that the emission reduction potential of fuelsTs used to the extent needed. 10. 2 Does the Proposed Action relate to a Matter of Exclusive Community Competence or Competence Shared with the Member States? The matter concerns harmonization of the internal market and therefore is an issue of exclusive Community competence. 10. 3 What Forms of Action are Available to the Community? The only realistic form of action is legislation based either on a Directive or a Regulation. 59 10. 4 Is a Uniform Regulation Necessary or will a Directive Imposing General Objectives with the Execution being Left to Member States Suffice? A directive imposing general objectives and with the detailed implementation being left to the Member States will achieve the necessary objectives while at the same time allowing the Member States considerable freedom with regard to practical details of implementation. 11. RESULTS OF CONSULTATION WITH AFFECTED PARTIES Consultation with Member States During the course of the Auto/Oil Programme which was to serve as the technical and scientific basis for legislation on car emissions and fuel quality, DG XI and DG HI have conducted a series of meetings with national experts. The purpose of the meetings was to fully inform Member States about all aspects of the programme and to ensure that their comments were taken into consideration. In a meeting on 7 December experts from Member States were consulted on the proposed fuel quality specifications laid down in this directive. The experts in general welcomed the Commission's initiative to put forward legislative proposals on the quality. of petrol and diesel fuels. Experts from Austria, Denmark, Finland, Germany, Sweden and the Netherlands expressed their strong view of most of the petrol and diesel fuel specifications not being strong enough. Especially Finland and Sweden voiced the concern that the high quality fuel specifications currently in place in their countries could be endangered by the Commission's proposal for only moderate changes of fuel quality. Experts from Ireland, France, Spain and Portugal were of the opinion that some fuel parameters in particular the sulphur content of both petrol and diesel fuel would be difficult for their refineries to achieve. Consultation with the European oil and car industries (Europia and ACEA) Both, the European associations of the oil (Europia) and the car (ACEA) industries were partners in the Auto/Oil Programme. The work carried out in the framework of the programme was based on the consensus of all partners involved. At a final technical meeting of the Auto/Oil Programme on 20 March 1996, the database and the methodology used for carrying out the cost-effectiveness ananlysis were approved. The oil industry was also consulted on a number of technical questions which arose in the discussion on transposing the fuel parameter values used in the cost-efectiveness analysis into limit values. With regard to the proposed specifications the oil industy has expressed its strong opposition concerning the intention to already indicate the need to make significant cuts in the sulphur content of petrol and diesel fuels in 2005. Europia considers this as a violation of the cost-effectiveness principle. With regard to the benzene content of petrol. Europia maintains its position that in view of the results of the air quality modelling carried out within the context of the Auto/Oil Programme a reduction of the current EU average market value of about 2. 3% is not justified. 60 The car industry however considers the proposed fuel specifications for the year 2000 as too moderate and would like to see more severe limit values in particular with regard to the sulphur content of diesel fuels. ACEA claims that with the current proposal on fuel quality, which amounts to yearly costs of around ECU 880 million for the oil industry puts the bulk of the total financial burden of ECU 5 326 million/year for the overall package of emission reduction measures on the car industry. 12. DESCRIPTION OF LEGISLATIVE SITUATION IN MEMBER STATES Current European legislation on fuel quality European legislation on fuel quality is currently limited to Directive 85/210/EEC on the lead and benzene content of petrol and EC Directive 93/12/EEC on the sulphur content of diesel fuel. Directive 85/536/EEC sets out the framework for the addition of oxygenates into petrol. Member States have to permit a certain amount of oxygenates in the petrol and can allow those in excess of it. According to the legislation referred to above Member States have to adhere to the following values: Petrol lead content (g/1) in leaded petrol: lead content (g/T in unleaded petrol: benzene content%V/V: > 0. 15 - < 0. 40 < 0. 013 < 5. 0 Diesel sulphur content% m/m 0. 2 0. 05 (1/10/1996) Temporary derogations for new EU Member States at the time of their accession The following countries were given temporary derogations with regard to some fuel components for which national legislation already existed: Austria benzene in petrol sulphur in diesel ban of leaded petrol 3% 500 ppm Sweden/Finland ban of leaded petrol/continuation of currently existing tax incentive scheme for environmentally higher quality fuels. —7 61 Additional national legislation Some Member States have extended the existing European legislation to other fuel parameters and have given legal status to the technical norms set by the European Committee for Standardisation (CEN) for a range of fuel parameters. Tables 9 and 10 give an overview of the countries which enforced CEN-norms as legally binding, the fuel types and the environmentally important fuel components to which they apply. Table 9 Specifications Density (kg/m3) Cetane number I Distillation, T 95% Diesel Fuel Limit values s 860 £ 820 £ 49 (temperate climate) | <L 370 C° (temperate climate) | Countries: Finland, France, Germany, United Kingdom, Italy Table 10 Specifications Limit values Unleaded Petrol (regular/premium) Sulphur content (%m/m) Reid vapour pressure (kPa) Distillation (El00) (%v) <. 0. 05 ^ 35 £ 100 (depending on seasonal and geographical conditions) z 40 ^ 70 (dep. on seasonal and geographical conditions) Countries: Austria, France, Germany, and the United Kingdom. The CEN-norms for unleaded regular and premium petrol have also been applied for the super grade. fuels. Applications from other Member States such as Ireland and Denmark, Finland, Greece and Sweden have under Directive 92/81/EEC been granted derogations with regard to the introduction of reduced excise rates on environmentally friendly the United Kingdom on the same issue are currently being evaluated by the Commission (see Chapter 5 'Fiscal Measures'). Tables 11 and 12 provide a comparison between the different diesel and petrol fuel qualities of some of these countries with the specifications proposed in this Directive. 62 Table 11: Comparison of Gasoline Fuel Parameters Parameter (Units) Sweden Finland Austria Sulphur(max) E. lOO(min) RVPsummer (max) ppm % Kpa Benzene(max) Vol % Aromatics (max) Vol % Olefins(max) Vol % Oxygen(max) % m/m 100 47 70 2 46 _ 2. 0 Lead(maxX g/1 0. 005 100 43 70 1 - _ 2. 7 - 100. 58 3 - _ _ - EU specifications proposed for 2000 200 46 60 2. 0 45 T8* 2. 3 0. 005 [* Except for unleaded petrol regular for which the maximum olefin content shall be 21/v/v. ] Table 12: Comparison of Diesel FUel Parameters Parameter (Units) Sweden {Category 1) Finland {City Diesel) Denmark Ultra light {Bus Fuel) EU Specifica tions proposed for 2000 Cetane Number(min) Density(max) Distillation 95% point (max) Polycyclic-aromatic hydrocarbons Aromatics Sulphur (max) No. kg/m3 °C % m/m Vol % ppm 50 820 285 0. 017 5 10 49 850 20 50 50 855 320. 500 51 845 360 11 — _ 350 63 13. EXPLANATION OF PROVISIONS OF THE PROPOSAL The scope of the Directive (Article 1) The scope of the proposal is to use harmonization of the various national legislation and/or fuel quality norms to ensure, on the one hand, a high level of protection against urban and regional air quality problems caused by vehicles through the use of petrol and diesel fuels and, on the other hand, the functioning of the internal market. The proposed measures will not eliminate the negative environmental impacts, but reduce them to some degree. Definitions (Article 2) The definitions of the various fuels are made as close as possible to the current EU definitions. Petrol (Article 3) 3. 1 3. 2 3. 3- 3. 6 Lead is a harmful air pollutant and a poison for the catalytic converter required to fulfil the latest passenger car emission standards. By 1995 the market share-of leaded petrol throughout the European Union has gone down to about 30% of the total petrol pool and is expected to be down at about 2% by the year 2000. By that time it is also estimated that the entire European car fleet will be able to run on unleaded petrol. The Commission therefore foresees the phasing out of leaded petrol by the year 2000. The European Auto/Oil Programme has identified the potential of certain petrol fuel quality changes for emission reduction and therefore the improvement of air quality. The limit values proposed are in accordance with the fuel quality measures identified by the cost-effectiveness analysis. These paragraphs allow for a temporary, two-year derogation from the 1 January 2000 ban on leaded petrol in those Member States where this may result in severe socio-economic difficulties. Diesel Fuels (Article 4) As for petrol the European Auto/Oil Programme has identified the potential of certain diesel fuel quality changes for emission reduction and therefore the improvement of air quality. The limit values proposed are in accordance with the fuel quality measures identified by the cost-effectiveness analysis. Free circulation (Article 5) This Article is to ensure that Member States do not prohibit, prevent or restrict the marketing of fuels complying with the specifications set out under the Directive. This applies also in the case of Member States making use of the derogations under Article 6 where stricter specifications may be encouraged through the application of tax incentives. Derogations-Special Fuels (Article 6) This Article provides for the situation where, in specific locations which are subject to special air quality conditions, Member States may be granted derogations in order that they may require the use of cleaner "special" fuels 64 Change in supply of crude oils (Article 7) The reformulation capacity required by refineries in each Member State will relate closely to. their supplies of a certain crude oil quality. In order to avoid problems posed by a sudden change in the supply of crude oil petroleum products, the Commission can authorize higher limit values for one or more fuel components for a period not exceeding six months. Monitoring compliance system and reporting (Article 8) Member States are required to establish national compliance monitoring systems to ensure that the fuel quality limit values are respected in the market. For this purpose a uniform system should be developed for which the assistance of the European Committee for Standardisation (CEN) might be requested. From the year 2002 onwards Member States are required to submit a yearly report on the market quality of petrol and diesel fuels. Review of progress achieved (Article 9) Within 12 months of the adoption of the proposed Directive and at the latest by 31 December 1998 the Commission will come forward with proposals for a revision of the Directive. This revison will be based on a comprehensive assessment carried out in accordance with Article 4 of the proposed amendment to Directive 70/220/EEC. The proposal will include a revised set of specifications for petrol and diesel fuels for the year 2005, including a significant reduction in the maximum sulphur content of both fuels. The proposal will also take account of possible action on alternative fuels. Procedure for adaptation to technical progress and Committee procedures (Article 10 and 11) Adaptation to technical progress with regard to the measuring méthodes laid down in annexes I and IT of this directive will be carried out by a Commission Committee established in accordance with Article 12 of Council Directive 96/. /EC(13). Repeal of the existing directives related to the fuel quality of petrol and diesel fuels (Article 12) All relevant regulations in the current directive related to certain petrol and diesel fuel components (85/210/EEC, 93/12, Article 1(b), Article 2(1) and (2) and 85/536/EEC) are transferred to the new proposal. The existing Directive 93/12/EEC will remain valid with respect only to gas oils. Transposition into National Legislation and Entry into Force (Articles 13 and-14) These Aticles contain standard conditions. Article 15 This Article contains standard wording. (13) Proposal submitted by the Commission on Ambient Air Quality Assessment and Management - COM(94) 109 final, 94/0106 (SYN), OJ No C 216, 6. 8. 1994, p. 4. 65 Proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE 96/0163 (COD) relating to the quality of petrol and diesel fuels, and amending Council Directive 93/12/EEC THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 100a thereof,; Having regard to the proposal from the Commission(1), Having regard to the opinion of the Economic and Social Committee(2), Acting in accordance with the procedure referred to in Article 189b of the Treaty, (1) Wliereas disparity between the laws or administrative measures adopted by the Member States on specifications of conventional and alternative fuels used in spark-ignited and diesel vehicles creates barriers to trade in the Community and may thereby have a direct impact on the establishment and functioning of the internal market; whereas in accordance with the provisions of Article 3b of the Treaty, it therefore appears necessary to approximate the laws in this field; (2) Wliereas, Article 100a(3) of the Treaty envisages that Commission proposals aimed at the establishment and functioning of the internal market and concerning environmental protection will take as a base a high level of protection; (3) Whereas primary air pollutants such as nitrogen oxides, unburnt hydrocarbons and particulate matter are emitted in significant amounts through the exhaust and evaporative fumes of motor vehicles thereby posing directly and indirectly through the development of the secondary pollutant ozone, a considerable risk to human health and the environment; (4) Wliereas despite the increasing stringency of vehicle emission limit values laid down by Council Directive 70/220/EEC(3), as last amended by Directive 96/ /EC of the European Parliament and of the Council(4), and by Council Directive 88/77/EEC(5), as last amended by Directive 96/1/EC of the European Parliament and of the Council(6), further measures to reduce atmospheric pollution caused by vehicles and other sources are necessary in order to achieve satisfactory air quality; (5) Whereas Article 4 of Directive 94/12/EC of the European Parliament and of the Council(7) introduced a new approach with regard to emission reduction policies for and beyond the year 2000 and required the Commission to examine inter alia the contribution that improvements in the quality of petrol and diesel and other fuels could make to reducing air pollution; 0) (2) (3) (4) (5) (6) (7) of this Official Journal. OJNoL 76, 64. 1970, p. 1. See p. OJNoL 36, 9. 2. 1988, p. 33. OJNoL 40, 17. 2. 1996, p. 1. OJ No L 100, 19. 4. 1994, p. 42. 66 (6) Whereas the European Auto/Oil Programme, the details of which are outlined in the Commission's Communication^ on a future strategy for the control of atmospheric emissions from road transport, provides the scientific, technical and economic basis for the introduction at Community level of new environmental fuel specifications for petrol and diesel fuels; (7) Whereas the introduction of environmental fuel specifications for petrol and diesel fuels is an important element of the cost-effective package of European-wide and national/regional/local measures identified by the European Auto/Oil Programme; (8) Wliereas the implementation of a combination of European-wide and national/regional/local measures to reduce vehicle emissions is part of the Commission's overall strategy to reduce air emissions from mobile and stationary sources in a cost-effective and balanced way; (9) Whereas this Directive should apply without prejudice to the provisions of Council Directive 92/81/EEC(9), as last amended by Directive 94/74/EC(10), and in particular Article 8(4) thereof; (10) Whereas fuel specifications aiming at the reduction of both exhaust and evaporative emissions are generally lacking; (11) Wliereas, it is to be expected that by 2000 all petrol-driven road vehicles should be able to run on unleaded petrol and whereas, therefore, leaded petrol should, as from that date, no longer be marketed; (12) Whereas the need for vehicle emission reduction and the availability of the necessary refinery technology justify the setting of environmental fuel specifications for the marketing of unleaded petrol and diesel fuels; (13) Wliereas, in order to protect human health and/or the environment in specific locations with special problems of air quality, Member States should be permitted to require the marketing of special fuels; (14) Whereas, in order to ensure compliance with the fuel quality standards required under this Directive, Member States should introduce monitoring systems. Such monitoring systems should be based on common procedures for sampling and testing; (15) Whereas, on the basis of a comprehensive assessment, the Commission should, within 12 months of the adoption of this Directive, but in any case no later than 31 December 1998, come forward with a proposal to amend the provisions of this Directive; (16) Whereas further developments with regard to reference methods for measuring the specifications set out in this Directive may be desirable in the light of scientific and technical progress; whereas to this end, provision should be made in order to adapt the Annexes to this Directive to technical progress; (8) (9) (10) OJNoC OJNoL 316, 31. 10. 1992, p. 12. OJ No L 365, 31. 12. 1994, p. 46. 67 (17) Whereas Council Directive 85/210/EEC of 20 March 1985 on the approximation of the laws of the Member States concerning the lead content of petrol(H), as last and Sweden, the Act of Accession of Austria, Finland amended by Council Directive 85/536/EEC of 5 December 1985 relating to crude-oil savings through the use of substitute fuel components in petrol(12), as amended by Commission Directive 87/441/EEC(13), and Article l(l)(b) and Article 2(1) of Council Directive 93/12/EEC of 23 March 1993 relating to the sulphur content of certain liquid fuels(14), should be repealed accordingly, HAVE ADOPTED THIS DIRECTIVE: Article 1 Scope This Directive sets technical specifications on health and environmental grounds for all fuels - conventional and alternative - to be used in spark-ignition and diesel vehicles. Article 2 Definitions For the purpose of this Directive: 1. 2. 1. 2. ( i i) (12) (13) (14) (15) (16) "petrol" means any volatile mineral oil intended for the operation of internal combustion spark-ignited engines used for the propulsion of vehicles and falling within CN Codes 2710 00 27, 2710 00 29, 2710 00 32, 2710 00 34 and 2710 00 36. "diesel fuels" means gas oils falling within CN Code 2710 00 69 and used for self-propelling vehicles as referred to in Directive 70/220/EEC, Directive 88/77/EEC and Council Directive 74/150/EEC(l5) and those used for engines in non-road mobile machinery(I6), which means any machine or vehicle with or without body work, powered by a compression ignition engine, with the exception of those vehicles intended for the use of passenger - or goods - transport on the road and agricultural tractors as defined in Article 1 of Directive 74/150/EEC, having a power output of not more than 560 kW2. Article 3 Petrol As from 1 January 2000 Member States shall prohibit the marketing of all leaded petrol within their territory. ~z Member States shall ensure that within their territory petrol can be marketed only if, with regard to certain parameters of environmental relevance, they comply with the specifications set out in Annex I. O J N oL 96, 3. 4. 1985, p' 25. O J N oL 334, 12. 12. 1985, p. 20. O J N oL 238, 21. 8. 1987, p. 40. O J N oL 74, 27. 3. 1993, p. 81. O J N oL 84, 28. 3. 1974, p. 10. O J N oC 328, 7. 12. 1995, p. 1. 68 3. By way of derogation from the provisions of paragraph 1, Member States may continue to permit the marketing of leaded petrol in their territory until three years after the adoption of this Directive, but in any case not later than 1 January 2002, if it can be demonstrated that the introduction of a total ban on the marketing of leaded petrol as from 1 January 2000 would result in severe socio-economic difficulties. Member States wishing to make use of the derogation, must inform the Commission before 1 January 1999. The Member State shall also provide the Commission with a justification of the need for such a derogation. The Commission may authorize the derogation for the marketing of leaded petrol. The Commission shall notify its decision. the Member States and inform the Council of Article 4 Diesel fuels Member States shall ensure that within their territory diesel fuel can be marketed only if, with regard to certain parameters of environmental relevance, they comply with the specifications set out in Annex II. Article 5 Free circulation No Member States may prohibit, restrict or prevent the placing on the market of fuels which comply with the requirements of this Directive as from the date of application laid down in Article 13(1). Article 6 Special fuels 1. 2. By derogation from the provisions of Articles 3, 4 and 5, Member States may in specific areas in which atmospheric pollution constitutes or may reasonably be expected to constitute a serious and recurrent problem for human health and/or the environment, require the marketing of fuels of a higher quality than those foreseen in this Directive. Member States wishing to make use of the derogation provided for in paragraph 1 must inform the Commission in advance, of the measures it intends to take. The Member State shall also provide the Commission with data on ambient air-quality for the area in question as well as the predicted effects on air quality of thelneasures proposed. In addition, the Member State shall also provide the Commission with evidence that the proposed measures respect the principle of proportionality and that they will neither disrupt the free movement of persons and goods nor unduly distort competition. ^ The Commission, after informing the other Member States of the information received, may authorize the specific measures for the marketing of cleaner fuels as proposed by the Member State in question. The Commission shall notify the Member States and the Council of its decision. Any Member State may refer the Commission's decision to the Council within one month of its notification. 69 The Council, acting by a qualified majority, may take a different decision within one month of the matter being referred to it. Article 7 Change in supply of crude oils If a sudden change in the supply of crude oils or petroleum products renders it difficult for the refineries in a Member State to respect the fuel specification requirements of Articles 3 and 4, that Member State shall inform the Commission thereof. The Commission after informing the Member States, may authorize higher limit values in that Member State for one or more fuel components for a period not exceeding six months. The Commission shall notify the Member States and the Council of its decision. Any Member State may refer the Commission's decision to the Council within one month of its notification. The Council, acting by a qualified majority, may take a different decision within one month of the matter being referred to it. 1. 2. 3. 4. 5. 1. Article 8 Monitoring compliance system and reporting Member States will establish programmes requirements of Article 3(2) and Article 4. to monitor compliance with the The analytical methods used the concentration/level of a to determine substance/parameter in the fuel will be the standard methods specified in Annexes I and II. The Commission will promote the development of a uniform' system for compliance monitoring programmes. The Commission may for the purposes of developing such a system request the assistance of CEN. Within 12 months after the date of entry into force of this Directive, Member States will submit their national the Commission a detailed description of compliance programme. to As from the year 2002, Member States will submit to the Commission by 30 June each year a summary of the results from the national compliance monitoring programme from the previous calendar year. The Commission will establish a common format for the submission of such summary results. — Article 9 Review process The Commission will, periodically and for the first time not later than 12 months from the date of adoption of this Directive but in any event not later than 31 December 1998, and in the light of the assessment carried out in conformity with the requirements of Article 5 of Directive 96/ /EC, submit to the European Parliament and the Council a proposal for a revision of this Directive. This proposal will include further, cost effective, improvements to the specifications for petrol and diesel fuels with regard to the parameters laid down in Annexes I and II to this Directive and should comprise, in particular, a significant reduction in the sulphur content of both petrol and diesel fuels, to come into effect on 1 January 2005. This action will form 70 an integral part of a strategy designed to produce effects to meet the requirements of the Community air quality standards and other related objectives at least cost. 2. In addition to the provisions of paragraph 1, the Commission may bring forward proposals to ensure the necessary availability and sufficient distribution throughout the Community before 2005, of fuels of a quality compatible with the effective functioning of the new pollution abatement technologies. In preparing such proposals the Commission shall have regard in particular, to considerations of air quality, cost-effectiveness and proportionality, and shall also take into account: the latest information with regard to the interaction between fuel quality and the performance of new pollution abatement the de-NOx catalyst; technologies such as the situation with regard to the development and production of the new pollution abatement technologies and the forecasts with regard to the marketing of vehicles equipped with such technologies; the need to ensure that the measures proposed will neither disrupt the free movement of persons and goods nor unduly distort competition. 3. The proposal referred to in paragraph 1 shall be submitted to the European Parliament and the Council at the same time as the proposal referred to in Article 5 of Directive 96/ /EC; the measures shall enter into effect at the same time as the measures provided for in the proposal to be submitted in accordance with Article 5 of Directive 96/ /EC. Article 10 Procedure for adaptation to technical progress Any amendments which are necessary in order to adapt the measuring methods as laid down in Annexes I and II to this Directive, to take account of technical progress, shall be adopted by the Commission assisted by the Committee established in accordance with Article 12 of Directive 96/. /EC(17) and in accordance with the procedure laid down in Article 11 of this Directive. Article 11 Committee procedure The representative of the Commission shall submit to the committee a draft of the measures to be taken. The committee shall deliver its opinion on the draft, within a time limit which the chairman may lay down according to the urgency of the matter, if necessary-fey taking a vote. The opinion shall be recorded in the minutes; in addition, each Member State shall have the right to ask to have its position recorded in the minutes. The Commission shall take the utmost account of the opinion delivered by the committee. It shall inform the committee of the manner in which its opinion has been taken into account. <17) Proposal submitted by the Commission on Ambient Air Quality Assessment and Management - COM(94) 109 final, 94/0106 (SYN), OJ No C 216, 6. 8. 1994, p. 4. 71 1. 2. 1. Article 12 Repeal and amendment of the existing directives related to the fuel quality of petrol and diesel fuels Directive 85/210/EEC and Directive 85/536/EEC are repealed as from the date of application laid down in Article 13(1). Directive 93/12/EEC is amended by deleting Article l(l)(b) and Article 2(1) as from the date of application laid down in Article 13(1). Article 13 Transposition into national legislation Member States shall adopt and publish the laws, regulations and administrative provisions necessary to comply with this Directive not later than 1 July 1999. They shall immediately inform the Commission thereof. Member States shall apply these provisions from 1 January 2000. Wlien Member States adopt these provisions, these shall contain a reference to this Directive or shall be accompanied by such reference at the time of their official publication. The procedure for such reference shall be adopted by Member States. 2. Member States shall communicate to the Commission the texts of the provisions of national legislation which they adopt in the field covered by this Directive. Article 14 Entry into force of the Directive This Directive shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Communities. Article 15 Addressees This Directive is addressed to the Member States. Done at Brussels, For the European Parliament The President For the Council The President 72 ANNEX I ENVIRONMENTAL SPECIFICATIONS FOR MARKET FUELS TO BE USED FOR VEHICLES EQUIPPED WITH POSITIVE IGNITION ENGINES Type: Petrol Parameter Unit Limits(1) Minimum Maximum Reid vapour pressure,. summer period(3) kPa Distillation(4): evaporated at 100 *C evaporated at 150 *C Hydrocarbon analysis:. olefins. aromatics. benzene 46. 0 75. 0 % v/v % v/v Oxygen content %m/m Sulphur content Lead content ppm g/l 60. 0 18. 0* 45. 0 2. 0 2. 3 200 0. 005 Test Method(2) EN 12 ISO~3405 ASTMD1319 EN 238 prEN 1601 ISO 8754 EN 237 (1) (2) (3) (4) I* The values quoted in the specification are "true values". In establishment of their limit values the terms of ISO 4259 "Petroleum products - Determination and application of precision data in relation to methods of test" have been applied and in fixing a minimum value, a minimum difference of 2R above zero has been taken into account (R - reproducibility). Should it be necessary to clarify the question as to whether a fuel meets the requirements of the specification, the terms of ISO 4259 should be applied. Equivalent ISO methods will be adopted when issued for all properties listed above. The summer period extends from 1 April to 30 September of each year and relates to all volatility classes as specified under EN228. The figures quoted show the evaporated quantities (percentage recovered + percentage loss). Except for unleaded petrol regular (minimum motor octane number (MON) of 81 ancLa minimum research octane number (RON) of 91) for which the maximum olefin content shall be 21% v/v]. 73 ANNEX n ENVIRONMENTAL SPECIFICATIONS FOR MARKET FUELS TO BE USED FOR VEHICLES AND NON-ROAD MOBILE MACHINERY EQUIPPED WITH COMPRESSION IGNITION ENGINES Type: Diesel fuel Parameter Unit Limits(1) Cetane number Density at 15 °C Distillation(3): 95% point kg/m3 °C Polycyclic aromatic hydrocarbons %m/m Sulphur content ppm Minimum Maximum 51. 0 845 360 11 350 Test Method(2) ISO 5165 ISO 3675 ISO 3405 prIP391 ISO 8754 The values quoted in the specification are "true values". In establishment of their limit values the terms of ISO 4259 "Petroleum products - Determination and application of precision data in relation to methods of test" have been applied and in fixing a minimum value, a minimum difference of 2R above zero has been taken into account (R - reproducibility). Should it be necessary to clarify the question as to whether a fuel meets the requirements of the specification, the terms of ISO 4259 should be applied. Equivalent ISO methods will be adopted when issued for all properties listed avove. The figures quoted relate to the evaporated quantities (percentage recovered + percentage loss). (2) (3) 74 FINANCIAL STATEMENT SECTION I - FINANCIAL CONSEQUENCES (PART B OF THE BUDGET). 1. TITLE OF OPERATION Proposal for a European Parliament and Council Directive relating to the quality of petrol and diesel fuels and amending Council Directive 93/12/EEC. 2. BimCTT HEADING INVOLVED B4-304 Environmental Legislation and other general actions based on the 5th Action Programme relating to the environment [Projects (XI. D. 3]. 3. LEGAL BASIS EU Treaty Article 100a, Resolution of the Council and the Representatives of the Governments of the Member States meeting within the Council of 1 February 1993 on a Community programme of policy and action in relation to the environment and sustainable development (OJ No C 138, 17. 5. 1993, p. 1). 4. DESCRIPTION OF OPERATION 4. 1 General objectives The European Union has a longstanding history in reducing vehicle emissions. However, despite the considerable achievements with regard to the emission reduction of individual vehicles, increased traffic activity (increased number of these travelled) vehicles, improvements thereby preventing the emission reductions necessary to achieve future air quality objectives. increased kilometers to counteract likely is The likelihood of further action to reduce vehicle emissions necessitated a reassessment of the existing policy approach; it being apparent that the emission reduction potential offered by further improvements in vehicle technology was limited and possibly very costly in comparison with other potential solutions. Therefore a new, comprehensive and integrated approach was developed which is set out in Directive 94/12/EC, Article 4. Article 4 stipulates that measures to be assessed with regard to their benefits and costs shall include improved vehicle technology, more appropriate mechanisms to reduce the in-use deterioration of emission control systems and "improvements in fuel quality as far as vehicle emissions of dangerous substances (in particular benzene) are concerned". The changes in the quality of both, petrol and diesel fuels, legislated for in this proposal will" considerably reduce emissions of pollutants such as benzene, volatile organic compounds (VOCs), nitrogen oxides (NOx), carbon monoxide (CO) and particulate matter (PM). With these emission reductions a significant contribution will be made to the achievement of future air quality objectives. 75 4. 2 Period covered and arrangements for renewal or extension The proposed Directive requires: * that Member States: will ensure that as from 1st January 2000 only fuels which correspond to the specifications laid down in the Directive can be marketed within their territory; will establish programmes to monitor compliance with the Directive; as from the year 2002 the Member States will submit to the Commission a summary of the results from the national compliance monitoring programme; * that the Commission: will promote the development of a uniform system for compliance monitoring programmes. For the purpose of developing such a system the assistance of the European Committee for Standardization might be requested; submits a report to Council and Parliament assessing the need for further action in the field of fuel quality, including possible action on alternative fuels; prepares a revised proposal on the sulphur content of diesel fuel which will be necessary at a time when new vehicle technologies such as the de-NOx catalyst are on the market; convenes technical progress. the meeting of the Committtee for Adaptation to 5. CLASSIFICATION OF EXPENDITURE OR REVENUE DNO and CD 6. TYPE OF EXPENDITURE Technical work directly linked to the development of a uniform system for compliance monitoring programmes; Technical work linked to the development of new proposals, in particular those dealing with alternative fuels and the relationship between new vehicle technologies and fuel quality; Technical work linked to the preparation of Commission Directives through the Committee procedure. 76 7. FINANCIAL IMPACT 7. 1 Method of calculating total cost of operation (definition of unit costs) Technical assistance with the development of a uniform fuel quality monitoring system to ECU 250 000. through CEN. Total costs would amount Technical assistance with regard to the development of new proposals, in particular those dealing with alternative fuels and the relationship between new vehicle technologies and fuel quality. The costs would amount to ECU100 000/year between 1998 and 2000. 7. 2 Itemized breakdown of cost (in ECU) Breakdown Year n - Technical assistance uniform fuel quality monetary system - CEM - Technical assistance development new proposals Total ECU million (money of the day) n+4 n+5 and subseq. Total n+1 0. 11 n+2 0. 11 n+3 0. 03 0. 1 0. 1 0. 1 0. 11 0. 21 0. 13 0. 1 0. 55 7. 3. Indicative schedule of appropriations Comitment appropriations Payment appropriations n n+1 n+2 n+3 n+4 n+5 and subseq. Total Year n n+1 0. 11 n+2 0. 21 n+3 0. 13 n+4 0. 1 n+5 and subseq. Total — 0. 55 0. 077 0. 033 0. 147 0. 063 0. 091 0. 039 0. 11 0. 21 0. 13 0. 07 0. 03 0. 1 0. 55 77 8. ANTI-FRAUD DISPOSITIONS It will be explicitly specified in contracts that all work performed is the property of the Commission. Final payment of contractors will only take place after reception and examination of the reports and services requested. SECTION H - ELEMENTS OF COST-EFFECTIVENESS ANALYSIS 9. 1 Specific and quantifiable objectives: target population The general objective of the operation is to increase the protection of: human health, ecosystems, vegetation and material against the impact of various air pollutants such as nitrogen oxides, hydrocarbons and ozone; human health additionally against the impact of particulate matter; ecosystems additionally against the impact of nitrogen oxides deposition ("acid rain") on land and water. According to the results of the European Auto/Oil Programme which provided the technical basis for the present directive, changes in the quality of both petrol and diesel fuels can make a significant contribution to the reduction of exhaust and evaporative fumes of motor vehicles. This Directive foms part of a package of measures derived from the Auto/Oil Programme. The package of measures is designed to deliver reductions in the emissions from road transport compatabile with the attainment of rigorous air quality standards for carbonmonoxide (5 ug/m3 as a 98 percentile of 8 hourly values), nitrogen dioxide (93 ug/m3 as a 98 percentile of hourly values), benzene (10 ug/m3 as an annual mean), particulate matter (50ug/m3 as a 24-hour running average) and regional ozone (180ug/m3 as a 1-hour average). This proposal will contribute to emission reductions across Europe in the range of 70% for oxides of nitrogen and volatile organic compounds, 65% for urban particulates and 75% for urban carbon monoxide. 9. 2 Grounds for the operation While some fuel components such as lead and benzene in petrol and sulphur in diesel have been subject to Community legislation, fuel quality as a whole as covered by this Directive has not. According to the considerations-that are described above and in Chapter 4 of the Explanatory Memorandum changes in the quality of both petrol and diesel fuels contribute significantly to improved air quality with regard to nitrogen oxides, particulate matter, benzene and ozone. Thus it would be unreasonable to neglect this source of pollutants which can be reduced in a cost-effective way as the results of the Auto/Oil Programme have shown. 78 9. 3 Monitoring and evaluation of the operation Monitoring compliance system In order to ensure compliance with this Directive, Member States are required to establish national compliance monitoring systems. The Commission will promote the development of a uniform system as a common basis for Member States to carry out these programmes and to be in a position to forward to the Commission this information on a comparable base. For this purpose the Commission is likely to seek the assistance of the European Committee for Standardization (CEN). The Member States are required to submit 12 months after the date of entry into force of the Directive a detailed description of their national compliance programme and as from the year 2002, by 30 June of each year, a summary of the results from these programmes for the previous calendar year. Air quality The Commission, in cooperation with the Member States, will monitor the development of air quality on an urban and regional level in order to verify the air quality predictions which have guided the currently proposed legislative measures. The results of this monitoring exercise will be one of the main elements of a report the Commission is required to bring forward at the latest by 30 June 2002 and inter alia will be the basis for deciding whether proposals for amendments and/or extensions to this Ddirective will be necessary. SECTION HI - ADMINISTRATIVE EXPENSES (PART A OF THE BUDGET) 10. ADMINISTRATIVE EXPENDITURE (Part A of section HI of the Budget) 10. 1 Increase in staff Type Human Resources Human Resources Length Permanent jobs Temporary jobs Existing human resources in the DG or service Additional human resources — Civil servants or temporary' agents A B C Other Total 0 0 0 0 79 10. 2 Financial global impact of additional human resources ^ Amounts Mode of computation Civil servants Temporary agents Other resources 0 0 0 Total (ECU) 0 10. 3 Increase of other operative expenses Budget item A-2510 (Travel for the Committee foreseen under Article 11 of the proposal Amounts 20 850 Total (ECU) 20 850 Mode of computation 15 x ECU 695imeeting x 2 meetings/year 80 IMPACT ASSESSMENT FORM The Impact of the proposal on business with special reference to small and medium- sized enterprises (SMEs) TTTLE OF THE PROPOSAL Proposal for a European Parliament and Council Directive on environmental specifications with regard to gasoline and diesel. fuel Reference Number (Repertoire): 1. TAKING INTO ACCOUNT THE PRINCIPLE OF SUBSIDIARITY. WHY IS COMMUNITY LEGISLATION NECESSARY IN THIS AREA AND WHAT ARE ITS MAIN ALMS? The matter concerns harmonization of the internal market and therefore is an issue of exclusive Community competence. The market in transport fuels is considerable (about 290 00 million litres in 1995) and despite the existence of norms laid down by the European Committee for Standarization (CEN) for certain fuel components, the majority of the petrol and diesel fuel market is characterised by numerous permissible levels for a number of fuel components (e. g. sulphur, aromatics, benzene). The proposal asserts an increased level of harmonization to replace the existing range, thus ensuring the proper functioning of the market. The main aim of the Directive is to reduce vehicle emissions in order to achieve future EU-wide air quality objectives and is part of a legislative package which the Commission intends to put forward for this purpose. The directive is part of the outcome of the European Auto/Oil Programme which explored cost-effective combinations of measures sufficient to achieve, by 2010, stringent air quality standards with respect to the most important urban and regional pollutants such as nitrogen oxides, particulate matter and ozone. The programme investigated the cost and the potential of a variety of different measures inter alia improved vehicle technology, inspection and maintenance schemes, changes in the quality of fuels and a number of non-technical measures such as scrappage schemes and road pricing. Drawing on the results of the Auto/Oil Programme, the Commission has decided upon a package of legislative proposals to be submitted to Council and Parliament: a proposal on a mild reformulation of petrol and diesel fuels (this proposal); a proposal to strengthen the emission limits for passenger cars (a proposal accompanying this proposal); proposals to strengthen the emission limits for light and heavy duty vehicles (1996/ 1997); a proposal with regard to the strengthening of the current legislation on inspection and maintenance (in 1997). With this legislative package the Commission estimates that by 2010, the above pollutants will be reduced considerably as compared to what the emissions would have been in the absence of these measures. 2. WHO WILL BE AFFECTED BY THE PROPOSAL? Which sectors of business? Changes in the quality of gasoline and diesel fuels affect refiners and therefore oil companies, the petrochemical industry and individual consumers driving a gasoline or diesel vehicle. There may also be effects for traders' organization who import petrol and/or diesel fuels from regions with less strict environmental fuel specifications. Which sizes of businesses? All oil and petrochemical companies can be considered to be large. Traders' organizations are small/medium enterprises. Are there particular geographical areas of the Community where these businesses are found? Refineries, petrochemical companies and traders' organizations are found in all regions of the Community. 3. WHAT WELL BUSINESS HAVE TO DO TO COMPLY WITH THE PROPOSAL? Refineries will have to change their refinery processes, install new process units and/or have to undertake blending operations in order to achieve the changes in gasoline and/or diesel fuel quality as required by the directive. The mechanisms used to control each of the fuel parameters are all currently available and proven technologies. Some changes can also be met by changes in crude oil diet e. g. to low sulphur crude types, such as North Sea, which tend to be high in benzene and aromatics content, or to low benzene/aromatics crude types such as Middle East (which tend to be high in sulphur). There are no obligations posed on petrochemical companies and individual fuel users associated with the proposed Directive. 4. WHICH ECONOMIC EFFECTS IS THE PROPOSAL LIKELY TO HAVE? On employment? The proposal will require significant investment for the refining industry (see below). Given the current over-capacity and narrow operating margins for the industry it is possible that the proposal may have a negative efffect on employment in the refining industry. However, in the area of feed-stock production (such as oxygenates) and of research and development a positive employment effect is likely to be seen. Production of oxygenates needs to be improved considerably in order to meet the required blending capacity. Some of this additional production capacity will be installed in Europe. In the area of research and development it can be expected that the search for more competitive, less costly refinery processes will stimulate the engineering/construction business which might have some positive effects on employment. 82 industry estimations with regard to employment For the petrochemical development are difficult to make. An oversupply in benzene through fuel reformulation is likely to have a negative effect on Europe's main benzene source for aromatic production of pygas. Ethylene producers might therefore loose some of their competitiveness. However, ethylene producers are in most cases also producers of aromatics and with the cheaper feedstock of benzene might be able to increase the aromatics production. The effect on employment is uncertain. There are unlikely to be any significant employment effects for the traders' organizations. On investment and creation of new business? According to cost estimations carried out under the Auto/Oil Programme, the achievement of the presently proposed fuel specifications requires refineries to invest a total of about ECU 8 442 million. The costs are based on the value of the ECU in 1995 and a project life of 15 years from 2000 onwards. Investments are envisaged to take place over 4 years between 1996 and 1999 with 15% being invested in 1996 and 1999 and 35% in each of the years 1997/98. In addition to the capital investment costs, fixed operating costs of ECU 342 million and energy costs of ECU 171 million will have to be borne by the European refining industry. All costs are aggregated costs which do not reflect individual refinery and regional variations. The variations in costs due to these individual and regional differences are not estimated to be uniform because the impact of the quality parameter changes depends on both feedstock and refinery configuration. The size of the refinery with regard to cost variations is likely to play a relatively influence of feedstock availability and role compared small refinery configuration. the to New business can be expected with regard to the production of oxygenates as a feedstock product. As shown earlier, the need for this product in order to compensate for octane loss through reduction of benzene and aromatics will increase considerably. Refineries themselves might expand their production of oxygenates (new catalysts) and/or new production units. through better technologies For petrochemical companies it is difficult to predict whether a loss of feedstock production (pygas) can be compensated by higher aromatic production and what consequences these developments would have for the employment situation. On the competitiveness of businesses? ~z The impact of the proposal on individual refineries will vary considerably as a function of the current technical configuration. While in the case of some refineries only minimal investment will be required others will need extensive upgrading dependent upon their technical configuration. 83 On the petrochemical side, increased availability of benzene from gasoline reformulation could adversely affect the production of an important feedstock product - pygas. Pygas is the biggest source of benzene for the aromatics market in Europe and if the value of pygas were to fall in view of over supply of benzene from other sources, the European ethylene producers would be at a competititve disadvantage. The competitiveness of traders' organizations might be affected if their import of petrol and diesel fuels mainly comes from sources with less strict or no environmental regain competitiveness if they ensure sufficient diversity of import sources. specifications. Traders can maintain or fuel 5. DOES THE PROPOSAL CONTAIN MEASURES TO TAKE INTO ACCOUNT THE SPECIFIC SITUATION OF SMALL AND MEDIUM-SIZE FIRMS (REDUCED OR DIFFERENT REQUIREMENTS, etci ? All refineries and petrochemical companies in Europe can be considered to be large enterprises. Traders' organizations have sufficient means to maintain their position in the market e. g. by diversification of import sources. The users of reformulated fuels will be insignificantly affected by negligibly increased prices for these fuels. Thus particular measures in favour of small and medium-sized companies appear to be unnecessary. 6. CONSULTATION List of organizations which have been consulted with regard to the proposal and outline of their main views: - Europia (European Petroleum Industry Association); - ACEA (European Automobile Manufacturers Association); - APA, a sector group of CEFIC (Aromatics Producer Association). Europia'ACEA Both, the European associations of the oil (Europia) and car (ACEA) industries were partners of the Auto/Oil Programme. The work carried out in the framework of the programme was based on the consensus of all partners involved. At a final-technical meeting of the Auto/Oil Programme on 20 March 1996, the database- and the methodology used for carrying out the cost-effectiveness analysis were approved. The oil industry was also consulted on a number of technical questions which arose the in cost-effectiveness analysis into limit values. the fuel parameter values used the discussion on transposing in 84 With regard to the proposed specifications the oil industy has expressed its in reservations concerning the limit values for the sulphur content of both fuels particular those for petrol claiming that the emission benefits are not in proportion to the costs incured. Another area of concern for the oil industry is the benzene content of petrol. Europia maintains its position that in view of the results of the air quality modelling carried out within the context of the Auto/Oil Programme a reduction of the current EU average market value of about 2. 3% is not justified. The car industry on the other hand considers the proposed fuel specifications as too moderate and would like to see more severe limit values in particular with regard to the sulphur content of diesel fuels. ACEA claims that with the current proposal on fuel quality which amounts to yearly costs of around 880 million ECU for the oil industry puts the bulk of the total financial burden of ECU 5 326 million/year for the overall package of emission eduction measures on the car industry. However, this argument of burden sharing between the two industries is not in line with the request for a cost-effective solution to future air quality problems which is required by Directive 94/12/EC, Article 4. APA APA's concern is that with increasing amounts of benzene from gasoline reformulation in Europe and the U. S. Pygas production, as a major benzene source for aromatics production in Europe, would be significantly reduced. In addition, while aromatics production could be increased in principle due to cheaper benzene feedstock prices, APA fears that developments of the aromatic markets in other parts of the world will prevent Europe from finding an adequate export market. 85 EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE 96/0164 (COD) Proposal for a relating to measures to be taken against air pollution by emissions from motor vehicles and amending Council Directives 70/156/EEC and 70/220/EEC 86 EXPLANATORY MEMORANDUM A. Objective of the proposal The objective of this proposal is to strengthen Community requirements aimed at limiting new passenger car polluting emissions. These are governed by Directive 70/220/EEC, as last amended by Directive 94/12/EC. The proposal forms part of a global Community strategy which will include strengthened requirements for passenger cars, light commercial vehicles and heavy duty vehicle?0 from year 2000, new minimum standards for motor fuels and enhanced in-use vehicle emission requirements. This set of measures, in combination with additional measures taken at local level, represents, in view of the Commission, an optimal package of legislative actions which will ensure that the Air Quality targets identified in the course of the implementation of the Auto/Oil Programme will be met by year 2010. In addition, this proposal includes a revision of the framework for emission-related fiscal incentives and emissions values corresponding to the foreseen Stage 2005 car emission standards. The Auto/Oil Programme itself is described in a separate auto/oil Communication. B. Legal basis The measures are proposed on the basis of Article 100a of the Treaty of the Union. They are consistent with the Council recommendation on the 5th Environmental Action Programme, which announced the need for a further improvement of car emission standards from the year 2000. The measures form part of the European Type-Approval system for cars and compliance with them will be mandatory for new approvals to be issued by national authorities. The measures reflect the traditional legislative approach followed in this sector namely total harmonization of all relevant technological prescriptions. The measures set the performance standards, leaving to the producers themselves, the design and manufacture of equipment necessary to ensure that these are met. This legislative approach is fully supported by the operators in the market. The text is relevant for the EEA Treaty. C. Background Much progress has been achieved in improving air quality in Europe through the successive tightening of emission standards. Since the first emission directive of 1970, the overall reduction of emissions from new passenger cars has been in the order of 90%, depending on the pollutant concerned (carbon monoxide emissions (CO), unburned hydrocarbons and nitrogen oxides emissions (HC + NOx)). The Auto/Oil Programme was set up, because it was recognized that, since additional reductions of emissions from new vehicles from the year 2000 would be increasingly difficult to achieve technologically and would be costly, future standards would have to be established on a more scientific basis which would allow for full account to be taken of the potential advantages and disadvantages of all possible measures to reduce emissions. (1) Directive 88/77/EEC, as last amended by Directive 96/1/EC. 87 1. Article 4 of Directive 94/12/EC: the multi-faceted approach Directive 94/12/EC adopted by the European Parliament and the Council on 23 March 1994, which set new emission limit values for new types of passenger cars from 1996, stipulated in Article 4 that the Commission should propose new measures to be implemented in the year 2000, according to a new multi-faceted approach, based on a comprehensive assessment of costs and effectiveness of all measures aimed at reducing road transport pollution. The Article stated that the proposal should include, besides tightened car emission standards, complementary measures, such as improvements in fuel quality and a strengthening of inspection and maintenance programmes for the car fleet. Article 4 of Directive 94/12/EC requires that the Commission base its proposals on two pillars. the establishment of air quality criteria and associated emission reduction objectives; an evaluation of the cost/efficiency of each proposed measure, taking into account the potential contribution of other measures such as: traffic management; enhancement of urban public transport; new propulsion technologies; the use of alternative fuels. Thus, Article 4 requires that the cost/effectiveness assessment should be carried out not only for the measures which will be proposed by the Commission (improvement of new vehicle technology, of fuels, technical inspection), but also encompassing all measures permitting the reduction of pollution by road traffic, regardless whether they are of the responsibility of Member States or of local authorities. This multi-faceted cost/effectiveness approach differs from the usual approach based on the assessment of the Best Available Technology. However, Article 4 also stipulated to the Commission that the Stage 2000 proposal would need to achieve a "substantial" reduction in emissions. The next stage will also continue to be founded on Article 100a of the Treaty, i. e. the proposal should be based on a "high level" of environmental protection. There is thus, to some degree, a need to reconcile these two different concepts. However, application of the Best Available Technology principle independently for each separate measure would lead in all likelihood to a sub-optimal set of measures, economically as well as environmentally. The multi-faceted approach therefore aims at determining the best cost/effective package of measures with a view to achieving a high level of protection. 2. The Auto/Oil Programme In accordance with the principle of shared responsibility expressed in the 5th Environmental Action Programme, the Commissioners for Energy, Environment and Industry, at the end of 1992, decided to initiate a technical scientific work programme for the purpose of providing a solid technical foundation upon which to base its future legislative proposals. The Commission invited the European Automobile manufacturers and Oil industry trade associations (ACEA and EUROPIA) to make available their considerable know-how and expertise. The two industries responded positively to this invitation and together with the Commission services designed, planned and executed the programme which subsequently became known as the Auto/Oil Programme. 88 The objective of the Auto/Oil Programme was to provide policy-makers with an objective assessment of the most cost-effective package of measures including vehicle technology, fuel quality, inspection and maintenance measures and non-technical measures, necessary to reduce emissions from the road transport sector to a level consistent with the attainment of the new air quality standards being developed for adoption across the European Union. The work organization, assumptions and outcomes of the Auto/Oil Programme are described in the accompanying Commission Communication on the Auto/Oil Programme and Future Strategies to Reduce Emissions(2). 3. Changes to vehicle technology Within the framework of the Auto/Oil Programme, European vehicle manufacturers were asked to provide estimates of the additional costs which would be required in order to equip their vehicles with the technology necessary to achieve a series of progressively more stringent emission scenarios. The main findings of the cost analysis of vehicle technologies are that: significant vehicle technology; reductions in pollutant emissions are possible through improved applying the most stringent reduction scenario to all vehicle categories would represent an annual cost of ECU 5. 5 billion (in 1995 ECU) to the Union; when expressed as a cost per vehicle, the most stringent packages for which cost data increase of 3-5% on current purchase price were provided equate (excluding taxation). to an In addition, as part of the Auto/Oil Programme, data were collected with regard to cost and to the efficiency of the various mechanisms designed to reduce the rate of deterioration of the emission control systems. Two technical devices by which such improvements can be achieved have been studied: electronic sensors installed on the vehicle to monitor the performance of the emission control systems - referred to commonly as on-board diagnostics (OBD); "In-use compliance testing" procedures whereby vehicles can be recalled by authorities and if necessary repaired if their emission performance deteriorates beyond an acceptable level; Inspection and maintenance requirements have also been shown to be particularly cost-effective. — 4. Cost effectiveness optimization On the basis of the data available on the costs and potential benefits of the various technical measures (engine technology, fuel quality and improved inspection and maintenance of emissions control systems), it has been possible to identify the most cost/effective packages of technical measures necessary to achieve a significant reduction of urban NOx, particulate matters in the most polluted areas and ozone precursors at European level. (2) COM(96) of June 1996. 89 D. 1. Consultations of interested parties Position of industry throughout industries were associated and were consulted The motor and oil the Auto/Oil Programme. These industries accepted the methodology as well as the majority of the results. The car manufacturers would have liked a method of calculation from the emissions giving more weight to measures with an immediate effect, by the taking into account of an emission carry over method or "emission discounting". However, the Commission considers that a sustainable policy of improvement of the air quality shall be based on balanced mix of immediate and long-term measures which is the objective with the overall 2000 Stage strategy. The car manufacturers consider that the main cost burden falls on it and that a certain rebalancing of the measures should be carried out. The Commission considers nevertheless that the proposed measures have to fulfil cost/effectiveness criteria. In this respect, the optimisation made during the programme shows that, in general, the measures affecting the vehicles are the most effective ones. 2. Position of the Member States Member States were informed and were consulted regularly throughout the programme. They considered that the orientations described by the Commission, in particular at an informal meeting on 7 December 1995, were in general acceptable. Half of the Member States could support of stricter measures than those envisaged at the time, in particular for the petrol cars. The principle of a later "Stage 2005" serving as a basis for granting tax incentives was not disputed. A majority of the Member States experts were in favour of an ambitious regulatory stage with a review clause. 3. Position of the European Parliament Four specific meetings were organized to inform the Members of the European Parliament of the work carried out. While the members of the European Parliament expressed their sympathy with the principles underlying the programme, they expressed some regret that certain interested parties had been less consulted, notably equipment suppliers, the fuel additive producers and non governmental organizations. Members also regretted the delay in presenting of the proposals. They are awaiting the specific proposals before to take formally taking a position with the expectation that proposals will take into account of the precautionary principle of as well as the need to harmonize on the basis of the best available technology. E. 1. Content of the proposal Passenger car emission standards - modification of Directive 70/220/EEC In accordance with the results of the Auto/Oil Programme, the Commission proposes that emissions standards for passenger cars are tightened and improved by the adding of new requirements. It is proposed that these measures (discussed below in detail) should apply from the year 2000 for new vehicle types and from 2001 for all new vehicles. A second regulatory stage should also be envisaged to be applied from 2005 for new vehicle types and from 2006 for all new vehicles. This should however be confirmed (see below). 90 1. 1 Test of the tailpipe emissions after a cold start ("type I test") The Type I test constitutes the main element of the Directive. It aims at the effective limitation of the air-polluting emissions of motor vehicles with a total mass up to 3 500 kg driven in typical urban and extra-urban traffic conditions. The driving cycle which simulates such traffic conditions for the purpose of carrying out this test in the laboratory will be modified in order to better represent a typical vehicle cold start. As suggested by the Commission's Motor Vehicle Emission Group, the 40 second warm up period before the sampling of the exhaust gases permitted in the current test will be deleted. This change will result for gasoline vehicles in a considerable increase of the emissions of carbon monoxide (up to 40%) and hydrocarbons measured during the test. Notwithstanding changes of the limit values, this measure by itself constitutes a significant severisation of the requirements of the Type I test. 1. 2 Limit values in the year 2000 The proposed new limit values to be applied from the year 2000 represent reductions, against Stage 1996 emissions standards, of: 40% nitrogen oxides, 40% hydrocarbons, 30% carbon monoxide for petrol engined passenger cars; 20% nitrogen oxides, 20% for the combined value for hydrocarbons plus nitrogen oxides, 40% carbon monoxide, 35% particulate matter for diesel passenger cars equipped with indirect injection engine; 40% nitrogen oxides, 40% for the combined value for hydrocarbons plus nitrogen oxides, 40% carbon monoxide, 50% particulate matter for diesel passenger cars equipped with direct injection engines which presently comply with less stringent limit values. These reductions correspond to scenarios evaluated in the Auto/Oil Programme, as described in the Auto/Oil Communication. The new limit values for diesel vehicles no longer make a distinction between indirect and direct injection engines, since direct injection technology will be mature by year 2000 and will therefore be able to comply with the general requirements for diesel vehicles. In applying these reductions to the present limit values of Directive 94/12/EC the combined limit value for hydrocarbons and nitrogen oxides has to be broken down. In the past it has been assumed that the ratio of these pollutants in the exhaust emissions was 55 to 45 for petrol cars and 20 to 80 for diesel cars. These ratios were established when the limit values for hydrocarbons and nitrogen oxides were combined in Directive 83/351 /EEC. Recent data shows, however, that for modern diesel engines, in particular when equipped with oxidation catalysts, a ratio of 10 to 90 is more representative. time first the for For petrol cars separate limit values are now proposed for hydrocarbon and nitrogen oxide emissions, in order to achieve specific emission reductions for both pollutants. However, a combined limit value for these pollutants is still maintained for diesel cars for which the Stage 2000 standards are particularly demanding, in order to assure the flexibility necessary for the engineering of future diesel engines and associated emissions reduction technologies. In addition diesel cars emit unburned hydrocarbons at a very low level. However, in accordance with the emphasis which the Commission attributes to the control of nitrogen oxide emissions, the combined value is completed by a separate limit value for nitrogen oxides emissions. 91 The incremental costs of the proposed Stage 2000 standards have been assessed in the Auto-oil cost/effectiveness study, as has the technology require to fulfil these standards. The mean calculated costs are from ECU 113 for a small gasoline car to ECU 402 for diesel cars. The standards will require technologies like close coupled catalyst, improved injection, dual oxygen sensor for gasoline vehicles, and fully electronic pump and electronically-controlled exhaust gas recirculation for diesel vehicles. The Auto/Oil Programme has shown that they will be available by the year 2000. The proposed Stage 2000 limit values are therefore. Stage: Directive 94/12/EC CO HC+NOx HC NOx (limit values in g/km ) 2. 2 0. 5 Petrol cars Directive 94/12/EC Corrected values(3) 2. 7 0. 341 0. 252 Stage 2000 2. 3 0. 20 0. 15 _ Stage: Directive 94/12/EC Diesel cars Directive 94/12/EC Corrected values Stage 2000 CO HC + NOx NOx PM (limit values in g/km ) 1. 0 0. 7/0. 9w 0. 08/0. 10(4) 1. 06 0. 71/0. 91 0. 63/0. 81w 0. 08/0. 10(4) 0. 64 0. 56 0. 50 0. 05 1. 3 Test of evaporative emissions ("type TV test") This test became part of the European emission standards in 1991 in order to control the losses of hydrocarbons by evaporation from the fuel system of a petrol car. For this purpose the test simulates the conditions of a car which is parked after use under hot weather conditions. Following the recommendation of the Commission's Motor Vehicle Emission Group, the test will be improved to better represent the real conditions which determine the evaporative emissions as well as the state of the art of the relevant laboratory techniques. Based on the review of available emission and meteorological data, it is proposed to up-grade the test with more severe specifications for pre-conditioning the test vehicles, and with a new 24-hour diurnal test after soaking for an extended period at hot temperatures. (3) (4) Corrected to take account of change in test cycle caused by elimination of the 40 second idling period. For vehicles equipped with direct injection engine. 92 1. 4. Measures for ensuring the durability of the emission control systems There are three important ways in which the durability of emission control systems can be assured, relevant to the proposed directive: 1. 4. 1 Onboard Diagnostic Systems (OBD) OBD systems have been identified by the Auto/Oil Programme as a cost-effective means of assuring that the emissions of a car are effectively controlled during its useful life. OBD systems have a double purpose. They detect failures of the anti-pollution equipment of the car and indicate these to the driver so that he can have the vehicle fixed in a repair shop. In addition, they record the detected failures allowing stations carrying out the annual roadworthiness inspections to verify that the relevant repairs have been carried out. A new Annex XI in the directive incorporates the technical provisions necessary for the approval of OBD systems. The proposed OBD specifications do not require the direct measurement of emissions, but aim at ensuring a monitoring, through electronic computing and sensing, of the performance of related component or systems. While the technology has already been proven for gasoline powered vehicles, OBD technologies are at ^ far less developed stage for diesel vehicles. The Directive stipulates, therefore, that requirements for these vehicles are, in a first stage, optional. The proposal takes into account the most recent technological developments for both categories of vehicles. OBD requirements shall necessarily include anti-tampering provisions. A clause has been added to avoid that anti-tampering features preclude the use of aftermarket parts which give an equivalent level of emission control. 1. 4. 2 Control of compliance of vehicles in service The Auto/Oil Programme has highlighted the favourable cost/effectiveness potential of systems for verifying the compliance of vehicles in service with the regulatory requirements in force when these vehicles are approved. Such systems exist in the United States, in Sweden and, on a voluntary basis, in the Netherlands. The EC type-approval procedure contains, at present, only provisions allowing the control of conformity of production. The Commission is therefore proposing to introduce in the EC type-approval procedure for motor vehicles, provisions which will verify the compliance of manufacturer's vehicles with the durability requirements of the present directive with the help of surveys carried out on vehicles in service which have accumulated up to 80 000 km and/or an age of five years. In order to assure the application of such provisions at EU level, they must be closely linked to existing provisions relating to the responsibilities of the national authorities with respect to the control of conformity of production. The introduction of the proposed new system necessitates not only amendments of the present directive but also amendments of the framework directive relating to EC type-approval (70/156/EEC). The amendments to the latter directive and the detailed provisions relating to the statistical aspects of the surveys of vehicles in service and the remedial measures that should apply in case of non-compliance (e. g. "recall") will be subject of the new Annex X of this Directive. 1. 4. 3 Test for verifying the durability of anti-pollution devices ("type V test") This test was introduced in Directive 91/441/EEC in order to verify the requirement that the emission control measures taken by the manufacturers remain effective throughout the normal life of the vehicles and under normal conditions of use. The test is intended to simulate the ageing of anti-pollution devices during an operation of 80 000 km in accordance with a specified driving pattern. 93 The experience made by industry and the national approval authorities with this test has, however, shown a considerable lack of representativity in the way that emission control The devices deteriorate of the concerned devices under actual driving conditions. Commission has decided therefore to refrain from proposing an extension of this test to 160 000 km which would merely increase the costs of emission approvals of cars without noticeable environmental benefits. Hence, the present provisions of the Directive relating to the type V test remain unchanged. 1. 5 Reference fuels The characteristics of the reference fuels used for emission testing are also modified to reflect evolution of the specifications of the commercial fuels in year 2000. 1. 6 Low temperature testing The Commission does not propose that specific requirements relating to the emission performances of vehicles at low temperatures be introduced, because the typical conditions simulated by this test were not covered in the Auto/Oil Programme. Nevertheless, in the light of the interest shown by some Member States for such a new test, the Commission ^will study its potential costs and effectiveness at a later stage, and will, if necessary, bring forward proposals. 2. Second stage 2005 The proposal also sets out indicative limit values to be applied for a second Stage to reduce vehicle emissions in the year 2005. The purpose of the second stage is twofold. Firstly by setting indicative, but realistic limit values which could be applied from the year 2005, the Commission is giving advance notice to the automobile industry as to the measures it anticipates will need to be applied from that date. Secondly, the year 2005 values are proposed in order to provide uniform targets to Member States which would like to stimulate the improvement of environmental technologies through the granting of fiscal incentives. In view of the anticipatory nature of the second stage, the Commission proposes that the limit values proposed should be confirmed by decision of the European Parliament and the Council. To this end, the Commission will bring forward proposals to the Council and the Parliament within twelve months of the adoption of this Directive, but not later than 31 December 1999, as required in Article 4 of this proposal. Contemporaneously with the new proposals on vehicles, the Commission will also propose new fuels quality specification for application also in year 2005. The proposals on fuels and vehicles to reduce emissions for the year 2005, will be based on a further analysis of trends in air quality, technical developments in vehicle and refinery technologies, the-potential for alternative fuels to reduce vehicle emissions and the relative cost/effectiveness of the measures concerned. The indicative limit values are based on the most stringent packages of measures examined in the Auto/Oil Programme but not selected for the year 2000. The costs of the technologies necessary to meet these second stage standards are not precisely known at the present time. Stage 2005 proposed standards will require, especially for diesel vehicles, the development of technologies like deNOx catalytic converters which are not yet industrially proven. These will require the availability of improved fuels (for instance, low sulphur diesel fuel). This is another reason why the second stage on vehicles needs to be accompanied by a second stage on fuels. * 94 The proposed Stage 2005 limit values are therefore: Stage: CO HC NOx (limit values in g/km ) Directive 94/12/EC Corrected values 2. 7 0. 341 0. 252 Stage: CO H C + N Ox NOx PM Directive 94/12/EC Corrected values 1. 06 0. 71/0. 91(i) 0. 63/0. 81(4) 0. 08/0. 10w 3. Emission based fiscal incentives Petrol cars Stage 2000 Regulatory values 2. 3 0. 20 0. 15 Diesel cars Stage 2000 Regulatory values 0. 64 0. 56 0. 50 0. 05 Stage 2005 Indicative values 1. 00 0. 10 0. 08 Stage 2005 Indicative values 0. 50 0. 30 0. 25 0. 025 Since the adoption of Directive 89/458/EEC, Community decisions relating to the environmental aspects of motor vehicle emissions have contained a framework for the granting of fiscal incentives to encourage the early application of the new limit values. In these directives a balance has been struck between, on the one hand, the need to encourage the introduction of new technologies as quickly as possible, and, on the other hand, the need to avoid fragmenting the Single Market with diverse fiscal incentive programmes incentivising different limit values with the consequence that, de facto, there would be simultaneously a multitude of emission standards existing in the market. The principles adopted in the framework set out in Article 3 of Directive 94/12/EC have been to permit fiscal incentives only for vehicles complying with the Directive and provided that they comply with the provisions of the Treaty and that they are: non-discriminatory; limited in time and that they terminate when the limit values become mandatory; of an amount lower than the additional cost of the technical solutions introduced to ensure compliance with the new limit values and the cost of their installation on the vehicle. — (5) For vehicle equipped with direct injection engine. 95 It should be noted that this fiscal framework has been established within the context of a directive based on Article 100a of the Treaty a point which has been contested by a number of Member States. Legally speaking however this is perfectly justified since the main subject matter of the directive concerns questions of the internal market (harmonization of legislation). The fiscal incentive framework does not aim at harmonizing taxes but rather at preventing obstacles to the functioning of the Internal Market in this sector. Without a Community framework there would be nothing to prevent Member States, within the limits of the Treaty, from incentivising a wide range of emission limit values. This would be damaging for the proper functioning of the internal market. It is for this reason that Member States have agreed to establishing a framework within which fiscal incentives could be given. The Commission believes that it is essential that this policy continues in the future. The Commission has however re-examined the modalities of the framework with a view to ascertaining if any additional flexibility could be introduced into it without prejudicing the objectives outlined above. The Commission notes in this context that in the course of the discussions on Directive 94/12/EC it stated that with regard to the inclusion of pollutant emissions in the basis for calculating the annual road tax, any adjustment should be progressive and be based upon the actual performance of each vehicle. Fiscal incentives should not be given to incentivjse limit values not agreed at Community level (e. g. US standards) but can be given in the context of annual road taxes to incentivise actual emission standards. In the last whereas clause of Directive 94/12/EC the Council and the Parliament requested the Commission, when putting forward measures to apply after the year 2000, to put forward, if necessary, target values involving a further substantial reduction of emissions. Such target values clearly would be used for purposes of fiscal incentivisation. In examining the relative merits of such an approach the Commission notes that for some time a number of Member States - notably Germany and Sweden - have advocated the establishment of target limit values for incentivisation purposes. Sweden indeed has applied such a system (by means of environmental Classes I/n/ffi) despite the fact that it is in contradiction with current Community legislation. The European Parliament has also been in favour of a second stage. Against this a number of Member States have made clear their preference for the maintenance of a single stage of incentivised limit values, which has been the approach followed up to now. This issue was discussed by the Commission in 1991 during which time the responsible Commissioners agreed that there was a case for providing a second stage target limit value for fiscal incentive purposes which would be based upon the most advanced technologies. The Auto/Oil Programme has provided data on the most advanced technologies and the information therefore exists on which to base a second stage for incentivisation purposes. In addition this information has been gathered on a European wide basis and hence is likely to provide a sounder basis for a second stage than figures put forward in the past by Member States individually which would reflect their own national industries' capabilities. On balance therefore the Commission considers that there are strong grounds for liberalising the current framework and providing for a second stage of incentivisation. It has to be acknowledged that allowing a second level of incentivisation contains certain risks in terms of internal market. Jiowever since, given the legislative timetable, this proposal is unlikely to be applied before 1998 by Member States on an optional basis for vehicle types approved to Stage 2000 standards. This is only a short time before vehicles will mandatorily have to conform to emission performances corresponding to Stage 2000 standards. As a practical matter therefore, there will be only a very short period when, theoretically, there are three simultaneous standards existing in the market (actual, Stage 2000, indicative Stage 2005). This has to be seen in the light of the far greater danger 'in terms of negative effects on the internal market which would result from a failure to agree to any framework at all. This later scenario would have the consequence that unbridled fiscal incentives measures would be permitted leading to the risk of a proliferation of standards in the market and a threat to the functioning of the internal market. 96 towards The two-stage approach the clear understanding that these and only these limit values will be permitted to be incentivised and not others such as US standards or variants thereof. Article 4 of the draft Directive provides, that the regime governing fiscal incentives for the year 2005 will, if necessary, be revised, in the course of the proposals conforming or revising the limit values to be applied in 2005. incentivisation should be permitted on With regard to fiscal incentive measures given in the context of annual road taxes the Commission proposes that the policy it outlined in the course of the adoption of Directive 94/12/EC should be maintained. F. New measures for other categories of vehicles A proposal will be submitted in 1996 to modify the light commercial vehicles (LCV) standards included in Directive 70/220/EEC. In order to ensure parallelism and coherence between light commercial vehicles and passenger cars, limit values for these vehicles will be an extrapolation of limit values in this proposal. The Commission will examine closely the issue of whether limit values for Class I and II LCV should be the same. A proposal aimed at achieving a 30% NOx and particulate reduction will also be-proposed in 1996, for heavy duty diesel engines approved according Directive 88/77/EEC. Limit values will take into account the on-going discussions on revising the heavy vehicle test procedure. The implementation dates will be the same as those for passenger cars. As for passenger cars and light commercial vehicles, it is also foreseen to propose target values for 2005 for heavy duty vehicles. Provisions for LPG/CNG technologies in buses and city vehicles will also be developed. G. 1. Subsidiarity Objective of the proposed measures in relation to the obligations placed upon the Commission The objective of the measures is to adapt existing measures to the technical progress as well as to new knowledge in the field of environment. These existing measures have largely contributed to achieving the harmonization of the Community vehicle market since 1970. Their adaptation is explicitly requested by Directive 94/12/EC and is an element of a global consensus which had permitted the adoption of the last directive. 2. Compared competence of the Community and of the Member States With the Council Directive 89/458/EEC, the Community has decided to harmonize all emission related requirements for new vehicle type-approval on the base of total harmonization. The matter is therefore an issue of exclusive Community competence. 3. Forms of actions available for the Community — The only realistic form of action is legislation based either on a directive or a regulation. As a separate directive permitting the application of the EU type-approval put in place by Directive 70/156/EEC, the proposal adopts the legal forms of all requirements in this field. 97 4. Availability of an approach with general objectives leaving execution to Member States A uniform detailed regulation is necessary to be coherent with the requirements of the framework Directive 70/156/EEC. H. Conclusions With this present proposal for a European Parliament and Council Directive, the highest degree of environmental protection, consistent with a economically sound global approach, will be ensured. The proposals will contribute to the improved protection of public health within the Community by setting ambitious but realistic objectives, whilst giving a sufficient lead time to the automobile and components industries to develop the relevant technologies. The Commission has moreover taken care of the need to provide a stable framework for operators in the market, and the proposals have been made with this objective in mind. The ambitiousness of the changes will put the Community squarely at the head of the global effort to reduce emissions. Nevertheless, alongside measures taken out at the level of the European Union, cost effective measures implemented at local level will be necessary to achieve air quality objectives. 98 Proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE 96/0164 (COD) relating to measures to be taken against air pollution by emissions from motor vehicles and amending Council Directives 70/156/EEC and 70/220/EEC THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 100 thereof, Having regard to the proposal from the Commission(1), Having regard to the opinion of the Economic and Social Committee(2), Acting in accordance with the procedure referred to in Article 189b of the Treaty(3), Whereas measures should be adopted within the framework of the internal market; Whereas the first programme of action of the European Community on protection of the environment^, approved by the Council on 22 November 1973, called for account to be taken of the latest scientific advances in combating atmospheric pollution caused by gases emitted from motor vehicles and for directives adopted previously to be amended accordingly; whereas the fifth programme of action, which in its general approach was approved by the Council in its resolution of 1 February 1993 ((5)), provides for additional effort to be made for a considerable reduction in the present level of emissions of pollutants from motor vehicles; whereas this fifth programme also set targets in terms of emission reduction for various pollutants in the understanding that emissions from both mobile and stationary sources would have to be reduced; Whereas Council Directive 70/220/EEC(6) lays down the limit values for carbon monoxide and unburnt hydrocarbon emissions from the engines of such vehicles; whereas these limit values were first reduced by Council Directive 74/290/EEC(7) and supplemented, in accordance with Commission Directive 77/102/EEC(8), by limit values for permissible nitrogen oxides; whereas the limit values for these three types of pollution were successively reduced by Commission Directives 78/665/EEC(9), 83/351/EEC(10) and 88/76/EEC(U); whereas limit values for particulate pollutant emissions from diesel engines were introduced by Council Directive 88/436/EEC(12); whereas more stringent European standards for the emissions of gaseous pollutants of motor vehicles below 1 400 cm were introduced by Council Directive 89/458/EEC(l3); whereas these standards have been extended to all passenger (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) OJ No C OJ No C Opinion of the European Parliament of — , Common Position of the Council of , and Decision of the European Parliament of OJNoC 112, 20. 12. 1973, p. 1. OJNoC 138, 17. 5. 1993, p. 1. OJNoL 76, 6. 4. 1970, p. 1. OJNoL 159, 15. 6. 1974, p. 61. OJNoL 32, 3. 2. 1977, p. 32. OJ No L 223, 14. 8. 1978, p. 48. OJNoL 197, 20. 7. 1983, p. 1. OJNoL 36, 9. 2. 1988, p. 1. OJNoL 214, 6. 8. 1988, p. 1. OJNoL 226, 3. 8. 1989, p. 1. 99 cars independently of their engine capacity on the basis of an improved European test procedure comprising an extra-urban driving cycle and, whereas requirements relating to evaporative emissions and to the durability of emissions-related vehicle components as well as more stringent particulate pollutant standards for motor vehicles equipped with diesel introduced by Council Directive 91/441/EEC(U); whereas engines which were Directive 94/12/EC of the European Parliament and of the Council(15) introduced more stringent limit values for all pollutants and a modification of the control of conformity of the production; whereas passenger cars designed to carry more than six passengers and having a maximum mass of more than 2 500 kg, light commercial vehicles, and off-road vehicles, covered by Directive 70/220/EEC, which benefited until then from less stringent standards, have been submitted by Council Directive 93/59/EEC(16) and Directive 96/. /EC of the European Parliament and of the Council(17), to standards as severe as the respective standards for passengers cars, taking into account the specific conditions of these vehicles; Whereas Article 4 of Directive 94/12/EC requires that the Commission proposes standards which will be enforced after the year 2000, according to a new multi-faceted approach, based on a comprehensive assessment of costs and efficiency of all measures aimed at reducing road transport pollution; whereas the proposal should include, besides car emission standard tightening, complementary measures, like an improvement in fuel quality and a strengthening of the car fleet inspection and maintenance programme; whereas the proposal should be based on the establishment of air quality criteria and associated emission reduction objectives and an evaluation of the cost/effectiveness of each package of measures, taking into account the potential contribution of other measures such as, inter alia, traffi z management, enhancement of urban public transport, new propulsion technologies, or the use of alternative fuels; Whereas the Commission has implemented a European programme on air quality, road traffic emissions, fuels and engines technologies (the Auto/Oil Programme08') with a view to fulfilling the requirements of Article 4 of Directive 94/12/EC; whereas the European car and oil industries have carried out the European Programme on Engines Fuels and Emissions (EPEFE) to determine the contribution which can be made both by future vehicles and the fuels which propels them; whereas the auto/oil and EPEFE programmes strove for ensuring that proposals for directives on polluting emissions seek the best solutions for both the citizen and for the economy; whereas a cost/effectiveness study within the Auto/Oil Programme has shown that a further improvement of car emission technology was necessary with a view to achieving air quality in year 2010 as described in the Communication by the Commission on the Auto/Oil Programme; Whereas improvement of requirements for new passenger cars in Directive 70/220/EEC constitute a part of a consistent global Community strategy which will also include a revision of standards for light commercial vehicles and heavy duty vehicles from year 2000, an improvement of motor fuels and more accurate assessment of in-use vehicle emission performances; whereas alongside these measures, additional cost/effective local measures will nevertheless be needed to achieve the air quality criteria in the most polluting areas; Whereas Directive 70/220/EEC is one of the separate directives under the type-approval procedure laid down by Council Directive 70/156/EEC of 6 February 1970 on the approximation of the laws of the Member States relating to the type-approval of motor vehicles and their trailers(l9), as last amended by Directive 96/27/EC of the European Parliament and of the Council(20); whereas the objective of reducing the level of (14) (15) (16) (,7) (18) (19) (20) OJNoL 242, 30. 8. 1991, p. 1. OJ No L 100, 19. 4. 1994, p. 42. OJNoL 186, 28. 7. 1993, p. 21. OJ No L Commission Communication. OJNoL 42, 23. 2. 1970, p. 1. OJNoL 169, 8. 7. 1996, p. 1. 100 pollutant emissions from motor vehicles cannot be sufficiently achieved by individual Member States and can therefore be better achieved by the approximation of the law of the Member States relating to measures to be taken against air pollution by motor vehicles; Whereas reductions of the Type I test limits applicable from year 2000 corresponding to abatements of 40% nitrogen oxides, 40% total hydrocarbons, 30% carbon monoxide for gasoline passenger cars, 20% nitrogen oxides, 20% for the combined value for hydrocarbons plus nitrogen oxides, 40% carbon monoxide, 35% particulate matters for indirect injection diesel passenger cars and 40% nitrogen oxides, 40% for the combined value for hydrocarbons plus nitrogen oxides, 40% carbon monoxides and 50% particulate matters have, for direct injection diesel passenger cars, been identified as key measures to achieve sufficient medium-term air quality; whereas these reductions have been applied to hydrocarbons and nitrogen oxides with the assumption that nitrogen oxides represent respectively 45% and 80% of the weight of the combined value measured for gasoline/diesel light duty vehicles complying with Directive 94/12/EC; whereas separate limit values are now normally fixed for gasoline vehicles in order to monitor the emissions of both pollutants; whereas a combined limit value is maintained for diesel vehicles for which the Stage 2000 standards are the most demanding, with a view to facilitating engineering of future engines; whereas these reductions will take into account the effect on real emissions of a modification also adopted for the test cycle with a view to better representing emissions after a cold start ("deletion of 40 s"); Whereas new provisions for on-board diagnostics (OBD) should be introduced with a view to permitting an immediate detection of failure of anti-pollution vehicle equipment and thus allowing a significant up-grading of the maintenance of initial emissions performances on in-use vehicles through periodical or kerbside control; whereas, however, OBD are at a less developed stage for diesel vehicles and can be fitted on such vehicles only as an option; Whereas the Type IV test which makes it possible to determinate the evaporative emissions of spark-ignition engines can be improved to better represent real evaporative emissions as well as the status of measuring techniques; Whereas the characteristics of the reference fuels used for emission testing should reflect the evolution of the market fuel specifications to be available in year 2000, following legislation on the quality of petrol and diesel fuels; Whereas a new method for conformity of production checking on in-use vehicles has been identified as a cost/effective accompanying measure; and is included in the emission directive with the objective of implementation in year 2001; whereas Directive 70/156/EEC should be amended accordingly; Whereas Member States should be allowed to encourage, by means of tax incentives, the introduction of vehicles which satisfy the improved requirements of this Directive; Whereas, it is necessary to establish indicative limit values to be applied from 2£05 which can also be used for the purposes of, inter alia, encouraging the early introduction of vehicles containing the most advanced anti-pollution equipment; these indicative limit values should be confirmed by a directive of the Whereas European Parliament and of the Council on the basis of a proposal to be made by the Commission not later than 31 December 1998; whereas the Commission will simultaneously propose measures to improve the quality of fuels for the year 2005; whereas both directives should enter into force together in 2005; Whereas Directive 70/220/EEC should be amended accordingly, 101 HAVE ADOPTED THIS DIRECTIVE: Article 1 Directive 70/156/EEC is amended as follows: 1. Article 10 is amended as follows: Article 10 (a) the heading is replaced by the following: "Conformity of production and in-service compliance arrangements" (b) the following paragraph 3 is added: "3. A Member State granting type-approval in relation to separate directives which contain quantified provisions for in-service durability of the systems, components or technical units, covered by these directives, shall make the necessary arrangements for verification to ensure compliance with these provisions by survey on vehicles in service in accordance with the procedures laid down in the directives concerned. " 2. Article 11 is amended as follows: (a) the heading is replaced by the following: "Non-conformity and non-compliance" (b) the following paragraph 4a is inserted: "4a. There shall be failure to comply with quantified durability provisions of a separate directive where a survey on vehicles in service, carried out in accordance with the relevant specifications of the directive, establish that a vehicle type concerned does not meet these durability requirements. If a Member State which has granted type-approval finds that vehicles in service accompanied by a certificate of conformity do not comply with the quantified durability provisions of a separate directive pursuant to which they have been type-approved, it shall decide on measures to be taken in order to ensure that vehicles in service will again comply with these provisions. The approval authorities of the Member State shall advise those of the other Member States of the measures planned. The relevant authorities in each Member State are competent to decide on the advisability of implementation in their territory of the planned measures. If a Member State demonstrates that vehicles in service accompanied by a certificate of conformity do not comply with the quantified durability provisions of a separate directive pursuant to which they have been type-approved, it shall request the Member State which granted the type-approval to verify that by survey on vehicles in use, if necessary in cooperation with the competent authorities of the other Member States vehicles in service comply with these provisions. Such action shall be taken as soon as possible and in any case within the six months of the date of the request. When non-compliance for a vehicle in service is established in accordance with the third subparagraph, the vehicle approval authority takes the measures referred to in the second subparagraph. " 102 (c) paragraphs 5 and 6 are replaced by the following: "5. The approval authorities of the Member States shall inform each other within one month of any withdrawal of type-approval and of the reasons for such a measure. In case of in-service survey under Article 10(2), the approval authorities of the Member State shall inform each other of the decisions taken on the basis of the results of the survey. 6. If the Member State which granted type-approval disputes the failure to conform or to comply demonstrated to it, the Member States concerned shall endeavour to settle the dispute. The Commission shall be kept informed and shall, where necessary, hold appropriate consultations for the purpose of reaching a settlement. " 3. In Article 12, the following subparagraph is added: "All decisions taken pursuant to the provisions adopted in implementation of this Directive and adopting planned measures to restore the conformity of vehicles in service, shall state in detail the reasons on which they are based. The competent authorities of each Member State which decide to initiate the planned measures shall notify the party concerned who shall, at the same time, be informed of the remedies available to him under the laws in force in the Member States and of the time limits allowed for the exercise of such remedies. " Article 2 The Annexes to Directive 70/220/EEC are amended in accordance with the Annex hereto. Article 3 1. Subject to the provisions of Article 6, with effect from 1 January 1998, no Member State may, on grounds relating to air pollution by their emissions: refuse to grant EC Directive 70/156/EEC, or type-approval pursuant to Article 4(1) of refuse to grant national type-approval, or prohibit the registration, sale or entry into service of vehicles, if the vehicles comply with the requirements of Directive 70/220/EEC, as amended by this Directive. 2. Subject Member States: to the provisions of Article 6, with effect from 1 January 2000, may no Directive 70/156/EEC, and longer grant EC type-approval pursuant to Article 4(1) of shall refuse national type-approval, for a new type of vehicle on grounds relating to air pollution by emissions if it fails to comply with the provisions of Directive 70/220/EEC, as amended by this Directive. For the Type I test the limit values set out in row A of the Table in Section 5. 3. 1. 4 of Annex I to Directive 70/220/EEC are to be used. 103 3. With effect from 1 January 2001, Member States shall: consider certificates of conformity which accompany new vehicles pursuant to Directive 70/156/EEC as no longer valid for the purpose of Article 7(1) of that Directive, and refuse the registration, sale or entry into service of new vehicles which are not accompanied by accordance with of a Directive 70/156/EEC, conformity certificate in on grounds relating to air pollution by emissions, if the vehicles fail to comply with the provisions of Directive 70/220/EEC, as amended by this Directive. For the Type I test the limit values set out in row A of the Table in Section 5. 3. 1. 4 of Annex I to Directive 70/220/EEC are to be used. Article 4 Member States may make provision for tax incentives only in respect of motor vehicles which comply with Directive 70/220/EEC, as amended by this Directive. Such incentives shall comply with the provisions of the Treaty and satisfy the following conditions: they shall apply to all new vehicles offered for sale on the market of a Member State which comply in advance with either the mandatory limit values set out in row A of the Table in Section 5. 3. 1. 4 of Annex I to Directive 70/220/EEC, as amended by this Directive, or, the indicative limit values set out in row B of the same Table; they shall be terminated with effect from the mandatory application of the emission limit values laid in Article 3(3) for new motor vehicles, or by 1 January 2005 in the case of the indicative limit values set out in row B of the Table in Section 5. 3. 1. 4 of Annex I to Directive 70/220/EEC, as amended by this Directive; for each type of motor vehicle, they shall be for an amount lower than the additional cost of the technical solutions introduced to ensure compliance with the values set in Article 3(3), or the indicative limit values set out in row B of the Table in Section 5. 3. 1. 4 of Annex I to Directive 70/220/EEC, as amended by this Directive, and of their installation on the vehicle. The Commission shall be informed in sufficient time of plans to institute or change the tax incentives referred to in the first paragraph, so that it can submit its observations. Article 5 The Commission will propose to the European Parliament and the Council a further-tightening of the emission standards of vehicles falling within the scope of this Directive no later than 12 months from the date of adoption of this Directive but in any event not later than 31 December 1998. It shall be based on a revised and enhanced version of the methodology used to prepare measures for this Directive. The strategy put forward in the proposal shall be designed to produce effects to meet the requirements of the Community air quality standards and related objectives at least cost and shall take account of: trends in air quality; noxious* pollutant emissions in Europe from transport and non-transport sources and the contribution that existing, pending and potential emission reduction measures from all sources could make to improve air quality; 104 technical developments with regard to vehicle technologies as well as new propulsion technologies (e. g. electric propulsion, fuel cells); and refinery technologies; the potential of alternative fuels such as compressed natural gas (CNG), Liquid Petroleum Gas (LPG), Dimethyl Ether (DME) and biofuels to reduce vehicle emissions; possible improvements in the test procedures, in particular the addition of a new test procedure at low temperatures; the potential of technical, non-technical and local measures to reduce emissions; in this context the contribution of transport and other policy measures such as traffic management, enhanced urban public transport and vehicles scrappage schemes should be evaluated; the contribution that selective and differentiated fiscal measures could make to reducing emissions, whilst not negatively the internal market; the functioning of impacting the effects of any measures on C02 emissions; the strategies followed by non-member countries to improve air quality and the emission limit values applied therein; the supply situation and qualities of crude oil available to Europe. The proposal shall contain, inter alia, mandatory emission limit values to be applied from 1 January 2005 confirming or modifying in Section 5. 3. 1. 4, row B of Annex 1 to Directive 70/220/EEC, as amended by this Directive. In addition, the proposal shall establish whether the framework under which Member States can make provision for tax incentives established in Directive 70/220/EEC, as amended by this Directive, should be revised. limit values stipulated indicative the p The proposal shall be submitted to the European Parliament and the Council at the same time /EC of the European Parliament and as the proposALreferred to in Article 9 of Directive 96/ of the Coun<pfc*/on the quality of petrol and diesel fuels]; the measures shall enter into effect at the same time as the measures foreseen in the proposal to be submitted in accordance with Article 9 of that Directive. Article 6 The provisions of this Directive will enter into force simultaneously with and in accordance with the same timetable for the introduction of measures specified in the Directive for a European Parliament and Council Directive related to the quality of petrol and dresel fuels. Article 7 1. Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive before 31 December 1997. They shall immediately inform the Commission thereof. When Member States adopt these provisions, these shall contain a reference to this Directive or shall be accompanied by such reference at the time of their official publication. The procedure for such reference shall be adopted by Member States. f«l) See p. of this Official Journal. 105 2. Member States shall communicate to the Commission the texts of the main provisions of national law which they adopt in the field covered by this Directive. Article 8 This Directive shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Communities. This Directive is addressed to the Member States. Article 9 Done at Brussels, For the European Parliament The President For the Council The President 106 ANNEX AMENDMENTS TO THE ANNEXES TO DIRECTIVE 70/220/EEC AS AMENDED BY DIRECTIVE. List of Annexes 1. The list of Annexes is amended as follows: The indication to Annex VI reads as follows: 'Annex VI: Type IV test (Determination of evaporative emissions from vehicles with spark-ignition engines) Appendix 1 : Calibration frequency and methods Appendix 2: Diurnal ambient temperature profile for the diurnal emission test' Annex VIII: The title reads as follows: 'Specifications of reference fuels' The following items are added: 'Annex X: Control of compliance of vehicles in service Annex XI: On-board diagnostics (OBD) for motor vehicles Appendix 1 : Functional aspects of OBD systems Appendix 2: Diagnostic services (Test Modes) Appendix 3: OBD tools Appendix 4: Numeric codes Appendix 5: Addendum to the Information Document Appendix 6: Essential characteristics of the vehicle family- Appendix 7: Addendum to the EC type-approval certificate' 107 Annex I 2. The heading reads as follows: 'SCOPE, DEFINITIONS, APPLICATION FOR EC-TYPE APPROVAL, EC TYPE APPROVAL, REQUIREMENTS AND TESTS, EXTENSION OF EC TYPE- APPROVAL, CONFORMITY OF PRODUCTION, COMPLIANCE IN SERVICE, ON BOARD DIAGNOSTIC (OBD) SYSTEMS' 3. Section 1: The first sentence reads as follows. 'This Directive applies to - the tailpipe emissions, evaporative emissions, emissions of crankcase gases, the durability of anti-pollution devices and on-board diagnostic (OBD) systems for all motor vehicles equipped with positive-ignition engines and the tailpipe emissions, the durability of anti-pollution devices and on-board diagnostic (OBD) systems from vehicles of category Mj and Nj(1), equipped with compression-ignition engines covered by Article 1 of Directive 70/220/EEC in the version of Directive 83/351/EEC(2), with the exception of those vehicles of categ with the exception of those vehicles of categories Nj for which type-approval has been granted pursuant to Directive 88/77/EEC( V 4. A new Section 2. 13 is added to read as follows '2. 13. 'OBD' means an on-board diagnostics system for emission control which shall have the capability of identifying the likely area of malfunction by means of fault codes stored in computer memory. ' Sections 3 to 3. 2. 1 read as follows: '3. APPLICATION FOR EC TYPE-APPRO VAL 3. 1. for EC The application to Article 3(4) of Directive 70/156/EEC of a vehicle type with regard to its tailpipe emissions, evaporative emissions, durability of antipollution devices as well as to its the diagnostic on-board vehicle manufacturer. type-approval pursuant submitted (OBD) system shall by — be As far as the application concerns an on-board diagnostic (OBD) system the procedure described in Annex XI, Section 3 has to be followed. 3. 2. A model for the information document relating to tailpipe emissions, evaporative emissions and durability is given in Annex II; concerning an on-board diagnostic (ODB) system a model is given in Annex XI, Appendix 5. 3. 2. 1. Where appropriate, copies of other type-approvals with the relevant data to enable extension of approvals and establishment of deterioration factors shall be submitted. ' 108 6. Sections 4 to 4. 2 read as follows: •4. GRANTING OF EC TYPE-APPROVAL 4. 1. If the relevant requirements are satisfied, EC type-approval shall be granted to Article 4 (3) of Directive 70/156/EEC. 4. 2. A model for the EC type-approval certificate relating to tailpipe emissions, evaporative emissions and durability is given in Annex DC, concerning an on board diagnostic (OBD) system a model is given in Annex XI, Appendix 7. ' 7. Section 5: The note is deleted. 8. Section 5. 1. 1: The second paragraph reads as follows: ' The technical measures taken by the manufacturer must be such as to ensure that the tailpipe and evaporative emissions are effectively limited, pursuant to this Directive, throughout the normal life of the vehicle and under normal conditions of use. This will include the security of those hoses, their joints and connections, used within the emission control systems, which must be so constructed as to conform with the original design intent. For tailpipe emissions, these provisions are deemed to be met if the provisions of Section 5. 3. 1. 4 (type-approval), Section 7 (conformity of production) and Section 8 (compliance of vehicles in service) are respectively complied with. For evaporative emissions, these provisions are deemed to be met if the provisions of Section 5. 3. 4 (type-approval), Section 7 of Annex VI (conformity of production) and Section 8 (compliance of vehicles in service) are respectively complied with. ' 9. A new Section 5. 1. 3 is added to read as follows: T '5. 1. 3. Provision must be made to prevent excess evaporative emissions caused by a missing fuel filler cap. This may be achieved by using: - an automatically opening and closing, non-removable fuel filler cap; - design features which avoid excess evaporative emissions in the case of a missing fuel filler cap; - a malfunction indicator different from the OBD malfunction indicator to signal a missing fuel filler cap; or any other provision which has the same effect. ' 109 10. Figure 1. 5. 2 is replaced by the following new figure: Figure 1. 5. 2 Different routes for type-approval and extensions Type approval test Type I Type II Type III Type IV Type V In Service Compliance (Section 8) On Board Diagnostics (Section 9) Extension conditions Positive-ignition engined vehicles of categories M and N Yes (mass £ 3,5 t) Yes (mass <> 3,5 t) Yes Yes (mass £ 3,5 t) Yes (mass £ 3,5 t) Yes (mass <. 3,5 t) Yes (Capacity <, 6 occupants) (mass £ 2,5 t) Section 6 Compression ignition engined vehicles of categories Mt and N, Yes (mass <> 3,5 t) -. Yes (mass <. 3,5 t) Yes (mass <; 3,5 t) Optional - Section 6 - M2 and N2 with reference mass not more than 2 840 kg' I 110 11. Section 5. 3. 1. 4: - After the first paragraph a new Table is inserted to read as follows: Limit values. Category of vehicle Reference Mass of carbon Mass of Mass of oxides Combined mass Mass of mass monoxide hydrocarbons of nitrogen of hydrocarbons particulates (CO) (HC) (NO. ) (HC + NO,) (PM) and oxides of nitrogen RW 0<g) (g/km) (g/km) L3 (g/km) (g/km) (g/km) Category Class Petrol Diesel Petrol Diesel Petrol Diesel Petrol Diesel Diesel A(2000) B (2005)* M(2) MO - - all all 2,3 1,00 0,64 0,50 0,20 0,10 - - 0,15 0,08 0,50 0,25 - - 0,56 0,30 0,05 0,025 (*) Indicative limit values to be applied to new types of vehicles from 1 January 2005 which are subject to confirmation by the Council and the European Parliament. These limit values can be the subject of tax incentives referred to in Article 3 of Directive [number of current amending directive]. - The first line of the present Table relating to vehicles of category M is deleted. 12. A new Section 7. 1. 4 is added to read as follows: 7. 1. 4. If a verification of the performance of the OBD system is to be carried out, it must be conducted in accordance with Section 7 of Annex XI. ' 13. Section 8 is deleted. 14. A new Section 8 and 9 are added to read as follows: •8. CONTROL OF COMPLIANCE OF VEHICLES IN SERVICE 8. 1 In order to satisfy the provisions of Section 5. 1. 1, vehicles in service-properly used and maintained shall comply with the provisions of Sections 5. 3. 1. 4 (tailpipe emissions) and 5. 3. 4 (evaporative emissions) for up to 5 years of age or 80 000 km, which occurs first. Compliance with these provisions will be verified in accordance with the provisions of Article 11 of Directive 70/156/EEC by the authorities which have approved the vehicle type concerned with the help of surveys on vehicles in service belonging to this vehicle type. The procedure to be followed for such in service survey is laid down in Annex X. Any vehicle being accompanied by a valid certificate of conformity in accordance with Directive 70/156/EEC may be subject of an in-service survey. I ll Where non-compliance is established in accordance with the provisions of Annex X, the manufacturers of the vehicle type concerned shall carry out the measures notified to him by the authorities of the Member States in accordance with the provisions of Article 11(2) and 12(2) of Directive 70/156/EEC. 9. ON-BOARD DIAGNOSTIC (OBD) SYSTEM FOR MOTOR VEHICLES 9. 1. Vehicles of category M°} equipped with positive-ignition engines, except - vehicles designed to carry more than six occupants including the driver, - vehicles whose maximum mass exceeds 2 500 kg, shail be fitted with an on-board diagnostic (OBD) system for the emission control in accordance with Annex XI. If other vehicles of category M are fitted with an on-board diagnostic (OBD) system, the OBD system must meet the requirements of Annex XI. ' (1) As defined in Annex II Section A to Directive 70/156/EEC. 112 Annex III 15. Section 2. 3. 1: - Paragraph 2 and 3 are deleted. - Paragraph 2 (former paragraph 4) reads as follows: 'Vehicles which do not attain the acceleration. ' (rest unchanged). 16. Section 6. 1. 3: The first sentence reads as follows: 'A current of air of variable speed shall be blown over the vehicle. ' 17. Section 6. 2. 2 is deleted. Appendix 1 18. Section 1. 1: - Figure III. 1. 1 is replaced by the following new figure: Figure III. 1. 1 Operating cycle for the Type I test Speed (km/h) 1 20 1 00 + BS BS: Beginning of sampling, engine start ES: End of sampling 113 - In the English version in column 5 of Table III. 1. 2 (entitled: 'Speed (km/h)'); operation 23 reads as follows: '35 - 10' 19. Sections 4 to 4. 3 including Table III. 1. 4 and Figure III. 1A are deleted. Appendix 3 20. Section 5. 1. 1. 2. 7: In the English version, the formula reads as follows: • p _ M V AV ' 500T 114 Annex VI 21. Sections 1 to 6 read as follows: '1. INTRODUCTION This Annex describes the procedure of the Type IV test according to Section 5. 3. 4 of Annex 1. This procedure describes a method for the determination of the loss of hydrocarbons by evaporation from the fuel systems of vehicles with spark ignition engines. 2. DESCRIPTION OF TEST The evaporative emission test (Figure VI. 1) is designed to determine HC evaporative emissions as a consequence of diurnal temperatures fluctuation, hot soaks during parking, and urban driving. The test consists of these phases: - test preparation including an urban (Part One) and extra-urban (Part Two) driving cycle, - hot soak loss determination, - diurnal loss determination. Mass. emissions of hydrocarbons from the hot soak and the diurnal loss phases are summed up to provide an overall result for the test. 3. VEHICLE AND FUEL 3 1 Vehicle 3. 1. 1. The vehicle must be in good mechanical condition and have been ran in and driven at least 3 000 km before the test. The evaporative emission control system must be connected and have been functioning correctly over this period and the carbon canister(s) shall have been subject to normal use, neither undergoing abnormal purging nor abnormal loading. 32 Fuel 3. 2. 1. The appropriate reference fuel must be used, as defined in Annex VIII to this Directive. 4. TEST EQUIPMENT FOR EVAPORATIVE TEST 4. 1. Chassis dynamometer The chassis dynamometer must meet the requirements of Annex III. 115 4. 2. Evaporative emission measurement enclosure The evaporative emission measurement enclosure must be a gas-tight rectangular measuring chamber able to contain the vehicle under test. The vehicle must be accessible from all sides and the enclosure when sealed must be gas tight in accordance with Appendix 1. The inner surface of the enclosure must be impermeable and non-reactive to hydrocarbons. The temperature conditioning system shall be capable of controlling the internal enclosure air temperature to follow the prescribed temperature versus time profile throughout the test, and an average tolerance of ± 1 K over the duration of the test. The control system shall be tuned to provide a smooth temperature pattern that has a minimum of overshoot, hunting, and instability about the desired long- term ambient temperature profile. Interior surface temperatures shall not be less than 278 K (5 °C) nor more than 328 K (55 "Q at any time during the diurnal emission test. Wall design must be such as to promote good dissipation of heat. Interior surface temperatures shall not be below 293 K (20 °C), nor above 325 K (52 °C) for the duration of the hot soak test. To accommodate the volume changes due to enclosure temperature changes, either a variable-volume or fixed-volume enclosure may be used. 4. 2. 1. Variable-volume enclosure The variable-volume enclosure expands and contracts in response to the temperature change of the air mass in the enclosure. Two potential means of accommodating the internal volume changes are movable panel(s), or a bellows design, in which impermeable bag(s) inside the enclosure expand and contract in response to internal pressure changes by exchanging air from outside the enclosure. Any design for volume accommodation must maintain the integrity of specified temperature range. the enclosure as specified in Appendix 1 over the Any method of volume accommodation shall limit the differential between the enclosure internal pressure and the barometric pressure to a maximum value of± 5 hPa. The enclosure shall be capable of latching to a fixed volume. A variable volume enclosure must be capable of accommodating a ± 7 percent change from its "nominal volume" (see Appendix 1 Section 2. 1. 1), accounting for temperature and barometric pressure variation during testing. 4. 2. 2. Fixed-volume enclosure The fixed-volume enclosure shall be constructed with rigid panels that maintain a fixed enclosure volume, and meet the following requirements. 116 4. 2. 2. 1. The enclosure shall be equipped with an outlet flow stream that withdraws air at a low, constant rate from the enclosure throughout the test. An inlet flow stream may provide make-up air to balance the outgoing flow with incoming ambient air. Inlet air must be filtered with activated carbon to provide a relatively constant hydrocarbon level. Any method of volume accommodation shall maintain the differential between the enclosure internal pressure and the barometric pressure between 0 and -5 hPa. 4. 2. 2. 2. The equipment shall be capable of measuring the mass of hydrocarbon in the inlet and outlet flow streams with a resolution of 0,01 gram. A bag sampling system may be used to collect a proportional sample of the air withdrawn from and admitted to the enclosure. Alternatively, the inlet and outlet flow streams may be continuously analyzed using an on-line FID analyzer and integrated with the flow measurements to provide a continuous record of the mass hydrocarbon removal. 117 r Fuel drain and refill max 1 h Canister load to breakthrough (gasoline) u Repeated diurnal heat builds to 2-gram breakthrough Tflm= 293 K (20 °C) A T= 15 K Figure VIA Evaporative emission determination 3000 km run-in period (no excessive purge/load) Ageing of canister(s) verified Steam clean of vehicle (if necessary) Start ' ' Fuel T: 283 to 287 K (10-14 'C). 40% ± 2% of nominal tank capacity Ambient T: 293 to 303 K (20-30 C). Canister load to breakthrough (butane) Butane/nitrogen loading to 2-grams breakthrough max 1 h Fuel drain and refill _L | 12 to 36 h max 5 min max 2 min max 7 min and max 2 min from engine shut-off Hot soak test 6 to 36 h JL FuelT: 291 ±8 K (18 8 °C) 40% _ 2% of nominal tank capacity Ambient T: 293 to 303 K (20-30 °C) Type I: one Part 1 + two Parts 2. = 293 to 303 K (20-30 'C). Ambient T = 293 to 303 K (20-30 C). Type I: one Part 1 + one Part 2. T^ = 293 to 303 K (20-30 'C). Type I: Part 1. Tmin = 296 K (23 'C). T^ = 304 K (31 C). 60 min ± 0,5 min T = 293 ± 2 K (20 ± 2 CC) last 6 hours. T ,^ = 293 K (20 °C) T„„ = 3 0 8 K; AT = 15 K 24 hours, No. l of diumals = 1 Note: 1. Evaporative emission control families - details clariiled. • 2. Tailpipe emissions may be measured during type I test drive, but these are not used for legislative purposes. Exhaust emission legislative test remains separate. 118 4. 3. Analytical systems 4. 3. 1. Hydrocarbon analyzer 4. 3. 1. 1. The atmosphere within the chamber is monitored using a hydrocarbon detector of the flame ionization detector (FID) type. Sample gas must be drawn from the mid-point of one side wall or roof of the chamber and any bypass flow must be returned to the enclosure, preferably to a point immediately downstream of the mixing fan. 4. 3. 1. 2. The hydrocarbon analyzer must have a response time to 90% of final reading of less than 1,5 seconds. Its stability shall be better than 2% of full scale at zero and at 80 ± 20% of full scale over a 15-minute period for all operational ranges. 4. 3. 1. 3. The repeatability of the analyzer expressed as one standard deviation shall be better than 1% of full scale deflection at zero and at 80 ± 20% of full scale on all ranges used. 4. 3. 1. 4. The operational ranges of the analyzer must be chosen to give best resolution over the measurement, calibration and leak checking procedures. 4. 3. 2. Hydrocarbon analyzer data recording system 4. 3. 2. 1. The hydrocarbon analyzer must be fitted with a device to record electrical signal output either by strip chart recorder or other data processing system at a frequency of at least once per minute The recording system must have operating characteristics at least equivalent to the signal being recorded and must provide a permanent record of results. The record shall show a positive indication of the beginning and end of the hot soak or diurnal emission test (including beginning and end of sampling periods along with the time elapsed between start and completion of each test). 4. 4. Fuel tank heating (only applicable for gasoline canister load option) 4. 4. 1. The fuel in the vehicle tank(s) must be heated by a controllable source of heat, for example a heating pad of 2 000 W capacity is suitable. The heating system must apply heat evenly to the tank walls beneath the level of the fuel so as not to cause local overheating of the fuel. Heat must not be applied to the vapour in the tank above the fuel. 4. 4. 2. The tank heating device must make it possible to evenly heat the fuel in the tank by 14 K from 289 K (16 °C) within 60 minutes, with the temperature sensor position as in Section 5. 1. 1. The heating system must be capable of controlling the fuel temperature to ± 1,5 K of the required temperature during the tank heating process. 119 4. 5. Temperature recording 4. 5. 1. The temperature in the chamber is recorded at two points by temperature sensors which are connected so as to show a mean value. The measuring points are extended approximately 0,1 m into the enclosure from the vertical centre line of each side wall at a height of 0,9 ± 0,2 m. 4. 5. 2. The temperatures of the fuel tank(s) shall be recorded by means of the sensor positioned in the fuel tank as in Section 5. 1. 1 in the case of use of the gasoline canister load option (Section 5. 1. 5). 4. 5. 3. Temperatures must, throughout the evaporative emission measurements, be recorded or entered into a data processing system at a frequency of at least once per minute. 4. 5. 4. The accuracy of the temperature recording system must be within ± 1,0 K and the temperature must be capable of being resolved to 0,4 K. 4. 5. 5. The recording or data processing system must be capable of resolving time to ± 15 seconds. 4. 6. Pressure recording 4. 6. 1. The difference Ap between barometric pressure within the test area and the enclosure internal pressure must, throughout the evaporative emission measurements, be recorded or entered into a data processing system at a frequency of at least once per minute. 4. 6. 2. The accuracy of the pressure recording system must be within ± 2 hPa and the pressure must be capable of being resolved to 0,2 ± hPa. 4. 6. 3. The recording or data processing system must be capable of resolving time to ± 15 seconds. 4. 7. Fans 4. 7. 1. By the use of one or more fans or blowers with the SHED door(s) open it must be possible to reduce the hydrocarbons concentration in the chamber to the ambient hydrocarbon level. 4. 7. 2. The chamber must have one or more fans or blowers of likely capacity 0,1 to 0,5 mV1 with which to thoroughly mix the atmosphere in the enclosure. It must be possible to attain an even temperature and hydrocarbon concentration in the chamber during measurements. The vehicle in the enclosure must not be subjected to a direct stream of air from the fans or blowers. 120 4. 8. v Gases 4. 8. 1. The following pure gases must be available for calibration and operation: - purified synthetic air (purity: < 1 ppm Cj equivalent £ 1 ppm CO, £ 400 ppm C02, £ 0,1 ppm NO); oxygen content between 18 and 21% by volume. - hydrocarbon analyzer fuel gas (40 ± 2% hydrogen, and balance helium with less than 1 ppm CY equivalent hydrocarbon, less than 400 ppm C02), - propane (C3H8), 99,5% minimum purity; - butane (C4H10), 98% minimum purity; - nitrogen (N2), 98% minimum purity. 4. 8. 2. Calibration and span gases shall be available containing mixtures of propane (C3H8) and purified synthetic air. The true concentrations of a calibration gas must be within ± 2% of stated figures. The accuracy of the diluted gases obtained when using a gas divider must be to within ± 2% of the true value. The concentrations specified in Appendix 1 may also be obtained by the use of a gas divider using synthetic air as the diluent gas. 4. 9. Additional equipment 4. 9. 1. The absolute humidity in the tests area must be measurable to within ± 5%. 5. TEST PROCEDURE 5. 1. Test preparation 5. 1. 1. The vehicle is mechanically prepared before the test as follows: - the exhaust system of the vehicle must not exhibit any leaks, - - the vehicle may be steam cleaned before the test, in the case of use of the gasoline canister load option (Section 5. 1. 5) the fuel tank of the vehicle must be equipped with a temperature sensor to enable the temperature to be measured at the mid-point of the fuel in the fuel tank when filled to 40% of its capacity, - additional fittings, adapters of devices must be fitted to the fuel system in order to allow a complete draining of the fuel tank. For this purpose it is not necessary to modify the shell of the tank. 5. 1. 2. The vehicle is taken into the test area where the ambient temperature is between 293 and 303 K (20 and 30 °C). 5. 1. 3. The ageing of the canister(s) has to be verified. This may be done by demonstrating that it has accumulated a minimum of 3 000 km. If this demonstration is not given, the following procedure is used. In the case of a multiple canister system each canister shall undergo the procedure separately. 5. 1. 3. 1. The canister shall be removed from the vehicle. Special care shall be taken during this step to avoid damage to components and the integrity of the fuel system. 121 5. 1. 3. 2. Check the weight of the canister. 5. 1. 3. 3. Connect the canister to a fuel tank, possibly an external one, filled with reference fuel, to 40% volume of the fuel tank(s). 5. 1. 3. 4. The fuel temperature in the fuel tank should be between 283 K (10 °C) and 287 K (14 °C). 5. 1. 3. 5. Heat the (external) fuel tank from 288 to 318 K (15 to 45 °C) (1 °C increase every 9 minutes). 5. 1. 3. 6. If the canister reaches breakthrough before the temperature reaches 318 K (45 *C), the heat source shall be turned off. Then weigh the canister. If the canister did not reach breakthrough during the heating to 318 K (45 °C), the procedure shall be repeated from Section 5. 1. 3. 3 until breakthrough occurs. 5. 1. 3. 7. Breakthrough may be checked as is described in Sections 5. 1. 6. 1 and 5. 1. 6. 2 of this Annex, or with the use of another sampling and analytical arrangement capable of detecting the emission of hydrocarbons "from the canister at breakthrough. 5. 1. 3. 8. Purge the canister with 25 _ 5 liters per liter of charcoal and per minute laboratory air until 300 bed volume exchanges the emission using are reached. 5. 1. 3. 9. Check the weight of the canister. 5. 1. 3. 10 Repeat nine times the steps of the procedure in Sections 5. 1. 3. 4 to 5. 1. 3. 9. The test may be terminated prior to that, after not less than three ageing cycles, if the weight of the canister after the last cycles has stabilized. 5. 1. 3. 11 Reconnect the evaporative emission canister and restore the vehicle to its normal operation condition. 5. 1. 4. One of the methods specified in Sections 5. 1. 5 and 5. 1. 6 shall be used to precondition the evaporative canister. For vehicles with multiple canisters, each canister shall be preconditioned separately. 5. 1. 4. 1. Canister emissions are measured to determine breakthrough. Breakthrough is here defined as the point at which the cumulative quantity of hydrocarbons emitted is equal to 2 grams. 5. 1. 4. 2. Breakthrough may be verified using the evaporative emission enclosure as described in Sections 5. 1. 5 and 5. 1. 6 respectively. Alternatively, breakthrough may be determined using an auxiliary evaporative canister connected downstream of the vehicle's canister. The auxiliary canister shall be well purged with dry air prior to loading. 122 5. 1. 4. 3. The measuring camber shall be purged for several minutes immediately before the test until a stable background is obtained. The chamber air mixing fan(s) must be switched on at this time. The hydrocarbon analyzer must be zeroed and spanned immediately before the test. 5. 1. 5. Canister loading with repeated heat builds to breakthrough 5. 1. 5. 1. The fuel tank(s) of the vehicle(s) is (are) emptied using the fuel tank drain(s). This must be done so as not to either abnormally purge nor abnormally load the evaporative control devices fitted to the vehicle. Removal of the fuel cap will normally be sufficient to achieve this. 5. 1. 5. 2. The fuel tank(s) is (are) refilled with test fuel at a temperature of between 283 and 287 K (10 and 14 °C) to 40 ± 2% of the tank's normal volumetric capacity. The fuel cap(s) of the vehicle must be fitted at this point. 5. 1. 5. 3. Within one hour of being refuelled the vehicle shall be placed,"with the engine shut off, in the evaporative emission enclosure. The fuel tank temperature sensor shall be connected to the temperature recording system. A heat source shall be properly positioned with respect to the fuel tank(s) and connected to the temperature controller. The heat source is specified in Section 4. 4. In the case of vehicles fitted with more than one fuel tank, all the tanks must be heated in the same way as described below. The temperatures of the tanks must be identical to within ± 1,5 K. 5. 1. 5. 4. The fuel may be artificially heated to the starting diurnal temperature of 293 K (20 °C) ± 1 K. 5. 1. 5. 5. When the fuel temperature reaches at least 292 K (19 °C), immediately: turn initiate the purge blower; close and seal enclosure doors; and off measurement of the hydrocarbon level in the enclosure. 5. 1. 5. 6. When the fuel temperature of the fuel tank reaches 293 K (20 °C) a linear ' heat build of 15 K (15 °C) begins. The fuel shall be heated in such a way that the temperature of the fuel during the heating shall conform to the function below to within i 1,5 K. The elapsed time of the heat build and temperature rise is recorded. where: Tr = T0 + 0,2333 - t Tr = required temperature (K), T0 = initial temperature (K); t = time from start of the tank heat build in minutes. — 123 5. 1. 5. 7. As soon as breakthrough occurs or when the fuel temperature reaches 308 K (35 °C), whichever occurs first, the heat source shall be turned off, the enclosure doors shall be unsealed and opened, and the vehicle fuel tank cap(s) shall be removed. If breakthrough has not occurred by the time the fuel temperature reaches 308 K (35 °C), the heat source shall be removed from the vehicle, the vehicle shall be removed from the evaporative emission enclosure and the entire procedure outlined in Section 5. 1. 7. shall be repeated until breakthrough occurs. 5. 1. 6. Butane loading to breakthrough 5. 1. 6. 1. If the enclosure is used for the determination of the breakthrough (see Section 5. 1. 4. 2) the vehicle shall be placed, with the engine shut off, in the evaporative emission enclosure. 5. 1. 6. 2 Prepare the evaporative emission canister for the canister loading operation. The canister shall not be removed from the vehicle, unless access to the canister in its normal location is so restricted that loading can only reasonably be accomplished by removing the canister from the-vehicle. Special care shall be taken during this step to avoid damage to the components and the integrity of the fuel system. 5. 1. 6. 3. Load the canister with a mixture composed of 50 percent butane and 50 percent nitrogen by volume at a rate of 40 grams butane per hour. 5. 1. 6. 4. As soon as the canister reaches breakthrough, the vapour source shall be shut off. 5. 1. 6. 5. Reconnect the evaporative emission canister and restore the vehicle to its normal operation condition. 5. 1. 7. Fuel drain and refill 5. 1. 7. 1. The fuel tank(s) of the vehicle(s) is (are) emptied using the fuel tank drain(s). This must be done so as not to either abnormally purge nor abnormally load the evaporative control devices fitted to the vehicle. Removal of the fuel cap will normally be sufficient to achieve this. 5. 1. 7. 2. The fuel tank(s) is (are) refilled with test fuel at a temperature of between 291 ± 8 K (18 ± 8 °C) to 40 ± 2% of the tank's normal volumetric capacity. The fuel cap(s) of the vehicle must be fitted at this point. 5. 2. Preconditioning drive 5. 2. 1. Within one hour from the completing of canister loading in Section 5. 1. 5. or 5. 1. 6 the vehicle is placed on the chassis dynamometer and is driven through one Part One and two Part Two driving cycles of Type I test as specified in Annex III. Exhaust emissions are not sampled during this operation. 124 5. 3. Soak 5. 3. 1. Within five minutes of completing the preconditioning operation specified in Section 5. 2. 1 the engine bonnet must be completely closed and the vehicle driven off the chassis dynamometer and parked in the soak area. The vehicle is parked for a minimum of 12 hours and a maximum of 36 hours. The engine oil and coolant temperatures must have reached the temperature of the area of within ± 3 K at the end of the period. 5. 4. Dynamometer test 5. 4. 1. After conclusion of the soak period the vehicle is driven through a complete Type I test drive as described in Annex III (cold start urban and extra urban test). Then the engine is shut off. Exhaust emissions may be sampled during this operation and the results are not used for the purpose of exhaust emission type approval. 5. 4. 2. Within two minutes of completing the Type I test drive specified in Section 5. 4. 1 the vehicle is driven a further conditioning drive consisting of one urban test cycle (hot start) of a Type I test. Then the engine is shut off again. Exhaust emissions need not to be sampled during this operation. 5. 5. Hot soak evaporative emissions test 5. 5. 1. Before the completion of the conditioning drive the measuring chamber must be purged for several minutes until a stable hydrocarbon background is obtained. The enclosure mixing fan(s) must also be turned on at this time. 5. 5. 2. The hydrocarbon analyzer must be zeroed and spanned immediately prior to the test. 5. 5. 3. At the end of the conditioning drive the engine bonnet must be completely closed and all connections between the vehicle and the test stand disconnected. The vehicle is then driven to the measuring chamber with a minimum use of the accelerator pedal. The engine must be turned off before any part of the vehicle enters the measuring chamber. The time at which the engine is switched off is recorded on the evaporative emission measurement data recording system and temperature recording begins. The vehicle's windows and luggage compartments must be opened at this stage, if not already opened. 5. 5. 4. The vehicle must be pushed or otherwise moved into the measuring chamber with the engines switched off. 5. 5. 5. The enclosure doors are closed and sealed gas-tight within two minutes of the engine being switched off and within seven minutes of the end of the conditioning drive. 5. 5. 6. The. start of a 60 ± 0,5 minute hot soak period begins when the chamber is sealed. The hydrocarbon concentration, temperature and barometric pressure are measured to give the initial readings CHçi5 Pj and T} for the hot soak test. These figures are used in the evaporative emission calculation, Section 6. The ambient SHED temperature T must not be less than 296 K and no more than 304 K during the 60-minute hot soak period. 125 5. 5. 7. The hydrocarbon analyzer must be zeroed and spanned immediately before the end of the 60 ± 0,5 minute test period. 5. 5. 8. At the end of the 60 ± 0,5 minute test period measure the hydrocarbon concentration in the chamber. The temperature and the barometric pressure are also measured. These are the final readings CHCf, Pf and Tf for the hot soak test used for the calculation in Section 6. 5. 6. Soak 5. 6. 1. The test vehicle shall be pushed or otherwise moved to the soak area without use of the engine and shall be soaked for not less than 6 hours and not more than 36 hours between the end of the hot soak test and the start of the diurnal emission test. For at least 6 hours of this period; the vehicle shall be soaked at 293 K ± 2 K (20 °C ± 2 °C). 5. 7. Diurnal test 5. 7. 1. The test vehicle shall be exposed to one cycle of ambient temperature according to the profile specified in Appendix 2 with a maximum deviation of ± 2 K at any time. The average temperature deviation from the profile, calculated using the absolute value of each measured deviation, shall not exceed 1 K. Ambient temperatures shall be measured at least every minute. Temperature cycling shall begin when time tstart = 0, as specified in Section 5. 7. 6. 5. 7. 2. The measuring chamber shall be purged for several minutes immediately before the test until a stable background is obtainable. The chamber mixing fan(s) must also be switched on at this time. 5. 7. 3. The test vehicle, with the engine shut off and the test vehicle windows and luggage compartment(s) opened shall be moved into the measuring chamber. The mixing fan(s) shall be adjusted in such a way that it (they) maintain a minimum air circulation of 8 km/h under the fuel tank of the test vehicle. 5. 7. 4. The hydrocarbon analyser must be zeroed and spanned immediately before the test. 5. 7. 5. The enclosure doors are closed and gas-tight sealed. 5. 7. 6. Within 10 minutes of closing and sealing the doors, the hydrocarbon concentration, temperature and barometric pressure are measured to give the initial readings CHci, Pj and T{ for the diurnal test. This is the point where time tstart = 0. ' 126 5. 7. 7. The hydrocarbon analyser must be zeroed and spanned immediately before the end of the test. 5. 7. 8. The end of the emission sampling period shall occur 24 hours ± 6 minutes after the beginning of the initial sampling, as specified in Section 5. 7. 6. The time elapsed is recorded. The hydrocarbon concentration, temperature and barometric pressure are measured to give the final readings CHCf, Pf and Tf for the diurnal test used for the calculation in Section 6. This completes the evaporative emission test procedure. 6. CALCULATION The evaporative emission tests described in Section 5 allow the hydrocarbon emissions from the diurnal and hot soak phases to be calculated. Evaporative losses from each of theses phases is calculated using the initial and final hydrocarbon concentrations, temperatures and pressures in the enclosure, ' together with the net enclosure volume. The formula below is used: MHC-k V 10"4 ( ^ | - 5- <*£!-?)+ M H * « I- MHC,. Tf Ti where: MHC MHc CHC V T P = mass of hydrocarbon exiting the enclosure, in the case of fixed-volume enclosures for diurnal emission testing (grams). ,i= m a ss °f hydrocarbon entering the enclosure, in the case of fixed-volume enclosures for diurnal emission testing (grams). = measured hydrocarbon concentration in the enclosure (ppm (volume) C, equivalent), = net enclosure volume in cubic metres corrected for the volume of. the vehicle, with the windows and the luggage compartment open. If the volume of the vehicle is not determined a v o l u me of 1,42 m3 is subtracted. = ambient chamber temperature, K, = barometric pressure in kPA, - H/C = hydrogen to carbon ration, k = 1,2 • (12 + H/C); when: i f H /C H /C is the initial reading is the final reading is taken to be 2,33 for diurnal test losses, is taken to be 2,20 for hot soak losses. 127 6. 2. Overall results of test The overall hydrocarbon mass emission for the vehicle is taken to be: Houi = MDI + MHS where: Houi MDI MHs overall mass emissions of the vehicle (grams), = = hydrocarbon mass emission for diurnal test (grams). = hydrocarbon mass emission for the hot soak (grams). ' 128 Appendix 1 22. Sections 1 and 2 read as follows: • 1. 1. 1. 1. 2. CALIBRATION FREQUENCY AND METHODS All equipment must be calibrated before its initial use and then calibrated as often as necessary and in any case in the month before type-approval testing. The calibration methods to be used are described in this Appendix. Normally the series of temperatures which are mentioned firstly should be used. The series of temperatures within square brackets can alternatively be used. 2. CALIBRATION OF THE ENCLOSURE 2. 1. Initial determination of enclosure internal volume 2. 1. 1. Before its initial use, the internal volume of the chamber must be determined as follows. The internal dimensions of the chamber are carefully measured, allowing for any irregularities such as bracing struts. The internal volume of the chamber is determined from these measurements. For variable-volume enclosures, latch the enclosure to a fixed volume when the enclosure is held at an ambient temperature of 303 K (30 °C) [302 K (29 °C)]. This nominal volume shall be repeatable within ± 0,5 percent of the reported value. 2. 1. 2. The net internal volume is determined by subtracting 1,42 m3 from the internal volume of the chamber. Alternatively the volume of the test vehicle with the luggage compartment and windows open may be used instead of the 1,42 m\ 2. 1. 3. The chamber must be checked as in Section 2. 3. If the propane mass does not agree with the injected mass to within ± 2% then corrective action is required. 2 2 Determination of chamber background emissions This operation determines that the chamber does not contain any materials that emit significant amounts of hydrocarbons. The check must be carried out at the enclosure's introduction to service, after any operations in the enclosure which may affect background emissions and at a frequency of a least once per year. - 2. 2. 1. Variable-volume enclosures may be operated in either latched or unlatched volume configuration, as described in Section 2. 1. 1. Ambient temperatures shall be maintained at 308 ±2 K (35 ± 2 °C) [309 ± 2 K (36 ±2 °C)], throughout the 4-hour period mentioned below. 129 2. 2. 2. Fixed volume enclosures shall be operated with inlet and outlet flow streams closed. Ambient temperatures shall be maintained at 308 ± 2 K (35 ± 2 °C) [309 ± 2 K (36 ± 2 °C)] throughout the 4-hour period mentioned below. 2. 2. 3. The enclosure may be sealed and the mixing fan operated for a period of up to 12 hours before the 4-hour background sampling period begins. 2. 2. 4. Calibrate the analyzer (if required), then zero and span. 2. 2. 5. 2. 2. 6. 2. 2. 7. 2. 2. 8. 2. 2. 9. Purge the enclosure until a stable hydrocarbon reading is obtained. The mixing fan is turned on if not already on. Seal the chamber and measure the background hydrocarbon concentration, temperature and barometric pressure. These are the initial readings CHCi, Pj and ^ used in the enclosure background calculation. The enclosure is allowed to stand undisturbed with the mixing fan on for a period of four hours. At the end of this time use the same analyzer to measure the hydrocarbon concentration in the chamber. The temperature and the barometric pressure are also measured. These are the final readings CHCf, Pf and Tf. Calculate the change in mass of hydrocarbons in the enclosure over the time of the test according to Section 2. 4. The background emission of the enclosure must not exceed 0,05 g. 2. 3. Calibration and hydrocarbon retention test of the chamber The calibration and hydrocarbon retention test in the chamber provides a check on the calculated volume in Section 2. 1 and also measures any leak rate. The enclosure leak rate shall be determined at the enclosure's introduction to service, after any operations in the enclosure which may effect the integrity of the enclosure, and at least monthly thereafter. If six consecutive monthly retention checks are successfully completed without corrective action, the enclosure leak rate may be determined quarterly thereafter as long as no corrective action is required. 2. 3. 1. 2. 3. 2. 2. 3. 3. Purge the enclosure until a stable hydrocarbon concentration is reached. Turn on the mixing fan, if not already switched on. The hydrocarbon analyzer is zeroed, calibrated if required, and spanned. On variable-volume enclosures latch the enclosure to the nominal volume position. On fixed-volume enclosures close the outlet and inlet flow streams. Turn on the ambient temperature control system (if not already on) and adjust it for an initial temperature of 308 K (35 °C) [309 K (36 °C)]. 130 2. 3. 4. When the enclosure stabilizes at 308 ± 2 K (35 ± 2 "C) [309 ± 2 K (36 ± 2 °C)], seal the enclosure and measure the background concentration, temperature and barometric pressure. These are the initial readings CHCi, P{ and Tj used in the enclosure calibration. 2. 3. 5. Inject a quantity of approximately 4 grams of propane into the enclosure. The mass of propane must be measured to an accuracy and precision of ± 0,2% of the measured value. 2. 3. 6. Allow the contents of the chamber to mix for five minutes and then measure the hydrocarbon concentration, temperature and barometric pressure. These are the final readings CHCft Tf and Pf for the calibration of the enclosure as well as the initial readings CHCi, T} and P} for the retention check. 2. 3. 7. Using the readings taken in Sections 2. 3. 4 and 2. 3. 6 and the formula in Section 2. 4, calculate the mass of propane in the enclosure. This must be within ± 2% of the mass of propane measured in Section 2. 3. 5. 2. 3. 8. 2. 3. 9. For variable-volume enclosures unlatch the enclosure from the" nominal volume configuration. For fixed-volume enclosures, open the outlet and inlet flow streams. Start cycling the ambient temperature from 308 K (35 °C) to 293 K (20 °C) and back to 308 K (35 °C) [308,6 K (35,6 °C) to 295,2 K (22,2 °C) and back to 308,6 K (35,6 °C)] over a 24-hour period according to the profile [alternative profile] specified in Appendix 2 within 15 minutes of sealing the enclosure. (Tolerances as specified in Section 5. 7. 1 of Annex VI) 2. 3. 10. At the completion of the 24-hour cycling period, measure and record the final hydrocarbon concentration, temperature and barometric pressure. These are the final readings CHCf, Tf and Pf for the hydrocarbon retention check. 2. 3. 11. Calculate using the formula in Section 2. 4, the hydrocarbon mass from the readings taken in Sections 2. 3. 10 and 2. 3. 6. The mass may not differ by more than 3% from the hydrocarbon mass given by Section 2. 3. 7. 131 2. 4. Calculations The calculation of net hydrocarbon mass change within the enclosure is used to determine the chamber's hydrocarbon background and leak rate. Initial and final readings of hydrocarbon concentration, temperature and barometric pressure are used in the following formula to calculate the mass change. Mnc-k V 10"4 {9^L- Ç ^J + MHC. M-MHC,. where: MHc = hydrocarbon mass in grams MHCou1 = mass of hydrocarbon exiting the enclosure, in the case of fixed-volume enclosures for diurnal emission testing (grams) MHc,i = m a ss °f hydrocarbon entering the enclosure, in the case of fixed volume enclosures for diurnal emission testing (grams) hydrocarbon concentration (NB: ppm carbon = ppm propane x 3)) in the enclosure (ppm carbon = enclosure volume in cubic mêtrbslas measured in Section = ambient temperature in the enclosure, K, = barometric pressure, kPa, = 17,6; 'HC V T P k when: i f is the initial reading. is the final reading' 132 Appendix 2 23. The following new Appendix 2 is added: 'Appendix 2 Diurnal Ambient Temperature Profile for the Calibration of the Enclosure and the Diurnal Emission Test Alternative Diurnal Ambient Temperature Profile for the Calibration of the Enclosure in Accordance with Annex I Section 1. 2 , Time (hours) Temperature (°Q) calibratio test Time (hours) Temperature (°C. ) 16 17 18 19 20 21 22 23 24 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 20 20,2 20,5 21,2 23,1 25,1 27,2 29,8 31,8 33,3 34,4 35 34,7 33,8 32 30 28,4 26,9 25,2 24 23 22 20,8 20,2 20 Ô 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 35^1 35,3 34,5 33,2 31,4 29,7 28,2 27,2 26,1 25,1 24,3 23,7 23,3 22,9 22,6 22,2 22,5 24,2 26,8 29,6 31,9 33,9 35,1 35,4 35,6 133 Annex VIII 24. Annex VIII reads as follows: •ANNEX VIII SPECIFICATIONS OF REFERENCE FUELS 1 TECHNICAL DATA OF THE REFERENCE FUEL TO BE USED FOR TESTING VEHICLES EQUIPPED WITH POSITIVE-IGNITION ENGINES Type: petrol, unleaded (regular, premium, super) Parameter Unit Limits(1) Test Method(2) Minimum Maximum Research octane number, RON Motor octane number, MON Density at 15 °C Reid vapour pressure, - summer period*} Distillation(4): - initial boiling point - evaporated at 100 °C - evaporated at 150 °C - final boiling point Residue Hydrocarbon analysis: - olefins - aromatics - benzene - saturates Carbon/hydrogen ratio Oxidation staf3ility(} Oxygen content Existent gum Sulphur content Copper corrosion at 50 °C Lead content Phosphorous content 95,0 85,0 0,748 56,0 24 49,0 81,0 190 8 29,0 balance r a 480 ISO 5164 ISO 5163 0,762 ASTM D 1298 60,0 40 57,0 87,0 215 2 14 41,0 2,0 t i o 2Ï3 0,04 150 1 0,005 0,0013 EN 12 ASTM D 86 ISO 3405 ISO 3405 ASTM D 86 ASTM D 86 ASTMD1319 ASTMD1319 EN 238 ASTMD 1319 ASTM D 525 pr EN 1601 ASTMD 381 ISO 8754 ASTMD 130 EN 237 ASTMD 3231 kg/l kPa °C % v/v % v/v °C % , % v/v % v/v % v/v min % m/m mg/ml % ppm g/l (1) (2) (3) (4) (5) The values quoted in the specification are 'true values'. In establishment of their limit values the terms of ISO 4259 'Petroleum products - Determination and application of precision data in relation to methods of test' have been appliea and in fixing a minimum value, a minimum difference of_2R above zero has been taken into account; in fixing a maximum and minimum value, the minimum difference is 4R (R = reproducibility). Notwithstanding this measure which is necessary for statistical reasons, the manufacturer or fuels should nevertheless aim at a zero value where the stipulated maximum value is 2R and at the mean value in the case of quotations of maximum and minimum limits. Should it be necessary to clarify the question as to whether a fuel meets the requirements of the specifications, the terms of ISO 4259 should be applied. Equivalent ISO methods will be adopted when issued for all properties listed above. The summer period extends from 1 April to 30 September of each year. The figures quoted shows the evaporated quantities (percentage recovered + percentage loss). The fuel may contain exidation inhibitors and metal deactivators normally used to stabilize refinery gasoline streams, but détergent/dispersant additives and solvent oils must not oe added. 134 TECHNICAL DATA OF THE REFERENCE FUEL TO BE USED FOR TESTING VEHICLES EQUIPPED WITH A DIESEL ENGINE Type: Diesel fuel Parameter Unit Limits(1) Test Method(2) Minimum Maximum 52,0 833 245 345 55 2,5 3 Cetane number1^ Density at 15 °C Distillation(4): - 50% point - 95% point - final boiling point Flash point CFPP Viscosity at 40 °C Polycyclic aromatic hydrocarbons Sulphur content Copper corrosion Conradson carbon residue (10% DR) Ash content Water content Neutralization (strong acid) number Oxidation stability(6) kg/m3 °C °C °c °c °c mm2/s % m/m % m/m % mass % mass % mass mg KOH/g mg/ml 54 837 350 370 -5 3,5 6,0 0,03 1 0,2 0,01 0,05 0,02 2,5 ISO 5163 ISO 3675 ISO 3405 ISO 3405 ISO 3405 ASTM D 93 EN 116 ASTM D 445 prIP 391 ISO 8754 ASTMD 130 ASTMD 189 ASTM D 482 ASTM D95/D 1744 ASTM 2274 (1) (2) (3) (4) (5) (6) The values quoted in the specification are 'true values'. In establishment of. their limit values the terms of ISO 4259 'Petroleum products - Determination and application of precision data in relation to methods of test' have been applied and in fixing a minimum value, a minimum difference of 2R above zero has been taken into account; in fixing a maximum and minimum value, the minimum difference is 4R (R = reproducibility). Notwithstanding this measure, which is necessary for statistical reasons, the manufacturer of fuels should nevertheless aim at a zero value where the stipulated maximum value is 2R and at the mean value in the case of quotations of maximum and minimum limits. Should it be necessary jto clarify the question as to whether a fuel meets the requirements of the specifications, the terms of ISO 4259 should be applied. Equivalent ISO methods will be adopted when issued for all properties listed above. The range for cetane number is not in accordance with the requirement of a minimum range of 4R. However, in the case of dispute between fuel supplier and fuel user, the terms in ISO 4259 can be used to resolve such disputes provided replicate measurements of sufficient number to archive the necessary precision, are made in preference to single determinations. The figures quoted shows the evaporated quantities (percentage recovered + percentage loss). As from 1 January 2005. Even though oxidation stability is controlled, it is likely that self life will be limited. Advice should be sought from the supplier as to storage conditions and life. 135 Annex X 25. A new Annex X is added to read as follows: Annex X CONTROL OF COMPLIANCE OF VEHICLES IN SERVICE 1. INTRODUCTION 1. 1. This Annex describes the procedure referred to in Section 8 of Annex I for the control of compliance of vehicles in service. The procedure describes the selection and handling of test vehicles, in service survey testing and evaluation, the plan of remedial measures and its implementation. 2. IN SERVICE SURVEY 2. 1. 2. 2. 2. 3. The in service survey will be performed by the approval authority which granted the original type-approval according to this Directive, according to procedures laid down in Section 5. The manufacturer shall be notified whenever the approval authority in a Member State, which granted the original type-approval in accordance with this directive, has determined that a vehicle type produced by that manufacturer, although properly maintained and used, does not conform to these provisions. When a manufacturer is notified that a vehicle type is in non-compliance with applicable requirements (including emission limit values) of this Directive, the manufacturer shall submit a plan of measures to the approval authority to remedy such non-compliance. 2. 4. Any vehicle approved according to the requirements of this Directive is subject to the provisions in this Annex. 3. DEFINITIONS For the purpose of this Annex the following definitions apply. 3. 1. 3. 2. 3. 3. The terms used in this Annex X and not specifically defined shall have the meaning assigned to such terms in Annex I to this Directive, or if not defined in Annex I to this Directive, the meaning assigned to such terms in Directive 70/156/EEC. Tn Service Survey' means tests and evaluations of compliance conducted according to this Annex. 'Properly maintained and used' means for the purpose of a test vehicle that such a vehicle satisfies the criteria for acceptance of a selected vehicle of Section 5. 4. SURVEY SCHEDULE 4. 1. 4. 2. The manufacturer will be notified 45 working days before the initiation of the in service survey of a vehicle type. * The manufacturer may submit a voluntary plan of remedial measures, drafted according to Section 6 at any time prior to completion of an in service survey. 136 5. SELECTION CRITERIA, MAINTENANCE, AND SURVEY TEST 5. 1. 5. 2 Emission tests and evaluations to determine whether a vehicle type conforms to the requirements shall be performed in accordance with the procedures of Section 5. The manufacturer shall have an opportunity to observe all the selection and testing and to inspect all vehicles tested under Section 5. In service survey testing of the on-board diagnostic system shall be performed in accordance with Section 5. 5. Sections 5. 2, 5. 3 and 5. 4 do not apply under OBD survey. The approval authority shall select vehicles for in service survey on a random base chosen in accordance with Appendix 1 to this Annex from vehicles within the selected vehicle type. The approval authority determines the vehicle selection. The vehicles for testing shall be representative of the vehicle type which they belong to and available for sale or sold in the EU. Selection criteria 5. 3. The criteria for acceptance of a selected vehicle follows from Sections 5. 3. 1 - 5. 3. 8. Information will be gathered through vehicle examination and a interview with the owner which may include a written survey by the manufacturer. 5. 3. 1. The vehicle belongs to a vehicle type that is type-approved under this Directive and is accompanied with a Certificate of Conformity according to Directive 70/156/EEC. It shall be registered and privately used in the EU. 5. 3. 2. The vehicle has been in service for less than 80 000 km or 5 years which ever occurs first. 5. 3. 3. There is a maintenance record to show that the vehicle has been properly maintained, e. g. has been serviced in accordance with the manufacturer's recommendations. 5. 3. 4. There is no indication of abuse (e. g. , racing, overloading, misfuelling, or other misuse), or other factors (e. g. , tampering) that would affect emissions performance. In the case of vehicles fitted with an OBD system, the information stored in its memory shall be taken into account. 5. 3. 5 There has been no unauthorized major repair to the engine or major repair of the vehicle. 5. 3. 6. Lead content and sulphur content of fuel sample from the vehicle tank meets applicable standards and there is no other evidence of misfuelling. Checks may be done in the exhaust pipe, etc. 5. 3. 7. There is no indication of any problem that might jeopardize the safety of laboratory personnel. 5. 3. 8. All emission control system components on the vehicle shall be in conformity with applicable type approval. 137 Diagnosis and restorative maintenance 5. 4. Diagnosis and restorative maintenance will be performed on vehicles accepted for testing, prior to in service survey testing, according to Sections 5. 4. 1-5. 4. 8. 5. 4. 1. Check air filter, all drive belts, all fluid levels, radiator cap, all vacuum hoses and electrical wiring related to emissions control for integrity; check ignition, fuel metering and emission control system components for maladjustments and/or tampering. Record all discrepancies. 5. 4. 2. Check the integrity of the OBD system; record all malfunction information stored in the OBD memory; make all repairs necessary for extinguishing all malfunction indications. 5. 4. 3. If the OBD malfunction indicator registers a malfunction during a preconditioning cycle or emission test cycle, the fault may be identified and repaired. The test may be rerun, and the results from that repaired vehicle may be used. 5. 4. 4. Check ignition system and replace defective components; i. e. , spark plugs, wires, etc. 5. 4. 5. Check compression. 5. 4. 6. Check and adjust engine parameters to manufacturer's specifications. 5. 4. 7. If the vehicle is [before]within 800 km of a scheduled maintenance service, that maintenance will be performed according to the manufacturer's service instructions. Regardless of odometer reading, change of oil and air filter may be performed at the request of the manufacturer. 5. 4. 8. Upon acceptance of the vehicle the fuel shall be replaced with appropriate emission test reference fuel, unless the manufacturer accepts1 the use of market fuel. 5. 5. 5. 6. In service survey testing and evaluation of results Applicable emission tests in accordance with this Directive will be performed on vehicles selected in accordance with the requirements of Sections 5. 3 and 5. 4 and after being pre-conditioned. Vehicles equipped with an OBD system will be checked for proper durability indication, etc. , in relation to levels of -emissions of the malfunction (e. g. malfunction the indication type-approved specification. in Annex XI) limits defined for 5. 6. 1. The OBD system may be tested for, e. g. , levels of emissions above applicable limit values with no malfunction indication, systematic erroneous activation of faulty or deteriorated components in the OBD system. the malfunction indication, and identified 5. 6. 2. If a component or system that operates outside of the particulars in the type- approval certificate and/or information package for such vehicle type and such deviation has not been authorized under Article 5 (3) or 5 (4) of Directive 70/156/EEC with no malfunction indication by the OBD, the component or system shall not be replaced prior to emission testing, unless it is determined that the component or system has been tampered with or abused in such a manner that the OBD does not detect the resulting malfunction. 138 5. 7. 5. 8. 5. 9. The test results are submitted to the evaluation procedure in accordance with Appendix 1 of this Directive. Within 10 working days after concluding the test, the results of the test and of the evaluation referred to in Section 5. 7 shall be submitted to the manufacturer. The manufacturer shall have, as far as possible, the opportunity to make such inspections and investigations of vehicles whose test results do not comply with the limit value for any pollutant applicable under this Directive to determine the existence of any improper maintenance, misuse, misfuelling, tampering or abuse that was not reasonably discoverable prior to the commencement of testing. 5. 10. Within 25 working days from receiving the test results, the manufacturer may submit a statement based on additional investigation on sample vehicles to the authority concerning the performance of the testing or the determination of a non-compliance. The statement, if any, will be enclosed in the test report. The authority shall give due regard to the manufacturer's statement in determing whether a non-compliance exists. 5. 11. Within 10 working days after the time limit of Section 5. 10 has elapsed, the authority shall finalize the test report and take a decision on compliance and non-compliance. Non-compliance shall be declared when for any single pollutant the result of the evaluation referred in Section 5. 7 exceed the limit values given in Section 5. 3. 1. 4 of Annex I to this Directive. Test results shall not be multiplied by deterioration factors. 6. PLAN OF REMEDIAL MEASURES 6. 1. 6. 2. When the manufacturer is notified that a vehicle type is in non-compliance according to the requirements of these provisions, the manufacturer shall submit to the approval authority a plan of remedial measures to remedy the non-compliance. These plan of remedial measures can address vehicles in service, vehicles under production as well as amendements to the type- approval, if appropriate. The plan of remedial measures shall be filed with the approval authority not later than 45 working days from the date of the notification issued according to Section 5. 10. The approval authority shall within 20 working days declare the approval or disapproval of the plan of remedial measures. 6. 2. 1. The accaptence of the plan of remedial measures may be subject to conditions required by the approval authority. - 6. 2. 2. The approval authority may specify an extended time limit for submitting a plan of remedial measures by up to 60 working days if the manufacturer in writing showed good cause for such extension. 6. 2. 3. When the approval authority cannot approve the plan of remedial measures it may take other measures in accordance with Article 11 (2) (a) to Directive 70/156/EEC. 6. 3. The approval authority shall notify all Member States of its decision concerning the plan of remedial measures and supply all Member States with the plan of remedial measures. 139 The plan of remedial measures 6. 4. The plan of remedial measures shall have the content specified in Sections 6. 4. 1 - 6. 4. 11. The manufacturer shall give the plan of remedial measures a unique identifying name or number. 6. 4. 1. A description of each vehicle type included in the plan of remedial measures. 6. 4. 2. A description of the specific modifications, alterations, repairs, corrections, adjustments, or other changes to be made to bring the vehicles into conformity including a brief summary of the data and technical studies which support the manufacturer's decision as to the particular remedial changes to be used in correcting the non-compliance. 6. 4. 3. A description of the method by which the manufacturer will inform the vehicle owners. 6. 4. 4. A description of the proper maintenance or use, if any, upon which the manufacturer conditions eligibility for repair under the plan of "remedial measures, and an explanation of the manufacturer's reasons for imposing any such condition. No maintenance or use conditions may be imposed unless it is demonstrably related to the non-compliance and the remedial measures. 6. 4. 5. A description of the procedure to be followed by vehicle owner to obtain correction of the non-compliance. This shall include a date after which when the non-compliance may be remedied, the estimated time for the workshop to perform the remedy, and where the remedy can be done. The repair shall be done expediently, within a reasonable time after delivery of the vehicle. 6. 4. 6. A copy of the information transmitted to the vehicle owner. 6. 4. 7. A brief description of the system which the manufacturer will use to assure an adequate supply of component or system, for fulfilling the remedial action. It shall be indicated when there will be an adequate supply of component or system to initiate the campaign. 6. 4. 8. A copy of all instructions to be sent to those persons who are to perform the repair. 6. 4. 9. A description of the impact of the proposed remedy on the emissions, fuel consumption, driveabiliry, and safety of each vehicle type, included the plan of remedial measures with data, technical studies etc. which supports these conclusions. 6. 4. 10. Any other information, reports or data the approval authority reasonably may determine is necessary to evaluate the plan of remedial measures. 6. 4. 11. In the case the plan of remedial measures includes a recall, a description of the méthode for recording the repair shall be submitted to the type approval authority. In the case a label is used an exemple of it shall be submitted. 6. 5. 6. 6. The manufacturer may be required to conduct tests on components and vehicles incorporating a proposed change, repair, or modification reasonably designed and necessary to demonstrate the effectiveness of the change, repair, or modification. The manufacturer is responsible for keeping a record of every vehicle recalled and repaired and the workshop which performed the repair. The approval authority shall have access to the record after request for a period of 5 years from the implementation of the plan of remedial measures. 140 7. 7. 1. IMPLEMENTATION OF THE PLAN OF REMEDIAL MEASURES A recall campaign is commencing after decision by the Member State, based on the approved plan of remedial measures. The manufacturer, or his/her representative, is responsible for conducting the campaign according to the approved plan of remedial measures. 7. 1. 1. If theplan of remedial measures is not carried in the approved time limits fixed in the remedial plan and the manifacturer cannot justify the exceed of the time limits, the approval authority can take measures in accordance with Article ll(2)(a) to Directive 70/156/EEC. 7. 2. 7. 3. The notification of the vehicle owner shall be done expeditiously. This notification shall include all relevant information relating the necessary repair of the vehicle. The manufacturer shall provide a copy of all communication related to the plan of remedial measures. He/she shall also maintain a record onlhe recall campaign, and supply regularly status reports to the approval authority. 141 Annex XI 26. A new Annex XI is added to read as follows: Annex XI ONBOARD DIAGNOSTICS (OBD) FOR MOTOR VEHICLES 1. SCOPE This Annex applies to the functional aspects of on-board diagnostic (OBD) systems for the emission control of all motor vehicles of category M,(1)) equipped with positive-ignition engines and all motor vehicles of categories Mi equipped with compression-ignition engines covered by Article 1 of this Directive. 2. DEFINITIONS For the purposes of this Annex: 2. 1. 2. 2. 2. 3. 2. 4. 2. 5. 2. 6. 2. 7. 'OBD' means an on-board diagnostics system for emission control which shall have the capability of identifying the likely area of malfunction by means of fault codes stored in computer memory. 'Vehicle type' means a category of power driven vehicles which do not differ in such essential engine and OBD system characteristics as defined in Appendix 5. 'Vehicle family' means a manufacturer's grouping of vehicles which, through their design, are expected to have similar exhaust emission and OBD system characteristics. Each engine of this family must have complied with the requirements of this Directive. 'Emission control system' means the electronic engine management controller and any emission related component in the exhaust or evaporative system which supplies an input to or receives an output from this controller. 'Malfunction indicator (MI)' means a visible or audible indicator that clearly informs the driver of the vehicle in the event of a malfunction of any emission related component connected to the OBD system, or the OBD system itself. 'Malfunction' means the failure of an emission related component or system that would result in emissions exceeding the limits in Section 5. 3. 2 of this Annex. 'Secondary air' refers to air introduced into the exhaust system by means of a pump or aspirator valve or other means that is intended to aid in the oxidation of HC and CO contained in the exhaust gas stream. (1) As defined in Annex II Section A of Directive 70/156/EEC. 142 2. 8. 2. 9. 2. 10. 2. 11. 2. 12. 2. 13. 'Engine misfire' means lack of combustion in the cylinder of a positive ignition engine due to absence of spark, poor fuel metering, poor compression or any other cause. In terms of OBD monitoring it is that percentage of misfires out of a total number of firing events (as declared by the manufacturer) that would result in emissions exceeding the limits given in Section 5. 3. 2 or that percentage that could lead to an exhaust catalyst, or catalysts, overheating causing irreversible damage. 'Type I test' means the driving cycle (Parts One and Two) used for emission approvals, as detailed in Annex III, Appendix 1. 'A driving cycle' consists of engine start-up, a driving mode where a malfunction would be detected if present, and engine shut-off. 'A warm-up cycle1 means sufficient vehicle operation such that the coolant temperature has risen by at least 22 K from engine starting and reaches a minimum temperature of 343 K (70 °C). 'Fuel trim' refers to feedback adjustments to the base fuel schedule. Short-term fuel trim refers to dynamic or instantaneous adjustments. Long-term fuel trim refers to much more gradual adjustments to the fuel calibration schedule than short-term trim adjustments. These long-term adjustments compensate for vehicle differences and gradual changes that occur over time. 'Calculated load value' refers to an indication of the current airflow divided by peak airflow, where peak airflow is corrected for altitude, if available. This definition provides a dimensionless number that is not engine specific and provides the service technician with an indication of the percent engine capacity that is being used (with wide open throttle as 100%); CLV - Current airflow Peak aIrflow(al sea lev$l , Atm. pressure(at sea levfl Barometric pressure 2. 14. 'Permanent emission default mode' refers to a case where the engine management controller permanently switches to a setting that does not require an input from a failed component or system where such a failed component or system would result in an increase in emissions from the vehicle to a level above the limits given in Section 5. 3. 2 of this Annex. 2. 15. 'Power Take-Off unit' means an engine driven output provision for the purposes of powering auxiliary, vehicle mounted, equipment. 143 3. 3. 1. APPLICATION FOR EC TYPE-APPRO VAL The application conforming to Annex I, Section 3 is accompanied by the additional information required in Appendix 5 together with: 3. 1. 1. a declaration by the manufacturer of: 3. 1. 1. 1. in the case of vehicles equipped with positive-ignition engines, the percentage of misfires out of a total number of firing events that would result in emissions exceeding the limits given in Section 5. 3. 2 of this Annex if that percentage of misfire had been presem from the start of a Type I test as described in Section 5. 3. 1 of Annex III; 3. 1. 1. 2. in the case of vehicles equipped with positive-ignition engines, the percentage of misfires out of a total number of firing events that could lead to an exhaust catalyst, or catalysts, overheating prior to causing irreversible damage; 3. 1. 2. 3. 1. 3. 3. 1. 4. 3. 1. 5. detailed written information fully describing the functional "operation characteristics of the OBD system, including a listing of all relevant parts of the vehicle's emission control system, i. e. sensors, actuators and components, that are monitored by the OBD system; a description of the MI used by the OBD system to signal the presence of a fault to the driver of the vehicle; the manufacturer shall describe provisions taken to prevent tampering and modification of the emission control computer; when appropriate, copies of other type-approvals with the relevant data to enable extensions of approvals; 3. 1. 5. 1. if applicable, the particulars of the vehicle family as referred to in Appendix 6. 3. 2. 4. 4. 1. 5. 5. 1. For the tests described in Section 5 of this Annex, a vehicle representative of the vehicle types or vehicle family fitted with the OBD system to be approved must be submitted to the technical service responsible for the type-approval test. If the technical service determines that the submitted vehicle does not fully represent the vehicle type or vehicle family described in Appendix 6, an alternative, and if necessary, an additional vehicle shall be submitted for test according to Section 5 of this Annex. GRANTING OF EC TYPE-APPROVAL The certificate conforming to Annex I, Section 4, is accompanied by the Addendum for which a model is given in Appendix 7. REQUIREMENTS AND TESTS All vehicles shall be equipped with an OBD system so designed, constructed and installed in a vehicle to enable it to identify types of deterioration or malfunction over the entire life of the vehicle. In achieving this objective the approval authority shall accept that vehicles which have travelled distances in excess of the Type V durability distance, referred to in Section 5. 3. 1, may show some deterioration in OBD systeih performance such that the emission limits given in Section 5. 3. 2 may be exceeded before the OBD system signals a failure to the driver of the vehicle. 144 5. 2. The OBD system must be so designed, constructed and installed in a vehicle to enable it to comply with the requirements of this Annex during conditions of normal use. 5. 2. 1. Temporary disablement of the OBD system. 5. 2. 1. 1. A manufacturer may disable the OBD system if its ability to monitor is affected by low fuel levels. Disablement shall not occur when the fuel tank level is above 15 percent of the nominal capacity of the fuel tank. level provided 5. 2. 1. 2. A manufacturer may disable the OBD system at ambient engine starting temperatures below 266 K (-7 °C) or at elevations over 2 500 metres above sea an engineering evaluation which adequately demonstrate that monitoring would be unreliable when such conditions exist. A manufacturer may also request disablement engine system starting temperatures if he demonstrates to the authority with data and/or an engineering evaluation that mis-diagnosis would occur under such conditions. the manufacturer submits data the OBD ambient and/or other of at 5. 2. 1. 3. For vehicles designed to accommodate the installation of Power Take-Off units, disablement of affected monitoring systems is permitted provided disablement occurs only when the Power Take-Off unit is active. 5. 2. 2. Engine Misfire - vehicles equipped with positive-ignition engines. 5. 2. 2. 1. Manufacturers may adopt higher misfire percentage malfunction criteria, than that declared to the authority, under specific engine speed and load conditions where it can be demonstrated to the authority that the detection of lower levels of misfire wouH be unreliable. 5. 2. 2. 2. Manufacturers who can demonstrate to the authority that the adoption of higher misfire percentages would still lead to unreliable detection may disable the monitoring system when such conditions exist. 5. 3. Description of tests. 5. 3. 1. The tests are carried out on the vehicle used for the Type V durability test, given in Annex VII, and using the test procedure in Appendix I to this Annex. Tests are carried out at the conclusion of the Type V durability testing. When no Type V durability testing is carried out, or at the request of the manufacturer, a suitably aged and representative vehicle may be used for these OBD demonstration tests. 5. 3. 2. The OBD system shall indicate the failure of an emissions related component or system when that failure results in an increase in emissions above the limits given below: Engine Type Positive-ignition Compression-ignition CO (g/km) 3,2 3,2 HC (g/km) 0,4 0,4 NOx (g/km) 0,6 1,2 PM°> (g/km) 0,18 (1) for compression-ignition engines only 145 5. 3. 3. Monitoring requirements for vehicles equipped with positive-ignition engines In satisfying the requirements of Section 5. 3. 2 the OBD system shall, at a minimum, monitor for: 5. 3. 3. 1. Reduction in the efficiency of the catalytic converter with respect to the emissions of HC only; 5. 3. 3. 2. The presence of engine misfire in the engine operating region bounded by the following lines: (a) A maximum speed of 4 500 min"1 or 1 000 min"1 greater than the highest speed occurring during a Type I test cycle, whichever is the lower; (b) The positive torque line (i. e. engine load with the transmission in neutral); (c) A line joining the following engine operating points: the positive torque line at 3 000 min"1 and a point on the maximum speed line defined in (a) above with the engine's manifold vacuum at 13,33 kPa lower than that at the positive torque line. 5. 3. 3. 3. Oxygen sensor deterioration 5. 3. 3. 4. Other emission control system components or systems, or emission-related powertrain components or systems which are connected to a computer, the failure of which may result in tailpipe emissions exceeding the limits given in Section 5. 3. 2; 5. 3. 3. 5. Any other emission-related powertrain component connected to a computer shall be monitored for circuit continuity; 5. 3. 3. 6. The electronic evaporative emission purge control shall, at a minimum, be monitored for circuit continuity. 5. 3. 4. Monitoring requirements for vehicles equipped with compression-ignition engines. In satisfying shall monitor: the requirements of Section 5. 3. 2 the OBD system 5. 3. 4. 1. Where fitted, reduction in the efficiency of the catalytic converter; 5. 3. 4. 2. Where fitted, the functionality and integrity of the particulate trap; 5. 3. 4. 3. The fuel injection system electronic fuel quantity and timing actuator(s) will be. monitored for circuit continuity and total functional failure; 5. 3. 4. 4. Other emission control system components or systems, or emission-related powertrain components or systems, which are connected to a computer, the failure of which may result in tailpipe emissions exceeding the limits given in Section 5. 3. 2. Examples of such systems or components are those for monitoring and control of air mass-flow, air volumetric flow (and temperature), boost pressure and inlet manifold pressure (and relevant sensors to enable these functions to be carried out). 5. 3. 4. 5. Any other emission-related powertrain component connected to a computer shall be monitored for circuit continuity. 146 5. 3. 5. Manufacturers may demonstrate to the approval authority that certain components or systems need not be monitored if, in the event of their total failure or removal, emissions do not exceed the emission limits given in Section 5. 3. 2 of this Annex. 5. 4. A sequence of diagnostic checks will be initiated at each engine start and completed at least once provided that the correct test conditions are met. The test conditions shall be selected in such a way that they all occur under normal driving as represented by the Type I test. 5. 5. Activation of malfunction indicator. 5. 5. 1. 5. 5. 2. The OBD system shall incorporate a malfunction indicator (MI) readily perceivable to the vehicle operator. The MI shall not be used for any other purpose except to indicate emergency start-up or limp-home routines to the driver. The MI shall be in all reasonable lighting conditions. When activated, it shall display a symbol in conformance with ISO 2575(2)). A vehicle shall not be equipped with more than one general purpose MI for emission-elated problems. Separate specific purpose warning lights (e. g. brake system, fasten seat belt, oil pressure, etc. ) are permitted. The use of red for a MI is prohibited. For strategies requiring on average between three and ten driving cycles for MI activation, the manufacturer shall provide data and/or an engineering evaluation which adequately demonstrates that the monitoring system is equally effective and timely in detecting component deterioration. Strategies requiring on average more than ten driving cycles for MI activation shall not be accepted. The MI shall also activate whenever the engine control enters a permanent emission default mode of operation if the emission limits given in Section 5. 3. 2 are exceeded. The MI shall operate in a distinct warning mode, e. g. a flashing light, under any period during which engine misfire occurs at a level likely to cause catalyst damage, as specified by the manufacturer. The MI shall also activate when the vehicle's ignition is in the "key-on" position before engine starting or cranking and de activate after engine starting if no malfunction has previously been detected. 5. 6. Fault code storage. The OBD system shall record code(s) indicating the status of the emission control system. Separate status codes shall be used to identify correctly functioning emission control systems and those emission control systems which need further vehicle operation to be fully evaluated. Fault codes that cause MI activation due to deterioration or malfunction or permanent emission default modes of operation shall be stored and that fault code shall identify the type of malfunction. 5. 6. 1. In the case of vehicles equipped with positive-ignition engines, misfiring cylinders need not be uniquely identified if a distinct single or multiple cylinder misfire fault code is stored. (2) International Standard ISO 2575-1982 (E), entitled "Road vehicles - Symbols for controls, indicators and tell-tales", Symbol Number 4. 36. 147 5. 7. Extinguishing the MI. 5. 7. 1. 5. 7. 2. For misfire malfunctions at levels likely to cause catalyst damage (as specified by the manufacturer), the MI may be switched to the normal mode of activation if the misfire is not present any more, or if the engine is operated after changes to speed and load conditions where the level of misfire will not cause catalyst damage. For all other malfunctions, the MI may be de-activated after three subsequent sequential driving cycles during which the monitoring system responsible for activating the MI ceases to detect the malfunction and if no other malfunction has been identified that would independently activate the MI. 5. 8. Erasing a fault code. 5. 8. 1. The OBD system may erase a fault code and freeze-frame information if the same fault is not re-registered in at least 40 engine warm-up cycles. 5. 9. Provisions for system security. 5. 9. 1. 5. 9. 2. 5. 9. 3. 5. 9. 4. Any vehicle with an emission control computer shall include features to deter modification, except as authorized by the manufacturer. Any reprogrammable computer codes or operating parameters must be resistant to tampering and the computer and any related maintenance instructions must conform to the provisions in SAE J2186 "E/E Data Link Security" (ISO XXX-8). Any removable calibration memory chips shall be potted, encased in a sealed container or protected by electronic algorithms and shall not be changeable without the use of specialised tools and procedures. Computer-coded engine operating parameters shall not be changeable without the use of specialised tools and procedures (e. g. soldered or potted computer components or sealed (or soldered) computer enclosures). In the case of mechanical fuel injection pumps fitted to compression- ignition engines, manufacturers shall take adequate steps to protect the maximum fuel delivery setting from tampering while the vehicle is in service. Manufacturers may apply to the approval authority for an exemption to this requirement for those vehicles which are unlikely to require protection. The criteria that the approval authority will evaluate in considering an exemption will include, but are not limited to, the current availability of performance chips, the high performance capability of the vehicle and the probable sales volume of the vehicle. 5. 9. 5. Manufacturers using programmable computer code systems (e. g. Electrical Erasable Programmable Read-Only Memory, EEPROM) shall employ proven methods to deter unauthorized reprogramming. Manufacturers shall include enhanced tamper protection strategies including data encryption using methods to secure the encryption algorithm and write protect features requiring electronic access to an off-site computer maintained by the manufacturer. Equivalent methods may be considered by the authority. 5. 9. 6. Anti-tampering features should not preclude the use of replacement parts which give the equivalent level of emission control. 148 6. 6. 1. EXTENSION OF EC TYPE-APPROVAL Approval granted to a vehicle type with respect to the OBD system may be extended to different vehicle types belonging to the same vehicle-OBD family as described in Appendix 6. The engine emission control system must be identical to that or the vehicle already approved and comply with the description of the OBD engine family given in Appendix 6, regardless of the following vehicle characteristics: - combustion process - engine accessories - method of engine fuelling - tyres - equivalent inertia - cooling system - overall gear ratio - transmission type - type of bodywork 7. 7. 1. 7. 2. 7. 3. 8. 8. 1. 8. 1. 1. 8. 1. 2. CONFORMITY OF PRODUCTION OF A VEHICLE EQUIPPED WITH AN OBD SYSTEM When the approval authority determines that the quality of production seems unsatisfactory a vehicle is randomly taken from the series and subjected to the tests described in Appendix 1. If the vehicle taken from the series does not satisfy the requirements of Section 7. 1. 5. 2 a further random sample of three vehicles shall be taken from the series and subjected to the tests described in Appendix 1. The tests may be carried out on vehicles which have been run-in a minimum of 3 000 km. The production is deemed to conform if at least 3 vehicles meet the requirements of the tests described in Appendix 1. ALTERNATIVE REQUIREMENTS Manufacturers may obtain type-approval on the basis of the alternative technical requirements given in Section 8. 1. 1 and 8. 1. 2, subject to the additional requirements of Sections 8. 1. 3, 8. 1. 4 and 8. 1. 5: Federal Register 40 CFR Part 86 Subpart A, entitled "Control of Air Pollution From New Motor Vehicles and New Motor Vehicle Engines; Regulations Requiring On-Board Diagnostic Systems on 1994 and Later Model Year Light-Duty Vehicles and Light-Duty Trucks", published by the US Government Printing Office, Washington, DC 20402. Section 1968. 1 of Title 13, California Code of Regulations (CCR), entitled "Malfunction and Diagnostic Systems Requirements - 1994 and Subsequent Model Year Passenger Cars, Light-Duty Trucks and Medium-Duty Vehicles and Engines". 149 8. 1. 3. The application for approval shall include a written statement that the vehicle family conforms to this Annex. The application for approval to this Annex shall include the complete documentation to meet the requirements of either Section 8. 1. 1 or 8. 1. 2 and the documentation required in Appendix 5 of this Annex. 8. 1. 4. The MI shall comply with the requirements of Section 5. 5 of this Annex. 8. 1. 5. If type-approval is granted according to the requirements of this Section, Section 7 of this Annex shall continue to apply for conformity of production checking. 150 Appendix 1 FUNCTIONAL ASPECTS OF ON-BOARD DIAGNOSTIC (OBD) SYSTEMS 1. INTRODUCTION This Appendix describes the procedure of the test according to Section 5 of this Annex. The procedure describes a method for checking the function of the on-board diagnostic (OBD) system installed on the vehicle by failure simulation of relevant systems in the engine management or emission control system. It also sets procedures for determining the durability of OBD systems. The manufacturer shall make available the defective components and/or electrical devices which would be used to simulate failures. Having simulated a failure the OBD system is approved if the MI is activated when the vehicle emissions exceed die limits of Section 5. 3. 2 by less than [20%]. DESCRIPTION OF TEST The testing of OBD systems consists of the following phases: - simulation of malfunction of a component of the engine management or emission control system; - preconditioning of the vehicle with a simulated malfunction over at least one Type I test or specific preconditioning cycle specified by the manufacturer; - driving the vehicle with a simulated malfunction over the Type I test cycle and measuring the emissions of the vehicle; - determining whether the OBD system reacts to the simulated malfunction and indicates malfunction in an appropriate manner to the vehicle driver. Alternatively, at the request of the manufacturer, malfunction of one or more components may be electronically simulated according to the requirements of Section 6 of this Appendix. Manufacturers may request that monitoring take place outside the Type I test cycle if it can be demonstrated to the authority that monitoring during conditions encountered during the Type I test cycle would impose restrictive monitoring conditions when the vehicle is used in service. TEST VEHICLE AND FUEL Vehicle 2. 2. 1. 2. 2. 2. 3. 3. 3. 1. The test vehicle must meet the requirements of Section 3. 1 of Annex III. 3. 2. Fuel The appropriate reference fuel as described in Annex IX must be used for testing. 151 4. 4. 1. 5. 5. 1. 6. 6. 1. TEST TEMPERATURE AND PRESSURE The test temperature and pressure must meet the requirements of the Type I test as described in Annex III. TEST EQUIPMENT Chassis dynamometer The chassis dynamometer must meet the requirements of Annex III. OBD TEST PROCEDURE The operating cycle on requirements of Annex III. the chassis dynamometer shall meet the 6. 2. Vehicle preconditioning 6. 2. 1. According to the engine type and after introduction of one of the failure modes given in Section 6. 3, the vehicle shall be preconditioned by driving at least two consecutive Type I tests (Parts One and Two). For compression ignition engined vehicles an additional preconditioning of two Part Two cycles is permitted. At the request of the manufacturer, alternative preconditioning methods may be used. 6. 3. Failure modes to be tested. 6. 3. 1. Positive-ignition engined vehicles. 6. 3. 1. 1. Replacement of the catalyst with a deteriorated or defective catalyst or electronic simulation of such a failure. 6. 3. 1. 2. Engine misfire conditions according to the conditions for misfire monitoring given in Section 5. 3. 3. 2 of this Annex. 6. 3. 1. 3. Replacement of the oxygen sensor with a deteriorated or defective oxygen sensor or electronic simulation of such a failure. 6. 3. 1. 4. Electrical disconnection of any other emission-related powertrain component connected to a computer. 6. 3. 1. 5. Electrical disconnection of the electronic evaporative purge control device (if equipped). 6. 3. 2. Compression-ignition engined vehicles. 6. 3. 2. 1. Where fitted, replacement of the catalyst with a deteriorated or defective catalyst or electronic simulation of such a failure. 6. 3. 2. 2. Where fitted, total removal of the particulate trap or, where sensors are an integral part of the trap, a defective trap assembly. 6. 3. 2. 3. Electrical disconnection of any fuelling system electronic fuel quantity and timing actuator. 6. 3. 2. 4. #Electrical disconnection of any other emission-related powertrain component connected to a computer. 152 6. 3. 2. 5. In meeting the requirements of Sections 6. 3. 2. 3 and 6. 3. 2A, and with the agreement of the approval authority, the manufacturer shall take appropriate steps to demonstrate that the OBD system will indicate a fault when disconnection occurs. 6. 4. OBD system test. 6. 4. 1. Vehicles fitted with positive-ignition engines. 6. 4. 1. 1. After vehicle preconditioning according to Section 6. 2 above, the test vehicle shall be driven over a Type I test (Parts One and Two). The MI must activate before the end of this test under any of the conditions given in Sections 6. 4. 1. 2 to 6. 4. 1. 5 of this Appendix. The technical service may substitute those conditions by others in accordance with Section 6. 4. 1. 6. However, the total number of failures simulated shall not exceed 4 for the purpose of type-approval. 6. 4. 1. 2. Replacement of a catalyst with a deteriorated or defective catalyst or electronic simulation of a deteriorated or defective catalyst that "results in emissions exceeding the HC limit given in Section 5. 3. 2 of this Annex. 6. 4. 1. 3. An induced misfire condition according to the conditions for misfire monitoring given in Section 5. 3. 3. 2 of this Annex that results in emissions exceeding any of the limits given in Section 5. 3. 2 of this Annex. 6. 4. 1. 4. Replacement of an oxygen sensor with a deteriorated or defective oxygen sensor or electronic simulation of a deteriorated or defective oxygen sensor that results in emissions exceeding any of the limits given in Section 5. 3. 2 of this Annex. 6. 4. 1. 5. Electrical disconnection of the electronic evaporative purge control device (if equipped). 6. 4. 1. 6. Electrical disconnection of any other emission-related powertrain component connected to a computer that results in emissions exceeding any of the limits given in Section 5. 3. 2 of this Annex. 6. 4. 2. Vehicles fitted with compression-ignition engines. 6. 4. 2. 1. After vehicle preconditioning according to Section 6. 2 above, the test vehicle shall be driven over a Type I test (Parts One and Two). The MI must activate before the end of this test under any of the conditions given in Sections 6. 4. 2. 2 to 6. 4. 2. 5 of this Appendix. 6. 4. 2. 2. Where fitted, replacement of a catalyst with a deteriorated or defective catalyst or electronic simulation of a deteriorated or defective catalyst that results in emissions exceeding limits given in Section 5. 3. 2 of this Annex. 6. 4. 2. 3. Where fitted, total removal of the particulate trap or replacement of the particulate trap with a defective particulate trap meeting the conditions of Section 6. 3. 2. 2 of this Appendix that results in emissions exceeding the limits given in Section 5. 3. 2 of this Annex. 6. 4. 2. 4. With reference to Section 6. 3. 2. 5 of this Appendix, disconnection of any fuelling system electronic fuel quantity and timing actuator that results in emissions exceeding any of the limits given in Section 5. 3. 2 of this Annex. 153 6. 4. 2. 5. With reference to Section 6. 3. 2. 5 of this Appendix, disconnection of any other emission-related powertrain component connected to a computer that results in emissions exceeding any of the limits given in Section 5. 3. 2 of this Annex. 6. 5. Diagnostic Signals 6. 5. 1. 1. Upon determination of the first malfunction of any component or system, "freeze frame" engine conditions present at the time shall be stored in computer memory. Should a subsequent fuel system or misfire malfunction occur, any previously stored freeze frame conditions shall be replaced by the fuel system or misfire conditions (whichever occurs first). Stored engine conditions shall include, but are not limited to calculated load value, engine speed, fuel trim value(s) (if available), fuel pressure (if available), vehicle speed (if available), coolant temperature, intake manifold pressure (if available), closed- or open-loop operation (if available) and the fault code which caused the data to be stored. The manufacturer shall choose the most appropriate set of conditions facilitating effective repairs for freeze frame storage. Only one frame of data is required. Manufacturers may "choose to store additional frames provided that at least the required frame can be read by a generic scan tool meeting the specifications of Sections 6. 5. 3. 2 and 6. 5. 3. 3. If the fault code causing the conditions to be stored is erased in accordance with Section 5. 7 of this Annex, the stored engine conditions may also be erased. 6. 5. 1. 2. If available, the following signals in addition to the required freeze frame information shall be made available on demand through the serial port on the standardised data link connector, if the information is available to the on-board computer or can be determined using information available to the on-board computer: diagnostic trouble codes, engine coolant temperature, fuel control system status (closed loop, open loop, other), fuel trim, ignition timing advance, intake air temperature, manifold air pressure, air flow rate, engine speed, throttle position sensor output value, secondary air status (upstream, downstream or atmosphere), calculated load value, vehicle speed and fuel pressure. The signals shall be provided in standard units based on the specifications given in Section 6. 5. 3 of this Appendix. Actual signals shall be clearly identified separately from default value or limp home signals. In addition, the capability to perform bi-directional diagnostic control based on the specifications given in Section 6. 5. 3 of this Appendix shall be made available on demand through the serial port on the standardised data link connector according to the specifications given in Section 6. 5. 3 of this Appendix. 6. 5. 1. 3. For all emission control systems for which specific on-board evaluation tests are conducted (catalyst, oxygen sensor, etc. ), except misfire detection, fuel system monitoring and comprehensive component monitoring, the results of the most recent test performed by the vehicle and the limits to which the system is compared shall be made available through the serial data port on the standardised data link connector according to the specifications given in Section 6. 5. 3 of this Appendix. For the monitored components and systems excepted above, a pass/fail indication for the most recent test results shall be available through the data link connector. 154 6. 5. 1. 4. The OBD requirements to which the vehicle is certified (i. e. this Annex or the alternative requirements specified in Section 8 of this Annex) and the major emission control systems monitored by the OBD system consistent with Section 6. 5. 3. 3 of this Appendix shall be available through the serial data port on the standardised data link connector according to the specifications given in Section 6. 5. 3 of this Annex. 6. 5. 2. 6. 5. 3. The emission control diagnostic system is not required to evaluate components during malfunction if such evaluation would result in a risk to safety or component failure. The emission control diagnostic system shall provide for standardised access and conform with the following ISO and/or SAE standards. Some of the ISO standards have been derived from Society of Automotive Engineers standards and Recommended Practices. Where this is the case the appropriate SAE reference appears in parenthesis. 6. 5. 3. 1. One of the following standards with the restrictions as described shall be used as the on-board to off-board communications link: ISO 9 1 4 1 -2 "Road Vehicles - Diagnostic Systems - CARB Requirements for the Interchange of Digital Information"; ISO 11519-4 "Road Vehicles - Low Speed Serial Data Communication - Part 4: Class B Data Communication Interface (SAE J1850)". Emission related messages shall use the cyclic redundancy check and the three byte header and shall not use inter-byte separation or checksums. ISO DIS 14230 - Parts 1, 2 and 3 "Road Vehicles - Diagnostic Systems - Keyword Protocol 2000". Either the CARB mode shall be used (directly equivalent to ISO 9141-2) or with fast initialisation at the address specified in Appendix 2 and with the format specified by using keybytes with the decimal value of 2025 (three byte header with normal timing). 6. 5. 3. 2. Test equipment and diagnostic tools needed to communicate with OBD systems shall meet or exceed the functional specification given in Appendix 3. 6. 5. 3. 3. Basic diagnostic data, (as specified in Section 6. 5. 1 of this Appendix) and bi-directional control information shall be provided using the format and units described in Appendix 2 and shall be available using a diagnostic tool meeting the requirements of Appendix 3. 6. 5. 3. 4. Fault codes selected by the manufacturer shall be consistent with those given in Appendix 4. 6. 5. 3. 5. The connection interface between the vehicle and the diagnostic tester shall meet the all requirements of SAE J1962 "Diagnostic Connector, June 1992" (ISO XXX-A "Road vehicles - Diagnostic systems - On-board connector"). The installation position shall be subject to agreement of the approval. authority such that it is readily accessible by service personnel but protected from tampering by non-qualified personnel. 155 Appendix 2 1. Scope This Apppendix defines diagnostic services and functionally addressed request- response messages required to be supported by vehicles and test tools for diagnostic purposes which pertain to vehicle emission-related data. These messages are intended to be used by any service tool meeting the requirements of Appendix 3. Seven Diagnostic Services (Test Modes) are defined and these are detailed in Section four. This Appendix is based on draft ISO CD XXXI and SAE J1979, "E/E Diagnostic Test Modes". 2. References 2. 1. Applicable Documents The following publications form a part of this specification to the extent specified herein. 2. 1. 1. Normative References ISO Documents: ISO 9141-2 Road vehicles - Diagnostic requirements for interchange of digital information systems - CARB ISO CD 14230 Keyword Protocol 2000, Parts 1/2/3 ISO 11519-4 Road Vehicles Low speed Serial Data Communication Class B - Data Communications Interface (SAE J1850) ISO CD 14229 Diagnostic Services 2. 1. 2. Informative References J1850 FEB94 Class B Data Communication Network Interface J1930 JUN93 Systems Diagnostic Terms, Definitions, E/E Abbreviations and Acronyms J1962 JUN93 Diagnostic Connector J1978 MAR92 OBD II Scan Tool J2012 MAR92 Recommended Format and Messages for Diagnostic Trouble Codes J2186 SEP91 Diagnostic Data Link Security J2190 JUN93 Enhanced E/E Diagnostic Test Modes 156 3. Definitions Most terms for components and systems contained in this document are included in ISO CD XXX3 (SAE J1930) - Terms, Definitions, and Acronyms. This section includes additional definitions of terms used in this document, not included in ISO CD XXX3. 3. 1. # = number 3. 2. "Service" in ISO diagnostic communication documents is the equivalent of "Test Mode" or "Mode" in the SAE documents. 3. 3. No further definitions. 4. Technical Requirements 4. 1. Diagnostic Service General Conditions These guidelines are necessary to ensure proper operation of both the test equipment and the vehicle during diagnostic procedures. Test equipment, when using messages defined in this document, should not affect normal operation of the emission control system. 4. 1. 1. Multiple Responses to a Single Data Request The messages contained in this Appendix are functional messages, which means the off-board test equipment will request data without knowledge of which module on the vehicle will respond. In some vehicles, multiple modules may respond with the information requested. In addition, a single module may send multiple responses to a single request. Any test device requesting information must, therefore, have provisions for receiving multiple responses. 4. 1. 2. Response Time For ISO 9141-2 and ISO 14230-2 interfaces, response time requirements are specified in these documents. For ISO CD 11519-4(SAE J1850) network interfaces, the on-board systems should respond to a request within 100 milliseconds of a request or a previous response. With multiple responses possible from a single request, this allows as much time as is necessary for all modules to access the data link and transmit their response(s). If there is no response within this time period, the tool can either assume no response will be received, or if a response has already been received, that no more responses will be received. 4. 1. 3. Minimum Time Between Requests from Scan Tool For ISO 9141-2 interfaces, the required times between requests are specified in the^ISO 9141-2 document. For SAE 11850 network interfaces, a tool should always wait for a response from the previous request, or "no response" timeout before sending another request. In no case should a request be sent less than 100 msec, after the previous request. 157 4. 1. 4. Data not Available There are two conditions for which data is not available. One condition is that the Service is not supported, and the other is that the Service is supported but data is not currently available. There will be no reject message to a functional request if the request is not supported by the module. This prevents responses from all modules that do not support a Service or a specific data value. Some Services are supported by a vehicle, but data may not always be available when requested. For Services $05 and $06, if the test has not been run since test results were cleared, or for Service $02 if freeze frame data has not been stored, valid data will not be available. For these conditions, the manufacturer has the option either to not respond or to respond with data that is invalid. The functional description for these Services discuss the method to determine if the data is valid. 4. 1. 5 Maximum Values If the data value exceeds the maximum value possible to be sent, the on-board system should send the maximum value possible ($FF or $FFFF). The tool should display the maximum value or an indication of data too high. This is not normally critical for real time diagnostics, but in the case of a misfire at 260 km/h with resulting freeze frame data stored, this will be very valuable diagnostic information. 4. 2. Diagnostic Message Format 4. 2. 1. Addressing method Functional addressing will be used for all generic Diagnostic Service messages because the test tool does not know which system on the vehicle has the information that is needed. 4. 2. 2. Maximum message length Is defined in Figure 1 below. 158 4. 2. 3. Diagnostic Message Format Is defined in Figure 1 below. Header Bytes Data Bytes Priority - Type Target Address Source Address #1 #2 #3 #4 #5 #6 #7 ERR RSP Diagnostic Request at 10. 4 Kbps (ISO 11519-4 [J1850] and ISO 9141-2) 68 48 61 41 61 41 6A Tester Address Fx Maximum 7 data bytes Yes No Diagnostic Response at 10. 4 \ Kbps (ISO 11519-4 [J1850] and ISO 9 L41-2) 6B ECU Addr Maximum 7 data bytes Yes No Diagnostic Response at 41. 6 Kbps (ISO 11519-4 [J1850]) 6A Fx Maximum 7 data bytes Yes No Diagnostic Response at 41. 6 Kbps (ISO 11519-4 [J1850]) 6B ECU Addr Maximum 7 data bytes Yes No Diagnostic Request at 41. 6 Kbps (ISO 14230) 6A Fx Maximum 7 data bytes Diagnostic Request at 41. 6 Kbps (ISO 14230) 6B ECU Addr Maximum 7 data bytes Figure 1 - Diagnostic Message Format 4. 2. 4. 'Header bytes The first three bytes of all diagnostic messages are the header bytes. The value of the first header byte is dependent on the bit rate of the data link and the type of message. The second byte has a value that depends on the type of message, either a request or a response. The third header byte is the physical address of the device sending the message. OBD Scan Tools have the address $F1. Other service tools should use addresses in the range from $F0 to $FD. The response to all request messages in this document will be independent of the address of the test equipment requesting the information. Vehicle manufacturers should not use the ISO CD XXX1(J1979) header bytes for any purpose other than diagnostic messages. When they are used, they must conform to this specification. 159 4. 2. 5. Data bytes The maximum number of data bytes available to be specified in this Appendix is 7. The first data byte following the header is the Diagnostic Service Type, and the remaining 6 bytes vary depending on the specific Diagnostic Service. For services $01 and $02, message length is determined by Parameter Identification (PID). For Service $05, message length is determined by Test ID. For other services, the message length is determined by the service. This enables the tools to check for proper message length, and to recognize the end of the message without waiting for possible additional data bytes. 4. 2. 6. Non-data bytes included in diagnostic messages with ISO 11519-4 (J1850) All diagnostic messages will use a Cyclic Redundancy Check (CRC), as defined in ISO 11519-4 (J185Ô), as the error detection (ERR) byte. In-frame response (RSP) is defined as optional in ISO 11519-4 (J1850). For messages defined in this document, the RSP byte is required in all request and response messages at 41. 6Kbps, and is not allowed for messages at 1X3. 4 Kbps. ISO 11519-4 (SAE J1850) defines additional message elements that may be included in Diagnostic Messages. Use of these message elements is beyond the scope of this specification, but needs to be considered when defining total diagnostic messages. 4. 2. 7. Non-data bytes included in diagnostic messages with ISO 9141-2 and ISO 14230 (Keyword Protocol 2000) Messages will include a checksum, defined in those documents, after the data bytes as the Error Detection Byte (ERR). There is no provision for an in-frame response. 4. 2. 8. Bit position convention Some data byte values in this document include descriptions that are based on bit positions within the byte. The convention used in this document is that the Most Significant Bit (MSB) is referred to as "bit 7", and the Least Significant Bit (LSB) is referred to as "bit 0," as shown below: MSB LSB 7 | 6 | 5 | 4 | 3 | 2 | 1 |0 Figure 2 - Bit position within a data byte 4. 3. Allowance for Expansion and Enhanced Diagnostic Services This Appendix allows for the addition of Diagnostic Services both as industry standards and manufacturer specific services. The Diagnostic Services $00 through $0F are reserved to be defined in ISO CD XXXI (J1979). 160 4. 4. Format of Data to be Displayed The format of data to be displayed to the user of the data obtained with these test needs to be standardised so that vehicle manufacturers can write generic service information. Data is transmitted from the vehicle in metric units. The following Table indicates the type of data and minimum requirements for format of the data. See Figure 3. Data Device ID - source address of response Parameter ID (PIP) Frame number Data values Diagnostic Trouble Codes Test ID | Services all $01 & $02 $02 "" $01 & $02 $03 & $07 Display Format Hexadecimal (00 to FF) __ Hexadecimal (00 to FF) description (see Table in Section 5. 3) Decimal (0 to 255) see Table in Section 5. 3 "P", "B", "C" or "U", plus 4 digits and/or DTC definition - see ISO CD XXX2 (SAE J2012) I Test value and test limits Test value and test limits Component ID Optional Data Bytes I $05, $06 & ~T " Hexadecimal (00 to FF) $08 $05 $06 Engineering units for Test IDs icss than $80 (see Section 5. 6. 2) - Decimal (0 ':o 255) for Test IDs grgater than $80 Decimal (0 to 65535) $06 (part of data byte #3) $08 J Hexadecimal (00 to 7F) 4 bytes, each decimal (0 to 255) Figure 3 - Format of Data to be Displayed 5. Services 5. 0. Diagnostic Services included in this document are: Service $01 - Request Current Powertrain Diagnostic Data Analogue inputs and outputs Digital inputs and outputs System status information Calculated values Service $02 - Request Powertrain Freeze Frame Data Analogue inputs and outputs Digital inputs and outputs System status information Calculated values 161 Service $03 Request Emission-Related Powertrain Diagnostic Trouble Codes Service $04 Clear/Reset Emission-Related Diagnostic Information Service $05 Request Oxygen Sensor Monitoring Test Results Service $06 Service $07 Request On-Board Monitoring Test Results for Non- continuously Monitored Systems Request On-Board Monitoring Test Results Continuously Monitored Systems for Service $08 - Request Control of on-board system, test or component For each Service this definition includes: Functional descriptions of service Request and response message formats For some of the more complex services, an example of messages and an explanation of the interpretation of those messages is included. 5. 1. Service $01 - Request Current Powertrain Diagnostic Data 5. 1. 1. Functional Description The purpose of this service is to allow access to current emission related data values, including analogue inputs and outputs, digital inputs and outputs, and system status information. The request fcr information includes a Parameter Identification (PDD) value that indicates to the on-board system the specific information requested. PED definitions, scaling information, and display formats are included in this document. The on-board module will respond to this message by transmitting the requested data value last determined by the system. All data values returned for sensor readings will be actual readings, not default or substitute values used by the system because of a fault with that sensor. Not all PIDs are applicable or supported by all systems. PID $00 is a bit- encoded PID that indicates, for each module, which PIDs that module supports. PID $00 must be supported by all modules that respond to a service $01 request as defined in this document, because diagnostic tools that conform to Appendix 3 use the presence of a response by the vehicle to this request to determine which protocol is supported for diagnostic communications. 162 5. 1. 2. Message Data Bytes Data Bytes (Hex) #1 #2 #3 | #4 | #5 | #6 #7 Request Current Powertrain Diagnostic Data Request Powertrain Diagnostic Data 01 PID Report Current Powertrain Diagnostic Data Report Powertrain Diagnostic Data 41 PID data A data B (*) data C (*) data D (*) Figure 4 - Message data Bytes (*) conditional - number of bytes depends on PID - see Figure 6 5. 2. Service $02 - Request Powertrain Freeze Frame Data 5. 2. 1. Functional Description The purpose of this service is to allow access to emission related data values in a freeze frame. This allows expansion to meet manufacturer specific requirements not necessarily related to the required freeze frame, and not necessarily containing the same data values as the required freeze frame. The request for information includes a Parameter Identification (PID) value that indicates to the on-board system the specific information requested. PID definitions, scaling information, and display formats for the freeze frame are included in this document. The on-board module will respond to this message by transmitting the requested data value stored by the system. All data values returned for sensor readings will be actual stored readings, not default or substitute values used by the system because of a fault with that sensor. Not all PIDs are applicable or supported by all systems. PID $00 is a bit-encoded PID that indicates, for each module, which PIDs that module supports. Therefore, PID $00 must be supported by all modules that respond to a Service $02 request as defined in this document. -- PDD $02 indicates the DTC that caused the freeze frame data to be stored. If freeze frame data is not stored in the module, the system should report $00 00 as the DTC. Any data reported when the stored DTC is $00 00 may not be valid. The frame number byte will indicate $00 for the freeze frame data. Manufacturers may optionally save additional freeze frames and use this service to obtain that data by specifying the freeze frame number in the request. If a manufacturer uses these additional freeze frames, they will be stored under conditions defined by the manufacturer, and contain data specified by the manufacturer. 163 5. 2. 2. Message Data Bytes #1 #2 Data Bytes (Hex) #5 #4 #3 #6 #7 Request Powertrain Freeze Frame Data Request Powertrain Freeze Frame Data 02 PID frame no. Report Powertrain Freeze Frame Data (only valid if Service $02 PID $02 DTC is not $00 00) Report Powertrain Freeze Frame Data 42 PID frame no. data A data B. (*) data C (*) data D (*) Figure 5 - Message Data Bytes (*) conditional - number of bytes depends on PID - see Figure 6 164 5. 3. PIDs for Services $01 and $02 - see Figure 6 Service ID (see note 1) PID (Hex) Description Min ($00) or ($0000) Max ($FF) or ($FFFF) $01 A $02 A 00 PIDs supported ($01 - $20): A 01 Module responds with a message that contains 4 bytes ojf bit-cncodcd information, each bit indicating support or non-support of a PID where: 0 = PID not supported by this module 1 = PID supported by this module Data A - Number of emission-related powertrain trouble codes and MI status: bits 0-6: Number of codes stored in this module bit 7: 0 = MI not commanded ON by this module 1 = MI commanded ON by this module Data B (bits 0 to 3) and Data C - Each bit indicates support or non- support of an on-board diagnostic evaluation: Data B: covers continuous monitoring tests Data C: covers tests run at least once per trip where: 0 = test not supported by this module 1 = test supported by this module Data B (bits 4 to 7) and Data D - Each bit indicates status of on-board diagnostic evaluation for this module, corresponding to tests included in Data B (bits 0 to 3) and Data C: 0 = test complete, or not applicable 1 = test not complete Note: Data B. bits 4 to 7, are required only for vehicles that do not support any non-continuous tests. Figure 6 PIDs for Services $01and $02 165 English display SI (Metric) Scaling/bit and display Byte bit PID Data A 7 $01 Data A 6 $02 DataB 7 $09 Data D 0 $20 Data B: bit Evaluation supported / status 0 Misfire monitoring supported 1 Fuel system monitoring supported 2 Comprehensive component monitoring supported 3 reserved (report as 0) 4 misfire monitoring status 5 fuel system monitoring status 6 Comprehensive component monitoring status 7 reserved (report as 0) Data C and Data D: bit Evaluation supported / status 0 Catalyst monitoring 1 Heated catalyst monitoring 2 Evaporative system monitoring 3 Secondary air system monitoring 4 A/C system refrigerant monitoring 5 Oxygen sensor monitoring 6 Oxygen sensor heater monitoring 7 EGR system monitoring i Service ID (see note 1) PID (Hex) Description Min ($00) or ($0000) Max ($FF) or ($FFFF) SI (Metric) Scaling/bit and display English display $01 $02 A 02 A A 03 DTC that caused required freeze frame data storage (2 byte value - $0000 indicates no freeze frame data) Data A: Fuel system 1 status Data B: Fuel system 2 status ($00 if not used) 00 00 09 99 Pxxxx, Cxxx, Bxxx or Uxxx Pxxxx, Cxxx, Bxxx or Uxxx For each data byte, no more than one bit at a time can be set to a 1 to indicate the status of that bank, where: bit 0 = Open loop - lias not yet satisfied conditions to go closed loop bit 1 = Closed loop - using oxygen sensor(s) as feedback for fuel control bit 2 = Open loop due to driving conditions (e. g. power enrichment, deceleration enleanment) bit 3 = Open loop due to detected system fault bit 4 = Closed loop, but fault with at least one oxygen sensor - may be using single oxygen sensor for fuel control bits 5-7 = reserved (report as 0) 04 05 06 07 08 09 0A Calculated load value Engine coolant temperature Short term fuel trim - Bank 1 (use if only 1 fuel trim value) Long term fuel trim - Bank 1 Short term fuel trim - Bank 2 Long term fuel trim - Bank 2 Fuel pressure gauge A A A A A A A A A A A A A A A A A A 0% -40°C 100% +215°C -100. 00% (lean) +99. 22% (rich) x » n 0 kPaG(gauge) n »» n 765 kPaG (gauge) 255 kPaA 100/255% xxx. x% xxx°F 100/128% (0% at 128) xxx. x% xx. x psig(gaugc) xx. x in. Hg 100/255% XXX. x% 1°C with -40°C offset xxx°C 100/128% (0% at 128) XXX. x% II II II 3 kPaG(gauge) xxx kPaG(gauge) 1 kPaA xxx kPaA 1/4 rpm xxxxx rpm OB Intake manifold absolute pressure OkPaA j Engine R1. PM (2 byte value - high byte/low byte) OC 0 rpm 16,383. 75 rpm Figure 6 PIDs for Services $01 and $02 (continued) 166 A A A A A A A X or PID $1D 10 11 12 13 Service ID (sec note 1) PID (Hex) Description $01 $02 Min ($00) or ($0000) Max ($FF) or ($FFFF) SI (Metric) Scaling / bit and display English display A 0D Vehicle speed 0 km/h 255 km/h 0E Ignition timing advance for #1 cylinder (not including mechanical advance) -64° +63,5° OF Intake air temperature -40°C +215°C Air flow rate from MAF sensor (2 byte value - high byte/low byte) Absolute throttle position 0 gm/scc 0% 655. 35 gm/scc 100% xxx mph xxx°F xxxx. x lb/min 1 km/h xxx km/h l/2°with 0° at 128 xx. x° 1°C with -40°C offset xxx°C. 01 gm/sec xxx. xx grh/sec 100/255% xxx. x% Commanded secondary air status (if supported, one, and only one bit at a time can be set to a 1) bit 0 bit 1 bit 2 bits 3 -7 = reserved (report as 0) I = upstream of first catalytic converter 1 = downstream of first catalytic converter inlet 1 = atmosphere / off Location of oxygen sensors, where sensor 1 is closest to the engine. Each bit indicates the presence or absence of an oxygen sensor at the following location: bit Sensor location 0 Bank 1 - Sensor 1 1 Bank 1 - Sensor 2 2 Bank 1 - Sensor 3 3 Bank 1 - Sensor 4 4 Bank 2 - Sensor 1 5 Bank 2 - Sensor 2 6 Bank 2 - Sensor 3 7 Bank 2 - Sensor 4 where: I 1 = sensor present at that location 0 = sensor not present at that location ' Figure 6 PIDs for Services $01 and $02 (continued) 167 Service ID (see note 1) PID (Hex) Description Min ($00) or($0000) Max ($FF) or ($FFFF) SI (Metric) Scaling/bit and display English display J $01 $02 A % 14 15 16 17 18' 19 1A IB Bank 1 - Sensor 1 Bank 1 - Sensor 2 Bank 1 - Sensor 3 Bank 1 - Sensor 4 Bank 2 - Sensor 1 Bank 2 - Sensor 2 Bank 2 - Sensor 3 Bank 2 - Sensor 4 for each sensor: Data A - Oxygen sensor output 0 volt 1. 275 volt B 1C voltage Data B - short term fuel trim associated with this sensor ($FF if this sensor is not used in the calculation) OBD requirements to which vehicle is designed, where: $ 01 - OBD II (California ARB) $ 02 - OBD (Federal EPA) $ 03 - OBD and OBD II $ 04 - OBD I $ 05 - Not intended to meet any OBD requirements Figure 6 PIDs for Services $01 and $02 (continued) -100. 00% (lean) 99. 22% (rich) This scaling assumes a nominal 1 volt full scale oxygen sensor; any sensor with a different full scale value should be normalised to provide nominal full scale at $C8 (200 decimal). 005 volt x. xxx volt 100/128% (0% at 128) xxx. x% 68 Service ID (sec note 1) PID (Hex) Description Min ($00) or ($0000) Max ($FF) or ($FFFF) SI (Metric) Scaling/bit and display English display $01 $02 A or PID S13 ID Location of oxygen sensors, where 1 is closest to the engine. Each bit indicates the presence or absence of an oxygen sensor at the following location: bit Alternate sensor location 0 Bank 1 - Sensor 1 1 Bank 1 - Sensor 2 2 Bank 2 - Sensor 1 3 Bank 2 - Sensor 2 4 Bank 3 - Sensor 1 5 Bank 3 - Sensor 2 6 Bank 4 - Sensor 1 7 Bank 4 - Sensor 2 Where 1 = sensor present at that location 0 = sensor not present at that location A IE Auxiliary Input Status bit 0:Powcr Take Off (PTO) Status where 0 =PTO not active 1 = PTO active bits 1 to 7 reserved for future expansion report as 0 Waive continuous monitoring tests during PTO Unused - reserved for future expansion. IF i Figure 6 PIDs for Services $01 and $02 (continued) 169 Service ID (see note 1) PID (Hex) Description $01 $02 A 20 PIDs supported ($21 - $40): Min ($00) or($0000) Max ($FF) or ($FFFF) SI (Metric) Scaling / bit and display English display Bvte bit PID Data A 7 $21 Data A 6 $22 Data B 7 $29 DataD 0 $40 21-3F 40 41-FF Reserved - to be specified in ISO 14230 - 3 (SAE J2190). if needed PIDs supported ($41 - $60): Reserved for future expansion A A Figure 6 PIDs for Services $01 and $02 (continued) NOTE 1 : Letters in the column under Service $01 or $02 indicate that this value is included in OBD legislation as indicated below. This information is for guidance only and may be out of date. Refer to the latest appropriate regulations to determine if each value is required to be supported on a given vehicle, or only required if available. 170 5. 4. Service $03 - Request Emission-Related Powertrain Diagnostic Trouble Codes 5. 4. 1. Service $03 Functional Description The purpose of this service is to enable the off-board test device to obtain stored emission-related powertrain trouble codes. This shall be a two step process for the test equipment but a module may respond to a Service $03 request without a Service PID $01 request. If a tester establishes that the Service $01, PID $01 is not supported by all of the modules on the vehicle it may send only Service $03 requests on all subsequent DTC requests. Step 1 - Send a Service $01, PID $01 request to get the number of stored emission-related powertrain trouble codes from all modules that have this available. Each on-board module that has codes stored will respond with a message that includes the number of stored codes to be reported. If a module capable of storing powertrain codes does not have stored codes, then that module shall respond with a message indicating zero codes are stored. Step 2 - Send a Service $03 request for all stored emission-related powertrain codes. Each module that has codes stored will respond with one or more messages, each containing up to 3 codes. If no codes are stored in the module, then the module may not respond to this request. If additional trouble codes are set between the time that the number of codes are reported by a module, and the stored codes are reported by a module, then the number of codes reported could exceed the number expected by the tool. In this case, the tool should repeat this cycle until the number of codes reported equals the number expected based on the Service 1 response. Diagnostic trouble codes are transmitted in two bytes of information for each code. The first two bits (high order) of the first byte for each code will be zeros to indicate a powertrain code (refer to Appendix 3 for additional interpretation of this structure). The second two bits will indicate the first digit of the diagnostic code (0 through 3). The second nibble of the first byte and the entire second byte are the next three digits of the actual code reported as * Binary Coded Decimal (BCD). A powertrain trouble code transmitted as $0143 should be displayed as P0143. See Figure 7 0 | 0 | 0 | 0 | 0 | 0 | 0 | 1 — 0 1 1 | 0 | 0 | 0 | 0 | 1 |1 P 0 1 I 4 i Figure 7 - Diagnostic Trouble Code Encoding Example If less than 3 trouble codes are reported, the response messages used to report diagnostic trouble codes should have their unused bits set to zero to maintain the required fixed message length for all messages. If there are no diagnostic trouble codes to report, no response is required. 171 5. 4. 2. Message Data Bytes Data Bytes (Hex) #1 | #2 J #3 #6 Request number of codes from all modules | #4 | #5 #7 Request number of Powertrain DTC 01 01 1 Report number of codes (each module] Report number of stored powertrain DTC 41 Request Request powertrain DTC 03 01 #DTC & MI codes from all modules Eval. Supp. #1 Eval. Supp. #2 Eval. Status - Report codes (each module) Report powertrain DTC 43 Code #1 or 00 00 Code #2 or 00 00 Code #3 or 00 00 Figure 8 - Message Data Bytes NOTE: Refer to Appendix 2 (ISO CD XXX2 - SAE J2012, Recommended Format and Messages for Diagnostic Trouble Codes), the encoding method for trouble codes. 172 5. 4. 3. Powertrain Diagnostic Trouble Code Example (assume 10. 4 Kbps) Header Bytes (Hex) Data Bytes (Hex) Pty/ Type Tgt Addr Src Addr #1 #2 #3 M #5 #6 #7 Request Powertrain DTC 68 6A FI 01 01 Report Number of Powertrain DTC 48 48 48 48 6B 6B 6B 6B 06 41 01 C3 41 01 2B 41 01 ^F 41 01 06 01 00 82 00 00 00 00 00 00 00 00 00 00 00 00 Request All Stored Powertrain DTC Request number of Powertrain DTC Module 06 has 6 stored DTC Module C3 has 1 stored DTC Module 2B has 0 stored DTC Module 3E has 2 stored DTC and MI ON Request powertrain DTC 1 68 | 6A FI | 03 1 Report All Stored Powertrain DTC Module 06 send codes P0143,P0196, & P0234 Module C3 send code P0443 Module 06 send codes P0357,P0531, & P0661 Module 3E send codes P0112 & P0445 48 6B 06 43 Code #1 Code #2 Code #3 01 43 01 96 02 34 48 6B C3 43 Code #1 48 6B 06 43 04 43 Code #4 Code #5 Code #6 00 00 00 00 48 6B 3E 43 03 57 Code #1 -3-1 05 Code #2 06 61 01 12 04 45 00 00 Figure 9 Powertrain Diagnostic Trouble Code Example 173 5. 5. Service $04 - Clear/Reset Emission-Related Diagnostic Information 5. 5. 1. Functional Description The purpose of this service is to provide a means for the external test device to command on-board modules to clear all emission-related diagnostic information. This includes: Clear number of diagnostic trouble codes (Service $01, PID $01) Clear diagnostic trouble codes (Service $03) Clear trouble code for freeze frame data (Service $01, PED $02) Clear freeze frame data (Service $02) Clear oxygen sensor test data (Service $05) Reset status of system monitoring tests (Service $01, PID $01) Clear on-board monitoring test results (Services $06 and $07) Other manufacturer specific "clearing/resetting" actions may also occur in response to this request. For safety and/or technical design reasons, some modules may not respond to this test service under all conditions. All modules must respond to this test service request with the ignition ON and with the engine not running. Modules that cannot perform this operation under other conditions, such as with the engine running, will ignore the request. 5. 5. 2. Message Data Bytes #6 Request to Clear/Reset Emission-Related Diagnostic Information #5 #2 #1 Data Bytes (Hex) #4 #3 #7 Clear Powertrain DTC 04 Report when Emission-Related Diagnostic Information is Reset Powertrain -DTC- cleared 44 Figure 10 Message Data Bytes 174 5. 6. Service $05 - Request Oxygen Sensor Monitoring Test Results 5. 6. 1. Functional Description The purpose of this service is to allow access to the on-board oxygen sensor monitoring test results. The same information may be obtained by the use of Service $06 The request for test results includes a Test ID value that indicates the information requested. Test value definitions, scaling information, and display formats are included in this document. Many methods may be used by different manufacturers to comply with this requirement. If data values are to be reported using these messages that are different from those predefined in this document, ranges of test values have been assigned that can be used which have standard units of measure. The tool can convert these values and display them in the standard units. The on-board module will respond to this message by transmitting the requested test data last determined by the system. The operation of this diagnostic service in the on-board module is different from Service $01. Service $01 reports data value(s) that are stored internally at a single, or multiple contiguous, locations in memory. Service $05 can report data values that are stored in non-contiguous memory locations. As an example, test results may be stored in RAM, and test limits, (if the value is a calculated value), would normally be stored in ROM. Therefore, the on-board software has additional requirements to respond to this request than it does for Service $01 requests. Not all test values are applicable or supported by all vehicles. An optional feature of this test service is for the on-board module to indicate which test IDs are supported. Test ID $00 is a bit-encoded value that indicates support for test IDs from $01 to $20. Test ID $20 indicates support for test IDs $21 through $40, etc. This is the same concept as used for PID support in test services $01 and $02. If Test ID $00 is not supported, then the module does not use this feature to indicate test ID support. 175 5. 6. 2. Message Data Bytes #1 #2 Data Bytes (Hex) #4 #3 #5 #6 #7 Request Oxygen Sensor Test Results 05 Test ID 02S Sens# Request Oxygen Sensor Test Results Report Oxygen Sensor Test ID Support - Optional (Test IDs $00, $20, $40, $60, $80, $A0, $C0, $E0) Report Oxygen Sensor Test ID Support 45 Test ID 02S Sens# Support for the next 32 test IDs following the requested ID is indicated in data bytes #4 through #7 Report Oxygen Sensor Test Results (All Test IDs That Do Not Indicate Test ID Support) Data is only valid if Service $01 PID $01 indicates Oxygen Sensor monitoring is supported and the test is complete. Report Oxygen Sensor Test Results 45 Test ID 0 2 S# test value min limit * max limit * Figure 11 - Message data Bytes * NOTE: report limits if value is a test result - not required for test constants, such as ID $01 to $04 Results of latest mandated on-board oxygen sensor monitoring test Oxygen Sensor Output Figure 12 - Test ID Value Example - Note: Numbers refer to Test ID 176 Data Description Byte 2 Which Test ID: ' ~ $00 - Test ID's supported - optional ($01 to $20) $01 - Rich to lean sensor threshold voltage (constant) $02 - Lean to rich sensor threshold voltage (constant) $03 - Low sensor voltage for switch time calculation (constant) $04 - High sensor voltage for switch time calculation (constant) $05 - Rich to lean sensor switch time (calculated) $06 - Lean to rich sensor switch time (calculated) $07 - Minimum sensor voltage for test cycle (calculated) $08 - Maximum sensor voltage for test cycle (calculated) $09 - Time between sensor transitions (calculated) $0A-$1F - reserved $20 - Test ID's supported - optional ($21 to $40) $21-$2F - values with units of time less than 1. 02 seconds $30-$3F - values with units of time less than 10. 2 seconds $40 - Test ID's supported - optional ($41 to $60) $41-$4F - values with units of voltage less than 1. 275 volts $50-$5F - values with units of voltage less than 12. 75 volts $60 - Test ID's supported - optional ($61 to $80) $61-$6F - values with units of Frequency less than 25. 5 Hz $70-$7F - values with units of counts less than 255 counts $80 - Test ID's supported - optional ($81 to $A0) $81-$9F - manufacturer specific values / units $A0 - Test ID's supported - optional ($A1 to $C0) $A1-$BF - manufacturer specific values ! units $C0 - Test ID's supported - optional ($C1 to $E0) $C1-$DF - manufacturer specific values / units $E0 - Test ID's supported - optional ($E1 to $FF) $E1-$FF - manufacturer specific values / units 3 Oxygen sensor location (one, and only one bit can be set to a 1): bit Sensor location * Alternative sensor location + 0 Bank 1 - Sensor 1 Bank 1 - Sensor 1 1 Bank 1 - Sensor 2 Bank 1 - Sensor 2 2 Bank 1 - Sensor 3 Bank 2 - Sensor 1 3 Bank 1 - Sensor 4 Bank 2 - Sensor 2 4 Bank 2 - Sensor 1 Bank 3 - Sensor 1 5 Bank 2 - Sensor 2 Bank 3 - Sensor 2 6 Bank 2 - Sensor 3 Bank 4 - Sensor 1 7 Bank 2 - Sensor 4 Bank 4 - Sensor 2 * If Service $01 PID $13 supported +If Service $01 PID $ ID supported ~~ The following 4 bytes define data bytes for Test IDs that indicate support of other Test IDs - optional ($00, $20, $40, $60, $80, $A0, $C0, and $E0) 4 Support for Test ID, where l=support, 0=non-support: bit 7 - support for Test ID request + $01 bit 6 - support for Test ID request + $02 bit 0 - support for Test ID request + $08 177 Support for Test ED, where l=support, O=non-support: bit 7 - support for Test ID request + $09 bit 6 - support for Test ID request + $0A bit 0 - support for Test ID request + $10 Support for Test ID, where l=support, 0=non-support: bit 7 - support for Test ID request + $11 bit 6 - support for Test ID request + $12 bit 0 - support for Test ID request + $18 Support for Test ID, where l=support, 0=non-support: bit 7 - support for Test ID request + $19 bit 6 - support for Test ID request + $1A bit 0 - support for Test ID request + $20 The following 3 bytes define data bytes for Test IDs that report data values Test ID: Test ID $01 Test ID $02 Test ID $03 Test ID $04 Test ID $05 Test ID $06 Test ID $07 Test ID $08 Test ID $09 Test ID $21-$2F Test ID $30-$3F Test ID $41-$4F Test ID $50-$5F Test ID $61-$6F Test ED $70-$7F Min ($00): 0 volt 0 volt Ovolt 0 volt 0 sec. 0 sec. Ovolt Ovolt 0 sec. 0 sec. 0 sec. Ovolt 0 volt 0 Hz 0 counts Max ($FF): 1. 275 v. 1. 275 v. 1. 275 v. 1. 275 v. 1. 02 sec. 1. 02 sec. 1. 275 v. 1. 275 v. 10. 2 sec. 1. 02 sec. 10. 2 sec. 1. 275 v. Scaling/bit. 005 v. 005 v. 005 v. 005 v. 004 sec. 004 sec. 005 v. 005 v. 04 sec. 004 sec. 04 sec. 005 volt. 05 volt. 1 Hz 12. 75 v. 25. 5 Hz 255 counts Minimum test limit (only for calculated test result) see Data Byte #4 for minimum value, maximum value, and scaling Maximum test limit (only for calculated test result) see Data Byte #4 for minimum value, maximum value, and scaling 1 count *NOTE: Current oxygen sensors are nominally 1 volt full scale. If an oxygen sensor is used with a different nominal output, the output voltage should be normalised to 1 volt. Full scale should be reported as $C8 (decimal 200), which allows for reporting an overvoltage condition. Figure 13 - Message Data Byte Description 178 5. 7. Service continuously Monitored Systems $06 - Request On-Board Monitoring Test Results for Non- 5. 7. 1. Functional Description The purpose of this test service is to allow access to the results for on-board diagnostic monitoring tests of specific components/systems that are not continuously monitored. Examples are catalyst monitoring and the evaporative system monitoring. The vehicle manufacturer is responsible for assigning test IDs and component IDs for tests of different systems and components. Test results are requested by test ID. Only one test limit is included in a response message, but that limit could be either a minimum or a maximum limit. If both a minimum and maximum test limit are to be reported, then two response messages will be transmitted, in any order. The most significant bit of the "test limit type / component ED" byte will be used to indicate the test limit type. This test service can be used as an alternative to Service oxygen sensor test results. $05 no report 5. 7. 2. Message Data Bytes Request Test Results #1 06 #2 Data Bytes (Hex) #3 | #4 | #5 #6 #7 Request Test Results Test ID Report Test ID Support (Test IDs $00, $20, $40, $60, $80, $A0, $C0, $E0) Report Test ED Support 46 Test ID FF Support for the next 32 test IDs following the requested ID for any component is indicated in data bytes #4 through #7 Report 1 Multiple Response (Test IDs other than $00, $20 Data is only valid if Service $01 P supported and t Test ID Report Test Results 46 rest Results s may be Transmitted , $40, $60, $80, $A0„$C0, $E0) ID $01 indicates the monitoring test is le test is complete. Test Limit Type & Component ID test value test limit MSB LSB MSB LSB 179 Data Byte 2 Description Test ID: $00 - Test ID's supported ($01 to $20) $01-$ IF - values defined by manufacturer $20 - Test ED's supported ($21 to $40) $21-$3F - values defined by manufacturer $40 - Test ID's supported ($41 to $60) $41-$5F - values defined by manufacturer $60 - Test ID's supported ($61 to $80) $61-$7F - values defined by manufacturer $80 - Test ID's supported ($81 to $A0) $81-$9F - values defined by manufacturer $A0 - Test ID's supported ($A1 to $C0) $A1-$BF - values defined by manufacturer $C0 - Test ID's supported ($C1 to $E0) $C1-$DF - values defined by manufacturer $E0 - Test ID's supported ($E1 to $FF) $E1-$FF - values defined by manufacturer bit 7: Most significant bit indicates type of test limit, where: 0 - test limit is maximum value - test fails if test value is greater than this value 1 - test limit is minimum value - test fails if test value is less than this value If the test result should be within a range of values, two messages will be returned, one with the maximum value and one with the minimum value bit 6 - bit 0: Component ID - manufacturer defined - necessary when multiple components or systems are present on the vehicle and have the same definition of test ID 180 The following 4 bytes define data bytes for Test IDs that indicate support of other Test IDs (Services $00, $20, $40, $60, $80, $A0, $C0, and $E0) Support for Test ID, where l=support, 0=non-support: bit 7 - support for Test ID request + $01 bit 6 - support for Test ID request + $02 bit 0 - support for Test ID request + $08 Support for Test ID, where l=support, 0=non-support: bit 7 - support for Test ID request + $09 bit 6 - support for Test ED request + $0A bit 0 - support for Test ID request + $10 Support for Test ID, where l=support, 0=non-support: bit 7 - support for Test ID request + $11 bit 6 - support for Test ID request + $12 bit 0 - support for Test ID request + $18 Support for Test ID, where l=support, 0=non-support: bit 7 - support for Test ID request + $19 bit 6 - support for Test ID request + $1A bit 0 - support for Test ID request + $20 The following 4 bytes define data bytes for Test EDs that report data values (multiple response messages will be received if there are multiple components that support the same test ID and $FF is included as data byte #3 in the request ) m g a e e s s 4-5 Test result (two byte value) - this value should be less than or equal to the test limit if most significant bit of data byte #3 is '0', and should be greater than or equal to the test limit if most significant bit of data byte #3 is '1' [Integer values] 6-7 Test limit (two byte value) [Integer values] Figure 14 - Message Data Bytes 181 5. 7. 3. Message Example #1 06 46 06 46 06 46 06 46 06 46 06 46 Request Test ID Support - ID in Hex Report Support for Test IDs 06, 10, IE and 20 Request Test ID Support Report Support for Test ID 40 Request Test ID Support Report Support for Test ID 60 Request Test ED Support Report Support for Test ID 80 Request Test ID Support Report Support for Test ID A0 Request Test ID Support Report Support for Test ID Al - no additional test IDs supported #2 #3 Determine Test ID Support #4 Data Bytes (Hex) #5 #6 #7 00 00 20 20 40 40 60 60 80 80 A0 A0 FF FF FF FF FF FF 00000100 =04 00000001 =01 00000000 =00 00000000 =00 00000000 =00 00000000 =00 00000000 =00 00000000 =00 00000000 =00 00000000 =00 10000000 =10 00000000 =00 0000000 0 =00 0000010 1 =05 0000000 0 =00 0000000 1 =01 0000000 0 - =00 0000000 1 =01 0000000 0 =00 0000000 1 =01 0000000 0 =00 0000000 1 =01 0000000 0 =00 0000000 0 =00 Following messages indicate test results for component 01 greater than the minimum Request Results for Test ID 06 Repou Results for component 01 - test value exceeds minimum - passed 06 46 06 06 81 test value minimum test limit 32 C4 16 00 cate test results greater than the maximum for component ID 01 less than the maximum for component 02 Following messages indi anc Request Results for Test ED 10 Report Results for component 01 - test value greater tfian maximum - failed Report Results for component 02 - test value less than maximum - passed 06 46 10 10 01 test value maximum test limit 46 10 02 • 92 36 test value 7F FF maximum test limit 06 61 58 43 182 Following messages indicate test results for component 31 between the minimum and maximum limits Request Results for Test ID Al Report Results for component 31 - test value greater than minimum - passed 06 46 Al Al Bl test value 46 Al 31 35 95 test value Report Results for component 31 - test value less than maximum - passed minimum test limit 14 00 maximum test limit 35 95 66 53 Figure 15 - Message Example 5. 8. Service $07 - Request On-Board Monitoring Test Results for Continuously Monitored Systems 5. 8. 1. Functional Description for emission-related powertrain components/systems The purpose of this service is to enable the off-board test device to obtain test results that are continuously monitored during normal driving conditions. The intended use of this data is to assist the service technician after a vehicle repair, and after clearing diagnostic information, by reporting test results after a single driving cycle. If the test failed during the driving cycle, the DTC associated with that test will be reported. Test results reported by this service do not necessarily indicate a faulty component/system. If test results indicate a failure after additional driving, then the MI will be illuminated and a DTC will be set and reported with Service $03, indicating a faulty component/system. Test results for these components/systems are reported in the same format as •the diagnostic trouble codes in Test Service $03 - refer to the functional description for Service $03. If less than 3 DTC values are reported for failed tests, the response messages used to report the test results should be padded with $00 to fill 7 data bytes. This maintains the required fixed message length for all messages. If there are no test failures to report, no response is required. 5. 8. 2. Message Data Bytes Data Bytes (Hex) #1 #2 #3 | #4 | #5 #6 #7 Request test results for continuously monitored systems Request test results | Report test results for continuously monitored systems | 07 | Report test results 47 Code #1 or 00 00 Code #2 or 00 00 Code #3 or 00 00 Figure 16 - Message Data Bytes 183 5. 9. Service $08 - Request Control of on-board system, test or component 5. 9. 1. Functional Description The purpose of this service is to enable the off-board test device to control the operation of an on-board system, test or component. The data bytes will be defined, if necessary, for each Test ED, and will be unique for each Test ID. If any data bytes are unused for any test, they should be filled with $00 to maintain a fixed message length. Possible uses for these data bytes in the request message are: Turn device ON Turn device OFF Cycle device for nn seconds. Possible uses for these data bytes in the response message are: Data Bytes (Hex) #4 #3 #5 #6 #7 Data C or $00 DataD or $00 DataE or $00 DataC or $00 DataD or $00 DataE or $00 - Report system status - Report test results 5. 9. 2. Message Data Bytes #1 #2 Request control of on board device 08 Test ID Request control o ? on-board device DataB Data A or or $00 $00 Report control of on board device 48 Report control of on-board device DataB or $00 Data A or $00 Test ID Figure 17 - Message Data Bytes 184 5. 9. : Test ID and Data Byte Description Test ID (Hex) 00 I Test ID and Data Byte Description Test IDs supported ($01 to $20) Request: Data bytes A to E should be set to $00 Response: Data A - $00 Data B - Same as Data Byte #4 in Service $06 Data C - Same as Data Byte #4 in Service $06 Data D - Same as Data Byte #4 in Service $06 Data E - Same as Data Byte #4 in Service $06 01 Evaporative system leak test Data bytes A to E should be set to $00 for request and response. If the conditions are not proper to run the test, the vehicle may either not respond to the request, or may respond with a manufacturer defined value as Data A which corresponds to the reason the test cannot be run. This test mode enables the conditions required to conduct an evaporative system leak test, but does not actually run the test. An example is to close a purge solenoid, preventing leakage if the system is pressurised. The vehicle manufacturer is responsible to determine the criteria to automatically stop the test (open the solenoid in the example), such as engine running, vehicle speed greater than zero, or exceeding a specified time period. 02-FF J Reserved - to be defined by ISO / SAE Figure 18 Test ED and Data Byte Description 185 Appendix 3 Scope This Appendix defines the requirements of OBD tools, i. e. test equipment that will interface with vehicle modules in support of the OBD diagnostic requirements. It covers the required capabilities of and conformance criteria for OBD Scan Tools. This Appendix is based on ISO CD XXX4 and SAE J1978, "OBD II Scan Tool". 2. References 2. 1. Applicable Documents: The following publications form a part of this Appendix to the extent specified herein. 2. 1. 1. Normative References ISO Documents: ISO 9141-2: 1994 (E) 2. 1. 2. Informative References SAE Documents: "Road Vehicles - Diagnostic Systems - CARB Requirements of Digital Information" Interchange for SAE J1850 SAE J1930 SAE J1962 SAE J1979 SAE J2012 SAE J2201 SAE J2205 Class B Data Communication Network Interface Electrical / Electronic Systems Diagnostic Terms, Acronyms, and Definitions Diagnostic Connector E/E Diagnostic Test Modes Recommended Diagnostic Trouble Codes Format and Messages for Universal Interface for OBD II Scan Tools DRAFT - Expanded Diagnostic Protocol California Code of Regulations, Section 1968. 1 Title 13 - "Malfunction and Diagnostic System Requirements 1994 and Subsequent Model Year Passenger Cars, Light Duty Trucks, and Medium Duty Vehicles With Feedback Control Systems" Environmental Protection Agency 40 CFR Part 86 Control of Air Pollution From New Motor Vehicles and New Motor Vehicle engines; Regulations Requiring On-Board Diagnostic Systems on 1994 and later Model Year Light- Duty Vehicles and Light-Duty trucks 186 4. Most terms for components and systems, contained in this document are included in ISO CD XXX3 (SAE J1930) - Terms, Definitions, and Acronyms. This Section includes additional definitions of terms used in this document, not included in ISO CD XXX3. 4. 1. Service = Test Mode 4. 2. No further definitions 5. Required Functions The following are the basic functions that the OBD Scan Tool is required to support or provide: - Automatic hands-off determination of the communication interface used, - Obtaining and displaying the status and results of vehicle on-board emission related diagnostic evaluations, - Obtaining and displaying OBD emissions related diagnostic trouble codes (DTCs), - Obtaining and displaying OBD emissions related current data, - Obtaining and displaying OBD emissions related freeze frame data, - Clearing the storage of OBD emissions related diagnostic trouble codes, OBD emissions related freeze frame data storage and OBD emissions related diagnostic tests status, - Ability to perform Expanded Diagnostic Protocol functions as described in ISO CD XXX6 (SAE J2205), - Obtaining and displaying OBD II emissions related test parameters and results as described in Appendix 2, - Provide a user manual and/or help facility. 6. Vehicle Interface The following specifies the minimum vehicle interfaces to be supported by an OBD Scan Tool. 6. 1. Communication Data Link and Physical Layers — The OBD Scan Tool must be able to communicate with vehicle control modules using the communication interfaces described as follows. ISO CD XXX6(SAE J2205) describes a set of functions and communication criteria. 6. 1. 1. ISO 11519-4 Recommended Practice Class B Data Communication Network Interface ISO 11519-4 describes two sets of data link and physical layers for class B vehicle serial multiplex bus networks. The OBD Scan Tool must support both ISO 11519-4 protocols in a manner that is transparent to the user. 187 6. 1. 2. ISO 9141-2: 1994 (E) Road Vehicles - Diagnostic Systems - CARB Requirements for Interchange of Digital Information ISO 9141-2 describes the physical and data link layers of a vehicle serial diagnostic bus. Refer to ISO CD XXX9 for further clarification regarding the use of ISO 9141-2. 6. 1. 3. ISO CD 14230-1,2 Road Vehicles - Diagnostic Sytems - Keyword Protocol 200 - Physical and Data Link Layers Refer to ISO 14230 for further clarification regarding the use of KWP2000. 6. 2. Connector The OBD Scan Tool must be compliant with SAE J1962 Diagnostic Connector. The OBD Scan Tool must support the Standard Pin Assignments defined in SAE J1962. 6. 3. Messages Appendix 2 or ISO 14230-1,2 describes the request messages to be sent by the OBD Scan Tool to the vehicle and the response messages to be sent by the vehicle to the OBD II Scan Tool in order to perform the required services. 6. 4. Expanded Diagnostic Protocol The OBD Scan Tool must allow the user to enter and send vehicle specific messages defined and supplied in motor vehicle manufacturer documents and ISO CD display XXX6(SAE J2205). response messages, as defined related the in 6. 5. Automatic Hands Off Determination of the Communication Interface Used in a Given Vehicle 6. 5. 1. General While there are four types of communication interfaces that could be used to access the OBD functions in a given vehicle (i. e. ISO 11519-4(SAE J1850) 41. 6 Kbps PWM, ISO 11519-4(SAE J1850) 10. 4 Kbps VPW with CRC, ISO 9141-2, KWP2000 ISO CD 14230-1,2), only one is allowed to be used in any one vehicle to access all supported OBD functions. When connected to a vehicle and/or when the OBD support is selected where such a selection is necessary, the OBD Scan Tool shall automatically attempt to determine which of the possible communication interfaces is being used in the vehicle to support OBD related functions. The tool will continue to try to determine which interface is being used until it is successful in doing so. No user the appropriate interface. required, nor allowed, input will be to determine 188 Indications or messages will be displayed during this process informing the user that initialisation is taking place and, if all interface types have been tested and none is responding properly to the request for OBD services, the OBD Scan Tool must advise the user: - To verify that the ignition is on. - To check the emissions label or vehicle service information to verify that the vehicle is OBD equipped. - To check that the tool is connected to the vehicle correctly. 6. 5. 2. Initialisation Details Only the following steps shall be used by an OBD Scan Tool to attempt to determine the type of communications interface used in a given vehicle to support OBD functions. - Test for ISO 11519-4(SAE J1850) 41. 6 Kbps PWM step 1: enablethelSO 11519-4(SAE J1850) 41. 6 Kbps PWM interface step 2: send a service 1 PID 0 request message step 3: if a service 1 PED 0 response message is received then ISO 11519-4(SAE J1850) 41. 6 Kbps PWM is the type of interface used in a vehicle for OBD support. - Test for ISO 11519-4(SAE J1850) 10. 4 Kbps VPW step 1: enablethelSO 11519-4(SAE J1850) 10. 4Kbps VPW interface step 2: send a service 1 PID 0 request message step 3: if a service 1 PID 0 response message is received then ISO 11519-4(SAE J1850) 10. 4 Kbps VPW with CRC is the type of interface used in a vehicle for OBD support. - Test for ISO 9141-2 step 1: enable the ISO 9141-2 interface step 2: if the initialisation sequence defined completed successfully, interface used in a vehicle for OBD II support. in ISO 9141-2 is then ISO 9141-2 is the- type of - Test for KWP2000 ISO CD 14230-1,2 step 1: enable the ISO 14230-1,2 interface step 2: if the initialisation sequence defined in ISO 14230-1,2 is completed successfully, then ISO 14230-1,2 is the type of interface used in a vehicle for OBD support. The previous tests may be performed in any order and where possible may be performed in parallel. The service 1 PID 0 request and response messages are defined in Appendix 2. 189 If the tester failts to establish communications using and of the initialisations and if the ignition is on and the vehicle emissions label or service information indicates the vehicle is OBD equipped, then the tester should indicate that there is a Data Link fault. 6. 6. On-Board Diagnostic Evaluations 6. 6. 1. Completed On-Board System Readiness Tests Immediately after initial communications are established, the OBD Scan Tool shall obtain the status of the on-board system readiness tests. If any supported tests have not been completed, the OBD Scan Tool shall indicate to the user: "Not all supported on-board system readiness tests have been completed" or equivalent. The OBD Scan Tool shall also allow the user to identify which readiness tests (if any) have not been completed. 6. 6. 2. Supported On-Board System Readiness Tests The OBD Scan Tool must be capable of indicating to the user which of the tests defined by Appendix 2 service 1 PED 1 data bytes 4 and 5 are supported and which are completed. 6. 6. 3. Malfunction Indicator The OBD Scan Tool must be capable of indicating if the MI has been commanded ON and if so, by which module or modules. 6. 7. Use of ISO CD XXX5(SAE J2201) Universal Interface for OBD Scan Tools The OBD Scan Tool shall use the interface described in ISO CD XXX5(SAE J2201), or an equivalent, as the interface to vehicles. 6. 8. Handling of No Response from Vehicle Vehicle modules may not respond to request messages from the OBD II Scan Tool because of incorrect communication of a request message or because the module does not support the request message. If a response is not received within the timeout period prescribed by the protocol, the scan tool shall: - first, retransmit the request message, - second, if still no response is received, transmit a service 1 PID 0 request message, in order to determine if communication with the vehicle is currently possible, and if the data desired is available, - - third, if a service 1 PID 0 response is received, transmit other messages, if available, to determine if the desired data is supported by the vehicle, lastly, if the above steps fail then as appropriate indicate to the user, that communication with the vehicle, the module or for the information the user has selected can not be performed. 6. 9. Connections Diagnostic Connector to the Vehicle in Addition to the SAE J1962 When connections are made between external equipment and the vehicle in addition to connections made between the same external equipment and the vehicle using the SAE J1962 Diagnostic Connector, any ground circuits must conform to the requirements of the Chassis Ground circuit in the SAE J1962 connector. The intent of this requirement is to maintain the isolation between the vehicle ground and the signal ground in external equipment. 190 7. System Interaction Capability 7. 1. Obtain and Display OBD II Emissions Related Diagnostic Trouble Codes The OBD Scan Tool must be capable of obtaining, converting and displaying OBD emissions related diagnostic trouble codes from a vehicle that can be transmitted by a response to a ISO CD XXX1(SAE J1979) request (see Appendix 2). Either the diagnostic trouble code, its descriptive text or both must be displayed. Diagnostic Trouble Codes and their descriptive text are defined in Appendix 4. When diagnostic trouble code data are selected for display, the OBD Scan Tool will continuously request of the vehicle it's DTC data and display the data received in the corresponding response messages. 7. 2. Obtain and Display OBD Emissions Related Current Data, Freeze Frame Data, Test Parameters and Results The OBD Scan Tool must be capable of obtaining, converting and displaying: - OBD emissions related current data; - OBD emissions related freeze frame data; - test parameters and results data as described in Appendix 2. Appendix 2 details the available data, the messages to be used to request the data, the messages to be used to return the data, the conversion values for the data and the format to be used to display the data. When current data items are selected for display, the OBD Scan Tool will continuously request of the vehicle the data to be displayed and display the data received in the corresponding response messages. When freeze frame or test parameters and results are selected for display, the OBD Scan Tool does not need to continuously request and display those items. Where applicable, the OBD II Scan Tool must indicate whether a test limit is a high limit or a low limit. Where applicable, the display of test results must also show the test ID and component ED. Data from the vehicle may indicate which items are supported, in which case this information shall be made available to the user by the OBD scan tool. The OBD Scan Tool shall also allow users to specify requests for services, parameters, test IDs, etc. irrespective of whether the vehicle has indicated support for such items. 7. 3. Responses from Multiple Modules — The OBD Scan Tool must be capable of interfacing with a vehicle in which multiple modules may be used to support OBD requirements. The QBD Scan Tool must inform the user when multiple modules respond to the same request. The OBD Scan Tool must inform the user when multiple modules respond with different values for the same data item. The OBD Scan Tool must provide the user with the ability to select for display, as separate items, the responses received from multiple modules for the same data item. 191 7. 4. Code Clearing The OBD Scan Tool must be capable of sending a request to clear OBD emissions related diagnostic trouble codes, OBD emissions related freeze frame data and OBD emissions related diagnostic tests status information. The OBD Scan Tool must require the user to confirm such a request before transmitting (e. g. are you sure?). 8. General Characteristics 8. 1. Display The OBD Scan Tool must be capable of displaying simultaneously at least 2 (two) items of OBD emissions related data/ A list of the OBD emissions related current data and freeze frame data items, their Parameter IDs, data resolution and data conversion information, units and display formats is provided in Appendix 2. The display units shall be the Standard International (SI) and English units as specified in Appendix 2. A user shall be able to select between English and SI values. The unit conversions specified in Appendix 2 shall be used. The display of each OBD emissions related current data or freeze frame data shall include the following: - Data value; - Data Parameter ID or name; - The module ID of the module that supplied the data. The display of each OBD emissions related diagnostic trouble code shall include the module ID of the module that supplied the code. As a minimum the data values of two data items must be displayed simultaneously. A display of the parameter EDs of the data items and the IDs of the modules that supplied the data items must be easily accessible if not displayed with the data values. The units of measurement associated with the data items must either be: - Displayed with the data values or; - easily accessible on the display or; — - readily available to the user (e. g. on the tester body); - Having this information available in a user's manual separate from the body of tiie tool does not satisfy this requirement. The display must be capable of showing at least alphanumeric characters. 192 8. 2. User Input The OBD Scan Tool must include some form of user input that would allow the user to: - Select between the basic functions required by OBD II, i. e: - display current data - display freeze frame data - display trouble codes - clear emissions related data - display test parameters and results); - select for simultaneous display at least two items of any one of the following: - OBD emissions related current data - OBD emissions related diagnostic trouble codes - OBD emissions related freeze frame data - OBD emissions related test parameters and results. Responses from multiple modules to requests for a current data item or a freeze frame data item are treated as separate data items for selection and display purposes - To verify a request to clear and/or reset OBD emissions related diagnostic information as defined by Appendix 2. - Enter and send Expanded Diagnostic Protocol messages as defined in ISO CD XXX6 (SAE J2205) Power Requirements if Powered by the Vehicle Through the ISO 11519 (SAE J1962) Diagnostic Connector Voltage Must operate normally within a range of 8. 0 to 18. 0 volts D. C. Must survive a steady state voltage of up to 24. 0 volts D. C. for at least 10. 0 minutes. Must survive a steady state reverse voltage of up to 24. 0 Volts D. C. for at least 10 minutes. The tool must withstand cranking in that communications and data shall not be lost during battery voltage reductions to 5. 5V for up to 0. 5s. The display need not function during this period. For Maximum current refer to ISO 11519(SAE J1962). 193 10. Electromagnetic Compatibility (EMC) The tool must not interfere with the normal operation of vehicle modules. The normal operation of the tool must be immune to conducted and radiated emissions present in a service environment and when connected to a vehicle. The tool must be immune to reasonable levels of Electrostatic Discharge (ESD). EMC and ESD measurements and limits will be in accordance to the standards prevailing in the country in which the tester is to be sold. 11. Conformance Testing 11. 1. General The documents relating to confromance testing are still being prepared. When they are completed the tests outlined below will need to be revised accordingly. Conformance testing defines the tests required to be passed in order for tools to be type approved as "ISO CD XXX4 <date to be added> OBD SCAN TOOL COMPATIBLE" or "CONFORMS TO ISO CD XXX4". Tools that do not pass these tests are not to be so labelled. Validation of the conformance test is the responsibility of the Scan Tool manufacturer and the Scan Tool manufacturer may elect to self-certify. The tests in this section must be performed successfully 5 consecutive times in order to be considered passed. Three examples of at least production intent level tools must pass all these tests in order for a given version of tool hardware and software to be considered passed. Any changes to the hardware or software used in a tool for the functions described in this document will require a retest of these tests or an explanation from the tool manufacturer as to why the change should not require a retest. Where an explanation is submitted in lieu of a retest due to a change, the organization originally performing these tests will determine whether the explanation is acceptable or whether a retest is required. Reasonable normal engineering criteria will be used when determining whether to accept an explanation. The Scan Tool manufacturer shall make available to the buying public: - The methods used to make these tests - The results of the tests - Clear indication of the versions of hardware and software that conform (i. e. labeled as conforming to or are compatible with the requirements of ISO CD XXX4 OBD Scan Tool or other labeling to that effect). 194 Both proper and improper response messages will be employed during these tests. Improper responses are those that have incorrect first, second or third bytes of the header, an incorrect mode, an incorrect PED, an incorrect length of the response message, or with an incorrect CRC or CS. The tool must ignore all improper response messages and perform as if no response was received. Situations involving multiple modules responding to a single request, single modules responding with multiple responses to a single request and multiple modules responding with multiple responses to a single request will be tested. The interval between the end of the request message and the beginning of the response message(s) will be varied from 0 ms up to the delay required to show a no response indication on the OBD II Scan Tool. The delay that causes the no response indication will be compared to the value defined in each protocol. The format, content and order of messages transmitted on each of the buses will be observed and reviewed for correctness. The ability to obtain and report the results of the on-board system readiness tests shall be verified. The ability to report which tests the vehicle supports and have been completed shall be verified. The requirements described in 11. 3 through 11. 7 (inclusive) shall be verified on each protocol specified in 6. 1. When performing these tests, observation of the indications and displays provided to the user and the signals on the ISO 11519-4 (SAE J1850) (bus +) and (bus -) lines, the ISO 9141-2 K and L lines and ISO 14230-1,2 K and L lines will be the criteria for proper performance. These tests will be executed in an environment of 25 degrees C +/-3 degrees C and between 30% and 80% relative humidity +/- 5%. The hardware and software used in the OBD II Scan Tool version being tested ' must be identified. 11. 2. Determine OBD II Communication Type Item to be tested: Automatic hands off determination of interface type - - - - - that it is automatic when the SAE J1962 connector is plugged into its mating connector in the vehicle and/or OBD support is selected, where such a selection is necessary. that a test of all OBD communication interfaces is performed at least once per scan. that the scan of all interfaces continues until successful or until terminated by the user. that some indication is provided to the user that the scan of interfaces is being performed. that a failure to successfully find an OBD II interface during a scan of all the possible interfaces is indicated to the user at the completion of each and every scan. 195 - - - - - that when an OBD interface is successfully found, the tool automatically prompts the user for function selection. that the tool provides and uses the facilities and/or messages defined in SAE J2201 (or equivalent), Appendix 2, ISO 9141-2, ISO 11519-4 (SAE J1850), ISO 14230 and Appendix 4. that the tool does not exceed the polling rates specified in Appendix 2. that the tool provides the proper bias for the K and L lines as specified in ISO 9141-2 and ISO 14230-1. that the tool performs the initialisation tests according to 6. 5. 2, and indicates the information according to 6. 5. 1. The interface determination tests will be performed: - with no modules available, - with an ISO 9141-2 module available, - with a KWP2000 (ISO 14230) module available, - with a ISO 11519 (SAE J1850) 41. 6 Kbps PWM module available, - with a ISO 11519 (SAE J1850) 10. 4 Kbps VPW module available. 11. 3. On-Board System Readiness Tests Item to be tested: - that the tool automatically requests and reports the results of the supported on-board system readiness tests. 11. 4. Select Functions Item to be tested: - - that the tool supports the functions described in Section 5. that the user is able to move back and forth between these functions. The criteria for successfully passing this test is to be able to easily move back and forth between all functions and observe the results. - 11. 5. Select and Display Items Item to be tested: - that the user is able to select and display simultaneously at least two items from any one of: - available DTC's, - current data items, - available freeze frame data items, and - test parameters and results. 196 - - - - - - - that the module ID's and the PID's or parameter names associated with either all the (a) simultaneously with the displayed items, or (b) in some alternate method (printed material, etc. ). also be displayed items mentioned above can that the units-of-measurement information associated with all the possible current data items and freeze frame data items is easily available either as a part of the data display, displayed separately, or otherwise available on or with the tool body itself. that the tool is able to handle multiple responses from the same module due to one request. that the tool is able to handle responses from multiple modules due to one request. that the tool is able to handle multiple responses from multiple modules due to one request. that the tool informs the user that responses from multiple modules due to one request were received. Responses for multiple modules to a request are to be made available to the user as separate items for display. that the tool informs the user that different responses from multiple modules due to one request were received. The criteria for successfully passing this test is to easily select back and forth between all the items and observe the results. 11. 6. Verify Requests to Clear Codes Item to be tested: - - that the selection of the Clear Codes function incorporates a request to the user to verification. that both yes and no responses to the request to the user to verify the selection of the Clear Codes function are processed appropriately. This test should involve situations where there are some DTC's to clear and other situations where there are no DTC's to clear. When making this test, the presence of DTC's must be verified both before and after the Clear Codes function is selected. 11. 7. General Diagnostic Communication Tests When performing tests involving diagnostic messages, tests are to be made of the tool's ability to handle an immediate response, a slow response and a response delayed longer than the maximum allowed by each of the protocols. The tool should be able to process all responses that are received within the maximum time allowed by each protocol and indicate a no response condition to the user when the response is delayed longer than the maximum allowed by each protocol. The tool must support the transmission of its node address as an in-frame- response during the transmission of any response messages from modules on a ISO 11519 (SAE J1850) bus and must be able to handle both the presence and the absence of an in-frame-response during the tool's transmission of request messages. 197 11. 8. Expanded Diagnostic Protocol Item to be tested: - that the user is reasonably able to enter Expanded Diagnostic Protocol (EDP) input and that the OBD Scan Tool correctly executes the entered EDP input. 11. 9. Capacitance and Impedance at the SAE J1962 Connector Item to be tested: - that the capacitance and impedance of the OBD Scan Tool, connecting cables and the male SAE J1962 connector, as seen at the connector, are within the limits defined in ISO 11519 (SAE J1850), ISO 9141-2, ISO 14230 and SAE J1962. Note that SAE J1962 details the impedance of both the used and unused pins. Measurement of these parameters will be made by the testing agency at their discretion following generally acceptable engineering practices. 11. 10. Operating Voltage and Current Draw Item to be tested: - - that the OBD Scan Tool will correctly operate throughout the voltage range specified in the Section 9 of this Appendix and will not require more than the maximum current specified in the Section 9 of this Appendix. that the tool will survive the use of supply voltages of up to the maximum survival voltage and survival reverse voltage specified in the Section 9 of this Appendix. During other conformance tests, the voltage supplied to the OBD Scan Tool is to be varied throughout the specified range and check for continuous operation. Also the current draw is to be compared with the limit specified. 11. 11. Protocol Check Item to be tested: - that all the request and response messages defined by each of the protocols, as specified in Section 6 are properly and appropriately used by the OBD Scan Tool. 11. 12. Alphanumeric Display Item to be tested: - that the OBD Scan Tool is able to display alphanumeric characters. The results of the above test will be observed to determine the ability of the OBD Scan Tool to display alphanumeric characters. 11. 13. User Manual and Help Facility Item to be tested: - that a useful user manual and/or HELP facility is available with the OBD Scan Tool. 198 - that the user manual and/or HELP facility at least includes: - Parameter definitions and Test Ids as described in Appendix 2; - DTC definitions as described in Appendix 4; - All abbreviations used by the tool; - how to select the functions; - how to select items for simultaneous display; - how to determine the PED, item name and module ED of data returned for display; - how to verify the selection of the Clear Codes function; - how to obtain and display OBD emissions related test parameters and results as described in related documentation for each protocol; - how multiple responses from one request is indicated; - how different responses to the same request is indicated; - what current and freeze frame data items are available through OBD; - how to enter requests for the Expanded Diagnostic Protocol and interpret the results. The OBD Scan Tool will be tested for a HELP facility and/or the availability and coverage of a user manual. 199 1. Scope Appendix 4 This Appendix provides some recommended uniformity for these numeric codes. It further provides guidance for uniform messages associated with these codes. The document is comprised of several sections addressing format structure, messages, and a few examples applying the recommendations of the document. The actual code assignments and messages for powertrain systems are contained in one part attached to the Appendix (Part A). The recommended Diagnostic Trouble Codes (DTC) consist of a three digit numeric code preceded by an alpha-numeric designator. The code structure itself is partially open ended. A portion of the available numeric sequences (portions of "BO", "CO", "PO, and "UO") are reserved for uniform codes assigned by this or future updates of this document. Because of continued development in OBD systems and the flexibility of the partially open assignment structure, particular attention should be paid to ensure the user has the latest version of this document. This Appendix is based on ISO CD XXX2 and SAE J 2012, "Diagnostic Trouble Code Definitions". 2. 2. 1. Normative References (References) Applicable Documents The following publications form a part of this specification to the extent specified herein. 2. 1. 1. Normative References ISO Documents: ISO 9141-2 - Diagnostic Road vehicles requirements for interchange of digital information. systems - CARB ISO CD 14230 Keyword Protocol 2000 Parts 1/2/3 ISO 11519-4 Road Vehicles Low speed Serial Data Communication Class B -Data Communications Interface (SAE J1850) ISO CD 14229 Diagnostic Services 2. 1. 2. Informative References SAE Documents: J1850 FEB94 Class B Data Communication Network Interface J1930 JUN93 Systems Diagnostic Terms, Definitions, E/E Abbreviations and Acronyms J1962 JUN93 Diagnostic Connector J1978 MAR92 OBD II Scan Tool J2012 MAR92 Recommended Format and Messages for Diagnostic Trouble Codes 200 J2186 SEP91 Diagnostic Data Link Security J2190 JUN93 Enhanced E/E Diagnostic Test Modes 3. Definitions Most circuit, component, or system Diagnostic Trouble Codes are defined by four basic categories: General Circuit Malfunction, Range/Performance Problem, Low or High Circuit Input. Most terms for components and systems contained in this document are included in ISO CD XXX3 (SAE Recommended Practice J1930) referenced above. This section includes additional definitions of terms not included in ISO CD XXX3. 3. 1. General circuit malfunction Fixed value or no response from the system. Manufacturers may choose to use this code in place of the dual High/Low (defined below) "Or use to indicate any other failure mode. 3. 2. Range/performance The circuit is functional but not in the normal operating range. May also be used to indicate stuck, erratic, intermittent, or skewed values indicating poor performance of a circuit, component, or system. 3. 3. Low input Circuit voltage, frequency, or other signal measured at the control module input terminal or pin that is at or near zero. This is measured with the external circuit, component, or system connected. The signal type (voltage, frequency, etc. ) shall be included in the message in place of the word "input". 3. 4. " High input Circuit voltage, frequency, or other signal measured at the control module input terminal or pin that is at or near full scale'for the particular signal being measured. This is measured with the external circuit, component, or system connected. The signal type (voltage, frequency, etc. ) shall be included in the message in place of the word "input". 3. 5. # = number While each manufacturer has the ability to define the specific DTC's to meet their specific controller algorithms all DTC words must meet applicable (SAE Recommended Practice J1930) referenced above. ISO CD XXX3 201 4. 0. 4. 1. Format structure Description The Diagnostic Trouble Code consists of an alpha-numeric designator, BO - - B3 for Body, CO ~ C3 for Chassis, P0 - P3 for Powertrain, and U0 ~ U3 for Network Communication, followed by three digits. The assignment of the proper alpha designator should be determined by the controller into which the particular function being diagnosed is being integrated, or in the case of multiple controllers, the area most appropriate for that function. In most cases, the alpha designator will be implied since diagnostic information will be requested from a particular controller. In the cases where the source of the diagnostic information is not clear, the uppermost nibble of the two-byte code message as defined in Appendix 2 will define the source system as follows: 0000 - P0 - Powertrain codes ISO / SAE controlled 0 0 0 1- PI - Powertrain codes Manufacturer controlled 0010 - P2 0011 - P3 - - Powertrain codes Reserved Powertrain codes Reserved 1100- U0 - Network Communication codes ISO / SAE controlled 1101- UI - Network Communication codes Manufacturer controlled 1110 - U2 - Network Communication codes Manufacturer controlled 1111 - U3 - Network Communication codes Reserved Within each code class, the first of the three digits identifies a particular grouping of codes. These particular groupings each contain a series of 100 sequence numbers for particular code definitions. Codes have been defined to indicate a suspected trouble or problem area and are intended to be used as a directive to the proper service procedure. To minimise service confusion, fault codes should not be used to indicate the absence of problems or the system (e. g. Powertrain System O. K. , or MEL illuminated), but should be confined to indicated areas in need of service attention. Each alpha designator has code subdivisions which are industry controlled or which are manufacturer specific. These are shown in the above Table and described as "Gore" and "Non Uniform" respectively in the following clauses. Codes in the ISO/SAE subdivisions even if not defined in this document are not to be used by manufacturers until they have been approved by SAE and ISO. the status of parts of 4. 2. Core DTCs Core Diagnostic Trouble Codes are those codes where industry uniformity has been achieved. These codes were felt to be common enough across most manufacturers' applications that a common number and fault message could be assigned. AJ1 undefined numbers in each grouping have been reserved for future growth. Although service procedures may differ widely amongst manufacturers, the fault being indicated is common enough to be assigned a particular fault code. 202 4. 3. Non-Uniform DTC the manufacturers due Areas within each alpha designator have been made available for non uniform DTCs. These are fault codes that will not generally be used by a majority of to basic system differences, implementation differences, or diagnostic strategy differences. Each vehicle manufacturer or supplier who designs and specifies diagnostic algorithms, software, and diagnostic trouble codes are strongly encouraged to remain consistent across their product line when assigning codes in the manufacturer controlled area. For Powertrain codes, the same groupings should be used as in the ISO / SAE controlled area, i. e. , 100's and 200's for Fuel and Air Metering, 300's for Ignition System or Misfire, etc. Code groupings for non-Powertrain codes will be defined at a later date. 4. 4. Powertrain System Groupings 4. 4. 1. POXXX ISO / SAE Controlled 4. 4. 1. 1. P01XX Fuel and Air Metering 4. 4. 1. 2. P02XX Fuel and Air Metering 4. 4. 1. 3. P03XX Ignition System or Misfire 4. 4. 1. 4. P04XX Auxiliary Emission Controls 4. 4. 1. 5. P05XX Vehicle Speed, Idle Control, and Auxiliary Inputs 4. 4. 1. 6. P06XX Computer and Auxiliary Outputs 4. 4. 1. 7. P07XX Transmission 4. 4. 1. 8. P08XX Transmission 4. 4. 1. 9. P09XX Reserved for ISO / SAE 4. 4. 1. 10. P00XX Reserved for ISO / SAE 4. 4. 2. P1XXX Manufacturer Controlled 4. 4. 2. 1. P11XX Fuel and Air Metering 4. 4. 2. 2. P12XX Fuel and Air Metering 4. 4. 2. 3. P13XX Ignition System or Misfire 4. 4. 2. 4. P14XX Auxiliary Emission Controls 4. 4. 2. 5. P15XX Vehicle Speed, Idle Control, and Auxiliary Inputs 4. 4. 2. 6. P16XX Computer and Auxiliary Outputs. 4. 4. 2. 7. P17XX Transmission 4. 4. 2. 8. P18XX Transmission 4. 4. 2. 9. P19XX Category to be Determined by ISO / SAE 203 4. 4. 2. 10. P10XX Category to be Determined by ISO / SAE 4. 4. 3. P2XXX ISO / SAE Reserved 4. 4. 4. P3XXX ISO / SAE Reserved 4. 5. Network Communication Groupings 4. 5. 1. UOXXX ISO / SAE Controlled 4. 5. 2. U1XXX Manufacturer Controlled 4. 5. 3. U2XXX Manufacturer Controlled 4. 5. 4. U3XXX Reserved 5. 0. Messages Each defined fault code has been assigned a message to indicate the circuit, component or system area that was determined to be at fault. The messages are organized such that different messages related to a particular sensor or system are grouped together. In cases where there are various fault messages for different types of faults, the group also has a "generic" message as the first Code/Message of the group. A manufacturer has a choice when implementing diagnostics, based on the specific strategy and complexity of the diagnostic, whether to use one "generic" code for any fault of that circuit, component or system or to use the more specific codes for better defining the type of fault that was detected. The manufacturer must determine what codes and messages best fit the diagnostics actually implemented. The intent is to have only one code stored for each fault detected. » Where messages are broken down into more specific fault descriptions for a circuit, component, or system, the manufacturer should choose the code most applicable to their diagnosable fault. The messages are intended to be somewhat general to allow manufacturers to use them as often as possible yet still not conflict with their specific repair procedures. The terms "LOW" and "HIGH" when used in a message, especially those related to input signals, refer to the voltage, frequency, etc. at the pin of the controller. The specific level of "LOW" and "HIGH" must be defined by each manufacturer to best meet their needs. 6. 0. Examples Manufacturers may chose the depth of diagnosis performed by on board systems and that performed by off board equipment and procedures. In the case of a fault detected with the Throttle Position (TP) Sensor a number of fault codes may be used. If the diagnosis is all to be completed off board then use P0120 (TP Sensor Circuit Malfunction). However if the manufacturer chooses to perform more diagnosis on board then the following codes could be used: - System detects that the input signal is stuck near zero use P0122 (TP Sensor Low Input) 204 - System detects that the input signal is stuck near full scale use P0123 (TP Sensor High Input), - System detects that the input signal is not as expected on idle (e. g. is at 1. 5v rather than l. Ov) use P0121 (TP Sensor Range / Performance). - The generic code P0120 (TP Sensor Circuit Malfunction) could be used in place of any of the above. Even with the more detailed information identification of the root cause of the problem remains as an off board task. For example the higher voltage on idle could be caused by corrosion of electrical contacts or by a poor setting of the throttle plate. 205 PART A POWERTRAIN SYSTEM DIAGNOSTIC TROUBLE CODES NOTE These include systems that might be Following are the Recommended Industry Common Trouble Codes for the Powertrain Control System. into an electronic control module that would be used for controlling Engine functions, such as Fuel, Spark, Idle Speed and Vehicle Speed (Cruise Control) as well as those for Transmission as a Common Industry Code does not imply that it is a Required Code (Legislated), an Emission Related Code, or that it indicates a fault that will cause the Malfunction Indicator Light to be illuminated. that a code control. The recommended integrated fact is P01XX Fuel and Air Metering P0100 P0101 P0102 P0103 P0104 P0105 P0106 P0107 P0108 P0109 P0110 P0111 P0112 P0113 P0114 P0115 P0116 P0117 P0118 P0119 P0120 P0121 P0122 P0123 P0124 P0125 P0126 P0130 P0131 P0132 P0133 P0134 PÔ135 Mass or Volume Air Flow Circuit Malfunction Mass or Volume Air Flow Circuit Range/Performance Problem Mass or Volume Air Flow Circuit Low Input Mass or Volume Air Flow Circuit High Input Mass or Volume Air Flow Circuit Intermittent Manifold Absolute Pressure/Barometric Pressure Circuit Malfunction Manifold Absolute Pressure/Barometric Pressure Circuit Range/Performance Problem Manifold Absolute Pressure/Barometric Pressure Circuit Low Input Manifold Absolute Pressure/Barometric Pressure Circuit High Input Manifold Absolute Pressure/Barometric Pressure Circuit Intermittent Intake Air Temperature Circuit Malfunction Intake Air Temperature Circuit Range/Performance Problem Intake Air Temperature Circuit Low Input Intake Air Temperature Circuit High Input Intake Air Temperature Circuit Intermittent Engine Coolant Temperature Circuit Malfunction Engine Coolant Temperature Circuit Range/Performance Problem Engine Coolant Temperature Circuit Low Input Engine Coolant Temperature Circuit High Input Engine Coolant Temperature Circuit Intermittent Throttle/Pedal Position Sensor/Switch "A" Circuit Malfunction Throttle/Pedal Position Sensor/Switch "A" Circuit Range/Performance Problem Throttle/Pedal Position Sensor/Switch "A" Circuit Low Input Throttle/Pedal Position Sensor/Switch "A" Circuit High Input Throttle/Pedal Position Sensor/Switch "A" Circuit Intermittent Insufficient Coolant Temperature for Closed Loop Fuel Control Insufficient Coolant Temperature for Stable Operation (Bank 1* Sensor 1) 02 Sensor Circuit Malfunction (Bank 1* Sensor 1) 02 Sensor Circuit Low Voltage (Bank 1* Sensor 1) 02 Sensor Circuit High Voltage 02 Sensor Circuit Slow Response (Bank 1* Sensor 1) 02 Sensor Circuit No Activity Detected (Bank 1* Sensor 1) (Bank 1* Sensor 1) 02 Sensor Heater Circuit Malfunction * For systems with single 02 sensors, use codes for Bank 1 sensor, contains cylinder #1. Sensor 1 is closest to the engine. Bank 1 206 P0136 P0137 P0138 P0139 P0140 P0141 P0142 P0143 P0144 P0145 P0146 P0147 P0150 P0151 P0152 PO 153 P0154 P0155 P0156 P0157 P0158 PO 159 PO 160 P0161 PO 162 PO 163 PO 164 P0165 P0166 P0167 PO 170 P0171 PO 172 P0173 PO 174 P0175' P0176 PO 177 PO 178 PO 179 P0180 P0181 P0182 P0183 P0184 P0185 PO 186 P0187 P0188 PO 189 PO 190 P0191 P0192 PO 193 PO 194 P0195 (Bank 02 Sensor Circuit Malfunction (Bank 02 Sensor Circuit Low Voltage (Bank 02 Sensor Circuit High Voltage 02 Sensor Circuit Slow Response (Bank 02 Sensor Circuit No Activity Detected (Bank (Bank 02 Sensor Heater Circuit Malfunction (Bank 02 Sensor Circuit Malfunction (Bank 02 Sensor Circuit Low Voltage (Bank 02 Sensor Circuit High Voltage 02 Sensor Circuit Slow Response (Bank 02 Sensor Circuit No Activity Detected (Bank (Bank 02 Sensor Heater Circuit Malfunction (Bank 02 Sensor Circuit Malfunction (Bank 02 Sensor Circuit Low Voltage (Bank 02 Sensor Circuit High Voltage 02 Sensor Circuit Slow Response (Bank 02 Sensor Circuit No Activity Detected (Bank (Bank 02 Sensor Heater Circuit Malfunction (Bank 02 Sensor Circuit Malfunction (Bank 02 Sensor Circuit Low Voltage 02 Sensor Circuit High Voltage (Bank (Bank 02 Sensor Circuit Slow Response 02 Sensor Circuit No Activity Detected (Bank (Bank 02 Sensor Heater Circuit Malfunction (Bank 02 Sensor Circuit Malfunction (Bank 02 Sensor Circuit Low Voltage (Bank 02 Sensor Circuit High Voltage 02 Sensor Circuit Slow Response (Bank 02 Sensor Circuit No Activity Detected (Bank (Bank 02 Sensor Heater Circuit Malfunction (Bank Fuel Trim Malfunction (Bank System too Lean (Bank System too Rich (Bank Fuel Trim Malfunction (Bank System too Lean (Bank System too Rich 1* Sensor 2) 1* Sensor 2) Sensor 2) 1* Sensor 2) 1* Sensor 2) 1* 1* Sensor 2) 1* Sensor 3) 1* Sensor 3) 1* Sensor 3) 1* Sensor 3) 1* Sensor 3) 1* Sensor 3) Sensor Y Sensor Y Sensor Y Sensor 1' Sensor 1] Sensor Y Sensor 2) Sensor 2] Sensor Sensor Sensor Sensor Sensor Sensor Sensor Sensor Sensor Sensor 1*) 1*) 1*) 2) 2) 2) For systems with single 02 sensors, use codes for Bank 1 sensor. Bank 1 contains cylinder #1. Sensor 1 is closest to the engine. Fuel Composition Sensor Circuit Malfunction Fuel Composition Sensor Circuit Range/Performance Fuel Composition Sensor Circuit Low Input Fuel Composition Sensor Circuit High Input Fuel Temperature Sensor "A" Circuit Malfunction Fuel Temperature Sensor "A" Circuit Range/Performance Fuel Temperature Sensor "A" Circuit Low Input Fuel Temperature Sensor "A" Circuit High Input Fuel Temperature Sensor "A" Circuit Intermittent Fuel Temperature Sensor "B" Circuit Malfunction Fuel Temperature Sensor "B" Circuit Range/Performance Fuel Temperature Sensor "B" Circuit Low Input Fuel Temperature Sensor "B" Circuit High Input Fuel Temperature Sensor "B" Circuit Intermittent Fuel Rail Pressure Sensor Circuit Malfunction Fuel Rail Pressure Sensor Circuit Fuel Rail Pressure Sensor Circuit Fuel Rail Pressure Sensor Circuit Fuel Rail Pressure Sensor Circuit Engine Oil Temperature Sensor Malfunction Range/Performance Low Input High Input Intermittent 207 P0196 P0197 P0198 P0199 Engine Oil Temperature Sensor Range/Performance Engine Oil Temperature Sensor Low Engine Oil Temperature Sensor High Engine Oil Temperature Sensor Intermittent P02XX Fuel and Air Metering P0200 P0201 P0202 P0203 P0204 P0205 P0206 P0207 P0208 P0209 P0210 P0211 P0212 P0213 P0214 P0215 P0216 P0217 P0218 P0219 P0220 P0221 P0222 P0223 P0224 P0225 P0226 P0227 P0228 P0229 P0230 P0231 P0232 P0233 P0235 P0236 P0237 P0238 P0239 P0240 P0241 P0242 P0243 P0244 P0245 P0246 P0247 P0248 P0249 P0250 P0251 P0252 P0253 nder 1 - Injector Circuit Malfunction nder 2 - Injector Circuit Malfunction nder 3 - Injector Circuit Malfunction nder 4 - Injector Circuit Malfunction nder 5 - Injector Circuit Malfunction nder 6 - Injector Circuit Malfunction nder 7 - Injector Circuit Malfunction nder 8 - Injector Circuit Malfunction nder 9 - Injector Circuit Malfunction nder 10 - Injector Circuit Malfunction nder 11 - Injector Circuit Malfunction inder 12 - Injector Circuit Malfunction Injector Circuit Malfunction Cyl Cyl Cyl Cyl Cyl Cyl Cyl Cyl Cyl Cyl Cyl Cyl Cold Start Injector 1 Malfunction Cold Start Injector 2 Malfunction Engine Shutoff Solenoid Malfunction Injection Timing Control Circuit Malfunction Engine Overtemp Condition Transmission Over Temperature Condition Engine Overspeed Condition Throttle/Pedal Position Sensor/Switch "B" Circuit Malfunction Throttle/Pedal Position Sensor/Switch "B" Circuit Range/Performance Problem Throttle/Pedal Position Sensor/Switch "B" Circuit Low Input Throttle/Pedal Position Sensor/Switch "B" Circuit High Input Throttle/Pedal Position Sensor/Switch "B" Circuit Intermittent Throttle/Pedal Position Sensor/Switch "C" Circuit Malfunction Throttle/Pedal Position Sensor/Switch "C" Circuit Range/Performance Problem Throttle/Pedal Position Sensor/Switch "C" Circuit Low Input Throttle/Pedal Position Sensor/Switch "C" Circuit High Input Throttle/Pedal Position Sensor/Switch "C" Circuit Intermittent Fuel Pump Primary Circuit Malfunction Fuel Pump Secondary Circuit Low Fuel Pump Secondary Circuit High Fuel Pump Secondary Circuit Intermittent Turbocharger Boost Sensor "A" Circuit Malfunction Turbocharger Boost Sensor "A" Circuit Range/Performance Turbocharger Boost Sensor "A" Circuit Low Turbocharger Boost Sensor "A" Circuit tligh Turbocharger Boost Sensor "B" Circuit Malfunction Turbocharger Boost Sensor "B" Circuit Range/Performance Turbocharger Boost Sensor "B" Circuit Low Turbocharger Boost Sensor "B" Circuit High Turbocharger Wastegate Solenoid "A" Malfunction Turbocharger Wastegate Solenoid "A" Range/Performance Turbocharger Wastegate Solenoid "A" Low Turbocharger Wastegate Solerioid "A" High Turbocharger Wastegate Solenoid "B" Malfunction Turbocharger Wastegate Solenoid "B" Range/Performance Turbocharger Wastegate Solenoid "B" Low Turbocharger Wastegate Solenoid "B" High Injection Pump "A" Rotor/Cam Malfunction Injection Pump "A" Rotor/Cam Range/Performance Injection Pump "A" Rotor/Cam Low 208 P0254 P0255 P0256 P0257 P0258 P0259 P0260 P0261 P0262 P0263 P0264 P0265 P0266 P0267 P0268 P0269 P0270 P0271 P0272 P0273 P0274 P0275 P0276 P0277 P0278 P0279 P0280 P0281 P0282 P0283 P0284 P0285 P0286 P0287 P0288 P0289 P0290 P0291 P0292 P0293 P0294 P0295 P0296 Injection Injection Injection Injection Injection Injection Injection Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Pump "A" Rotor/Cam High Pump "A" Rotor/Cam Intermittent Pump "B" Rotor/Cam Malfunction Pump "B" Rotor/Cam Range/Performance Pump "B" Rotor/Cam Low Pump "B" Rotor/Cam High Pump "B" Rotor/Cam Intermittent 1 Injector Circuit Low 1 Injector Circuit High 1 Contribution/Balance Fault 2 Injector Circuit Low 2 Injector Circuit High 2 Contribution/Balance Fault Injector Circuit Low Injector Circuit High Contribution/Balance Fault Injector Circuit Low 4 Injector Circuit High 4 Contribution/Balance Fault Injector Circuit Low Injector Circuit High Contribution/Balance Fault Injector Circuit Low 6 Injector Circuit High 6 Contribution/Balance Fault 7 Injector Circuit Low 7 Injector Circuit High 7 Contribution/Balance Fault 8 Injector Circuit Low 8 Injector Circuit High 8 Contribution/Balance Fault 9 Injector Circuit Low 9 Injector Circuit High 9 Contribution/Balance Fault 10 Injector Circuit Low 10 Injector Circuit High 10 Contribution/Balance Fault 11 Injector Circuit Low 11 Injector Circuit High 11 Contribution/Balance Fault 12 Injector Circuit Low 12 Injector Circuit High 12 Contribution/Balance Fault P03XX Ignition System or Misfire P0300 P0301 P0302 P0303 P0304 P0305 P0306 P0307 P0308 P0309 P0310 P0311 P0312 Random/Multiple Cylinder Misfire Detected Cylinder 1 Misfire Detected Cylinder 2 Misfire Detected Cylinder 3 Misfire Detected Cylinder 4 Misfire Detected Cylinder 5 Misfire Detected Cylinder 6 Misfire Detected Cylinder 7 Misfire Detected Cylinder 8 Misfire Detected Cylinder 9 Misfire Detected Cylinder 10 Misfire Detected Cylinder 11 Misfire Detected Cylinder 12 Misfire Detected 209 P0320 P0321 P0322 P0323 P0325 P0326 P0327 P0328 P0329 P0330 P0332 P0333 P0334 P0335 P0336 P0337 P0338 P0339 P0340 P0341 P0342 P0343 P0344 P0350 P0351 P0352 P0353 P0354 P0355 P0356 P0357 P0358 P0359 P0360 P0361 P0362 P0370 P0371 P0372 P0373 P0374 P0375 P0376 P0377 P0378 P0379 P0380 P0381 P0385 P0386 P0387 P0388 P0389 or Single Sensor •y or Single Sensor *) or Single Sensor *) or Single Sensor *) or Single Sensor *) *) *) *) (Bank (Bank (Bank (Bank (Bank (Bank 2 (Bank 2 (Bank 2 (Bank 2 Ignition/Distributor Engine Speed Input Circuit Malfunction Ignition/Distributor Engine Speed Input Circuit Range/Performance Ignition/Distributor Engine Speed Input Circuit No Signal Ignition/Distributor Engine Speed Input Circuit Intermittent Knock Sensor 1 Circuit Malfunction Knock Sensor 1 Circuit Range/Performance Knock Sensor 1 Circuit Low Input Knock Sensor 1 Circuit High Input Knock Sensor 1 Circuit Input Intermittent Knock Sensor 2 Circuit Range/Performance Knock Sensor 2 Circuit Low Input Knock Sensor 2 Circuit Eligh Input Knock Sensor 2 Circuit Input Intermittent Crankshaft Position Sensor "A" Circuit Malfunction Crankshaft Position Sensor "A" Circuit Range/Performance Crankshaft Position Sensor "A" Circuit Low Input Crankshaft Position Sensor "A" Circuit High Input Crankshaft Position Sensor "A" Circuit Intermittent Camshaft Position Sensor Circuit Malfunction Camshaft Position Sensor Circuit Range/Performance Camshaft Position Sensor Circuit Low Input Camshaft Position Sensor Circuit High Input Camshaft Position Sensor Circuit Intermittent Ignit Ignit Ignit Ignit Ignit Ignit Ignit Ignit Ignit: Ignit Ignit Ignit Ignit on Coil Primary/Secondary Circuit Malfunction on Coil "A" Primary/Secondary Circuit Malfunction on Coil "B" Primary/Secondary Circuit Malfunction on Coil "C" Primary/Secondary Circuit Malfunction on Coil "D" Primary/Secondary Circuit Malfunction on Coil "E" Primary/Secondary Circuit Malfunction on Coil "F" Primary/Secondary Circuit Malfunction on Coil "G" Primary/Secondary Circuit Malfunction on Coil "H" Primary/Secondary Circuit Malfunction on Coil "I" Primary/Secondary Circuit Malfunction on Coil "J" Primary/Secondary Circuit Malfunction on Coil "K" Primary/Secondary Circuit Malfunction on Coil "L" Primary/Secondary Circuit Malfunction * Bank 1 contains cylinder 1 Timing Reference High Resolution Signal "A" Malfunction Timing Reference High Resolution Signal "A" Too Many Pulses Timing Reference High Resolution Signal "A" Too Few Pulses Timing Reference High Resolution Signal Timing Reference Eligh Resolution Signal Timing Reference High Resolution Signal Timing Reference High Resolution Signal Timing Reference High Resolution Signal Timing Reference EEigh Resolution Signal Timing Reference Eligh Resolution Signal Glow Plug /Heater Circuit Malfunction Glow Plug /Heater Indicator Circuit Malfunction Crankshaft Position Sensor "B" Circuit Malfunction Crankshaft Position Sensor "B" Circuit Range/Performance Crankshaft Position Sensor "B" Circuit Low Input Crankshaft Position Sensor "B" Circuit High Input Crankshaft Position Sensor "B" Circuit Intermittent 'A" Intermittent/Erratic Pulses 'A" No Pulses •B" Malfunction 'B" Too Many Pulses 'B" Too Few Pulses 'B" Intermittent/Erratic Pulses *B" No Pulses 210 P04XX Auxiliary Emission Controls P0400 P0401 P0402 P0403 P0404 P0405 P0406 P0407 P0408 P0410 P0411 P0412 P0413 P0414 P0415 P0416 P0417 P0420 P0421 P0422 P0423 P0424 P0430 P0431 P0432 P0433 P0434 P0440 P0441 P0442 P0443 P0444 P0445 P0446 P0447 P0448 P0450 P0451 P0452 P0453 P0454 P0455 P0460 P0461 P0462 P0463 P0464 P0465 P0466 P0467 P0468 P0469 P0470 P0471 P0472 Exhaust Gas Recirculation Flow Malfunction Exhaust Gas Recirculation Flow Insufficient Detected Exhaust Gas Recirculation Flow Excessive Detected Exhaust Gas Recirculation Circuit Malfunction Exhaust Gas Recirculation Circuit Range/Performance Exhaust Gas Recirculation Sensor "A" Circuit Low Exhaust Gas Recirculation Sensor "A" Circuit EEigh Exhaust Gas Recirculation Sensor "B" Circuit Low Exhaust Gas Recirculation Sensor "B" Circuit High Secondary Air Injection System Malfunction Secondary Air Injection System Incorrect Flow Detected Secondary Air Injection System Switching Valve "A" Circuit Malfunction Secondary Air Injection System Switching Valve "A" Circuit Open Secondary Air Injection System Switching Valve "A" Circuit Shorted Secondary Air Injection System Switching Valve "B" Circuit Malfunction Secondary Air Injection System Switching Valve "B" Circuit Open Secondary Air Injection System Switching Valve "B" Circuit Snorted Catalyst System Efficiency Below Threshold (Bank 1*] Warm Up Catalyst Efficiency Below Threshold (Bank 1*' Main Catalyst Efficiency Below Threshold (Bank 1* (Bank 1* Heated Catalyst Efficiency Below Threshold (Bank 1* Heated Catalyst Temperature Below Threshold (Bank 2) Catalyst System Efficiency Below Threshold (Bank 2) Warm Up Catalyst Efficiency Below Threshold (Bank 2) Main Catalyst Efficiency Below Threshold (Bank 2) Heated Catalyst Efficiency Below Threshold (Bank 2) Heated Catalyst Temperature Below Threshold * Bank 1 contains Cylinder #1 Evaporative Emission Control System Malfunction Evaporative Emission Control System Incorrect Purge Flow Evaporative Emission Control System Small Leak Detected Evaporative Emission Control System Purge Control Valve Circuit Malfunction Evaporative Emission Control System Purge Control Valve Circuit Open Evaporative Emission Control System Purge Control Valve Circuit Snorted Evaporative Emission Control System Vent Control Malfunction Evaporative Emission Control System Vent Control Open Evaporative Emission Control System Vent Control Snorted Evaporative Emission Control System Pressure Sensor Malfunction Evaporative Emission Control System Pressure Sensor Range/Performance Evaporative Emission Control System Pressure Sensor Low Input Evaporative Emission Control System Pressure Sensor High Input Evaporative Emission Control System Pressure Sensor Intermittent Evaporative Emission Control System Gross Leak Detected Fuel Level Sensor Circuit Malfunction Fuel Level Sensor Circuit Range/Performance Fuel Level Sensor Circuit Low Input Fuel Level Sensor Circuit High Input Fuel Level Sensor Circuit Intermittent Purge Flow Sensor Circuit Malfunction Purge Flow Sensor Circuit Range/Performance Purge Flow Sensor Circuit Low Input Purge Flow Sensor Circuit High Input Purge Flow Sensor Circuit Intermittent Exhaust Pressure Sensor Malfunction Exhaust Pressure Sensor Range/Performance Exhaust Pressure Sensor Low 211 P0473 P0474 P0475 P0476 P0477 P0478 P0479 Exhaust Pressure Sensor High Exhaust Pressure Sensor Intermittent Exhaust Pressure Control Valve Malfunction Exhaust Pressure Control Valve Range/Performance Exhaust Pressure Control Valve Low Exhaust Pressure Control Valve High Exhaust Pressure Control Valve Intermittent P05XX Vehicle Speed , Idle Control , and Auxiliary Inputs P0500 P0501 P0502 P0503 P0505 P0506 P0507 P0510 P0530 P0531 P0532 P0533 P0534 P0550 P0551 P0552 P0553 P0554 P0560 P0561 P0562 P0563 P0565 P0556 P0567 P0568 P0569 P0570 P0571 P0572 P0573 P0574 to P0580 Vehicle Speed Sensor Malfunction Vehicle Speed Sensor Range/Performance Vehicle Speed Sensor Circuit Low Input Vehicle Speed Sensor Intermittent / Erratic / High Idle Control System Malfunction Idle Control System RPM Lower Than Expected Idle Control System RPM Higher Than Expected Closed Throttle Position Switch Malfunction A/C Refrigerant Pressure Sensor Circuit Malfunction A/C Refrigerant Pressure Sensor Circuit Range/Performance A/C Refrigerant Pressure Sensor Circuit Low Input A/C Refrigerant Pressure Sensor Circuit High Input Air Conditioner Refrigerant Charge Loss Power Steering Pressure Sensor Circuit Malfunction Power Steering Pressure Sensor Circuit Range/Performance Power Steering Pressure Sensor Circuit Low Input Power Steering Pressure Sensor Circuit High Input Power Steering Pressure Sensor Circuit Intermittent System Voltage Malfunction System Voltage Unstable System Voltage Low System Voltage High Cruise Control On Signal Malfunction Cruise Control Off Signal Malfunction Cruise Control Resume Signal Malfunction Cruise Control Set Signal Malfunction Cruise Control Coast Signal Malfunction Cruise Control Accel Signal Malfunction Cruise Control / Brake Switch "A" Circuit Malfunction Cruise Control / Brake Switch "A" Circuit Low Cruise Control / Brake Switch "A" Circuit Eligh Reserved for Cruise Codes P06XX Computer and Auxiliary Outputs P0600 P0601 P0602 P0603 P0604 P0605 P0606 Serial Communication Link Malfunction Internal Control Module Memory Checksum Error Control Module Programming Error Internal Control Module Keep Alive Memory (KAM) Error Internal Control Module Random Access Memory (RAM) Error Internal Control Module Read Only Memory (ROM) Error (Module Identification Defined by ISO Cdxxxl / SAE J1979) Powertrain Control Module Processor Fault 212 P07XX Transmission P0700 P0701 P0702 P0703 P0704 P0705 P0706 P0707 P0708 P0709 P0710 P0711 P0712 P0713 P0714 P0715 P0716 P0717 P0718 P0719 P0720 P0721 P0722 P0723 P0724 P0725 P0726 P0727 P0728 P0730 P0731 P0732 P0733 P0734' P0735 P0736 P0740 P0741 P0742 P0743 P0744 P0745 P0746 P0747 P0748 P0749 P0750 P0751 P0752 P0753 P0754 P0755 P0756 P0757 P0758 P0758 P0760 P0761 Transmission Control System Malfunction Transmission Control System Range/Performance Transmission Control System Electrical Torque Converter/Brake Switch "B" Circuit Malfunction Clutch Switch Input Circuit Malfunction Transmission Range Sensor Circuit Malfunction (PRNDL Input) Transmission Range Sensor Circuit Range/Performance Transmission Range Sensor Circuit Low Input Transmission Range Sensor Circuit High Input Transmission Range Sensor Circuit Intermittent Transmission Fluid Temperature Sensor Circuit Malfunction Transmission Fluid Temperature Sensor Circuit Range/Performance Transmission Fluid Temperature Sensor Circuit Low Input Transmission Fluid Temperature Sensor Circuit High Input Transmission Fluid Temperature Sensor Circuit Intermittent Input/Turbine Speed Sensor Circuit Malfunction Input/Turbine Speed Sensor Circuit Range/Performance Input/Turbine Speed Sensor Circuit No Signal Input/Turbine Speed Sensor Circuit Intermittent Torque Converter/Brake Switch "B" Circuit Low Output Speed Sensor Circuit Malfunction Output Speed Sensor Circuit Range/Performance Output Speed Sensor Circuit No Signal Output Speed Sensor Circuit Intermittent Torque Converter/Brake Switch "B" Circuit EEigh Engine Speed Input Circuit Malfunction Engine Speed Input Circuit Range/Performance Engine Speed Input Circuit No Signal Engine Speed Input Circuit Intermittent Incorrect Gear Ratio Gear 1 Incorrect Ratio Gear 2 Incorrect Ratio Gear 3 Incorrect Ratio Gear 4 Incorrect Ratio Gear 5 Incorrect Ratio Reverse Incorrect Ratio Torque Converter Clutch Circuit Malfunction Torque Converter Clutch Circuit Performance or Stuck Off Torque Converter Clutch Circuit Stuck On Torque Converter Clutch Circuit Electrical Torque Converter Clutch Circuit Intermittent Pressure Control Solenoid Malfunction Pressure Control Solenoid Performance or Stuck Off Pressure Control Solenoid Stuck On Pressure Control Solenoid Electrical Pressure Control Solenoid Intermittent Shift Solenoid "A" Malfunction Shift Solenoid "A" Performance or Stuck Off Shift Solenoid "A" Stuck On Shift Solenoid "A" Electrical Shift Solenoid "A" Intermittent Shift Solenoid "B" Malfunction Shift Solenoid "B" Performance or Stuck Off Shift Solenoid "B" Stuck On Shift Solenoid "B" Electrical Shift Solenoid "B" Intermittent Shift Solenoid "C" Malfunction Shift Solenoid "C" Performance or Stuck Off 213 P0762 •P0763 P0764 P0765 P0766 P0767 P0768 P0769 P0770 P0771 P0772 P0773 P0774 P0780 P0781 P0782. P0783 P0784 P0785 P0786 P0787 P0788 P0789 P0790 C" Stuck On C" Electrical C" Intermittent Malfunction Performance or Stuck Off Stuck On Electrical Intermittent E" Malfunction E" Performance or Stuck Off E" Stuck On E" Electrical E" Intermittent Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Malfunction 1-2 Shift Malfunction 2-3 Shift Malfunction 3-4 Shift Malfunction 4-5 Shift Malfunction Shift/Timing Solenoid Malfunction Shift/Timing Solenoid Range/Performance Shift/Timing Solenoid Low Shift/Timing Solenoid EEigh Shift/Timing Solenoid Intermittent Normal/Performance Switch Circuit Malfunction 214 Appendix 5 ADDENDUM to the Information Document No in accordance with Annex II of Council Directive 70/156/EEC0 relating to type approval and referring to emission control by on-board diagnostic systems for motor vehicles 3. POWER PLANT (q) 3. 2. 12. 2. 8. On-Board Diagnostic (OBD) System 3. 2. 12. 2. 8. 1. Written description and/or drawing of the MI: 3. 2. 12. 2. 8. 2. List and purpose of all components monitored by the OBD system: 3. 2. 12. 2. 8. 3. Written description (general working principles) for: 3. 2. 12. 2. 8. 3. 1. Positive-ignition engines* }: 3. 2. 12. 2. 8. 3. 1. 1. Catalyst monitoring(1): 3. 2. 12. 2. 8. 3. 1. 2. Misfiredetection(1): 3. 2. 12. 2. 8. 3. 1. 3. Oxygen sensor monitoring* ^: 3. 2. 12. 2. 8. 3. 1. 4. Other components monitored by the OBD system(1): 3. 2. 12. 2. 8. 3. 2. Compression-ignition engines(): 3. 2. 12. 2. 8. 3. 2. 1. Catalyst monitoring11): 3. 2. 12. 2. 8. 3. 2. 2. Particulate trap monitoring(1): 3. 2. 12. 2. 8. 3. 2. 3. Electronic fuelling system monitoring(1): 3. 2. 12. 2. 8. 3. 2. 4. Other components monitored by the OBD system(1): 3. 2. 12. 2. 8. 4. Criteria for MI activation (fixed number of driving cycles or stati sti cal method): 3. 2. 12. 2. 8. 5. List of all OBD output codes and formats used (with explanation of each): 3. 2. 12. 2. 8. 6. - Type of (off-board) interrogation tool: n The item numbers and footnotes used in this Information Document correspond to those set out in Annex I to Directive 70/156/EEC. Items not relevant for the purpose of this Directive are omitted. 215 Appendix 6 ESSENTIAL CHARACTERISTICS OF THE VEfflCLE FAMILY Parameters defining the OBD family The OBD family may be defined by basic design parameters which must be common to vehicles within the family. In some cases there may be interaction of parameters. These effects must also be taken into consideration to ensure that only vehicles with similar exhaust emission characteristics are included within an OBD family. To this end, those vehicle types whose parameters described below are identical are considered to belong to the same engine-emission control-OBD system combination. Engine: - combustion process (i. e. positive-ignition, compression-ignition, two stroke, four stroke); - method of engine fuelling (i. e. carburettor or fuel injection). Emission control system: - - type of catalytic converter (i. e. oxidation, three-way, heated catalyst, other) type of particulate trap - secondary air injection (i. e. with or without) - exhaust gas recirculation (i. e. with or without) OBD parts and functioning: - the methods of OBD functional monitoring, malfunction detection and malfunction indication to the vehicle driver. 216 Appendix 7 ADDENDUM to the EC type-approval certificate No. concerning the type-approval of an on-board diagnostic system (OBD) Directive 70/220/EEC, as last amended by Directive. 1. 1. Written description and/or drawing of the MI: 1. 2. List and purpose of all components monitored by the OBD system: 1. 3. Written description (general working principles) for: 1. 3. 1. Misfire detection* ): 1. 3. 2. Catalyst monitoring* }: 1. 3. 3. Oxygen sensor monitoring* }: 1. 3. 4. Other components monitored by the OBD system* }: 1. 3. 5. Catalyst monitoring* }: 1. 3. 6. Particulate trap monitoring* }: 1. 3. 7. Electronic fuelling system actuator monitoring*2): 1. 3. 8. Other components monitored by the OBD system* }: 1. 4. for MI Criteria statistical method): activation (fixed number of driving cycles or 1. 5. List of all OBD output codes and formats used (with explanation of each): 1. 6. Specification of (off-board) interrogation tool: 2. 4. Comments(ifany): (1) *2) In the case of positive-ignition engines. In the case of compression-ignition engines. 217 FINANCIAL STATEMENT B5-3000 Internal Market 1. TITLE OF OPERATION Proposal for a European Parliament and the Council Directive relating to measures to be taken against air pollution by emissions from motor vehicles and amending Directives 70/220/EEC and 70/156/EEC. 2. BUDGET HEADING INVOLVED B5-3000 Internal Market 3. LEGAL BASIS Article 100a of the EU Treaty 4. DESCRIPTION OF OPERATION 4. 1 General Objectives Measures to be taken against air pollution by emissions from motor vehicles 4. 2 Period covered and arrangements for renewal or extension The proposed Directive requires: From 1 January 2000, Member States may no longer grant EC type-approval for a new type of vehicle on grounds relating to air pollution by emissions if it fails to comply with the provisions of "stage 2000". With effect from 1 January 2001, Member States shall refuse the registration, sale or entry into service of new vehicles which do not comply with the provisions of the Directive. As regards the limit values applicable from 1 January 2005, the Commission shall submit, before 31 December 1999, a report to the Council and Parliament concernint the industrial feasibility of the application of such limits, taking account of the technological progress achieved as well as environmental needs and the availability of improved fuels. In the light of this report, the Commission shall submit a proposal for confirming or revising, if necessary, these limit values. 218 5. CLASSIFICATION OF EXPENDITURE OR REVENUE There are no receipts following this action. 6. TYPE OF EXPENDITURE Technical work directly linked to the assessment of envisaged future vehicle technology (A) Technical work linked to the development of new proposals, in particular those dealing with breakthrough technologies (de NOx catalyser, CNG engineered vehicles, other alternatives: fuelled/propelled vehicles), monitoring of air quality, development of Community assessment criteria for non-technical measures (B) Technical work linked to the preparation of Commission Directives through the Committee procedure (notably improvement of OBD requirements), design of prerequisit conditions for type approving of replacement parts ensuring a control of pollution emission equivalent to the original part while not triggering the OBD (C) Organization of a "Review Conference in 1999" (D) 7. FINANCIAL IMPACT 7. 1 Method of calculating total cost of operation (relation between individual and total costs) The expected cost would globally amount to approximately ECU 600 000 dispatched in 1997/1999, for the following actions, in the form of contract, with the following breakdown: (A) 0. 2 (B) 0. 1 (C) 0. 1 (D) 0. 2 7. 2 Itemized breakdown of costs (in ECU million) Budget 96 PDB 97 PDB 98 PDB 99 Total ' A B C D Total 0. 1 0. 1 0. 1 0. 1 0. 2 219 0. 1 0. 2 0. 3 0. 2 0. 1 0. 1 0. 2 0. 6 7. 3 Operational expenditure of studies, experts, included in Part B of the Budget (in ECU million) Breakdown Budget 96 PDB 97-99 Var. in % - Studies - Meetings of experts - Conferences and congresses - Information and publications 0 Total 0. 4 0. 2 0. 6 New 8. FRAUD PREVENTION MEASURES - It will be explicitly specified in contracts that all work performed is the property of the Commission. - Final payment of contractors will only take place after reception and examination of the reports and services requested. 9. ELEMENTS OF COST-EFFECTIVENESS ANALYSIS 9. 1 Specific and quantified objectives; target population On the basis of the data available on the costs and potential benefits of the various technical measures (engine technology, fuel quality and improved inspection and maintenance of emissions control systems), it has been possible to identify the most cost/effective packages of technical measures necessary to achieve a significant reduction of urban NOx, particulate matters in the most polluted areas and ozone precursors at European level. The present proposal corresponds to the most cost/effective strategy found in the Auto/Oil programme. 9. 2 Grounds for the operation The European Union has a longstanding history in reducing vehicle emissions. However, despite the considerable achievements with regard to the emission reduction of individual vehicles, increased traffic activity (increased number of vehicles, increased kilometers travelled) is likely to counteract these improvements thereby preventing the emission reductions necessary to achieve future air quality objectives. The likelihood of further action to reduce vehicle emissions necessitated a reassessment of the existing policy approach; it being apparent that the emission reduction potential offered by further improvements in vehicle technology was limited and possibly very costly in comparison with other potential solutions. 220 Therefore a new, comprehensive and integrated approach was developed which is set out in Directive 94/12/EC, Article 4. Article 4 stipulates that technical and non- technicla measures to be assessed with regard to their cost-effectiveness shall include improved vehicle technology, the use of alternative fuels (e. g. LPG, CNG, biofuels), more appropriate mechanisms to reduce the in-use deterioration of emission control systems (based on an inspection and maintenance programme) and "improvements in fuel quality as far as vehicle emissions of dangerous substances (in particular benzene) are concerned". The proposal forms part of a global Community strategy which will include strengthened requirements for passenger cars, light commercial vehicles and heavy duty vehicles from year 2000, new minimum standards for motor fuels and enhanced in-use vehicle emission requirements. This combination of measures represents, in view of the Commission, an optimal package of legislative actions which will ensure that the Air Quality targets identified in the course of the implementation of the Auto/Oil programme will be met by year 2010. In addition, the present proposal includes a revision of the framework for emission-related fiscal incentives and emissions values corresponding to the foreseen Stage 2005 car emission standards. 9. 3 Monitoring and evaluation of the operation The Commission, in cooperation with the Member States, will monitor the development of air quality on an urban and regional level in order to verify the air quality predictions which have guided the currently proposed legislative measures. 221 ISSN 0254-1475 COM(96) 248 final DOCUMENTS EN 14 12 15 Catalogue number : CB-CO-96-310-EN-C ISBN 92-78-05787-8 Office for Official Publications of the European Communities L-2985 Luxembourg 222

Proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE relating to measures to be taken against air pollution by emissions from motor vehicles and amending Council Directives 70/156/EEC and 70/220/EEC

http://publications.europa.eu/resource/cellar/292ba782-2334-4f69-bda9-df81bd27bafd

eng

COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 18. 06. 1996 COM(96) 248 final 96/0163 (COD) 96/0164 (COD) COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL on a future strategy for the control of atmospheric emissions from road transport taking into account the results from the Auto/Oil Programme Proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE relating to the quality of petrol and diesel fuels and amending Council Directive 93/12/EEC Proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE relating to measures to be taken against air pollution by emissions from motor vehicles and amending Council Directives 70/156/EEC and 70/220/EEC (presented by the Commission) COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL on a future strategy for the control of atmospheric emissions from road transport taking into account the results from the Auto/Oil Programme 1. BACKGROUND EU Legislation on vehicle emission standards Directive 70/220/EEC(]) was the first directive to lay down emission limits for passenger cars. Over the past two decades subsequent amendments to Directive 70/220/EEC and the adoption of legislation on emission standards for light commercial^ and heavy duty vehicles(3) have strengthened and extended Community policy in this area. When the emission standards. for passenger cars laid down in Directive 94/12/EC(4) (the latest amendment of the 1970 base directive) comes into effect in 1996/97, emissions of regulated pollutants from new passenger cars will be reduced by over 90% as compared to the standards which prevailed in the early 1970s. These improvements in standards are illustrated below in Figure 1. Figure 1 Evolution of Community Passenger Car Emission Standards •5 O S 3 03 OJ t 0- 100 m % co m % HC & NOx (1) (2) (3) (4) Directive 70/220/EEC; OJ No L 76, 6. 4. 1970, p. 1. Directive 93/59/EEC; OJ No L 186, 28. 7. 1993, p. 21. Directive 91/542/EEC; OJ No L 295, 25. 10. 1991, p. 1 Directive 94/12/EC; OJ No L 100, 19. 4. 1994, p. 42. However, despite these considerable achievements with regard to the emission reduction of individual vehicles, increased traffic activity (increased numbers of vehicles, increased kilometres travelled) are likely to counteract these improvements and to militate against overall emissions being reduced to a level consistent with the attainment of future air quality objectives. Given the reductions already achieved, further action to reduce vehicle emissions necessitated a reassessment of the existing policy approach since the emission reduction potential offered by further improvements in vehicle technology, was limited and possibly very costly in comparison to other potential solutions. The Commission, in October 1992 therefore organized a conference with all relevant interest groups to discuss the» issue of vehicle emission standards for the year 2000 and beyond. The major conclusion from this conference was that future emission standards should be based on an integrated approach and should have as their objective the achievement of air quality targets. In this context it was recognized that further steps would be needed not least because of increased traffic activity (increased numbers of vehicles and increased kilometres travelled). This new approach was outlined in the legislative proposals the Commission submitted to Council and Parliament in 1992. It is reflected in Article 4 of Directive 94/12/EC "which was adopted by Council and Parliament in 1994 under the co-decision procedure. The main elements of Article 4 are outlined below: "In these proposals [future proposals for emission standards to apply from 2000] the Commission shall take the following approach: the measures shall be designed to produce effects to meet the requirements of the Community's air quality criteria and related objectives, an assessment of the cost effectiveness of taking each measure shall be undertaken; in this global assessment full account shall be taken, inter alia, of the contributions that: traffic management, costs appropriately, for example by spreading the environmental enhanced urban public transport, new propulsion technologies (e. g. electric propulsion), • the use of alternative fuels (e. g. biofuels), could make to improving air quality, the measures shall be proportional and reasonable intended objectives. in the light of the The proposals, taking account of the methodology outlined above and aimed at a substantial reduction of pollutant emissions as regards the vehicles covered by this Directive, shall comprise in particular the following elements: 1. Further improvements in the requirements of this Directive: based on the assessment of the potential of the Traditional engine and post-combustion technology, possible improvements in the test procedure, e. g. cold-start, starting in low or wintry tests), evaporative emissions, temperatures, durability conformity (e. g. the in measures at the level of type-approval supporting strengthened inspection and maintenance requirements, including, for example, on-board diagnostic systems, the possibility of checking the conformity of vehicles in circulation, the proportional need for: (i) specific limits for HC and NOx in addition to a cumulative limit value, and (ii) measures to cover pollutants not yet regulated. 2. Complementary technical measures in the framework of specific Directives, including: improvements in fuel quality as far as vehicle emissions of dangerous substances (in particular benzene) are concerned, strengthening of the requirements of the inspection and maintenance programme. The reduced limit values which will be the subject of the new Directive shall not apply before 1 January 2000 for new type-approvals. The Council shall decide on the conditions for granting tax incentives on the basis of these limit values. " While Directive 94/12/EC was only adopted in 1994, Article 4 of that Directive is the formal expression of the framework within which the Commission carried out its preparatory work for the development of future legislative proposals directed at the reduction of emissions from road transport to be effective from the year 2000. 2. THE AUTO/OIL PROGRAMME In recognition of the fact that the future Community policy on the control of vehicle emissions should be based on an integrated and comprehensive approach and taking into account the potential of a wide variety of different measures for bringing about cost-effective solutions, the Commission, in 1992, invited the European oil and automobile industries to participate in a collaborative programme with the intention of developing a solid technical foundation upon which the Commission could build its future strategy: this programme subsequently became known as the Auto/Oil Programme. (A short summary of the technical analysis carried out in the Auto/Oil Programme is included as Annex 1 to this Communication. A more detailed explanation of the programme can be found in a consolidated technical report). The Auto/Oil Programme was a ground-breaking initiative in which the resources and expertise of two major industries were combined in collaboration with the services of the Commission and focused on the challenge of developing a rationale basis for future legislative action. The programme is an example of the principle of partnership identified in the fifth Environmental Action Programme. The Commission would like to record its thanks and appreciation to both industries in demonstrating their commitment to the goal of-sustainable development in such a tangible manner. In particular the extensive research programme known as the European Programme on Engines Fuels and Emissions (EPEFE) has provided a unique insight into the relationship between engine technology/fuel quality and vehicle emissions. The rationale of the Auto/Oil Programme was to quantify both the cost and the emission reduction potential of a variety of different measures which could contribute to reducing vehicle emissions and the attainment of air quality targets. The measures which were included in the analysis included not only advances in vehicle technology and fuel quality but also the benefits of improvements to the regular inspection and maintenance procedures as well the potential contribution of non-technical measures such as road pricing, improved public transport and scrappage schemes. The objective of the auto/oil analysis was to identify cost effective packages of measures sufficient to reduce vehicle emissions to the level compatible with the achievement of rigorous air quality standards throughout the Community. 3. CLEAN AIR: THE MOTIVATION FOR REDUCING VEHICLE EMISSIONS review process as well as Article 4 of Directive 94/12/EC requires that measures to reduce emissions from road traffic shall be designed to meet the requirements of the Community's air quality criteria and related objectives. The existing Community legislation on air quality objectives and dealing inter alia with nitrogen di-oxide, sulphur dioxide and particulate matter, lead and troposheric ozonze are currently being revised. In order to take account of the latest information emerging from that the existing World Health Organization air quality guidelines, the Commission and the two industry partners in the Auto/Oil Programme agreed to explore a number of air quality objectives: these objectives and the way they were used in the Auto/Oil Programme are described in summary form in the Annex to the present Communication and in greater detail in the consolidated air quality report from the Auto/Oil Programme. The critical air quality objectives which were eventually used as the basis for designing the package of measures to reduce road transport emissions are presented in Table 1. the ongoing work revise to Table 1 Air Quality Targets Pollutant: Urban N02 Air Quality Targets: 200 ug/m3 As maximum hourly value Urban Carbon Monoxide 10 mg/m3 As maximum hourly value. Urban Benzene Urban Particulates Tropospheric Ozone 10 ug/m3 As an annual mean 50 ug/m3 As a24 hour rolling average 180 ug/m3 As a one hour 99 percentile value. 4. REDUCING EMISSIONS FROM ROAD TRANSPORT STRATEGIES: SHARED RESPONSIBILITY INTEGRATED The Auto/Oil Programme focused exclusively on the control of emissions from the road transport sector. While for the majority of atmospheric pollutants road transport constitutes the single most important source of emissions other sources such as power stations, Industry and individual households also make a significant contribution. The implementation of the measures arising out of the Auto/Oil Programme will ensure that emissions from road transport are reduced to a level compatible with the attainment of rigorous air quality standards. However, in order that the air quality standards are achieved it will require equally significant and parallel reductions in emissions from other man made sources. In particular the results from the Auto/Oil Programme have demonstrated that reductions of man made emissions of both Volatile Organic Compounds (VOCs) and oxides of nitrogen (NOx) of the order of 70+% as compared to today's levels will be required if air quality iargets for tropospheric (low-level) ozone are to be achieved. ~ The attainment of satisfactory air quality throughout the Community should be based on an integrated, balanced and cost-effective approach to the reduction of emissions. Clearly, there are significant differences in the air quality to be found in the different cities and regions throughout the Community. The most cost-effective solution with regard to transport related emissions, will not be based on the assumption that Community wide technical measures should be expected, on their own, to resolve the pollution problems in the worst affected cities/regions. Air quality standards are laid down in Community legislation and Member States are required as a minimum to ensure that these standards are respected. This basic legal obligation placed upon the Member States constitutes the ultimate legal safeguard that the emission reduction measures taken at Community, national and local level will result in the achievement of the necessary air quality standards. In the Auto/Oil Programme and in the package of measures to be put forward by the Commission the underlying rationale was that technical measures, such as emission standards, fuel quality and improved inspection and maintenance regimes, will be applied at a certain intensity across the Community and will result in a widespread and significant reduction in emissions and consequent improvements in air quality. However, these Community-wide measures will have to be complemented and supplemented, as appropriate, by local and national measures such as road pricing, the expansion of the public transport system, emission related vehicle taxes and scrappage schemes applied to old vehicles. As a minimum, these national and local measures would need to be applied in localities/regions where, in the absence of such targeted actions, the Community-wide technical measures would not, on their own, ensure that the air quality standards required under Community legislation are achieved and respected. In addition, those Member States and localities that wish to achieve air quality standards higher than the minimum standards required under Community legislation, are of course free to introduce whatever national and local measures they see fit in order to reduce emissions from vehicles on condition that such measures are compatible with the Treaty such as the provisions on the free movement of goods and in particular the provisions of the Directives accompanying the present Communication. While decisions with regard to the appropriate choice of geographically restricted-measures aimed at reducing atmospheric pollution should be taken at the national, regional and local level, in the context of shared responsibility, there is a role for the Community to inform, promote and enable in order to ensure that Community policies have a positive influence. To this end the Commission has issued a Green Paper concerning public passenger transport and entitle "The Citizens Network" which suggests ways in which public transport can be made more attractive and usable. The Commission is also involved in a number of other initiatives and collaborative projects including inter alia the Car Free Cities Network which now has over 50 participating cities ,the networks addressing transport, energy efficiency and air quality involved in JOULE-THERMDE projects (the POLIS network on transport telematics applications, the EUROCITEES, TELECITIES and POLIS networks on the European Digital Cities project, city networks in environment telematics projects and the CITELEC). The interdependence of the various elements in the Commission's strategy applies not only to the relationship between actions taken at the Community/national/regional and local levels but also to the various technical measures. The increased severity of the vehicle emission standards applies at the time when a vehicle is type approved for marketing in the. Community; manufacturers are then required to ensure that all examples of that model which are produced conform to these standards and to ensure that the emission performance will not deteriorate significantly during the life of the vehicle; once the vehicle is on the road its emission performance will be influenced by the quality of the fuel and the behaviour of the driver; electronic sensors which monitor the emissions of the vehicle will also inform the driver of any defects and signal the need for repair; finally regular inspection and maintenance tests combined with road side checks and re-call schemes will also ensure that vehicles maintain a high level of emission performance throughout their life. The message which has to be underlined in relation to the control of vehicle emissions is the interdependence of all the elements 'in the systems. The technical components need to be compatible and the administrative systems need to inter-lock and be mutually supportive. In addition vehicle manufacturers and oil companies need to comply with their obligations. Finally and very importantly , individual vehicle owners have a major role to play in reducing vehicle emissions: responsible driving behaviour has a significant effect on fuel consumption and emissions; poorly maintained vehicles contribute a disproportionate amount to the total pollution load from the vehicle fleet. The Auto/Oil Programme and the Commission's future strategy on the control of vehicle emissions is based on the concept of shared responsibility and burden sharing between the Community, national and local governments, Industry and the individual citizen: such an approach is entirely consistent with the principle of sustainable development which requires that all stake-holders have a role to play in the protection of the environment. 5. FROM AUTO/OIL PROGRAMME TO LEGISLATIVE PROPOSALS The Auto/Oil Programme provides the technical foundation upon which the Commission will, build its strategy with regard to the control of vehicle emissions. In developing its proposals for the legislative actions which form a central part of that strategy the Commission took account of a number of considerations over and above the exclusively technical input provided by the programme: Uncertainty In recognition of the uncertainty inherent in any scientific investigation , particularly one a complex as the Auto/Oil Programme, the Commission's proposals are based on a precautionary approach. This means that the severity of the legislative proposals is such that even making conservative assumptions regarding the efficiency of non-technical measures it is confidently to be expected that the necessary air quality objectives will be respected throughout the Community. An integrated package As explained in section 3 the Commission's strategy is based on an integrated approach relying on action at a number of levels and the shared responsibility of all stakeholders. The Commission's legislative proposals must therefore be seen as a package - all the elements in the package are required to be adopted for the strategy to be effective. In addition and in accordance with the underlying premises of the Auto/Oil Programme, the different elements must be implemented concurrently to ensure maximum effectiveness. Feasibility The Commission's proposals also take account of the technological feasibility of introducing the measures according to the specified deadlines. For example in the case of the emission standards for diesel vehicles the proposals are based on the assumption that the de-NOx catalyst will not be in commercial production by the year 2000. The Commission's proposal does, however, take account of the need to provide an incentive for the continued development of this important technology as well as a commitment to guarantee that when vehicles equipped with these technologies arrive on the market, fuels of the a quality sufficent to ensure the effective performance of the new technologies are also available. The integrity of the internal market The economic benefits deriving from the creation of an internal market of over 350 million inhabitants were extremely important considerations for the Commission in developing its legislative proposals. The Commission has endeavoured to achieve an effective balance between one the one hand the need for flexibility in order to respond to the different air quality situations in the Community and on the other hand, the desire to ensure thejntegrity of the internal market. Coherence in legislative policy The Commission's proposals also took into account the history and the balance in the existing legislative regime. For example, in relation to the emission standards applied to different classes of vehicles the Auto/Oil Programme indicated that severe emission limits should be applied to light commercial vehicles and only light to moderate limits on passenger cars. In recognition of the fact that the same engines are often used in both categories of vehicle the Commission will propose that similar and co-ordinated emission limits are applied to each. Expectations of the Member States and the Parliament On the basis of frequent meetings with technical experts and written statements, the Commission has been kept informed of the position of the Member States with regard both to the Auto/Oil Programme and the legislative proposals arising from it. In addition the Parliament has on several occasions expressed itself in favour of environmentally ambitious measures to reduce emissions from road transport. The views of the Member States and the Parliament have been taken into account by the Commission in preparing its legislative proposals. 6. THE LEGISLATIVE PACKAGE ARISING FROM THE AUTO/OIL PROGRAMME In order to facilitate a clearer understanding as to how the Commission's proposals correspond to the framework established under Article 4 of Directive 94/12/EC, a short description of these proposals is given below: 6. 1 Vehicle-related measures 6. 1(a) Passenger Cars (this proposal to Directive 70/220/EEC The emission standards for passenger cars will be tightened by means of a proposed modification the present Communication). A summary of the new emission standards to come into force in 2000 and an indication of the percentage improvement as compared to current standards is given in Table 2 (designated as proposal A in the Table) Also shown in Table 2 are the indicative values which the Commission proposes should come into force in 2005 (designated as proposal B in the Table). These very stringent standards are referred to as the "second step" standards and will be subject to review and confirmation by the Council and Parliament in 1998. The rationale behind the establishment of a second step is provided in section 7 (Table 2 also shows for comparison the LEV and ULEV standards from the U. S. A. ) is attached to The Commission's proposal also contain provisions to ensure that the emission control systems in the car work effectively throughout the life of the vehicle. In particular there is now a requirement for passenger cars to be equipped with technology to monitor the emission performance and to indicate malfunctions to the driver: this technology is known as on board diagnostics (OBD). In addition, the Directive on passenger cars will also introduce arrangements for the in-use testing and eventual re-call of vehicle models after they have been placed on the market. Together with the strengthening of the periodic technical inspections (see below), OBD and re-call provisions should ensure that the emission performance should not deteriorate significantly during the life of the vehicle. As a means to reduce the amount of volatile organic compounds (essentially petrol fumes) which are lost to the atmosphere due to evaporation, a more rigorous test procedure for evaporative losses will be incorporated into the requirements for the type approval of gasoline passenger cars. One of the conclusions from the Auto-oil study was that already existing measures will result in significant reductions in vehicle related emissions of carbon-monoxide (CO) such that CO air quality standards will be respected. It was therefore concluded that the introduction of a cold start test procedure as part of the type approval requirements was not in fact necessary. Finally, in relation to passenger cars, the Commission's proposals (see Table 2) also include separate emission limits for NOx and hydrocarbons as was requested in Article 4 of Directive 94/12/EC. Table 2 Comparison of Passenger Car Limit Values Limit Values Mass of Carbon Mass of Mass of Oxides of Combined mass of Monoxide Hydrocarbons Nitrogen (CO) L, (g/km) (HC) L2 (g/km) (NOx) L3 (g/km) hydrocarbons and oxides of nitrogen (HC+NOx) L2 + L 3 (g/km) Petrol Diesel Petrol Diesel Petrol Diesel Petrol Diesel Mass of particulates (PM) L4 (g/km) Diesel 0. 05 Proposal A (2000) Proposal B* (2005) Current U. S. Federal Standards C. A. R. B. TLEV** C. A. R. B. LEV*** C. A. R. B. ULEV **" 2. 3 0. 64 0. 20 1. 00 0. 50 0. 10 - - 0. 15 0. 50 0. 08 0. 25 2. 1 2. 1 0. 25 0. 25 0. 25 0. 25 2. 1 2. 1 1. 7 2. 1 2. 1 1. 7 0. 08 0. 08 0. 25 0. 05 0. 05 0. 12 0. 02 0. 02 0. 12 0. 25 0. 12 0. 12 - - - _ _ - 0. 56 0. 30 '- 0. 025 -. _ - 0. 05 _ _ - Indicative limit values C. A. R. B. ( Califomian Air Resources Board)standards will be progressively introduced in a number of U. S. States in addition to California over the next ten years. C. A. R. B. Standards are: Transient Low Emission Vehicle Standard Low Emission Vehicle Standard Ultra Low Emission Vehicle Standard These standards specify emissions for Non Metane Organic Gases (NMOG) rather than Hydrocarbons (NMOG being a major fraction of HC). The test cycle used in the USA differs to that used in the EU, and so limit values are not directly comparable. 10 6. 1(b) Light commercial vehicles to Directive 70/220/EEC By the end of 1996, the Commission will come forward with a proposal for a further modification light commercial this vehicles. Indicative emission reductions for pollutant emissions to be incorporated into the type approval procedures for this category of vehicle as from the year 2000 are shown in Table 3: at present the exact values of the emission standards are still to be finalized and the values in Table 3 are therefore expressed as percentage reductions as compared to current standards. in relation time to In addition to the revised emission standards, the Commissions proposal for an amendment to Directive 70/220/EEC with regard to light commercial vehicles will also include many of the additional provisions which are foreseen for passenger cars e. g. OBD, re-call, an improved test procedure for evaporative emissions of volatile hydrocarbons and separate emission limits for NOx and hydrocarbons. Indicative Emission Reductions to Light Commercial Vehicle Emission Standards Table 3 Percentage Reduction from Current Standard Gasoline LCVs Diesel LCVs CO 30% 40% HC 4. 0% 65% NOx 40% 20% PM _ 35% 6. 1(c) Heavy duty vehicles By the beginning of 1997, the Commission will come forward with a proposal to amend Directive 88/77/EEC which concerns diesel engines used principally in heavy duty vehicles. The Commission's proposal will include stricter emission limits for regulated pollutants (see Table 4). As was the case with the light commercial vehicles, the precise values of the emission limits are not yet finalized and therefore the figures given in Table 4 are expressed as approximate percentage improvements as compared to current standards. In addition to the improved emission standards the Commission's proposal may also include the introduction of a new test cycle for measuring emissions as part of the type approval procedure (the effects of the new driving cycle will also need to be reflected in establishing the new emission limits). This new test cycle is intended to represent the real world driving pattern for these type of engines more effectively than the current procedure. Indicative Emission Reductions to Heavy Duty Engine Emission Standards Table 4 ^ 1 Diesel HDVs & Buses | Percentage Reduction from Current Standard NOx - 30% PM - 30% | | 11 6. 1(d) Alternative propulsion systems Although Article 4 of Directive 94/12/EC did require that the potential of alternative, propulsion systems should be evaluated by the Commission this issue was not addressed as part of the Auto/Oil Programme. However, the Commission is convinced that such systems, may achieve a significant role in the 21st century, recognizing that even more stringent emissions targets may have to be introduced as the effects of automotive emissions on health and global warming become better understood, and to meet the growing threat of global competition in the field of clean propulsion technologies. To this end the Commission has established a Task Force The Car of Tomorrow' (see section 8 below) which has as its objective the coordination of research on future technologies with a particular focus on advanced propulsion systems and more rigorous, broad-based comparative assessment of their performance relative to conventional propoulsion. 6. 2 Improved fuel quality The Auto/Oil Programme confirmed that improved fuel quality can have a significant impact upon pollutant emissions from vehicles. The Auto/Oil Programme also identified improved fuel quality standards as being a component part of a cost effective package of Community wide technical measures which would also contribute to the achievement of stringent air quality objectives. At the present time there exist relatively few Community provisions dealing with the quality of fuel used in road transport (lead and benzene in petrol (Directive 85/210/EEC); oxygenate levels in petrol (Directive 85/536/EEC) and sulphur levels in diesel (Directive 93/12/EEC)). These provisions will now be replaced by a comprehensive set of specifications to come into force in 2000 for both petrol and diesel and set out in the new fuel quality Directive. The impact upon the fuel quality on the European market in the year 2000 which will result from the Commission's proposal for a fuel quality Directive are shown in Tables 5 and 6. Predicted Market Average Fuel Quality in 2000 and Effect of Proposal - Petrol Table 5 Parameter Unit Market Average Without proposal Market Average with Proposal __ 58 53 84 11 37 1. 6 1 150 0. 005 RVP Summer E. 100 E. 150 Olefins Aromatics Benzene Oxygen Sulphur Lead kPa % v/v % v/v % v/v % v/v % v/v % m/m ppm ^ 68 53 84 11 40 2. 3 0. 6 300 0. 005 12 Predicted Market Average Fuel Quality in 2000 and Effect of Proposal - Diesel Table 6 Parameter Cetane Number Density Unit - kPa Poly-aromatics % Vol T95 Sulphur °C ppm Market Average without proposal Market Average with Proposal 51 843 9 355 450 53 835 6 350 300 Article 4 of Directive 94/12/EC made specific reference to the need to address the problem of the benzene content of petrol. In the proposal for a framework Directive on fuel quality, the Commission's position is that the maximum content of benzene should be reduced from 5% as is currently the case under Directive 85/210/EEC, to 2%. Article 4 of Directive 94/12/EC also required that the Commission should take into account the potential of alternative fuels in developing its future legislative proposals. Alternative fuels such as compressed natural gas (CNG) and liquid petroleum gas (LPG) were considered in the Auto/Oil Programme as potential alternatives to diesel fuel to be used for buses and other 'captive fleets' - waste disposal lorries, taxis etc - in cities (see below under local measures). The Commission's proposed fuel quality framework directive also includes a commitment to explore further the potential of CNG, LPG, biofuels and other alternative fuels and if appropriate to put forward amendments to the Directive. 6. 3 Inspection and maintenance Periodic - annual or bi-annual - inspection and maintenance checks are effective in ensuring that the emission performance of a vehicle does not deteriorate significantly during its life. The Auto/Oil Programme identified all measures targeted at the improved durability of emission control systems - OBD, recall (see section 6. 1a above) and improved inspection and maintenance - as being highly cost effective in reducing pollutant emissions indeed such measures were estimated as having the potential to contribute over a third of the emission reduction targets for some pollutants. The Community already has basic requirements for inspection and maintenance as laid down in Directive 92/55/EEC. In the light of the conclusions from the Auto/Oil Programme and the results of an extensive study due to be finalized in 1996, the Commission will, during the course of 1997, come forward with proposals to strengthen the requirements laid down in Directive 92/55/EEC. These-proposals to be implemented in 2000, will include improvements to the tests for roadworthiness in order to make these tests more representative of real world conditions and to ensure that the gross polluters in the vehicle fleet( it has been estimated that over 50% of vehicle emissions are produced by 10% of the fleet) are consistently identified. The Commission will also take steps to encorage Member States to implement road-side inspections as a further step towards ensuring that motor vehicles maintain their emission performance throughout their life. Finally, and as explained in section 3, the individual vehicle owner has an important role to play in reducing polluting emissions from road vehicles and the responsibility to keep a vehicle well maintained is a fundamental obligation for all road users. 13 7. THE TWO-STEP APPROACH At the time of adoption of Directive 94/12/EC it was recognized that when the Commission came forward with its proposals for measures to apply after the year 2000, it might also be necessary to put forward target values involving a further substantial reduction in emissions (14th "whereas" clause). In the Commission's proposals relating to the emission standards for passenger cars there are two sets of emission limits. The first set of emission limits will be obligatory and apply as from the year 2000: it is based on the results of the Auto/Oil Programme. The second set of emission limits which is considerably more ambitious than the first, will come into force in 2005. However, these limits will be reviewed by the end of 1998 with regard to their industrial feasibility, taking account of air quality requirements and the availability of improved fuels. The second set of emission limits (the second step) is an essential part of the Commission's policy on reducing vehicle emissions. The Member States will be able to offer fiscal incentives in order to encourage the marketing of vehicles respecting both the first and second set of emission standards (see below for a more detailed discussion on fiscal incentives). This means that manufacturers will have an incentive to continue to invest in the development of pollution abatement technologies. The second step is therefore designed to encourage the early introduction into the market of cleaner vehicle technologies developed by vehicle manufacturers. To illustrate the benefit of the second step it is informative to look at the example of the diesel passenger car. Diesel engines are relatively high emitters of particulate matter and oxides of nitrogen (NOx). At present, considerable resources are being invested in the development of new technologies (particulate traps and de-NOx catalysts) which have the potential to significantly reduce the emissions of these pollutants without negative effects on other emissions. However, it is generally accepted that these technologies will not be in large scale commercial production by 2000 and the Commission's proposal for the emission limits for diesel cars for the year 2000 reflects these expectations. In the absence of a second step, manufacturers would have no incentive to push ahead with the development and introduction into the market place of the new pollution abatement technologies. The Commission also believes that the existence of the second step will provide the Industry with a degree of security concerning the regulatory environment within which it will have to operate over the next 10-15 years. Finally, by establishing challenging standards in the Community with a market of over 350 million people the Commission believes that this will provide the platform for a strong export potential for Community products. In particular the export markets in Asia and North America, will offer opportunities for low emission, fuel efficient vehicles. It is therefore in the Community's economic interest to be at the forefront of technical development: the promulgation of ambitious, technology-challenging standards is an effective instrument to ensure that European Industry remains competitive in the international market place. TZT With regard to fuels, the Commission intends to come forward with proposals to revise the specifications for petrol and diesel fuels and that these improved specifications should come into effect in 2005 at the same time as the "second step" emission standards for vehicles referred to above. , The Commission's proposal will take into account that improvements to fuel quality have a direct and significant impact on emissions of particulate matter, volatile organic compounds and oxides of nitrogen. All of these pollutants either directly, or as a result of their contribution to ozone formation, result in important impacts on human health and the environment. 14 In addition, to the direct benefits that improved fuel quality has on vehicle emissions, there is a clear interaction between fuel quality and vehicle technology. With regard to the development of new pollution abatement technologies, such as the de-NOx catalyst, there is evidence that fuels of a certain quality, particularly low sulphur fuels, may well be required if such technologies are to achieve optimal and long-lasting levels of performance. Accordingly, the Commission foresees that its future proposal to revise the specifications of petrol and diesel fuels should comprise a significant reduction in the content of sulphur for both fuels. Current research and development indicates that a sulphur limit in the order of 50 ppm could be needed for the optimal functioning of the new, vehicle-based pollution abatement technologies as well as contributing to improving emissions from the existing car pare. While for the reasons outlined above, the Commission is persuaded of the need to revise the fuel specifications for petrol and diesel fuels, it nevertheless considers that it would be premature, given the current state of knowledge, to lay down today the fuel specifications which should apply in the Community in the year 2005. The Commission, therefore, intends to bring forward by the end of 1998, a proposal for a revision of the present fuel quality Directive which will include inter alia a revision of specifications for petrol and diesel which are laid down in the Directive. These revised specifications will come into effect in 2005. The Commission's proposals will be based on a comprehensive cost-effectiveness assessment and review (see below). The determination of the precise value of a revised sulphur specification for petrol and diesel fuels will of course be subject to the outcome of this assessment. To take account of the possibility that vehicles equipped with new pollution abatement technologies such as the de-NOx catalyst are developed and introduced into the market before 2005, the Commission has also included in its proposal a commitment to bring forward, if appropriate, proposals to ensure that when vehicles equipped with such technologies are placed on the market, fuels of a quality sufficient to guarantee the necessary level of performance of the technology will be widely available. In bringing forward such proposals the Commission will give due regard to considerations of air quality, cost-effectiveness and proportionality. The Commission will also take into account: (i) (ii) the latest information on the interaction between fuel quality and the performance of the new pollution abatement technologies; the situation with regard to the development and production of these technologies and the forecasts concerning the marketing of vehicles equipped with such technologies; (iii) the need to ensure that the measures proposed will neither disrupt the free movement of persons and goods nor unduly distort competition. The review process The strategy for the control of vehicle emissions which is described in the present Communication, is based on the methodology of the Auto/Oil Programme. The strategy is designed to produce effects to meet the requirements of Community air quality standards and related objectives at least cost. However, in a domain where knowledge is evolving so rapidly, the strategy cannot be static: it must evolve in response to developing knowledge. For this reason, the Commission has also announced its intention to carry out a comprehensive assessment and review of the strategy taking into account the following considerations: trends in air quality; noxious pollutant emissions in Europe from transport and non-transport sources and the contribution that existing, pending and potential measures to control emissions from all sources, could make to improve air quality; 15 technical developments with regard to: * * vehicle technologies as well as new propulsion technologies (e. g. electric propulsion, fuel cells); refinery technology; the potential of alternative fuels such as compressed natural gas (CNG), Liquid Petroleum Gas (LPG), and Dimethyl Ether (DME) and biofuels to reduce vehicle emissions; possible improvements in the test procedures for the type approval of vehicles, in particular the addition of a new test procedure at at low temperatures; the potential of technical, non-technical and local measures to reduce emissions: in this context, the contribution of transport and other policy measures such as traffic management, enhanced urban transport and vehicle scrappage schemes should be evaluated; the contribution that selective and differentiated fiscal measures could make to reducing emissions , whilst not negatively impacting on the functioning of the internal market; the effects of any measures on C02 emissions; the strategies followed by third countries to improve air quality and the emission values applied therein; the situation with regard to the supply and quality of crude oil available to the Community. On the basis of the comprehensive assessment described above the Commission will, not later than 12 months following the adoption of the two proposals accompanying this Communication and in any event not later than 31 December 1998, bring forward: a proposal for a further tightening of the emission standards for passenger cars. This proposal shall establish , inter alia whether the " second step" emission standards for vehicles (see above) and which in the present proposal for the amendment to Directive 70/220/EEC are given as indicative values, should be confirmed as the regulatory limit values to be applied from 1 January 2005; a proposal for a revision of the Directive on the quality of petrol and diesel fuels. This proposal should include further improvements to the specifications for petrol and diesel fuels (in particular, a significant reduction in the sulphur content of both petrol and diesel fuels) and will also come into effect on 1 January 2005. ~ Auto/Oil H Programme In order to carry out the comprehensive assessment upon which it will base its future proposals to be made at the latest by the end of 1998, the Commission considers that it will be necessary to build upon, improve, and extend the concept of the Auto/Oil Programme. With this in mind the Commission will take contact with Industries, Member States and NGOs with a view to setting up the Auto/Oil II Programme. 8. RESEARCH AND DEVELOPMENT, THE CAR OF TOMORROW In 1995 the Commission created a task force dedicated to the theme of the Car of Tomorrow, drawn up after extensive consultation with various stakeholders, including representation from the automotive and oil industries, public authorities, transport operators, and utilities. The 16 aims of this task force include a better focusing of R&D initiatives aimed at the next generation of road vehicles and in particular vehicles which are clean, safe, energy efficient and intelligent. These R&D initiatives will also aim at giving further insights into the development of air quality standards and improving the assessment of risks to health and the environment from vehicle emissions. Arising out of the work of the Task Force the Commission services have developed an Action Plan for the Car of Tomorrow. The Commission considers that the work of the task force and the recent action plan are directed at initiatives which will take the emission performance of road vehicles up to and far beyond the second step identified in the vehicle emission proposals and will lead ultimately to the development of near zero and zero emission vehicles. The task force will aim to achieve these goals through stimulation of RTD and demonstration of promosing clean propulsion technologies, utilising cleaner fuels. These efforts will be integrated with telematics systems and new technologies for reducing vehicle weight and drag. The RTD will be underpinned by a broad based comparative assessment process based on a life cycle approach, to identify more cost effective routes to reducing harmful vehicle emissions and energy consumption. 9. ECONOMIC INSTRUMENTS 9. 1 Fiscal instruments All taxes influence behaviour. This is independent of whether that is their intended purpose, or whether they are simply a means for raising revenues. A purchase tax, for instance, makes new cars more expensive, and will therefore lead consumers to buy fewer or different cars than. otherwise, or may induce them to hold on to their old vehicle for longer. A fuel tax affects a different aspect of transportation. As it increases the fuel costs for each mile driven, people may drive less or use more fuel efficient cars. One can therefore take advantage of this behavioural effect to design the tax system so that is has the effect of reducing vehicle emissions. To various degrees, Member States already apply a variety of taxes and fees as a means of changing transport behaviour in a desired direction. For instance, gasoline taxes are used to decrease fuel consumption. By analogy, fiscal instruments can encourage emission reductions by steering transport behaviour into a desired direction. Transport emissions will decrease when people buy cars with clean technology, keep them well-maintained, scrap old and dirty cars, burn cleaner fuels, drive less, participate in car pools, etc. Regulations concerning vehicle emissions and fuel specifications which are designed to harmonize Member States' legislation at a high level of environmental protection can address only a limited number of these behavioural factors. A policy limited to these technological aspects has little impact on behaviour. Therefore, important leverage points to achieve emission reduction would be left out. Economic instruments, by contrast, can have an influence on these behavioural aspects by making undesired behaviour more expensive than desired behaviour. This could be done either by increasing taxes on polluting activities, or by using tax incentives, i. e. by providing tax rebates to activities that decrease emissions. There are a variety of economic instruments that can be used to do this. 'For example, vehicle purchase or registration taxes can be differentiated in such a way that dirtier cars are taxed higher than cleaner ones. Similarly, one could differentiate annual circulation taxes according to emission characteristics. The impact of this instrument would not only be limited to new vehicles but it would also affect vehicles already in circulation, which contribute to a significant share of the transport emissions. Potentially, therefore, a structured circulation tax could be a cost-effective measure to complement emission standards, as it could reduce emissions from this part of the vehicle fleet. Scrappage subsidies could also help getting old and dirty vehicles off the road. 17 Tax differentiation for leaded and un-leaded gasoline, and for high and low sulphur fuels in some countries has shown the effectiveness of fiscal instruments in the fuel market. Driving behaviour can be influenced by increasing kilometre-dependent charges, for instance, through road taxes. For most of these measures the administrative structure is already in place. What is necessary is only to alter the rate structure to obtain the desired behavioural effect. A number of initiatives in the indirect taxes area are under way or scheduled for the near future where environmental concerns, such as emission levels, may be relevant. These initiatives cover both fuel taxes and vehicle taxes. All motor fuels are subject to excise duty. Within the excise system, a number of Member States have sought and been granted derogations from the normal rules, under a procedure which requires the approval of the Commission and all Member States (Aticle 8(4) of Directive 92/81/EEC). In some instances, the derogations are related to fuel quality. For example, Denmark, Finland, Greece & Sweden have been granted derogations allowing them to apply reduced rates on environmentally friendly diesel. Finland can apply reduced excise duty rates on reformulated unleaded and leaded petrol. Denmark can apply differential rates of duty between petrol distributed from petrol stations equipped with a return system for petrol fumes and petrol distributed from other petrol stations. A number of applications from other Member States are being processed at present. Some of the derogations granted under Article 8(4) of Directive 92/81/EEC expire at the end of this year, and all fall to be reviewed in the course of 1996. This review is necessary to ensure continuity and to deal with the evolving situation whereby various Member States wish to introduce rate differentiation, often on environmental grounds. The review will thus provide an opportunity for this aspect to be considered more fully in the short term. Minimum rates of excise duty are laid down at Community level, with a requirement that they be reviewed every two years in the light of the functioning of the internal market, the real value of the duty rates and the wider aspects of the Treaty. The first review did not make any proposals for change, pending a wide ranging consultation process which was to take account, inter alia, of the wider Treaty aspects. That process is now nearing completion, and the second review is due to be carried out later this year. The Commission's proposal for a framework Directive on fuel will result in a significant improvement in the average quality of fuels sold in the Community. However, it is probable that some Member States, particularly those which have used fiscal measures in the past (see above), may wish to encourage the use of even cleaner fuels as part of their overall strategy to improve air quality. The Commission notes that Directive 92/81/EEC provides a framework within which Member States may apply fiscal incentives. Discussions on a Commission proposal for a carbon/energy tax failed to reach agreement in the Council. In the absence of agreement, the ECOFIN Council of U March 1996 invited the Commission to bring forward new proposals for the taxation of energy products^A large number of Member States have expressed the wish that any such proposals should build on the existing excise structure. Given the obvious link between the requirement to review minimum rates of excise duty and the intention to bring forward new proposals for taxing energy products, it is likely that these two activities will be combined, and it is expected that new proposals will be brought forward by the end of 1996. It is clear that environmental aspects should be an important influence on these proposals. On the question of vehicle taxation, it is important to note that the tax treatment of vehicles varies enormously from one Member State to another, not just in terms of tax burden but also in terms of mix of tax type. Furthermore, the factors which influence fiscal policy for vehicles also vary significantly between Member States, often drawing on traditional, social and cultural elements in addition to the more obvious economic and industrial concerns. 18 The Commission has recently commenced a detailed study of vehicle taxation in the Member States. This study will analyse the Member States. It will also examine vehicle taxation from a Community perspective, with a view to ascertaining what Community measures are necessary, or appropriate, in the interests of improving the functioning of the internal market and advancing other policy objectives, including environmental concerns. the various approaches followed in 9. 2 Fiscal incentives used in relation to vehicle emission limits Article 4 of Directive 94/12/EC does not include any specific reference to fiscal/tax incentives (e. g. tax reductions) among the measures which should be taken into account by the Commission in the preparation of future legislative proposals. It is however stated in Article 4. 2 that the Council will decide upon the conditions for granting tax incentives with regard to the future emission standards on the basis of the emission limits proposed by the Commission. Since the adoption of Directive 89/548/EEC, Community decisions relating to the environmental aspects of motor vehicle emissions have contained a framework for the granting of fiscal incentives to encourage the early application of the new limit values. In these directives a balance has been struck between , on the one hand, the need to encourage the introduction of new technologies as quickly as possible, and, on the other hand, the need to avoid fragmenting the Single Market with diverse fiscal incentive programmes incentivizing different limit values with the consequence that, de facto , there would be simultaneously a multitude of regulatory limit values existing on the market. The principle adopted in the framework set out in Article 3 of Directive 94/12/EC have been to permit fiscal incentives only for vehicles complying with the Directive and provided that they comply with trie provisions of the Treaty and that they are: non-discriminatory; limited in time and that they terminate when the limit values become mandatory; of an amount lower than the additional cost of the technical solutions introduced to ensure compliance with the new limit values and the cost of their installation on the vehicle. its proposals for vehicle emission standards arising out of the In developing Auto/Oil Programme the Commission has declared its intention to explore a more flexible approach to the use of fiscal incentives. Accordingly, the Commission's proposals relating to vehicle emission standards and arising from the Auto/Oil Programme will include two sets of emission standards (see section 6. 1). Member States will be able to use fiscal incentives to encourage the introduction of vehicles conforming to both sets of emission limits. As compared to the present situation, the use of fiscal incentives in the context of artwo-step approach has considerable advantages as the emission limits in the second step will be sufficiently ambitious as to ensure that fiscal incentives applied in relation to this step will constitute a genuine encouragement to innovation. It is possible, despite the two-step approach and the greater freedom allowed in relation to the use of fiscal incentives, that some Member States may object to the principle of Community legislation based on Article 100a, imposing restrictions on their freedom with regard to the use of fiscal/tax incentives. However, the Commission continues to believe that a Community framework for the application of emission related fiscal incentivesis necessary to ensure the integrity of the internal market which could be jeopardized by the proliferation of incentive schemes in the different Member States. Thus, while the Commission is in favour of introducing greater freedom into Community policy on vehicle emissions it would be totally opposed to initiatives which could seriously undermine the principle of the single market and the advantages associated with it. 19 Pollutant, Urban NOx Urban Particulates Urban Benzene Total VOCs Total NOx 10. The emission reduction benefits and the costs associated with the Commission's package of measures on vehicle emissions The package of legislative actions due to come into force in 2000 and described in section 6 will result in considerable reductions in the emissions from road transport over and above those which would be expected from already agreed measures (see Table 7 below). Effect on Road Transport Emissions of Auto Oil Package of Measures Table 7 Emissions in 1990 Emissions in 1995 Emissions in 2010 without Auto Oil 1000 Tonnes/yr Percent of 1990 Level 1000 Tonnes/ yr Percent of 1990 Level 1000 Tonnes/ yr Percent of 1990 Level 1 936. 68 100 1 940. 58 100 1 207. 77 62 Emission in 2010 with' Auto Oil Package 1000 Tonnes/ yr 748. 817 Percent of 1990 Level 38. 7 124. 663 100 137. 029 110 69. 383 Urban CO 25 189. 17 100 100 20 224. 04 13. 88 80 87 1 1961. 25 7. 78 15. 91 56 47 49 42. 324 34 5 980. 625 4. 0456 23. 7 25. 4 4 105. 72 100 3 688. 83 90 1 811. 33 44 996. 232 24 5 864. 84 100 5 581. 33 95 3 053. 25 52 1 984. 613 33. 8 While these Community measures may in some localities need to be complemented by targetted local initiatives (see section 3) the Commission is confident that by 2010 and assuming parallel actions to reduce emissions from other sources, that the air quality targets referred to in Table 1 will be respected thfoughout the Community. While the benefits in terms of human health (mortality, morbidity and quality of life) and the environment (crop production and ecosystem damage) are difficult to quantify, it is clear from the available evidence that these benefits will be considerable. In addition to the significant emission reduction benfits associated with the measures due to come into force in 2000 further reductions will clearly be associated ^with the implementation of the second step for vehicle emissions and the future proposal on fuel quality (see section 7). 20 The Costs(S) of the Commission's package of legislative measures Tnsts to industry Measures to become effective from 2000 Passenger car producers Van /light commercial vehicle producers Heavy duty vehicle producers Refining Industry National governments associated with improved inspection and maintenance ECU 3 094 million per annum ECU 373 million per annum ECU 675 million per annum ECU 765 million per annum ECU 555 million per annum TOTAL ECU 5 461 million per annum. Measures proposed for vehicles for 2005 'the Second Step* Passenger car/light commercial vehicle producers ECU 2 500 million per annum ECU 500 million per annum Heavy duty vehicle producers Cost to the consumer Measures which become effective from 2000 Fuel Additional cost per litre/1 000 litres Petrol: Diesel: ECU 0. 002 per litre: ECU 0. 0018 per litre: ECU 2 per 1 000 litres ECU 1. 8 per 1 000 litres Additional cost on the fuel bill of the average motorist ECU 2. 3 (assuming 12 600 km per year and 8. 61 1/100 km) Petrol Car: Diesel Car: ECU 1. 7 (assuming 12 600 km per year and 7. 61 1/100 km) Increased new vehicle costs Petrol passenger car Diesel passenger car Small Medium Large ECU 200 per new car ECU 225 per new car ECU 290 per new car Medium ECU 380 per new car ECU 520 per new^ear Large Light commercial vehicles: ECU 145-290 per vehicle Heavy duty vehicles: ECU 530-1 620 per vehicle Increased maintenance costs ECU 7. 5 - 10 per annum for passenger cars. Measures proposed for vehicles for 2005 'the Second Step' Between ECU 150 and 200 per new car as an average (5) All costs are in 1995 ECU 21 REPORT ON THE AUTO/OIL PROGRAMME ANNEX 1. THE EUROPEAN AUTO/OEL PROGRAMME 1. 1 Phase I - Establishing the framework In keeping with its commitment to develop a more comprehensive approach to reducing emissions from road transport, the Commission decided at the end of 1992 to initiate a work programme to provide a solid technical foundation upon which to base its future legislative proposals. In accordance with the principle of 'shared responsibility' expressed in the 5th Environmental Action Programme, the Commissioners for Environment, Industry and Energy, invited the European associations of the car (ACEA) and oil (EUROPIA) industries to make available their considerable know-how and expertise and to collaborate in the realization of this work programme. The two industries responded positively to this invitation and together with the Commission designed, planned and executed the programme which subsequently became known as the Auto/Oil Programme. The objective of the Auto/Oil Programme were defined as: to provide policy-makers with an objective assessment of the most cost-effective package of measures including vehicle technology, fuel quality, improved durability and non-technical measures, necessary to reduce emissions from the road transport sector to a level consistent with the attainment of the new air quality standards being developed for adoption across the European Union. 1. 2 Work programme The work programme was divided into a number of inter-related components as follows: (i) (ii) (iii) (iv) the prediction of future air quality in the Community and in the case where future air quality was predicted to fall below an acceptable standard, the identification of appropriate emission reduction targets for road transport; the collation and, where necessary, the generation of data concerning the potential of the various measures inter alia engine technology, fuel quality, increased durability requirements and complementary measures, to reduce emissions from road transport; the collation and, where necessary, the generation of data concerning the cost of introducing the measures identified under ii (above); ^ on the basis of the data generated in steps ii and iii above to identify the most cost effective package of measures necessary to achieve the emission reduction targets identified under step i). 1. 3 Organizational framework (a) Cooperation Commission/industry A management group and a number of technical working groups were established comprised of representatives of the Commission and ACEA and EUROPIA. The management group met on a regular basis and was responsible for the oversight and planning of the work programme with regard to content and time. The technical working groups were established for issues requiring further investigation. 22 At the level of the Commission services a number of Directorates General (principally DGs II, IE, XI and XVII with support from DGs VII and XII) were involved in the implementation of the Auto/Oil Programme. In addition to the involvement in the programme of staff from the Commission and the two industries, external consultants/consultancy companies were commissioned to carry out certain parts of the programme. Their work was specifically related to fuel quality, emissions/air quality and cost-effectiveness issues. (b) Information Provision Auto/Oil Programme to interested parties not directly involved in the (i) European Parliament In 1995 a number of technical briefings with members of various committees of the Parliament were held in order to keep Members of the European Parliament and their staff informed as to the progress of the Auto/Oil Programme. (ii) Member States A national expert group on "environmental fuel specifications" (EFEG) was established early in 1993 to follow and to discuss on a regular basis the progress invited being made with Member States to provide technical advice and support in areas of specific interest to them. the Auto/Oil Programme. The Commission In addition the Motor Vehicle Emissions Group (MVEG) was consulted and informed on various aspects related to vehicle technology and ^ improved durability requirements. In the course of 1995 the Commission held four combined EFEG/MVEG meetings in order to give full account of the progress and results of the programme. EFEG/MVEG meetings also provided a forum for a number of industries and non-government environmental organizations. In this way access to information on the programme was also guaranteed to a range of interest groups likely to be effected by future legislation. 2. ABR QUALITY MODELLING 2. 1 Introduction The following atmospheric pollutants were investigated as part of the Auto/Oil Programme: Carbon Monoxide (CO) - in cities Particulate matter (PM) - in cities Benzene - in cities Nitrogen dioxide (N02) - in cities Tropospheric Ozone (03) - principally at the regional level A short description of each of these pollutants, their effects on human health and the environment as well as the contribution of road transport to total emissions is to be found in Box 1. 23 Pollutants Investigated in the Auto Oil Programme BOX1 Carbon Monoxide (CO) Colourless, odourless, and tasteless gas. It replaces Oxygen in the blood and thus causes asphyxiation in high concentrations. It is transformed to Carbon Dioxide - a "green house" gas - in the Atmosphere. Soared of all CO Emissions In EU in 1990 Road Transport Carbon Monoxide Emission Sourcts Apfcvlton Nat«n 1H Nitrogen Monoxide / Nitric Oxide (NO) (Transforms mainly to N02) Nitrogen Dioxide ( N 02- N 02& NO together are known as NOx) A reddish-brown gas, it causes a variety of respiratory conditions, especially in vulnerable groups (e. g. children & asthmatics). Contributor to the problem of Acid deposition, and decreases plant growth their Effects and Sources Particulate Matter (PM) / Black Smoke (BS) Any fine particle, the effect of which is dependent on the type of particulate, although there is some evidence that the smaller fractions are, in general, carcinogenic. However, black smoke may not contain the smallest size fractions now associated with carcinogenic effects. Furthermore, many components, e. g. heavy metals, are toxic. Ozone ( 03) A secondary pollutant formed by the reactions of mainly NOx and VOCs in the presence of sunlight. A strong oxidising agent it induces eye, nose, and throat irritation, chest discomfort, coughs and headaches. It also damages materials and inhibits plant growth. Hydrocarbons (HC) The complete range of organic compounds - usually gasses - this term includes both VOCs and Benzene. Volatile Organic Compounds (VOCs) Any organic compound sufficiently volatile to cause significant emissions into the air via evaporatioa The complex interaction of many of the VOCs cause the formation of "secondary" pollutants such as Ozone (see below). VOCs also contribute to the problem of acidity and ethylene is a serious plant growth inhibitor. Contains some Carcinogenic compounds -See Benzene Below. Sources of all VOC Emissions in EU In 1990 — Road Transport VOC Emission Sources 'TV V«kklei B «M * * * *" 7H J *. —**- L%k« C M U M K UL VAfclM, 1IH Sourcts of all NOx (as N02) Emissions in EU in 1990 Road Transport NOx Emission Sources B«n« Twa Wheal» BnrMUonA •xilfUh * Otter MrtCa W i rf treatment 13H. __ l**"*t»7 Othar Mai Sivrcea 1 2* Colourless liquid or gas - smells of almonds Benzene is known to be both toxic and a carcinogen. Benzene (CéH«) •Antwx tn Cammunimfirm • The Auto Oil Programme 24/05/1996 page 4 2. 2 Air quality in cities Population density, industrial activity and traffic intensity in urban environments can frequently give rise to acute problems of air pollution. In order to investigate the problem of atmospheric pollution in cities, seven European cities - Athens, the Hague, Cologne, London, Lyon, Madrid and Milan - were chosen for detailed study. These cities were considered as being representative in terms inter alia of their air quality, geographic location and the characteristics of their vehicle fleets(1). On the basis of information on the emissions of pollutants from various sources and the relationships between emissions and air quality, computer models were used to predict the air quality in the seven cities in the year 2010( \ Unfortunately, in the case of particulate matter, the quality of the data was not good enough to permit the prediction of air quality in 2010 in each of the cities. For this reason pollution by particulate matter was dealt with separately (see section 3. 3 below) In order to decide whether the predicted air quality in respect of the three pollutants carbon monoxide, benzene and oxides of nitrogen were satisfactory, air quality standards were defined for each pollutant. In the case of N02 and CO air quality standards already exist, laid down either, in Community legislation (N02: Directive 85/23/EEC) or in WHO guidelines. However, in recognition of the fact that the WHO guidelines for both N02 and GO were in the process of being reviewed and that initial recommendations for revised values from scientific expert groups were already available, it was decided to use two air quality standards for the purposes of the Auto/Oil Programme: a less severe standard based on current air quality standards; a more severe standard based on the initial recommendations of the expert groups currently reviewing the WHO guidelines. In the case of benzene there are no existing Community standards and the WHO does not set limit values for substances such as benzene which are regarded as carcinogenic. In the light of existing scientific evidence and recommended the Member States, the Auto Oil partners agreed upon a less severe and a more severe standard as they had done for CO and N02. However, in recognition of the fact that certain Member States have also expressed aspirations to achieve extremely low 'target values ' in terms of benzene concentrations the Commission also insisted upon the inclusion of a third very severe standard in relation to this pollutant. limit values which exist in A summary of the air quality standards used for CO, N02 and benzene is given in Table 1. A summary of the emission reduction requirements determined to be necessary in each of the seven cities in order to achieve these air quality standards is given in Table 2. (i) (2) To enable the Auto/Oil Programme to base air quality predictions on the most reliable data on the future development of the EU vehicle fleet, the Commission made available the FOREMOVE model. The commission funded this model which contains details of vehicle fleets in each Member State (vehicle categories, age, and distance travelled) and generates information concerning the total and percentage emission of major pollutants by each category of vehicle. FOREMOVE also contains assumptions concerning the development of the vehicle fleet in each country over the next 25 years and the predicted effect of current and agreed new legislation on vehicle emissions. The year 2010 was chosen as reference year because the programme was designed to identify measures which would take effect from 2000. Measures introduced in 2000, such as emission standards for new vehicles, will only have a gradual effect on air quality as the existing vehicle fleet is replaced. By 2010, it will be possible to judge their impact. 25 2. 3 Particulate material As indicated in Section 2. 2 it was not possible to model pollution by particulate material in the same way as the other urban pollutants. There is a lack of basic information concerning the relationship between emissions and air quality and a lack of consistency in the way that particulate matter is measured. However, results are just beginning to emerge which allow some provisional conclusions concerning the likely effects of particulate pollution on human health, tentative air quality standards and the need for emission reductions. There is increasing evidence that particulate material may contribute significantly to patterns of morbidity and mortality on western Europe. There is also an emerging consensus that the particulate material which causes health effects is to be found in the smaller size fractions: these smaller size fractions are now measured using a parameter called PM10 which means those particles with a size of 10 microns or less. With regard to the establishment of an air quality standard sufficient to protect human health, there is as yet no international consensus. However, the UK Government's Expert Panel on Air Quality Standards has recently recommended a value of 50ug/m3 measured as a 24 hour running average and in the absence of alternative standards this figure will be used for the purposes of the present report. 26 Table 1 Air Quality Target Values Used in Air Quality Modelling Pollutant N02 Standard* Less severe standard = 200ug/m3 as 98 percentile** of hourly values More severe standard*** = 93 u g/m3 as a 98 percentile of hourly values. CO Less severe standard = 10mg/m3 as a 98 percentile of 8 hourly values. More severe standard **** = 5 mg/m3 as a 98 percentile of 8 hourly values Benzene Less severe standard = 16 ug/m3 as an annual mean More severe standard = 10 ug/m3 as an annual mean Very severe standard ***** = 2. 5 ug/m3 as an annual mean To Equate values for the different averaging periods used to determine these standards it was necessary to undertake a statistical analysis of European air quality data using the Commission's Air Pollution Information Service (APIS) database enhanced with additional data from Member States obtained by CONCAWE. a 98th percentile value means that only 2% of all values recorded during the year would be above this value. Therefore in the case where measurements are taken on an hourly basis, in any one year there will be a total of 365 x 24 (=8760) separate values. The 98th percentile figure would correspond to the value below which lie 8585 of the hourly readings. Expressed in another manner the 98th percentile value is the value which may be exceeded on 175 hours each year, i. e. a total of 7 days. ***98th percentile value corresponding to a maximum value of 200 ug/m3 (recommended new standard emerging from WHO working groups). The relationship between maximum values and 98 percentiles was obtained from european air quality records. """98th percentile value corresponding to a maximum value of 10 mg/m3 (recommended new standard emerging from WHO working groups). The relationship between maximum values and 98 percentiles was obtained from european air quality records """Benzene is of particular concern in a number of Member States who have reflected-this by setting very low, long term target values. Recognizing the aspirational nature of these target values, it was agreed that the necessary reductions to achieve a value of 2. 5ug/m3 would be investigated. 27 Table 2 Air Quality Modelling - Summary of the Emission Reductions N02*/ NOx CO Benzene CITY Percentage Emissions Reduction necessary to achieve air quality targets: Percentage Emissions Reduction necessary 'to achieve air quality targets: Percentage Emissions Reduction necessary to achieve air quality targets: Less severe standard More severe standard Less severe standard More severe standard Less severe standard More severe standard Very severe standard Athens Cologne The Hague London Lyon Madrid Milan (N/A - Not Available) 0 0 0 0 0 0 0 50 20. 5 0 31. 5 22. 5 39 45 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 50 0 0 0 20 35 15 * Nitrogen di-oxide is a pollutant with demonstrated direct and indirect effects upon human health and the environment. Air quality standards are therefore expressed in terms of concentrations of N02. However, emissions from vehicles and other sources consist of a mixture of nitrogen di oxide and nitrous oxide (NO). For the purposes of establishing emission limits these two gases are combined under one heading - NOx. Therefore, while the air quality concentrations given in Table 2 are expressed in terms of N02 the emission reduction targets are expressed in terms of NOx. 28 Reliable measurements of ambient air concentrations of particulate matter using the PM10 parameter have only recently started to come available. Some data are available from the UK and additional information has been generated from a major research project undertaken in the context of the European Community's Research Programme: results from the UK and the EU programme are presented in Table 3 below. It would appear from the data summarized in Table 3, that maximum daily mean values for PM10 concentrations in many european cities are within the range 100-150 ug/m3. This would imply thai reductions in the range of 50-65% are required in order to meet the air quality standard of 50ug/m3. In trying to convert these estimates into tentative conclusions as to the likely magnitude of emission reductions great care must be exercised as the contribution of different sources to the total particulate load is only poorly understood and shows significant variation between regions. Nevertheless it was decided in the Auto/Oil Programme to use the range of 50-65% of 1995 levels as an emission reduction target for 2010(3). 2. 4. Regional Tropospheric Ozone Tropospheric ozone is referred to as a secondary pollutant, this means that it is formed as a result of the interaction between primary pollutants, principally nitrogen oxides and Volatile Organic Compounds (VOCs). The chemical reactions leading to the formation of-ozone are accelerated in warm conditions and in the presence of sunlight: ozone is therefore often referred to as 'summer smog'. Tropospheric ozone is a regional, transboundary problem: high concentrations of ozone frequently being found considerable distances (100s of kilometres) away from the major urban centres which are the principal source of the precursor pollutants, NOx and VOCs. In order to explore the regional aspects of ozone formation, the Auto Oil partners relied heavily on the EMEP model which has been developed to support the various protocols which have been established in the context of the 1979 Geneva Convention on transboundary air pollution. On the basis of data relating to emissions of primary pollutants, the detailed chemistry of ozone formation and factors such as temperature, wind speed, intensity of solar radiation etc, the EMEP model can be used to predict ozone concentrations throughout Europe. Having taken into account the expected trends in emissions of primary pollutants the predicted air quality values were then compared with the air quality objectives for tropospheric ozone as laid down in Directive 92/72/EC (see Table 4). If one considers the benefits of improvements which could be expected as a result of across the board decreases in emissions from all sources, some of the results generated from the EMEP model are given in Table 5. These results are expressed as the percentage of the Community's land area in compliance with the various air quality objectives. (3) Already agreed measures will reduce particulate emissions across the EU to nearly a half of those in 1995. Therefore the additional emission reductions required in 2010 to achieve the target reduction of 50-65% compared to 1995 levels is equivalent to approximately one-third off the predicted 2010 emissions. 29 Summary of Data from UK and EU Studies on Urban PM Concentrations. Table 3 APHEA Project data: ,1 ». City Measurement Winter (December, January, February) Summer (June, July, August) Athens Black Smoke Barcelona TSP or PMx Helsinki TSP or PMx Cologne TSP or PMx London Black Smoke Lyon Milan Paris PM13 TSP or PMx 187. 9 TSP or PMx Rotterdam Black Smoke Min. * 64. 0 137. 5 33. 4 70. 3 24. 1 48. 6 36. 4 15. 6 Max. ** 141. 4 232. 2 121. 8 83. 8 94. 5 87. 8 199. 7 67. 3 29 Min. * 41. 8 117. 2 41. 9 72. 1 7. 2 29. 8 81. 7 37. 6 9. 4 Max. ** 102. 4 177. 7 91. 7 83. 4 15. 9 55. 7 85. 1 47. 8 20. 4 PEACE Project: Country City Finland Kupio Germany Berlin Germany Zerbst Greece Athens Italy Italy Pisa Torre del Lago NL Amsterdam Sweden Mal mo 1 Max. PM10 Winter (ug/m3) UK data: City Dailv mean PM10 (Mg/m3) 60 117 95 201 131 149 123 59 Belfast BirminghamA BirminghamB Bristol Cardif Edinburgh Hull Leeds Liverpool 191 113 106 83 96 65 84 114 84 * Mean from the station giving the minimum annual measurements levels for each city. **Mean from the station giving the maximum annual measurements levels for each city. (Mean figure from above data is: 112. 6) 30 Table 5 also indicates the predicted impact of 50%, 60%, 70%, and 80% emission reductions in both NOx and VOCs from all anthropogenic sources as compared to 1990 The nature of ozone formation is such that dramatic reductions from all sources for all precursors are required before complete compliance with air quality standards can be expected. Indeed it is only when an 80% emission reduction (compared to 1990) of precursors from all sources is achieved that over 90% of the EU land area is predicted to have a 1 hour maximum ozone concentration below 180ug/m3. With regard to the 99 percentile 1 hour mean 180 ug/m3 standard, across the board reductions in ozone precursor emissions of 60% and to a percentage land area compliance of 95 and 99% respectively. It was 70% correspond decided that for the Auto/Oil Programme an overall emission reduction target for ozone precursors in 2010 would be 70% of 1990 levels(4). Table 4 Comparative Values: reactive pollutant modelling Guidelines Directive 92/72/EEC Directive 92/72/EEC Air Quality Standard 110 ug/m3 8-hour average 180 ug/m3 1-hour average WHO Air Quality Guidelines 1995 120 ug/m3 8 hour average Relevance Health protection threshold Threshold level over which information / warnings have to be issued by the authorities to the general public. Protection of health threshold (4) Already agreed measures will reduce ozone precursor emissions across the EU to nearly a half of those in 1990. Therefore the additional emission reductions required in 2010 to achieve the target of 70% reductions compared to 1990 is equivalent to approximately one-third off the predicted 2010 emissions. 31 Compliance with Ozone Air Quality Standards Table 5 EU Percentage of EU Land Area (measured in EMEP grid squares) in Compliance with Standards 1 h mean 100 percentile % > 180 ug/m3 1 h mean 99 percentile % > 180 ug/m3 37 53 62 73 81 92 73 87 89 95 99 100 8 h mean 100 percentile % > 120 ug/m3 not known 5 8 11 18 26 8 h mean 99 percentile % > 120 ug/m3 10 19 25-_ 28 37 46 Scenario 1990 basecase 2010 Basecase 1990 basecase -50% 1990 basecase - 60% 1990 basecase - 70% 1990 basecase - 80% 32 The following are the conclussions from the Auto Oil Study with respect to each of the pollutants which were investigated: (1) Carbon Monoxide; the impact of already agreed measures (in particular the increasing penetration of the three way catalyst) will already, by 2005 reduce urban background concentrations in all the cities studied to below the level of the most stringent air quality standard. On the basis of these results regulating for further reductions in vehicular emissions of this gas would not be a priority. (2) Benzene; the results indicate that as with carbon monoxide, the impact of the three way catalyst will result in a marked improvement of urban background concentrations over the coming years. Only in the case where an air quality standard of 2. 5 ug/m3 is used as a basis for comparison are emission reductions foreseen to be necessary in a number of the most polluted cities. (3) Oxides of Nitrogen; the air quality modelling results clearly demonstrate lhat if one uses the more stringent air quality standard for nitrogen dioxide as a basis for comparison it will still be necessary in 2010 to make further reductions in emissions of between 0 and 50% dependent upon the city. (4) Particulates; emission reductions of particulate matter from road transport in urban environments in the range 50-65% as compared to todays levels were considered necessary in order to achieve suitable air Quality targets. (5) Regional Ozone Pollution; the most important messages to be taken from this analysis are: - that the emission reductions resulting from already agreed measures will by 2010 bring about a considerable improvement with regard to regional ozone pollution; - that to reduce ozone pollution beyond that achieved by already agreed measures will require significant emission reductions of NOx and VOCs emissions of the order of 70-80% as compared to 1990; - that further emission reduction measures applied to traffic will, in the absence of parallel measures applied to other sources particularly sources of VOCs , have at most a marginal impact. - that for the purpose of the Auto/Oil Programme an emissions reduction target of at least 70% compared to 1990 levels of both total NOx and totai VOCs across the EU would be used. 33 3. THE COSTS AND POTENTIAL BENEFITS OF MEASURES TO REDUCE POLLUTANT EMISSIONS FROM VEHICLES. 3. 1. The European Programme on Environmental Fuels and Engines (EPEFE) One of the first steps taken in the Auto/Oil Programme was to review all available data concerning the relationships between vehicle emissions fuel properties, and engine technologies: this review included the results of the US Auto/Oil Programme. The conclusions from this review were published in 1994 in the report entitled "Effect of Fuel Qualities and Related Vehicle Technologies on European Vehicle Emissions"(5). In reviewing existing information on the relationship between fuel quality, engine technology and exhaust gas emissions it became apparent that gaps existed concerning certain fuel and vehicle interactions. As such knowledge was vital for the completion of the Auto/Oil Programme, the European Oil and Vehicle industries collaborated in the realization of an extensive research initiative designed to generate the missing data. This research programme was known as the "European Programme on Emissions, Fuels and Engine Technologies" (EPEFE) The EPEFE programme was extremely successful and has allowed important insights into the relationships between fuel quality and emissions. These relationships are complex, indeed it was observed that in some cases changing certain fuel parameters would decrease emissions of one pollutant while increasing emissions of another. Such insights are of vital importance when selecting fuels with the object of attacking priority pollutants. The EPEFE programme is one of the most ambitious studies of this type ever carried out. It has assisted in the quantification of the relationship between certain important fuel parameters (e. g sulphur content, aromatics content, distillation characteristics for gasoline; cetane number, density, polyaromatics content, and distillation characteristics in the case of diesel) and pollutant emissions. The EPEFE programme represented a significant investment on the part of the industrial partners in the Auto/Oil Programme and it is unlikely that such an ambitious undertaking would have taken place without the impetus of the Auto/Oil Programme. The results of the EPEFE programme have been published by the Industry(6). The individual test results from the tens of thousands of measurements taken during the EPEFE programme are also available upon request. 3. 2 Fuel quality changes - Costs and potential benefits Combined with already existing data, the EPEFE programme constituted a solid foundation upon which to make reliable estimates of the effects of changing fuel quality upon vehicle emissions. This allowed the Auto Oil partners to design fuels and to be confident in predicting the impact each fuel would have on the emission profiles of different classes of vehicles. In order to cany out a cost analysis it was necessary to combine the information concerning the effects of different fuel qualities on engine emissions (the benefits) with information concerning the additional costs of producing fuels corresponding to new, environmentally driven, specifications. (5) (6) This report - the report of "sub-Group 1" - is available on request from the European Commission. European Programme on Emissions, Fuels and Engine Technologies, Final Report. ACEA/EUROPIA, 9. 10. 1995. 34 On the basis of information provided by the Industry and the evaluation carried out by the independent contractor engaged by the Commission, the cost to the Industry of making changes to the composition of the gasoline and diesel fuels produced by EU refineries was assessed. A summary of some of the data concerning the benefits (emission reductions) and costs of cleaner gasoline and diesel fuels is presented in Tables 6 and 7 below. Complete details of the costs and benefits of fuel reformulations are to be found in the consultants report and the summary report of the Auto/Oil Programme. Table 6 Costs and Emissions Benefits of Cleaner Fuels - Gasoline: Emissions Reduction Potential for vehicles equiped with a 3-way catalyst. Cost to Industry per annum** Cost per litre Cost to the * motorist*** NOx* 7. 12% tl -6. 36% VOCs 18. 62% tl 4. 31% CO 17. 16% t l" 5. 36% ECU 327 - 1 450 million/year ECU 0. 003478/litre - ECU 0. 010964/litre ECU 3. 77 per year - ECU 11. 89 per year Negative emissions reduction for NOx in cases where fuel reformulation would cause an increase in emissions (from catalyst equipped vehicles) compared to current average fuel quality. Costs in Net present value in millions of 1995 ECU, discounted over period 1996 - 2015 at 7% per annum. Average costs assuming fuel use of 8. 611 / 100km and annual travel of 12, 000km. 35 Table 7 Costs and Emissions Benefits of Cleaner Fuels - Diesel in Passenger Cars and LCVs: Emissions Reduction Potential per vehicle Cost to industry per annum* Cost per litre Cost to the motorist** NOx 1. 8% ti 0. 5% VOCs 34. 3% tl 10. 7% CO 36. 1% ti 10. 6% PM 30% tl 10% ECU 260 - 1742 million/year ECU 0. 001761/litre - ECU 0. 01301/litre ECU 1. 69 per year -• ECU 12. 47 per year All costs expressed as Net present value in milhons of 1995 ECU, discounted over die period 1996-2015 at 7% per annum. Average costs assuming fuel use of 7. 611 / 100km and annual travel of 12, 000km. 36 3. 3 Changes to vehicle technology - Costs and potential benefits European vehicle manufactures were asked to provide estimates of the additional costs involved in equipping their vehicles with the technology necessary to achieve progressively more severe emission reductions. The manufacturers were invited to provide this information for a total of 16 different sub-categories e. g Gasoline cars - small, medium and large; heavy duty diesel vehicles - small, medium and large etc. The information provided by the manufacturers was evaluated by the independent contractors engaged by the Commission and was also cross-checked against information obtained from component manufacturers. A summary of some of the data concerning the emissions reduction benefit and associated costs is presented in Tables 8 and 9 below. Complete details of the costs and benefits of improved vehicle technology are to be found in the consultants report and the summary report of the Auto/Oil Programme. With regard to the potential of diesel engines to achieve further emission reductions, the figure used in the analysis are based on the assumption that the de-NOx catalyst will probably not be available for production models by the year 2000. Clearly if such technology were available in a reliable form, the potential for NOx emission reductions would be increased significantly. 37 Table 8 Costs and Emissions Benefits of Improved Vehicle Technology - Gasoline Passenger Cars Emission Reduction Benefits as compared to existing standards: NOx 65% tl 20% HC* 65% tl 20% CO 45% tl 20% Costs: Additional Cost per vehicle Percentage of Purchase Price Annual Cost to Industry Small ECU 43 - 237 Medium ECU 42 - 256 Large ECU 7 2 - 3 41 0. 5 - 2% ECU 574 - 3 262 million - HC = Hydro-Carbons - a high proportion of which will be VOCs Table 9 Costs & Emissions Benefits of Improved Vehicle Technology - Diesel Passenger Cars Emission Reduction Benefits as compared to existing standards: PM Costs: 50% tl 20% NOx 20% tl 20% HC* 65% tl 10% CO Additional Cost per vehicle Percentage of Purchase Price Medium ECU 203 - 367 Large ECU 227 - 402 0. 5 - 2. ! 5% HC = Hydro-Carbons - a proportion of which will be VOCs 50% tl 25% Annual Cost to Industry ECU345 «*605 million 38 3. 4 Improved durability of Emission Control Systems - Costs and potential benefits As a vehicle gets older its performance including that of the emission control system deteriorate. Significant reductions in vehicle emissions can potentially be achieved by reducing the rate of detioration in the emission control systems. There are several mechanisms by which such improvements can be achieved. increased severity and frequency of compulsory inspection and maintenance checks; manufacturers liability for the performance of the emission control systems extended from 80 000 km to 160 000 km; electronic sensors installed on the vehicle to monitor the performance of the emission control systems -referred to commonly as on-board diagnostics; re-call procedures whereby models can be re-called and re-fitted if their emission performance deteriorate beyond an acceptable level; improved mechanisms for the remote-roadside detection of vehicles emitting above acceptable levels. As part of the Auto/Oil Programme data were collected with regard to the cost and the emission's benefit of the various mechanisms designed to reduce the rate of detioration of the emission control systems. A summary of some of the data concerning the emissions reduction benefit and associated costs of improved durability of emission control systems is presented in Table 10 below. Table 10 Costs and Emissions Benefits of Improved Emission Control System Durability Emission Reduction Potential: Total NOx 15. 9% tl 0% Total VOCs 30% tl 0% Urban PM* 10% tl 0% Costs*": ECU 290 million/year -» ECU 1 112 million/year Emission reductions from diesel vehicles assumed to apply only to particulate emissions. Costs expressed as Net Present Value in 1995 ECU, discounted at 7% between 1996 and 2015. 39 4. COMPLEMENTARY LOCAL TECHNICAL AND NON-TECHNICAL MEASURES - COSTS AND POTENTIAL BENEFITS Article 4 of Directive 94/12/EC required that the Commission when developing future proposals should also take into account the potential of complementary non-technical measures such as traffic management and enhanced public transport as well as the use of alternative fuels. Non-technical instruments are geared towards changing the behaviour of transport users. As the analysis carried out by the Commission showed (see below), such behavioural changes are needed especially in cities with severe air quality problems where more stringent vehicle emission control, better fuel quality and improved durability of emission control systems alone are not sufficient to meet air quality targets. Many of these complementary measures would, of course, be applied at the Member State, regional or local level and decided by the corresponding authorities. The Commission has acknowledged the importance of these measures by promoting research, development and demonstration projects relating especially to urban transport through a number of channels (e. g. the THERMIE and SAVE II Programmes) and by fostering the exchange of experience between European cities in order to promote "best practice" in local transport planning (e. g. through the Commission's Urban Environment Expert Group and the Sustainable Cities Campaign). Most recently, the Commission presented two Green Papers on the Citizen's Network and the use-of pricing mechanisms in the transport area to stimulate the discussion on these issues at the European level. The instruments looked at included both local measures (traffic bans, speed regulation, cheaper public transport, alternative fuels), certain non-fiscal economic instruments (road pricing, scrappage subsidies) and the use of fuel taxes, vehicle purchase taxes and annual vehicle circulation taxes to influence transport users. In the final analysis, road pricing, traffic bans, the subsidy of public transport, scrappage subsidies and the conversion of urban buses to alternative fuels (LPG, CNG) were included. Information on the costs and the effectiveness of these instruments were collected, drawing on the experience in their application in different countries. The EUCARS passenger transport model developed by the Commission (Directorate-General II) was used to estimate the behavioural responses associated with the different instruments(7). Besides the investment and operating costs associated with some of the measures, non-monetary costs to society ("welfare costs") were taken into account which arise from the behavioural changes imposed on European citizens (e. g. their loss of freedom to drive by car into the city centre) and changes in tax revenues. Citizens adapt their behaviour in different ways in response to the non-technical measures studied, for example through reduced car usage, the purchase of less polluting vehicles or the better maintenance of vehicles. As compared to the evaluation of technical improvements, the assessment of non-technical measures is compounded by a number of difficulties. The responses of transport users cannot be predicted exactly and are often determined by local factors; the definition of measures is not as precise which makes it more difficult to assess their costs and effectiveness; many of the measures are interdependent and their costs and benefits are affected by-external influences (e. g. economic development). Therefore, the quantification of the costs and benefits of local transport measures and economic instruments entails considerable uncertainties. The analysis done showed that the non-technical measures considered had very different investment, operating and welfare costs. The analysis pointed to the fact that a reform of vehicle-related taxation in line with environmental criteria could make a cost-effective contribution to the reduction of transport-related air pollution. Under certain conditions, road pricing could even yield additional benefits beyond that of emission reduction by increasing (7) European Commission (Directorate-General II), "A Welfare Cost Assessment of Various Measures to Reduce Pollutant Emissions from Passenger Road Vehicles for the Year 2010" (Final Report, 12. 10. 1995) See also the consultants report from the cost effectiveness analysis. 40 the overall efficiency of the transport system. With due consideration to the uncertainty inherent in the assessment of these measures, it was concluded that local technical (LPG/CNG buses) plus non-technical measures (road pricing, cheaper public transport, traffic bans and scrappage subsidies, but excluding taxation instruments) can reduce urban NOx emissions by 10 to 25% beyond the reductions achieved through fuel quality changes, changes to vehicle technology and improved durability of emission control systems. The potential contribution of local technical and non-technical measures to emission reduction of other pollutants was not assessed in the same detail as for urban NOx but is likely to be of a similar magnitude. 5. COST-EFFECTIVE SOLUTIONS TO ACHIEVE AIR QUALITY TARGETS The most important step in the Auto/Oil Programme involved the exploitation of the data compiled on the costs and benefits of the various emission reduction measures (sections 4 and 5) in order to identify the most cost effective solutions to achieve the emission reduction targets identified in section 2 (see Figure 2). In the original concept of the Auto/Oil Programme it was foreseen that emission reduction targets would be generated in a consistent manner for all pollutants and that least cost solutions would be generated simultaneously in order to satisfy these multiple- emission reduction objectives. However, as described in sections 2. 3, it was not possible to determine precise emission reduction targets for particulate matter in each of the seven cities although a tentative objective of a reduction in the range of 50-65% as compared to present levels was identified. Similarly reduction targets for total NOx and total VOCs as precursors of regional ozone were difficult to establish: again tentative reduction targets in the range 70-80% for both pollutants compared to 1990 were identified. In the absence of compatible emission reduction targets for all pollutants, the analysis was conducted in a step wise manner looking first at the three pollutants- NOx, CO and Benzene - for which it had been possible to identify precise emission reduction targets in the 7 cities. Subsequently, strategies for reducing urban particulate emissions were explored. Finally, approaches for reducing emissions of total NOx and total VOCs as contributors to regional ozone were examined. With regard to the attainment of the emission reduction targets for urban pollutants, one important consideration was the achievement of an effective balance between on the one hand EU wide, largely technical, measures such as emission standards, fuel quality and inspection and maintenance and on the other hand local, largely non-technical measures such as road pricing, increased public transport, scrappage schemes and the replacement of diesel buses and trucks with LPG/CNG fuelled vehicles. The objective was to identify the most cost-effective series of interlocking measures such that a certain proportion of the background levels of pollution would be removed by EU wide technical measures and that as and where appropriate these technical measures would be supplemented by national and/or local measures in localities with elevated levels of-pollution - the objective being to achieve the desired emission reductions at the least cost for the Community as a whole. The details of the technical procedures used to identify the least cost combination of measures are described in the^ consultants report on the cost-effectiveness study and the consolidated report of the Auto/Oil Programme. 41 EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE 96/0163 (COD) Proposal for a relating to the quality of petrol and diesel fuels and amending Council Directive 93/12/EEC 42 EXPLANATORY MEMORANDUM 1. BACKGROUND in reducing vehicle emissions. The European Union has a long standing history Directive 94/12/EC(1) is the latest amendment of base Directive 70/220/EEC(2), laying down new emission standards for passenger cars. When the provisions of Directive 94/12/EC come into effect in 1996/97, emissions of regulated pollutants from new passenger cars will be reduced by over 90% as compared to the standards which prevailed in the early 1970s. However, despite these considerable achievements with regard to the emission reduction of individual vehicles, increased traffic activity (increased numbers of vehicles, increased kilometers travelled) are likely to counteract these improvements thereby preventing the emission reductions necessary to achieve future air quality objectives. The likelihood of further action to reduce vehicle emissions necessitated a reassessment of the existing policy approach; it being apparent that the emission reduction potential offered by further improvements in vehicle technology was limited and possibly very costly in comparison to other potential solutions. In the light of the above considerations a new, comprehensive and integrated approach was developed. Directive 94/12/EC, Article 4 outlines the main elements of this new approach: "In these proposals [future proposals designed to reduce emissions from traffic which the Commission is requested to submit] the Commission shall take the following approach: * * the measures shall be designed to produce effects to meet the requirements of the Community's air quality criteria and related objectives; an assessment of the cost-effectiveness of taking each measure shall be undertaken; in this global assessment full account shall be taken, inter alia, of the contributions that: traffic management, for example by spreading the environmental costs appropriately, enhanced urban public transport, new propulsion technologies (e. g. electric transmission), the use of alternative fuels (e. g. biofuels), could make to improving air quality, * the measures shall be proportional and intended objectives. " reasonable in the light^ of the Article 4 of Directive 94/12/EC stipulates that measures to be assessed with regard to their benefits and costs shall include improved vehicle technology, more appropriate mechanisms to reduce the in-use deterioration of emission control systems and "improvements in fuel quality as far as vehicle emissions of dangerous substances (in particular benzene) are concerned". (1) (2) OJ No L 100, 19. 4. 1994, p. 42. O J N oL 76^ 6. 4. 1970, p. l. 43 The importance of fuels with regard to the release of atmospheric pollutants such as lead, benzene and sulphur dioxide from vehicles has been recognized for some time. EU-wide legislation aimed at limiting the detrimental health and environmental effects of these pollutants already exist. The in limit values currently Directive 85/210/EEC(3) concerning the lead and benzene content of petrol and the sulphur content of diesel fuels is regulated under Directive 93/12/EC(4). in place are laid down The use of fuels for transportation purposes is however also linked to the release of other air pollutants such as volatile organic compounds (NOx), carbonmonoxide (CO) and particulate matter (PM) which directly or as precursors of ozone can have detrimental health and environmental effects. (VOCs), nitrogen oxides Therefore, assessment of the cost-effectiveness of fuel quality changes as a measure to reduce vehicle emissions must include a wider range of fuel components than those already legislated for. 2. THE EUROPEAN AUTO/OIL PROGRAMME In keeping with its commitment towards the development of a more comprehensive approach to reducing emissions from road transport and in conformity with the principles set out in Article 4 of Directive 94/12/EEC the Commission, at the end of 1992, decided to initiate a technical work programme for the purpose of providing a solid technical foundation upon which to base its future legislative proposals. In accordance with the principle of 'shared responsibility' expressed in the 5th Environmental Action Programme, the Commissioners for Environment, Industry and Energy, invited the European associations of the car (ACEA) and oil (Europia) industries to make available their considerable know-how and expertise and to collaborate in the realization of this technical programme. The two industries responded positively to this invitation and together with the Commission designed, planned and executed the programme which subsequently became known as the Auto/Oil Programme. The content and the structure of the Auto/Oil Programme is described in the Communication which accompanies this proposal. A short description of the programme and the conclusions derived from it is presented below. The objective of the Auto/Oil Programme was defined as: to provide policy-makers with an objective assessment of the most cost-effective package of measures to reduce emissions from the road transport sector to a level consistent with the attainment of the new air quality standards being developed for adoption across the European Union. The Auto/Oil Programme explored cost-effective combinations of measures sufficient to achieve, by 2010, stringent air quality standards with respect to the following pollutants: ~ZT * * * * * oxides of nitrogen (NOx) in cities benzene in cities carbonmonoxide (CO) in cities particulate matter (PM) in cities tropospheric ozone and thereby emissions of total NOx and Volatile Organic Compounds (VOCs). (3) (4) OJNoL96, 03. 4. 1985, p. 25. OJNoL74, 27. 3. 1993, p. 81. 44 The Auto/Oil Programme demonstrated that in the absence of futher measures to significantly reduce emissions from road transport, concentrations of nitrogen oxides, particulate matter and tropospheric ozone would constitute a continuing threat to human health and the environment into the next millenium. In contrast, the impact of already agreed measures was predicted to reduce concentrations of carbonmonoxide and benzene to acceptable levels. The Auto/Oil Programme explored the cost and the emission reduction potential of a variety of different measures inter alia improved vehicle technology, inspection and maintenance schemes, changes in the quality of fuels and a number of non-technical measures such as scrappage schemes and road pricing. Drawing on the results of the Auto/Oil Programme the Commission has decided upon a package of legislative proposals to be submitted to the European Parliament and the Council. a proposal on a moderate reformulation of petrol and diesel fuels (this proposal); to strengthen a proposal for passenger cars the existing emission (Directive 70/220/EEC, as last amended by Directive 94/12/EC (accompanying this proposal); limits a proposal light duty vehicles (Directive 70/220/EEC as last amended by Common Position No 3/96, [in 1997])(5) ; the emission strengthen limits for to a proposal (Directive 88/77/EEC(6) as last amended by Directive 91/542/EEC7)); the emission strengthen limits to for heavy duty vehicles. a proposal with regard to the strengthening of the current legislation on inspection and maintenance (Directive 92/55/EC^ [in 1997]). The proposals enumerated above foresee the simultaneous entry into force of a series of measures as from 1 January 2000. The Commission estimates that the measures coming into effect in 2000 will, in 2010, reduce emissions from the road transport sector by: urban NOx = urban CO = urban benzene 39% 51% = 48% urban particulates total NOx total VOCs = = = 39% 35% 46% as compared to what the emissions would have been in the absence of the measures. 3. EMISSION REDUCTION FROM OTHER THAN MOBILE SOURCES The package of measures is part of an integrated Commission strategy to reduce atmospheric emissions from all sources and which was developed on the basis of the 5th Environmental Action Programme. While emission reductions from mobile sources are an important contribution to the achievement of future air quality targets they will not be sufficient to solve the problem of ozone pollution and acidification. (5) (6) (7) (8) O J N oC 37, 9. 2. 1996, p. 23. O J N oL 36, 9. 2. 1988, p. 1. O J N oL 295, 25. 10. 1991, p. 1. O J N oL 225, 10. 8. 1992, p. 68. 45 The Commission is therefore pursuing complementary measures aimed at emission reduction from stationary sources such as power plants, industrial installations, households, etc. The revision of the large combustion plant directive*9' and the proposed directive on Integrated Pollution Prevention and Control0* are steps in this direction. Further action, especially with regard to the reduction of volatile organic compounds as a precursor for ozone formation, are needed to complement the beneficial effects gained from traffic related measures. 4. THE EUROPEAN MARKET FOR PETROL AND DIESEL FUELS The Community's total energy demand is covered by several sources of which almost half is supplied by liquid fuels. The annual turnover is approximately ECU 40 billion/year. In 1990, energy demand for transport activities amounted to about 30% of total final energy consumption. More than 83% of the energy needed for transport is consumed by road transport in the form of fuels. The principal fuels are petrol and diesel with other fuels such as Liquified Petroleum Gas (LPG) and Compressed Natural Gas (CNG) only taking up a small share of the market. According to the latest oil industry figures gasoline and diesel consumption in 1995 amount to around 170 000 respect. 120 000 million litres. The consultancy company AD. Little has estimated that over the period 2000-2015, EU consumption of petrol and diesel fuels will amount to 2 540 respectively 2 572 thousand million litres. These forecasts are likely to be overestimated in view of the Commission's aim of bringing forward policy measures to reduce C07 emissions from cars. Market Share of Leaded and Unleaded Gasoj 0Leaded Figure 1 • Unloaded FfetiHtd Qftmany [jjKtmbourg aeijiuni ftwtoo 0% 10% 20% 30% 40% 50% 60%i 70% 80% 80% 100% Percentage Market Share (9) (10) Revision of Directive 88/609/EEC: OJ No L 336, 7. 12. 1988, p. 1 COM 96/C87/02 46 Leaded v unleaded petrol The market for petrol is divided into leaded and unleaded petrol, of which the latter has gained an increasing market share over the last years. In 1995 the average market share of unleaded petrol in the EU reached about 68%». However, this figure does not reflect the wide difference of the use of unleaded petrol in the Member States. While in countries like Austria, Finland and Sweden 100% of the petrol pool consists of unleaded petrol, in Spain, Greece and Portugal the latter only represents 30-40%. An overview of the share of leaded and unleaded petrol in the market in 1995 is provided in Figure 1. With the introduction of the catalytic converter the market share of unleaded petrol will increase further with an estimated growth rate of approx. 8% of the 1995 market share per year. Unleaded petrol is provided in the market as 'unleaded regular1 (91/92 RON [Research Octane Number]), 'unleaded premium/super' (RON 95) and 'unleaded super plus' (RON 98) Table 1 is the oil industry's estimate of the market share of each type calculated as percentage of total unleaded petrol and as percentage of total petrol. Table 1 (Estimate Europia 1995) TYPE unlead. % of total unleaded petrol % of total petrol pool RON 91/92 RON 95 RON 98 Fuel quality 1 3^ 68. 5 18. 0. 9 47 12 The quality of unleaded petrol and diesel fuels in Europe is subject to European standards as laid down by the European Committe for Standardisation (CEN) [see chapter 12, p. 22]. Requirements specified by the CEN standards are set with a view to improved performance of the engine/vehicle. While the establishment of European standards has led to a certain degree of harmonization current data on fuel quality in the market show that there are considerable variations with regard to locations (north, south, central) and seasons (winter/summer). The predicted average fuel quality of petrol and diesel fuels by the year 2000 and in the absence of any legislative action is shown in Tables 2 and 3 below. 47 Table 2: Predicted Average Values for Fuel Parameters of Market Fuel (unleaded petrol) Parameter RVP Summer E. 10Q E. 150 Olefins Aromatics Benzene Oxygen Sulphur Lead Unit kPa % v/v % v/v % v/v % v/v % v/v % m/m gpm g/1 Predicted Market Average in the year 2000 without new measures 68 53 84 U 40 23 (^6 300 0. 005 Table 3: Predicted Average Values for Fuel Parameters of Market Fuels (diesel) Parameter • Cetane Number Density Poly aromatics T95 Sulphur Units : kg/m3 vol% ^Ç ppm Predicted Market Average in the year 2000 without new measures 51 843 9 355 450 48 5. THE EMISSIONS BENEFITS AND COSTS OF CHANGES IN FUEL QUALITY The Auto/Oil Programme demonstrated clearly that changes of fuel components such as sulphur, aromatics and benzene content and vapour pressure for gasoline and sulphur, cetane number, density and polyaromatic content of diesel can have a significant benefit in terms the of reducing emissions of priority pollutants from vehicles. In Auto/Oil Programme the relationship between the benefits in terms of reduced emissions and the costs were explored for unleaded petrol and diesel fuels modified to increasing degrees of severity. the context of The Commission's proposal As described in Chapter 2. the Auto/Oil Programme identified moderate changes in the quality of petrol and diesel fuels as part of a cost-effective integrated package of measures. The fuel specifications proposed by the Commission for petrol and diesel fuel and foreseen to come into force in 2000 are shown in Tables 4 and 5. The specifications are expressed as maximum and minimum for various parameters of environmental relevance. The tolerances of the refinery production process mean that in order to ensure that the product complies with the prescribed specifications the average quality of the fuel placed on the market will be better than the specifications. Tables 4 and 5 also indicate the Commission's estimates of the market average fuel quality which will result from the application of the proposed specifications. A comparison with the predicted average market values for petrol and diesel fuels by the year 2000 in the absence of legislation (see Tables 2 and 3 on pages 6 and 7) shows improvements with regard to Reid Vapour Pressure (RVP), aromatics, benzene and sulphur in petrol and with regard to cetane number, density, poly aromatics, T95 (distillation) and sulphur in diesel fuel. Table 4: Proposed Fuel Specifications for Petrol to Come into Effect in 2000 and the Corresponding Predicted Market Average Values Parameter Unit Average Market Values of Proposed Fuel Package Limit Values of Proposed Fuel Package Minimum Maximum RVP Summer E. 100 E. 150 Olefins Aromatics Benzene Oxygen Sulphur Lead kPa % v/v % v/v % v/v % v/v % v/v % m/m ppm g/1 58 53 84 11 37 1. 6 1 150 0. 005 _ 46 75 - - - _ _ - 60 _ _ Ts* 45 2 2. 3 200 0. 005 [* Except for unleaded petrol regular for which the maximum olefin content shall be 2 1% v/v. ] 49 Table 5: Proposed Fuel Specifications for Diesel to Come into Effect in 2000 and the Corresponding Predicted Market Average Values Parameter Unit Average Market Values of Proposed Fuel Package Limit Values of Proposed Fuel Package Minimum Maximum Cetane Number Density - kPa Poly-aromatics % Vol. T95 Sulphur °C ppm 53 835 6 350 300 51 • _ _ - _ 845 11 360 350 Emission reductions The emission reductions which are achieved by the proposed petrol and diesel specifications foreseen in 2000 are shown in Table 6. Table 6: Emission Reductions Achieved From Different Vehicle Classes by Expected Petrol and Diesel Fuel Quality Changes Pollutant % emission reduction achieved by the proposed change in petrol % emission reduction achieved by the proposed change in die:elfuel (LDVs)* % emission reduction achieved by the proposed change in diesel fuel (HDVs)* NOx VOCs CO PM - 7. 12 - 8. 44 - 8. 89 Benzene -20. 7 - 0. 53 - 10. 68 - 10. 60 - 9. 95 — -2. 15 -2. 20 -0. 39 -3. 22 * The difference in emission reduction between light duty (LDVs) and heavy duty vehicles (HDVs)inrdue to the difference in the test cycle which reflects the different engine technologies of the two vehicle categories and the different loads under which they operate. In addition to the proposed Community-wide measures, supplementary emission reduction measures might be taken by Member States at national, regional or local level in order to achieve established EU or national air quality standards everywhere in the Community (see also 'Fiscal Measures' below). 50 Leaded petrol The Auto/Oil Programme only investigated the cost and emission effects of unleaded petrol, grades. With the increasing number of cars equipped with catalytic converters the share of leaded petrol in the total pool will diminish significantly. While today the share of leaded petrol is around 30% of the total pool the estimated growth rate of the market share of unleaded petrol (see chapter 4, p. 5) suggests that by the year 2000 only a very small amount of leaded petrol (2%) will be in the market. In addition, it is estimated that by the year 2000 the entire car fleet will be able to run on unleaded petrol except the socalled 'Oldtimers'. These cars can be run on unleaded petrol containing a lead substitute which can be added to the petrol tank. These lead substitutes are already available at the petrol station where they can be purchased and added by the consumer. In the light of the above and in recognition of the significant human health risk associated with lead pollution, the Commission has proposed a general ban on the marketing of leaded petrol as from 1. January 2000. However, in recognition of the fact that for certain Member States such a rapid phase- out may result in severe socio-economic problems, the Commission's proposal also provides for a limited, two year derogation. Benzene the benzene content in petrol is 5% as regulated under EC The current limit value of Directive 85/210. With a number of Member States producing petrol containing benzene levels well below this limit, the European average market value today is about 2. 3% (see Chapter 4, p. 6). Air quality modelling results obtained as part of the Auto/Oil Programme have shown that by the year 2010 atmospheric benzene levels will be sufficiently low even without the application of additional measures if this average value is being maintained. However, the Commission is aware that atmospheric benzene pollution is likely to persist in the short to medium term, in areas with high traffic density (inner cities, cross-roads, etc. ). For this reason countries like Austria, Finland, Germany, Italy and Sweden have in an Environment Council meeting in December 1994 demanded that a reduction of the benzene level in petrol to 1% be introduced at European level as the most effective measure to mitigate existing benzene pollution in those problem areas. Directive 94/12/EEC, Article 4 requires the Commission to particularly investigate the emission effects with regard to a change in benzene content. Austria, in the accession negotiations, was allowed to maintain its national benzene limit value of 3% for a transitional period. Sweden and Finland were permitted to continue a tax incentive scheme with which the benzene content of petrol has been redueed to 3% and 1%> respectively. The Commission in its response to Member States' concern on atmospheric benzene levels is taking a positive stance when proposing a considerable reduction of the current benzene limit value from 5%;to 2%. However, in view of the air quality from the Auto/Oil Programme and summarised in chapter 2. , the Commission does not see the need to mandate for a EU-wide benzene limit value of 1%. Review Process Within 12 months of the adoption of the Directive and in any event not later than 31 December 1998 the Commission will bring forward proposals to revise the provisions of the Directive. This proposal will be based on the comprehensive assessment to be carried out in conformity with the requirements of Article 4 of the proposed amendment to Directive 70/220/EEC. The purpose of that assessment is to develop a strategy designed to 51 produce effects to meet the requirements of Community air quality standards and related objectives, at least cost. In developing such a strategy, the Commission will take full account of: trends in air quality; noxious pollutant emissions in Europe from transport and non-transport sources and the contribution that existing, pending and potential measures to control emissions from non-transport sources , could make to improve air quality; technical developments with regard to: * * vehicle technologies as well as new propulsion technologies (e. g. electric propulsion, fuel cells), refinery technologies; the potential of alternative fuels such as compressed natural gas (CNG), Liquid Petroleum Gas (LPG), and Dimethyl Ether (DME) and biofuels to reduce vehicle emissions, possible improvements in the test procedures for the type approval of new vehicles, in particular the addition of a new test procedure at low temperatures; the potential of technical, non-technical and local measures to reduce emissions: in this context, the contribution of transport and other policy measures such as traffic management, enhanced urban public transport and vehicle scrappage schemes should be evaluated; the contribution that selective and differentiated fiscal measures could make to reducing emissions, whilst not negatively the internal market; the functioning of impacting the effects of any measures on C02 emissions; the strategies followed by third countries to improve air quality and the emission values applied therein; the situation with regard to the supply and the quality of crude oil available to the Community. The proposal to revise the provisions of the Directive based on a comprehensive assessment and as an integral part of the strategy described above, will include, inter alia, a revision of this the specifications for petrol and diesel fuels as laid down in Annexes I and frof Directive. These revised specifications would come into effect on January 1, 2005. The Commission's proposal will take into account that improvements to fuel quality have a direct and significant impact on emissions of particulate matter, volatile organic compounds and oxides of nitrogen. All of these pollutants either directly, or as a result of their contribution to ozone formation, result in important impacts on human health and the environment. In addition to the direct benefits that improved fuel quality has on vehicle emissions there is a clear interaction between fuel quality and vehicle technology. With regard to the development of new pollution abatement technologies such as the de-NOx catalyst there is evidence that fuels of a certain quality, particularly low sulphur fuels, may well be required if such technologies are to achieve optimal and long-lasting levels of performance. 52 Accordingly, the Commission foresees that its future proposal to revise the specifications of petrol and diesel fuels should comprise a significant reduction in the content of sulphur for both fuels. Current research and development indicates that a sulphur limit of the order of 50 ppm could be needed for the optimal functioning of the new vehicle-based pollution abatement technologies as well as contributing to improving emissions from the existing car pare. While this proposal does not specify a limit value for the sulphur content in petrol and diesel fuels for 2005 the establishment of these values will of course be based on the outcome of the cost-effectiveness assessment to be carried out prior to the development of the Commission's future proposal. To take account of the possibility that vehicles equipped with new pollution abatement technologies such as the de-NOx catalyst are developed and introduced into the market before 2005, the Commission has also included in its proposal a commitment to bring forward, if appropriate, proposals to ensure that when vehicles equipped with such technologies are placed on the market, fuels of a quality sufficient to guarantee the necessary level of performance of the technology will be widely available. In bringing forward such proposals the Commission will give due regard to considerations of air quality, cost-effectiveness and proportionality. The Commission will also take into account: (i) (ii) the latest information on the interaction between fuel quality and the performance of the new pollution abatement technologies; the situation with regard to the development and production of these technologies and the forecasts concerning the marketing of vehicles equipped with such technologies. (iii) the need to ensure that the measures proposed will neither disrupt the free movement of persons and goods nor unduly distort competition. Fiscal Measures While the Commission's proposal will result in a significant improvement in the average quality of fuels sold throughout the Community, it is likely that some Member States, particularly those in which. fiscal incentives have been applied in the past, may wish to encourage the use of even cleaner fuels as part of their overall strategy to improve air quality. The Commission would not wish to impede national or local initiatives aimed at improving air quality on condition that such initiatives were compatible with the provisions of Directive 92/81/EEC dealing with mineral oil structures. According to Directive 92/81/EEC(11), mineral oils used as a motor fuel shall be taxed at a single rate per product category. The excise duty rate for each product is to be decided by the individual Member States provided they respect the Community minimum rates as outlined in the Mineral Oils Rates Directive 92/82/EEC(12). Should Member States wish to use fiscal incentives and apply differential rates, other than those provided for in article 8(2) of Council Directive 92/81/EEC, they have the-possibility to request a derogation from the general regime according to Article 8(4) of the same Directive. Such requests must be authorized by the Council. For motor fuels, Denmark, Finland, Greece and Sweden have been granted derogations allowing them to apply reduced rates on environmentally friendly diesel. Finland can apply reduced excise duty rates on reformulated unleaded and leaded petrol. Denmark can apply differential rates of duty between petrol. distributed from petrol stations equipped with a return system for petrol fumes and petrol distributed from other petrol stations. A number of applications from other Member States are presently being evaluated. (11) (12) OJ No L 316, 31. 10. 1992, p. 12. OJ No L 316, 31. 10. 1992, p. 19. Derogations - Special Fuels Notwithstanding the possibilities open to Member States to encourage the marketing of cleaner fuels through fiscal measures, there may be specific locations such as large urban areas where atmospheric pollution constitutes or may reasonably be expected to constitute a serious and recurrent problem for human health and/or the environment. In such locations Member States may consider it appropriate to require the marketing of special fuels as part of a strategy to combat air pollution. The Commissions proposal therefore foresees the possibility for Member States to be granted a derogation in order to require the use of such special fuels. The Commission's proposal also foresees that Member States wishing to make use of this derogation will be required to motivate their proposed measures on the basis of air quality measurements and the improvement in air quality that the measures are expected to bring. The Member State should also provide evidence that the proposed measures respect the principle of proportionality with particular attention being given to their impact upon the internal market and competition. 6. THE EUROPEAN REFINING INDUSTRY The European Union (15) has 106 refineries with a total distillation capacity of In the past, refineries have been categorized in three types: 13 212 833 barrels per day. simple, catalytic cracking and full upgrading. However, these categories no longer represent the range of refineries operational in Europe. Over the last three to five years, some refiners have upgraded their installations in response to tighter product specifications such as the reduction of lead in petrol and the lowering of the sulphur content in gas oil and diesel fuel. The currently existing refinery types are best categorised as follows: * * * * * Simple - including thermal operations & some vaccum distillation Fluid Catalytic Cracking (FCC) with or without feed pretreatment with or without C6-Isomerisation Hydrocracking Fluid Catalytic Cracking (FCC) and hydrocracking Others (e. g. lube oil production, etc. ) ~ The latter category is without importance for petrol and diesel production and will therefore be excluded from the further analysis. The refinery type most common in Europe is the fluid catalytic cracking (FCC) type (with or without pretreatment and with or without C6-Isomerisation but not including the combination FCC plus Hydrocracker) accounting for around 61% of total atmospheric distillation capacity in the European Union. Table 7 provides an overview of European refinery types and their percentage share of total European distillation capacity. Figure 3 shows the types of refinery existing in each country and their total distillation capacity. 54 Table 7: European Refinery Types and Their Share of European Distillation Capacity (1994) Refinery Type Simple without thermal or C6 Isomenzation Simple without thermal but with C6 Isomenzation Simple with thermal but without C6 Isomenzation Simple with thermal and C6 Isomenzation Hydrocracker without C6 Isomerisation Hydrocracker with C6 Isomenzation FCC without Pretreatment or C6 Isomenzation FCC without Pretreatment but with C6 Isomerisation FCC with Pretreatment but without C6 Isomerisation FCC with Pretreatment and C6 Isomerization FCC and Hydrocracker without pretreatment or C6 Isomerization FCC and Hydrocracker without Pretreatment but with C6 Isomerization Other Number of Refineries Total Atmospheric Distilliation Capacity (b/cd) % of European Capacity in Each 18 3 10 9 7 3 19 17 8 3 4 2 3 969 030 244 000 737 118 696 700 881 160 494 000 3 218 500 2 793 000 7. 3% 1. 8% 5. 6% 5. 3% 6. 7% 3. 7% 24. 4% 21. 1% 1 454 025 11. 0% 598 300 737 000 390 000 4. 5% 5. 6% 3. 0% 0 0% Total in Europe 106 13 212 833 55 Figure 2 European Refinery Types per Country (1994) H Hydro D FCC and Hydro without Pretreatment m FCC with Pretreatment • FCC Without Pretreatment • Simple It can be seen from Figure 2 that in Austria, Belgium, France, Italy, the Netherlands, the UK and Spain the various types of FCC refineries predominate. Greece's distillation capacity is divided between simple and FCC refineries however, one of the FCC refineries also has some hydrocracking capacity which increases its flexibility with regard to the fuel quality changes required. the biggest hydrocracking capacity of all EU Member States. Finland has a simple and a FCC/hydrocracking refinery. Denmark and Ireland only operate simple refineries. Sweden's distillation capacity is nearly equally divided between the simple and the FCC refinery type. One of the latter however has some hydrocracking capacity. German refineries have — The refinery configuration has a major influence on the oil industry's ability to meet product specifications and is the key indicator as to the technical capacity of an individual refinery to cope with tighter specifications as a consequence of European environmental legislation. In general tighter limit values for diesel specifications and for petrol specifications such as sulphur and olefin content can more easily be met by simple and hydrocracking than by other refinery types. FCC and combined FCC/hydrocracker refineries are better suited to the tightening of certain petrol components such as benzene and aromatics. 56 Projected costs of legislative fuel specifications to the refining industry The financial implications incured by the proposed specifications are presented in Table 8 for the European refining industry (EU 12). They provide an overview of the estimated total costs over 15 years expressed as the net present value, indicate the overall capital investment costs and the yearly incured fixed operating and energy costs. Table 8: Cost Implications* for Proposed Petrol and Diesel Fuel Specifications in 2000 ŒU12) CECXJ) million Net present Value (over 15 years) Total Capital Investment Costs Fixed operating Costs/Year Energy Costs/Year 11 380 7 223 291 146 The costs are based on the value of the ECU in 1995 and a project life of 15 years from 2000 onwards. Not included in this cost analysis are the financial implications for the refinery industries in Austria, Finland and Sweden since they were not members of the European Union at the time when the Auto/Oil Programme began. However, all three new Member States have already undertaken action with regard to a change of certain parameters of pefol and diesel fuels. This is particular so for Sweden and Finland where a number of fuel specifications are much stricter than those proposed in this Directive. It can be expected that costs for the Swedish and Finnish refinery sector will not increase as a result of the forthcoming European legislation. For Austria however, some costs will occur. While the aggregated total costs for EU-12 do not reflect individual refinery and regional variations, these aspects have nevertheless been studied. It can be expected that the results for individual refineries and for regions show a wide difference. However, the variation is not uniform because the impact of the quality parameter changes depends on both feedstock and refinery configuration. Therefore, it is likely that the Mediterranean region with its higher sulphur feedstock will face higher costs than the aggregate for removal of sulphur. North West Europe and the atlantic region on the other hand will have to pay more than the aggregate costs for removal of benzene and aromatics because their feedstock contains a high amount of these compounds. It is expected that the aggregated costs can vary between ± 25% depending on refinery type and region. 7. TRADE IMPLICATIONS In order to produce a range of fuels and satisfy local demand it is often necessary for a refiner to trade in feedstock and/or a certain amount of their refinery products. This enables refiners to balance refinery configuration and design against fuel demand and the nature of, the crude oil supply. trade occurs among Member States and between Member States and This non-European countries. 57 Petrol Over the last ten years the EU trade balance of petrol has been positive with total exports to third countries increasing from 6. 7 to 15. 0 million tonnes. The U. S. A. and Canada are one of the major export markets of the EU for petrol. While in 1992 and 1993 exports were low because additional MTBE production in those countries replaced some of the previously imported petrol, in 1994 exports started to recover and rose to about 6. 8 million tonnes. Figure 3 shows the contribution of individual Member States towards these exports. It is difficult to predict the future development of these exports since they are influenced not only by the forthcoming changes of fuel quality in the EU but also by the evolution of the 'reformulated gasoline' programme in the USA. FigttrrS 1994 Petrol Exports to USA and Canada Source: E T S U/ High and Watt Associates, 1995. Gasoil/diesel fuel The EU- trade balance of gas/diesel oil between 1985 and 1994 has turned from negative to positive with net exports to third countries totalling about 1 million tonnes in 1994. Of the total imports the biggest share of 30% is coming from Russia. Another important supplier of gas/diesel oil is Egypt with 20%. No statistics on the breakdown of imports between diesel and other gas oil are available. However, the diesel share of total gas oil production increases. The rise has been from 49% in 1993 to 50% in 1994. For 1995 the share of diesel is projected to be 53%. Changes in diesel fuel quality as proposed in this Directive will make it more difficult to meet sulphur and density specifications in diesel and are likely to lead to an increasing demand on low sulphur (sweet), crudes. In the mid and long term North West Europe and the Atlantic region will become short on their reserves of low sulphur crude oil. It is therefore reasonable to expect the price differential to widen between low sulphur (sweet) and high sulphur (sour) crudes and imports of low sulphur crudes into the Community to rise. These developments will favour the North African crude oil suppliers while the Russian and most West African crudes are generally higher in sulphur. 58 8. IMPLICATIONS FOR THE CONSUMER The incurred European-wide costs for a change in the quality of fuel as illustrated in Chapter 5. will ultimately be borne by the consumer. For her/him the additional costs per litre at the pump will be around ECU 0. 002 for a petrol or diesel car for measures to be introduced in 2000. For a motorist who drives around 12 600 km/year this amounts to additional costs of around ECU 2/year for a petrol or diesel car. This increase in price is well below price changes which occur on a regular basis for other market reasons (e. g. changes in crude oil and feedstock products). 9. IMPACT ON EU-WIDE CO, EMISSIONS Changes in fuel quality require the use of additional energy which in turn increases C02 emissions. It is estimated that C02 emissions per year will rise by 6 million tonnes across the EU (12) when the proposed fuel quality changes will become mandatory for 2000. These 6 million tonnes represent around 0. 2% of total C02 emissions and 0. 8% of C02 emissions from transport sources in 1993. 10. SUBSIDIARITY 10. 1 What are the Objectives of the Proposed Measure in Relation to the Obligations Placed Upon the Commission? The objectives of the measure are to achieve a basic level of harmonization of the considerable market of transport fuels (about 290. 000 million litres in 1995). Despite the existance of norms laid down by the European Committee for Standardization (CEN) for certain fuel components, the majority of the petrol and diesel fuel marketed is characterized by numerous permissible levels for a number of fuel components (e. g. sulphur, aromatics, benzene). The proposal asserts an increased level of harmonization to replace the existing range, thus ensuring the proper functioning of the internal market. Harmonization will be even more important in the future as environmental concerns may lead many Member States to introduce new restrictions on some of the above mentioned fuel components. Unilateral measures could produce differences in product specifications in the various Member States thereby hindering the free flow of goods. The role of transport fuels with regard to their potential of reducing vehicle emissions has been discussed in Chapter 5. For the purpose of considerable emission reductions necessary to achieve future urban and regional air quality objectives, changes in fuel quality have proven to be a cost-effective means. Only legislative -action on Community level can ensure that the emission reduction potential of fuelsTs used to the extent needed. 10. 2 Does the Proposed Action relate to a Matter of Exclusive Community Competence or Competence Shared with the Member States? The matter concerns harmonization of the internal market and therefore is an issue of exclusive Community competence. 10. 3 What Forms of Action are Available to the Community? The only realistic form of action is legislation based either on a Directive or a Regulation. 59 10. 4 Is a Uniform Regulation Necessary or will a Directive Imposing General Objectives with the Execution being Left to Member States Suffice? A directive imposing general objectives and with the detailed implementation being left to the Member States will achieve the necessary objectives while at the same time allowing the Member States considerable freedom with regard to practical details of implementation. 11. RESULTS OF CONSULTATION WITH AFFECTED PARTIES Consultation with Member States During the course of the Auto/Oil Programme which was to serve as the technical and scientific basis for legislation on car emissions and fuel quality, DG XI and DG HI have conducted a series of meetings with national experts. The purpose of the meetings was to fully inform Member States about all aspects of the programme and to ensure that their comments were taken into consideration. In a meeting on 7 December experts from Member States were consulted on the proposed fuel quality specifications laid down in this directive. The experts in general welcomed the Commission's initiative to put forward legislative proposals on the quality. of petrol and diesel fuels. Experts from Austria, Denmark, Finland, Germany, Sweden and the Netherlands expressed their strong view of most of the petrol and diesel fuel specifications not being strong enough. Especially Finland and Sweden voiced the concern that the high quality fuel specifications currently in place in their countries could be endangered by the Commission's proposal for only moderate changes of fuel quality. Experts from Ireland, France, Spain and Portugal were of the opinion that some fuel parameters in particular the sulphur content of both petrol and diesel fuel would be difficult for their refineries to achieve. Consultation with the European oil and car industries (Europia and ACEA) Both, the European associations of the oil (Europia) and the car (ACEA) industries were partners in the Auto/Oil Programme. The work carried out in the framework of the programme was based on the consensus of all partners involved. At a final technical meeting of the Auto/Oil Programme on 20 March 1996, the database and the methodology used for carrying out the cost-effectiveness ananlysis were approved. The oil industry was also consulted on a number of technical questions which arose in the discussion on transposing the fuel parameter values used in the cost-efectiveness analysis into limit values. With regard to the proposed specifications the oil industy has expressed its strong opposition concerning the intention to already indicate the need to make significant cuts in the sulphur content of petrol and diesel fuels in 2005. Europia considers this as a violation of the cost-effectiveness principle. With regard to the benzene content of petrol. Europia maintains its position that in view of the results of the air quality modelling carried out within the context of the Auto/Oil Programme a reduction of the current EU average market value of about 2. 3% is not justified. 60 The car industry however considers the proposed fuel specifications for the year 2000 as too moderate and would like to see more severe limit values in particular with regard to the sulphur content of diesel fuels. ACEA claims that with the current proposal on fuel quality, which amounts to yearly costs of around ECU 880 million for the oil industry puts the bulk of the total financial burden of ECU 5 326 million/year for the overall package of emission reduction measures on the car industry. 12. DESCRIPTION OF LEGISLATIVE SITUATION IN MEMBER STATES Current European legislation on fuel quality European legislation on fuel quality is currently limited to Directive 85/210/EEC on the lead and benzene content of petrol and EC Directive 93/12/EEC on the sulphur content of diesel fuel. Directive 85/536/EEC sets out the framework for the addition of oxygenates into petrol. Member States have to permit a certain amount of oxygenates in the petrol and can allow those in excess of it. According to the legislation referred to above Member States have to adhere to the following values: Petrol lead content (g/1) in leaded petrol: lead content (g/T in unleaded petrol: benzene content%V/V: > 0. 15 - < 0. 40 < 0. 013 < 5. 0 Diesel sulphur content% m/m 0. 2 0. 05 (1/10/1996) Temporary derogations for new EU Member States at the time of their accession The following countries were given temporary derogations with regard to some fuel components for which national legislation already existed: Austria benzene in petrol sulphur in diesel ban of leaded petrol 3% 500 ppm Sweden/Finland ban of leaded petrol/continuation of currently existing tax incentive scheme for environmentally higher quality fuels. —7 61 Additional national legislation Some Member States have extended the existing European legislation to other fuel parameters and have given legal status to the technical norms set by the European Committee for Standardisation (CEN) for a range of fuel parameters. Tables 9 and 10 give an overview of the countries which enforced CEN-norms as legally binding, the fuel types and the environmentally important fuel components to which they apply. Table 9 Specifications Density (kg/m3) Cetane number I Distillation, T 95% Diesel Fuel Limit values s 860 £ 820 £ 49 (temperate climate) | <L 370 C° (temperate climate) | Countries: Finland, France, Germany, United Kingdom, Italy Table 10 Specifications Limit values Unleaded Petrol (regular/premium) Sulphur content (%m/m) Reid vapour pressure (kPa) Distillation (El00) (%v) <. 0. 05 ^ 35 £ 100 (depending on seasonal and geographical conditions) z 40 ^ 70 (dep. on seasonal and geographical conditions) Countries: Austria, France, Germany, and the United Kingdom. The CEN-norms for unleaded regular and premium petrol have also been applied for the super grade. fuels. Applications from other Member States such as Ireland and Denmark, Finland, Greece and Sweden have under Directive 92/81/EEC been granted derogations with regard to the introduction of reduced excise rates on environmentally friendly the United Kingdom on the same issue are currently being evaluated by the Commission (see Chapter 5 'Fiscal Measures'). Tables 11 and 12 provide a comparison between the different diesel and petrol fuel qualities of some of these countries with the specifications proposed in this Directive. 62 Table 11: Comparison of Gasoline Fuel Parameters Parameter (Units) Sweden Finland Austria Sulphur(max) E. lOO(min) RVPsummer (max) ppm % Kpa Benzene(max) Vol % Aromatics (max) Vol % Olefins(max) Vol % Oxygen(max) % m/m 100 47 70 2 46 _ 2. 0 Lead(maxX g/1 0. 005 100 43 70 1 - _ 2. 7 - 100. 58 3 - _ _ - EU specifications proposed for 2000 200 46 60 2. 0 45 T8* 2. 3 0. 005 [* Except for unleaded petrol regular for which the maximum olefin content shall be 21/v/v. ] Table 12: Comparison of Diesel FUel Parameters Parameter (Units) Sweden {Category 1) Finland {City Diesel) Denmark Ultra light {Bus Fuel) EU Specifica tions proposed for 2000 Cetane Number(min) Density(max) Distillation 95% point (max) Polycyclic-aromatic hydrocarbons Aromatics Sulphur (max) No. kg/m3 °C % m/m Vol % ppm 50 820 285 0. 017 5 10 49 850 20 50 50 855 320. 500 51 845 360 11 — _ 350 63 13. EXPLANATION OF PROVISIONS OF THE PROPOSAL The scope of the Directive (Article 1) The scope of the proposal is to use harmonization of the various national legislation and/or fuel quality norms to ensure, on the one hand, a high level of protection against urban and regional air quality problems caused by vehicles through the use of petrol and diesel fuels and, on the other hand, the functioning of the internal market. The proposed measures will not eliminate the negative environmental impacts, but reduce them to some degree. Definitions (Article 2) The definitions of the various fuels are made as close as possible to the current EU definitions. Petrol (Article 3) 3. 1 3. 2 3. 3- 3. 6 Lead is a harmful air pollutant and a poison for the catalytic converter required to fulfil the latest passenger car emission standards. By 1995 the market share-of leaded petrol throughout the European Union has gone down to about 30% of the total petrol pool and is expected to be down at about 2% by the year 2000. By that time it is also estimated that the entire European car fleet will be able to run on unleaded petrol. The Commission therefore foresees the phasing out of leaded petrol by the year 2000. The European Auto/Oil Programme has identified the potential of certain petrol fuel quality changes for emission reduction and therefore the improvement of air quality. The limit values proposed are in accordance with the fuel quality measures identified by the cost-effectiveness analysis. These paragraphs allow for a temporary, two-year derogation from the 1 January 2000 ban on leaded petrol in those Member States where this may result in severe socio-economic difficulties. Diesel Fuels (Article 4) As for petrol the European Auto/Oil Programme has identified the potential of certain diesel fuel quality changes for emission reduction and therefore the improvement of air quality. The limit values proposed are in accordance with the fuel quality measures identified by the cost-effectiveness analysis. Free circulation (Article 5) This Article is to ensure that Member States do not prohibit, prevent or restrict the marketing of fuels complying with the specifications set out under the Directive. This applies also in the case of Member States making use of the derogations under Article 6 where stricter specifications may be encouraged through the application of tax incentives. Derogations-Special Fuels (Article 6) This Article provides for the situation where, in specific locations which are subject to special air quality conditions, Member States may be granted derogations in order that they may require the use of cleaner "special" fuels 64 Change in supply of crude oils (Article 7) The reformulation capacity required by refineries in each Member State will relate closely to. their supplies of a certain crude oil quality. In order to avoid problems posed by a sudden change in the supply of crude oil petroleum products, the Commission can authorize higher limit values for one or more fuel components for a period not exceeding six months. Monitoring compliance system and reporting (Article 8) Member States are required to establish national compliance monitoring systems to ensure that the fuel quality limit values are respected in the market. For this purpose a uniform system should be developed for which the assistance of the European Committee for Standardisation (CEN) might be requested. From the year 2002 onwards Member States are required to submit a yearly report on the market quality of petrol and diesel fuels. Review of progress achieved (Article 9) Within 12 months of the adoption of the proposed Directive and at the latest by 31 December 1998 the Commission will come forward with proposals for a revision of the Directive. This revison will be based on a comprehensive assessment carried out in accordance with Article 4 of the proposed amendment to Directive 70/220/EEC. The proposal will include a revised set of specifications for petrol and diesel fuels for the year 2005, including a significant reduction in the maximum sulphur content of both fuels. The proposal will also take account of possible action on alternative fuels. Procedure for adaptation to technical progress and Committee procedures (Article 10 and 11) Adaptation to technical progress with regard to the measuring méthodes laid down in annexes I and IT of this directive will be carried out by a Commission Committee established in accordance with Article 12 of Council Directive 96/. /EC(13). Repeal of the existing directives related to the fuel quality of petrol and diesel fuels (Article 12) All relevant regulations in the current directive related to certain petrol and diesel fuel components (85/210/EEC, 93/12, Article 1(b), Article 2(1) and (2) and 85/536/EEC) are transferred to the new proposal. The existing Directive 93/12/EEC will remain valid with respect only to gas oils. Transposition into National Legislation and Entry into Force (Articles 13 and-14) These Aticles contain standard conditions. Article 15 This Article contains standard wording. (13) Proposal submitted by the Commission on Ambient Air Quality Assessment and Management - COM(94) 109 final, 94/0106 (SYN), OJ No C 216, 6. 8. 1994, p. 4. 65 Proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE 96/0163 (COD) relating to the quality of petrol and diesel fuels, and amending Council Directive 93/12/EEC THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 100a thereof,; Having regard to the proposal from the Commission(1), Having regard to the opinion of the Economic and Social Committee(2), Acting in accordance with the procedure referred to in Article 189b of the Treaty, (1) Wliereas disparity between the laws or administrative measures adopted by the Member States on specifications of conventional and alternative fuels used in spark-ignited and diesel vehicles creates barriers to trade in the Community and may thereby have a direct impact on the establishment and functioning of the internal market; whereas in accordance with the provisions of Article 3b of the Treaty, it therefore appears necessary to approximate the laws in this field; (2) Wliereas, Article 100a(3) of the Treaty envisages that Commission proposals aimed at the establishment and functioning of the internal market and concerning environmental protection will take as a base a high level of protection; (3) Whereas primary air pollutants such as nitrogen oxides, unburnt hydrocarbons and particulate matter are emitted in significant amounts through the exhaust and evaporative fumes of motor vehicles thereby posing directly and indirectly through the development of the secondary pollutant ozone, a considerable risk to human health and the environment; (4) Wliereas despite the increasing stringency of vehicle emission limit values laid down by Council Directive 70/220/EEC(3), as last amended by Directive 96/ /EC of the European Parliament and of the Council(4), and by Council Directive 88/77/EEC(5), as last amended by Directive 96/1/EC of the European Parliament and of the Council(6), further measures to reduce atmospheric pollution caused by vehicles and other sources are necessary in order to achieve satisfactory air quality; (5) Whereas Article 4 of Directive 94/12/EC of the European Parliament and of the Council(7) introduced a new approach with regard to emission reduction policies for and beyond the year 2000 and required the Commission to examine inter alia the contribution that improvements in the quality of petrol and diesel and other fuels could make to reducing air pollution; 0) (2) (3) (4) (5) (6) (7) of this Official Journal. OJNoL 76, 64. 1970, p. 1. See p. OJNoL 36, 9. 2. 1988, p. 33. OJNoL 40, 17. 2. 1996, p. 1. OJ No L 100, 19. 4. 1994, p. 42. 66 (6) Whereas the European Auto/Oil Programme, the details of which are outlined in the Commission's Communication^ on a future strategy for the control of atmospheric emissions from road transport, provides the scientific, technical and economic basis for the introduction at Community level of new environmental fuel specifications for petrol and diesel fuels; (7) Whereas the introduction of environmental fuel specifications for petrol and diesel fuels is an important element of the cost-effective package of European-wide and national/regional/local measures identified by the European Auto/Oil Programme; (8) Wliereas the implementation of a combination of European-wide and national/regional/local measures to reduce vehicle emissions is part of the Commission's overall strategy to reduce air emissions from mobile and stationary sources in a cost-effective and balanced way; (9) Whereas this Directive should apply without prejudice to the provisions of Council Directive 92/81/EEC(9), as last amended by Directive 94/74/EC(10), and in particular Article 8(4) thereof; (10) Whereas fuel specifications aiming at the reduction of both exhaust and evaporative emissions are generally lacking; (11) Wliereas, it is to be expected that by 2000 all petrol-driven road vehicles should be able to run on unleaded petrol and whereas, therefore, leaded petrol should, as from that date, no longer be marketed; (12) Whereas the need for vehicle emission reduction and the availability of the necessary refinery technology justify the setting of environmental fuel specifications for the marketing of unleaded petrol and diesel fuels; (13) Wliereas, in order to protect human health and/or the environment in specific locations with special problems of air quality, Member States should be permitted to require the marketing of special fuels; (14) Whereas, in order to ensure compliance with the fuel quality standards required under this Directive, Member States should introduce monitoring systems. Such monitoring systems should be based on common procedures for sampling and testing; (15) Whereas, on the basis of a comprehensive assessment, the Commission should, within 12 months of the adoption of this Directive, but in any case no later than 31 December 1998, come forward with a proposal to amend the provisions of this Directive; (16) Whereas further developments with regard to reference methods for measuring the specifications set out in this Directive may be desirable in the light of scientific and technical progress; whereas to this end, provision should be made in order to adapt the Annexes to this Directive to technical progress; (8) (9) (10) OJNoC OJNoL 316, 31. 10. 1992, p. 12. OJ No L 365, 31. 12. 1994, p. 46. 67 (17) Whereas Council Directive 85/210/EEC of 20 March 1985 on the approximation of the laws of the Member States concerning the lead content of petrol(H), as last and Sweden, the Act of Accession of Austria, Finland amended by Council Directive 85/536/EEC of 5 December 1985 relating to crude-oil savings through the use of substitute fuel components in petrol(12), as amended by Commission Directive 87/441/EEC(13), and Article l(l)(b) and Article 2(1) of Council Directive 93/12/EEC of 23 March 1993 relating to the sulphur content of certain liquid fuels(14), should be repealed accordingly, HAVE ADOPTED THIS DIRECTIVE: Article 1 Scope This Directive sets technical specifications on health and environmental grounds for all fuels - conventional and alternative - to be used in spark-ignition and diesel vehicles. Article 2 Definitions For the purpose of this Directive: 1. 2. 1. 2. ( i i) (12) (13) (14) (15) (16) "petrol" means any volatile mineral oil intended for the operation of internal combustion spark-ignited engines used for the propulsion of vehicles and falling within CN Codes 2710 00 27, 2710 00 29, 2710 00 32, 2710 00 34 and 2710 00 36. "diesel fuels" means gas oils falling within CN Code 2710 00 69 and used for self-propelling vehicles as referred to in Directive 70/220/EEC, Directive 88/77/EEC and Council Directive 74/150/EEC(l5) and those used for engines in non-road mobile machinery(I6), which means any machine or vehicle with or without body work, powered by a compression ignition engine, with the exception of those vehicles intended for the use of passenger - or goods - transport on the road and agricultural tractors as defined in Article 1 of Directive 74/150/EEC, having a power output of not more than 560 kW2. Article 3 Petrol As from 1 January 2000 Member States shall prohibit the marketing of all leaded petrol within their territory. ~z Member States shall ensure that within their territory petrol can be marketed only if, with regard to certain parameters of environmental relevance, they comply with the specifications set out in Annex I. O J N oL 96, 3. 4. 1985, p' 25. O J N oL 334, 12. 12. 1985, p. 20. O J N oL 238, 21. 8. 1987, p. 40. O J N oL 74, 27. 3. 1993, p. 81. O J N oL 84, 28. 3. 1974, p. 10. O J N oC 328, 7. 12. 1995, p. 1. 68 3. By way of derogation from the provisions of paragraph 1, Member States may continue to permit the marketing of leaded petrol in their territory until three years after the adoption of this Directive, but in any case not later than 1 January 2002, if it can be demonstrated that the introduction of a total ban on the marketing of leaded petrol as from 1 January 2000 would result in severe socio-economic difficulties. Member States wishing to make use of the derogation, must inform the Commission before 1 January 1999. The Member State shall also provide the Commission with a justification of the need for such a derogation. The Commission may authorize the derogation for the marketing of leaded petrol. The Commission shall notify its decision. the Member States and inform the Council of Article 4 Diesel fuels Member States shall ensure that within their territory diesel fuel can be marketed only if, with regard to certain parameters of environmental relevance, they comply with the specifications set out in Annex II. Article 5 Free circulation No Member States may prohibit, restrict or prevent the placing on the market of fuels which comply with the requirements of this Directive as from the date of application laid down in Article 13(1). Article 6 Special fuels 1. 2. By derogation from the provisions of Articles 3, 4 and 5, Member States may in specific areas in which atmospheric pollution constitutes or may reasonably be expected to constitute a serious and recurrent problem for human health and/or the environment, require the marketing of fuels of a higher quality than those foreseen in this Directive. Member States wishing to make use of the derogation provided for in paragraph 1 must inform the Commission in advance, of the measures it intends to take. The Member State shall also provide the Commission with data on ambient air-quality for the area in question as well as the predicted effects on air quality of thelneasures proposed. In addition, the Member State shall also provide the Commission with evidence that the proposed measures respect the principle of proportionality and that they will neither disrupt the free movement of persons and goods nor unduly distort competition. ^ The Commission, after informing the other Member States of the information received, may authorize the specific measures for the marketing of cleaner fuels as proposed by the Member State in question. The Commission shall notify the Member States and the Council of its decision. Any Member State may refer the Commission's decision to the Council within one month of its notification. 69 The Council, acting by a qualified majority, may take a different decision within one month of the matter being referred to it. Article 7 Change in supply of crude oils If a sudden change in the supply of crude oils or petroleum products renders it difficult for the refineries in a Member State to respect the fuel specification requirements of Articles 3 and 4, that Member State shall inform the Commission thereof. The Commission after informing the Member States, may authorize higher limit values in that Member State for one or more fuel components for a period not exceeding six months. The Commission shall notify the Member States and the Council of its decision. Any Member State may refer the Commission's decision to the Council within one month of its notification. The Council, acting by a qualified majority, may take a different decision within one month of the matter being referred to it. 1. 2. 3. 4. 5. 1. Article 8 Monitoring compliance system and reporting Member States will establish programmes requirements of Article 3(2) and Article 4. to monitor compliance with the The analytical methods used the concentration/level of a to determine substance/parameter in the fuel will be the standard methods specified in Annexes I and II. The Commission will promote the development of a uniform' system for compliance monitoring programmes. The Commission may for the purposes of developing such a system request the assistance of CEN. Within 12 months after the date of entry into force of this Directive, Member States will submit their national the Commission a detailed description of compliance programme. to As from the year 2002, Member States will submit to the Commission by 30 June each year a summary of the results from the national compliance monitoring programme from the previous calendar year. The Commission will establish a common format for the submission of such summary results. — Article 9 Review process The Commission will, periodically and for the first time not later than 12 months from the date of adoption of this Directive but in any event not later than 31 December 1998, and in the light of the assessment carried out in conformity with the requirements of Article 5 of Directive 96/ /EC, submit to the European Parliament and the Council a proposal for a revision of this Directive. This proposal will include further, cost effective, improvements to the specifications for petrol and diesel fuels with regard to the parameters laid down in Annexes I and II to this Directive and should comprise, in particular, a significant reduction in the sulphur content of both petrol and diesel fuels, to come into effect on 1 January 2005. This action will form 70 an integral part of a strategy designed to produce effects to meet the requirements of the Community air quality standards and other related objectives at least cost. 2. In addition to the provisions of paragraph 1, the Commission may bring forward proposals to ensure the necessary availability and sufficient distribution throughout the Community before 2005, of fuels of a quality compatible with the effective functioning of the new pollution abatement technologies. In preparing such proposals the Commission shall have regard in particular, to considerations of air quality, cost-effectiveness and proportionality, and shall also take into account: the latest information with regard to the interaction between fuel quality and the performance of new pollution abatement the de-NOx catalyst; technologies such as the situation with regard to the development and production of the new pollution abatement technologies and the forecasts with regard to the marketing of vehicles equipped with such technologies; the need to ensure that the measures proposed will neither disrupt the free movement of persons and goods nor unduly distort competition. 3. The proposal referred to in paragraph 1 shall be submitted to the European Parliament and the Council at the same time as the proposal referred to in Article 5 of Directive 96/ /EC; the measures shall enter into effect at the same time as the measures provided for in the proposal to be submitted in accordance with Article 5 of Directive 96/ /EC. Article 10 Procedure for adaptation to technical progress Any amendments which are necessary in order to adapt the measuring methods as laid down in Annexes I and II to this Directive, to take account of technical progress, shall be adopted by the Commission assisted by the Committee established in accordance with Article 12 of Directive 96/. /EC(17) and in accordance with the procedure laid down in Article 11 of this Directive. Article 11 Committee procedure The representative of the Commission shall submit to the committee a draft of the measures to be taken. The committee shall deliver its opinion on the draft, within a time limit which the chairman may lay down according to the urgency of the matter, if necessary-fey taking a vote. The opinion shall be recorded in the minutes; in addition, each Member State shall have the right to ask to have its position recorded in the minutes. The Commission shall take the utmost account of the opinion delivered by the committee. It shall inform the committee of the manner in which its opinion has been taken into account. <17) Proposal submitted by the Commission on Ambient Air Quality Assessment and Management - COM(94) 109 final, 94/0106 (SYN), OJ No C 216, 6. 8. 1994, p. 4. 71 1. 2. 1. Article 12 Repeal and amendment of the existing directives related to the fuel quality of petrol and diesel fuels Directive 85/210/EEC and Directive 85/536/EEC are repealed as from the date of application laid down in Article 13(1). Directive 93/12/EEC is amended by deleting Article l(l)(b) and Article 2(1) as from the date of application laid down in Article 13(1). Article 13 Transposition into national legislation Member States shall adopt and publish the laws, regulations and administrative provisions necessary to comply with this Directive not later than 1 July 1999. They shall immediately inform the Commission thereof. Member States shall apply these provisions from 1 January 2000. Wlien Member States adopt these provisions, these shall contain a reference to this Directive or shall be accompanied by such reference at the time of their official publication. The procedure for such reference shall be adopted by Member States. 2. Member States shall communicate to the Commission the texts of the provisions of national legislation which they adopt in the field covered by this Directive. Article 14 Entry into force of the Directive This Directive shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Communities. Article 15 Addressees This Directive is addressed to the Member States. Done at Brussels, For the European Parliament The President For the Council The President 72 ANNEX I ENVIRONMENTAL SPECIFICATIONS FOR MARKET FUELS TO BE USED FOR VEHICLES EQUIPPED WITH POSITIVE IGNITION ENGINES Type: Petrol Parameter Unit Limits(1) Minimum Maximum Reid vapour pressure,. summer period(3) kPa Distillation(4): evaporated at 100 *C evaporated at 150 *C Hydrocarbon analysis:. olefins. aromatics. benzene 46. 0 75. 0 % v/v % v/v Oxygen content %m/m Sulphur content Lead content ppm g/l 60. 0 18. 0* 45. 0 2. 0 2. 3 200 0. 005 Test Method(2) EN 12 ISO~3405 ASTMD1319 EN 238 prEN 1601 ISO 8754 EN 237 (1) (2) (3) (4) I* The values quoted in the specification are "true values". In establishment of their limit values the terms of ISO 4259 "Petroleum products - Determination and application of precision data in relation to methods of test" have been applied and in fixing a minimum value, a minimum difference of 2R above zero has been taken into account (R - reproducibility). Should it be necessary to clarify the question as to whether a fuel meets the requirements of the specification, the terms of ISO 4259 should be applied. Equivalent ISO methods will be adopted when issued for all properties listed above. The summer period extends from 1 April to 30 September of each year and relates to all volatility classes as specified under EN228. The figures quoted show the evaporated quantities (percentage recovered + percentage loss). Except for unleaded petrol regular (minimum motor octane number (MON) of 81 ancLa minimum research octane number (RON) of 91) for which the maximum olefin content shall be 21% v/v]. 73 ANNEX n ENVIRONMENTAL SPECIFICATIONS FOR MARKET FUELS TO BE USED FOR VEHICLES AND NON-ROAD MOBILE MACHINERY EQUIPPED WITH COMPRESSION IGNITION ENGINES Type: Diesel fuel Parameter Unit Limits(1) Cetane number Density at 15 °C Distillation(3): 95% point kg/m3 °C Polycyclic aromatic hydrocarbons %m/m Sulphur content ppm Minimum Maximum 51. 0 845 360 11 350 Test Method(2) ISO 5165 ISO 3675 ISO 3405 prIP391 ISO 8754 The values quoted in the specification are "true values". In establishment of their limit values the terms of ISO 4259 "Petroleum products - Determination and application of precision data in relation to methods of test" have been applied and in fixing a minimum value, a minimum difference of 2R above zero has been taken into account (R - reproducibility). Should it be necessary to clarify the question as to whether a fuel meets the requirements of the specification, the terms of ISO 4259 should be applied. Equivalent ISO methods will be adopted when issued for all properties listed avove. The figures quoted relate to the evaporated quantities (percentage recovered + percentage loss). (2) (3) 74 FINANCIAL STATEMENT SECTION I - FINANCIAL CONSEQUENCES (PART B OF THE BUDGET). 1. TITLE OF OPERATION Proposal for a European Parliament and Council Directive relating to the quality of petrol and diesel fuels and amending Council Directive 93/12/EEC. 2. BimCTT HEADING INVOLVED B4-304 Environmental Legislation and other general actions based on the 5th Action Programme relating to the environment [Projects (XI. D. 3]. 3. LEGAL BASIS EU Treaty Article 100a, Resolution of the Council and the Representatives of the Governments of the Member States meeting within the Council of 1 February 1993 on a Community programme of policy and action in relation to the environment and sustainable development (OJ No C 138, 17. 5. 1993, p. 1). 4. DESCRIPTION OF OPERATION 4. 1 General objectives The European Union has a longstanding history in reducing vehicle emissions. However, despite the considerable achievements with regard to the emission reduction of individual vehicles, increased traffic activity (increased number of these travelled) vehicles, improvements thereby preventing the emission reductions necessary to achieve future air quality objectives. increased kilometers to counteract likely is The likelihood of further action to reduce vehicle emissions necessitated a reassessment of the existing policy approach; it being apparent that the emission reduction potential offered by further improvements in vehicle technology was limited and possibly very costly in comparison with other potential solutions. Therefore a new, comprehensive and integrated approach was developed which is set out in Directive 94/12/EC, Article 4. Article 4 stipulates that measures to be assessed with regard to their benefits and costs shall include improved vehicle technology, more appropriate mechanisms to reduce the in-use deterioration of emission control systems and "improvements in fuel quality as far as vehicle emissions of dangerous substances (in particular benzene) are concerned". The changes in the quality of both, petrol and diesel fuels, legislated for in this proposal will" considerably reduce emissions of pollutants such as benzene, volatile organic compounds (VOCs), nitrogen oxides (NOx), carbon monoxide (CO) and particulate matter (PM). With these emission reductions a significant contribution will be made to the achievement of future air quality objectives. 75 4. 2 Period covered and arrangements for renewal or extension The proposed Directive requires: * that Member States: will ensure that as from 1st January 2000 only fuels which correspond to the specifications laid down in the Directive can be marketed within their territory; will establish programmes to monitor compliance with the Directive; as from the year 2002 the Member States will submit to the Commission a summary of the results from the national compliance monitoring programme; * that the Commission: will promote the development of a uniform system for compliance monitoring programmes. For the purpose of developing such a system the assistance of the European Committee for Standardization might be requested; submits a report to Council and Parliament assessing the need for further action in the field of fuel quality, including possible action on alternative fuels; prepares a revised proposal on the sulphur content of diesel fuel which will be necessary at a time when new vehicle technologies such as the de-NOx catalyst are on the market; convenes technical progress. the meeting of the Committtee for Adaptation to 5. CLASSIFICATION OF EXPENDITURE OR REVENUE DNO and CD 6. TYPE OF EXPENDITURE Technical work directly linked to the development of a uniform system for compliance monitoring programmes; Technical work linked to the development of new proposals, in particular those dealing with alternative fuels and the relationship between new vehicle technologies and fuel quality; Technical work linked to the preparation of Commission Directives through the Committee procedure. 76 7. FINANCIAL IMPACT 7. 1 Method of calculating total cost of operation (definition of unit costs) Technical assistance with the development of a uniform fuel quality monitoring system to ECU 250 000. through CEN. Total costs would amount Technical assistance with regard to the development of new proposals, in particular those dealing with alternative fuels and the relationship between new vehicle technologies and fuel quality. The costs would amount to ECU100 000/year between 1998 and 2000. 7. 2 Itemized breakdown of cost (in ECU) Breakdown Year n - Technical assistance uniform fuel quality monetary system - CEM - Technical assistance development new proposals Total ECU million (money of the day) n+4 n+5 and subseq. Total n+1 0. 11 n+2 0. 11 n+3 0. 03 0. 1 0. 1 0. 1 0. 11 0. 21 0. 13 0. 1 0. 55 7. 3. Indicative schedule of appropriations Comitment appropriations Payment appropriations n n+1 n+2 n+3 n+4 n+5 and subseq. Total Year n n+1 0. 11 n+2 0. 21 n+3 0. 13 n+4 0. 1 n+5 and subseq. Total — 0. 55 0. 077 0. 033 0. 147 0. 063 0. 091 0. 039 0. 11 0. 21 0. 13 0. 07 0. 03 0. 1 0. 55 77 8. ANTI-FRAUD DISPOSITIONS It will be explicitly specified in contracts that all work performed is the property of the Commission. Final payment of contractors will only take place after reception and examination of the reports and services requested. SECTION H - ELEMENTS OF COST-EFFECTIVENESS ANALYSIS 9. 1 Specific and quantifiable objectives: target population The general objective of the operation is to increase the protection of: human health, ecosystems, vegetation and material against the impact of various air pollutants such as nitrogen oxides, hydrocarbons and ozone; human health additionally against the impact of particulate matter; ecosystems additionally against the impact of nitrogen oxides deposition ("acid rain") on land and water. According to the results of the European Auto/Oil Programme which provided the technical basis for the present directive, changes in the quality of both petrol and diesel fuels can make a significant contribution to the reduction of exhaust and evaporative fumes of motor vehicles. This Directive foms part of a package of measures derived from the Auto/Oil Programme. The package of measures is designed to deliver reductions in the emissions from road transport compatabile with the attainment of rigorous air quality standards for carbonmonoxide (5 ug/m3 as a 98 percentile of 8 hourly values), nitrogen dioxide (93 ug/m3 as a 98 percentile of hourly values), benzene (10 ug/m3 as an annual mean), particulate matter (50ug/m3 as a 24-hour running average) and regional ozone (180ug/m3 as a 1-hour average). This proposal will contribute to emission reductions across Europe in the range of 70% for oxides of nitrogen and volatile organic compounds, 65% for urban particulates and 75% for urban carbon monoxide. 9. 2 Grounds for the operation While some fuel components such as lead and benzene in petrol and sulphur in diesel have been subject to Community legislation, fuel quality as a whole as covered by this Directive has not. According to the considerations-that are described above and in Chapter 4 of the Explanatory Memorandum changes in the quality of both petrol and diesel fuels contribute significantly to improved air quality with regard to nitrogen oxides, particulate matter, benzene and ozone. Thus it would be unreasonable to neglect this source of pollutants which can be reduced in a cost-effective way as the results of the Auto/Oil Programme have shown. 78 9. 3 Monitoring and evaluation of the operation Monitoring compliance system In order to ensure compliance with this Directive, Member States are required to establish national compliance monitoring systems. The Commission will promote the development of a uniform system as a common basis for Member States to carry out these programmes and to be in a position to forward to the Commission this information on a comparable base. For this purpose the Commission is likely to seek the assistance of the European Committee for Standardization (CEN). The Member States are required to submit 12 months after the date of entry into force of the Directive a detailed description of their national compliance programme and as from the year 2002, by 30 June of each year, a summary of the results from these programmes for the previous calendar year. Air quality The Commission, in cooperation with the Member States, will monitor the development of air quality on an urban and regional level in order to verify the air quality predictions which have guided the currently proposed legislative measures. The results of this monitoring exercise will be one of the main elements of a report the Commission is required to bring forward at the latest by 30 June 2002 and inter alia will be the basis for deciding whether proposals for amendments and/or extensions to this Ddirective will be necessary. SECTION HI - ADMINISTRATIVE EXPENSES (PART A OF THE BUDGET) 10. ADMINISTRATIVE EXPENDITURE (Part A of section HI of the Budget) 10. 1 Increase in staff Type Human Resources Human Resources Length Permanent jobs Temporary jobs Existing human resources in the DG or service Additional human resources — Civil servants or temporary' agents A B C Other Total 0 0 0 0 79 10. 2 Financial global impact of additional human resources ^ Amounts Mode of computation Civil servants Temporary agents Other resources 0 0 0 Total (ECU) 0 10. 3 Increase of other operative expenses Budget item A-2510 (Travel for the Committee foreseen under Article 11 of the proposal Amounts 20 850 Total (ECU) 20 850 Mode of computation 15 x ECU 695imeeting x 2 meetings/year 80 IMPACT ASSESSMENT FORM The Impact of the proposal on business with special reference to small and medium- sized enterprises (SMEs) TTTLE OF THE PROPOSAL Proposal for a European Parliament and Council Directive on environmental specifications with regard to gasoline and diesel. fuel Reference Number (Repertoire): 1. TAKING INTO ACCOUNT THE PRINCIPLE OF SUBSIDIARITY. WHY IS COMMUNITY LEGISLATION NECESSARY IN THIS AREA AND WHAT ARE ITS MAIN ALMS? The matter concerns harmonization of the internal market and therefore is an issue of exclusive Community competence. The market in transport fuels is considerable (about 290 00 million litres in 1995) and despite the existence of norms laid down by the European Committee for Standarization (CEN) for certain fuel components, the majority of the petrol and diesel fuel market is characterised by numerous permissible levels for a number of fuel components (e. g. sulphur, aromatics, benzene). The proposal asserts an increased level of harmonization to replace the existing range, thus ensuring the proper functioning of the market. The main aim of the Directive is to reduce vehicle emissions in order to achieve future EU-wide air quality objectives and is part of a legislative package which the Commission intends to put forward for this purpose. The directive is part of the outcome of the European Auto/Oil Programme which explored cost-effective combinations of measures sufficient to achieve, by 2010, stringent air quality standards with respect to the most important urban and regional pollutants such as nitrogen oxides, particulate matter and ozone. The programme investigated the cost and the potential of a variety of different measures inter alia improved vehicle technology, inspection and maintenance schemes, changes in the quality of fuels and a number of non-technical measures such as scrappage schemes and road pricing. Drawing on the results of the Auto/Oil Programme, the Commission has decided upon a package of legislative proposals to be submitted to Council and Parliament: a proposal on a mild reformulation of petrol and diesel fuels (this proposal); a proposal to strengthen the emission limits for passenger cars (a proposal accompanying this proposal); proposals to strengthen the emission limits for light and heavy duty vehicles (1996/ 1997); a proposal with regard to the strengthening of the current legislation on inspection and maintenance (in 1997). With this legislative package the Commission estimates that by 2010, the above pollutants will be reduced considerably as compared to what the emissions would have been in the absence of these measures. 2. WHO WILL BE AFFECTED BY THE PROPOSAL? Which sectors of business? Changes in the quality of gasoline and diesel fuels affect refiners and therefore oil companies, the petrochemical industry and individual consumers driving a gasoline or diesel vehicle. There may also be effects for traders' organization who import petrol and/or diesel fuels from regions with less strict environmental fuel specifications. Which sizes of businesses? All oil and petrochemical companies can be considered to be large. Traders' organizations are small/medium enterprises. Are there particular geographical areas of the Community where these businesses are found? Refineries, petrochemical companies and traders' organizations are found in all regions of the Community. 3. WHAT WELL BUSINESS HAVE TO DO TO COMPLY WITH THE PROPOSAL? Refineries will have to change their refinery processes, install new process units and/or have to undertake blending operations in order to achieve the changes in gasoline and/or diesel fuel quality as required by the directive. The mechanisms used to control each of the fuel parameters are all currently available and proven technologies. Some changes can also be met by changes in crude oil diet e. g. to low sulphur crude types, such as North Sea, which tend to be high in benzene and aromatics content, or to low benzene/aromatics crude types such as Middle East (which tend to be high in sulphur). There are no obligations posed on petrochemical companies and individual fuel users associated with the proposed Directive. 4. WHICH ECONOMIC EFFECTS IS THE PROPOSAL LIKELY TO HAVE? On employment? The proposal will require significant investment for the refining industry (see below). Given the current over-capacity and narrow operating margins for the industry it is possible that the proposal may have a negative efffect on employment in the refining industry. However, in the area of feed-stock production (such as oxygenates) and of research and development a positive employment effect is likely to be seen. Production of oxygenates needs to be improved considerably in order to meet the required blending capacity. Some of this additional production capacity will be installed in Europe. In the area of research and development it can be expected that the search for more competitive, less costly refinery processes will stimulate the engineering/construction business which might have some positive effects on employment. 82 industry estimations with regard to employment For the petrochemical development are difficult to make. An oversupply in benzene through fuel reformulation is likely to have a negative effect on Europe's main benzene source for aromatic production of pygas. Ethylene producers might therefore loose some of their competitiveness. However, ethylene producers are in most cases also producers of aromatics and with the cheaper feedstock of benzene might be able to increase the aromatics production. The effect on employment is uncertain. There are unlikely to be any significant employment effects for the traders' organizations. On investment and creation of new business? According to cost estimations carried out under the Auto/Oil Programme, the achievement of the presently proposed fuel specifications requires refineries to invest a total of about ECU 8 442 million. The costs are based on the value of the ECU in 1995 and a project life of 15 years from 2000 onwards. Investments are envisaged to take place over 4 years between 1996 and 1999 with 15% being invested in 1996 and 1999 and 35% in each of the years 1997/98. In addition to the capital investment costs, fixed operating costs of ECU 342 million and energy costs of ECU 171 million will have to be borne by the European refining industry. All costs are aggregated costs which do not reflect individual refinery and regional variations. The variations in costs due to these individual and regional differences are not estimated to be uniform because the impact of the quality parameter changes depends on both feedstock and refinery configuration. The size of the refinery with regard to cost variations is likely to play a relatively influence of feedstock availability and role compared small refinery configuration. the to New business can be expected with regard to the production of oxygenates as a feedstock product. As shown earlier, the need for this product in order to compensate for octane loss through reduction of benzene and aromatics will increase considerably. Refineries themselves might expand their production of oxygenates (new catalysts) and/or new production units. through better technologies For petrochemical companies it is difficult to predict whether a loss of feedstock production (pygas) can be compensated by higher aromatic production and what consequences these developments would have for the employment situation. On the competitiveness of businesses? ~z The impact of the proposal on individual refineries will vary considerably as a function of the current technical configuration. While in the case of some refineries only minimal investment will be required others will need extensive upgrading dependent upon their technical configuration. 83 On the petrochemical side, increased availability of benzene from gasoline reformulation could adversely affect the production of an important feedstock product - pygas. Pygas is the biggest source of benzene for the aromatics market in Europe and if the value of pygas were to fall in view of over supply of benzene from other sources, the European ethylene producers would be at a competititve disadvantage. The competitiveness of traders' organizations might be affected if their import of petrol and diesel fuels mainly comes from sources with less strict or no environmental regain competitiveness if they ensure sufficient diversity of import sources. specifications. Traders can maintain or fuel 5. DOES THE PROPOSAL CONTAIN MEASURES TO TAKE INTO ACCOUNT THE SPECIFIC SITUATION OF SMALL AND MEDIUM-SIZE FIRMS (REDUCED OR DIFFERENT REQUIREMENTS, etci ? All refineries and petrochemical companies in Europe can be considered to be large enterprises. Traders' organizations have sufficient means to maintain their position in the market e. g. by diversification of import sources. The users of reformulated fuels will be insignificantly affected by negligibly increased prices for these fuels. Thus particular measures in favour of small and medium-sized companies appear to be unnecessary. 6. CONSULTATION List of organizations which have been consulted with regard to the proposal and outline of their main views: - Europia (European Petroleum Industry Association); - ACEA (European Automobile Manufacturers Association); - APA, a sector group of CEFIC (Aromatics Producer Association). Europia'ACEA Both, the European associations of the oil (Europia) and car (ACEA) industries were partners of the Auto/Oil Programme. The work carried out in the framework of the programme was based on the consensus of all partners involved. At a final-technical meeting of the Auto/Oil Programme on 20 March 1996, the database- and the methodology used for carrying out the cost-effectiveness analysis were approved. The oil industry was also consulted on a number of technical questions which arose the in cost-effectiveness analysis into limit values. the fuel parameter values used the discussion on transposing in 84 With regard to the proposed specifications the oil industy has expressed its in reservations concerning the limit values for the sulphur content of both fuels particular those for petrol claiming that the emission benefits are not in proportion to the costs incured. Another area of concern for the oil industry is the benzene content of petrol. Europia maintains its position that in view of the results of the air quality modelling carried out within the context of the Auto/Oil Programme a reduction of the current EU average market value of about 2. 3% is not justified. The car industry on the other hand considers the proposed fuel specifications as too moderate and would like to see more severe limit values in particular with regard to the sulphur content of diesel fuels. ACEA claims that with the current proposal on fuel quality which amounts to yearly costs of around 880 million ECU for the oil industry puts the bulk of the total financial burden of ECU 5 326 million/year for the overall package of emission eduction measures on the car industry. However, this argument of burden sharing between the two industries is not in line with the request for a cost-effective solution to future air quality problems which is required by Directive 94/12/EC, Article 4. APA APA's concern is that with increasing amounts of benzene from gasoline reformulation in Europe and the U. S. Pygas production, as a major benzene source for aromatics production in Europe, would be significantly reduced. In addition, while aromatics production could be increased in principle due to cheaper benzene feedstock prices, APA fears that developments of the aromatic markets in other parts of the world will prevent Europe from finding an adequate export market. 85 EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE 96/0164 (COD) Proposal for a relating to measures to be taken against air pollution by emissions from motor vehicles and amending Council Directives 70/156/EEC and 70/220/EEC 86 EXPLANATORY MEMORANDUM A. Objective of the proposal The objective of this proposal is to strengthen Community requirements aimed at limiting new passenger car polluting emissions. These are governed by Directive 70/220/EEC, as last amended by Directive 94/12/EC. The proposal forms part of a global Community strategy which will include strengthened requirements for passenger cars, light commercial vehicles and heavy duty vehicle?0 from year 2000, new minimum standards for motor fuels and enhanced in-use vehicle emission requirements. This set of measures, in combination with additional measures taken at local level, represents, in view of the Commission, an optimal package of legislative actions which will ensure that the Air Quality targets identified in the course of the implementation of the Auto/Oil Programme will be met by year 2010. In addition, this proposal includes a revision of the framework for emission-related fiscal incentives and emissions values corresponding to the foreseen Stage 2005 car emission standards. The Auto/Oil Programme itself is described in a separate auto/oil Communication. B. Legal basis The measures are proposed on the basis of Article 100a of the Treaty of the Union. They are consistent with the Council recommendation on the 5th Environmental Action Programme, which announced the need for a further improvement of car emission standards from the year 2000. The measures form part of the European Type-Approval system for cars and compliance with them will be mandatory for new approvals to be issued by national authorities. The measures reflect the traditional legislative approach followed in this sector namely total harmonization of all relevant technological prescriptions. The measures set the performance standards, leaving to the producers themselves, the design and manufacture of equipment necessary to ensure that these are met. This legislative approach is fully supported by the operators in the market. The text is relevant for the EEA Treaty. C. Background Much progress has been achieved in improving air quality in Europe through the successive tightening of emission standards. Since the first emission directive of 1970, the overall reduction of emissions from new passenger cars has been in the order of 90%, depending on the pollutant concerned (carbon monoxide emissions (CO), unburned hydrocarbons and nitrogen oxides emissions (HC + NOx)). The Auto/Oil Programme was set up, because it was recognized that, since additional reductions of emissions from new vehicles from the year 2000 would be increasingly difficult to achieve technologically and would be costly, future standards would have to be established on a more scientific basis which would allow for full account to be taken of the potential advantages and disadvantages of all possible measures to reduce emissions. (1) Directive 88/77/EEC, as last amended by Directive 96/1/EC. 87 1. Article 4 of Directive 94/12/EC: the multi-faceted approach Directive 94/12/EC adopted by the European Parliament and the Council on 23 March 1994, which set new emission limit values for new types of passenger cars from 1996, stipulated in Article 4 that the Commission should propose new measures to be implemented in the year 2000, according to a new multi-faceted approach, based on a comprehensive assessment of costs and effectiveness of all measures aimed at reducing road transport pollution. The Article stated that the proposal should include, besides tightened car emission standards, complementary measures, such as improvements in fuel quality and a strengthening of inspection and maintenance programmes for the car fleet. Article 4 of Directive 94/12/EC requires that the Commission base its proposals on two pillars. the establishment of air quality criteria and associated emission reduction objectives; an evaluation of the cost/efficiency of each proposed measure, taking into account the potential contribution of other measures such as: traffic management; enhancement of urban public transport; new propulsion technologies; the use of alternative fuels. Thus, Article 4 requires that the cost/effectiveness assessment should be carried out not only for the measures which will be proposed by the Commission (improvement of new vehicle technology, of fuels, technical inspection), but also encompassing all measures permitting the reduction of pollution by road traffic, regardless whether they are of the responsibility of Member States or of local authorities. This multi-faceted cost/effectiveness approach differs from the usual approach based on the assessment of the Best Available Technology. However, Article 4 also stipulated to the Commission that the Stage 2000 proposal would need to achieve a "substantial" reduction in emissions. The next stage will also continue to be founded on Article 100a of the Treaty, i. e. the proposal should be based on a "high level" of environmental protection. There is thus, to some degree, a need to reconcile these two different concepts. However, application of the Best Available Technology principle independently for each separate measure would lead in all likelihood to a sub-optimal set of measures, economically as well as environmentally. The multi-faceted approach therefore aims at determining the best cost/effective package of measures with a view to achieving a high level of protection. 2. The Auto/Oil Programme In accordance with the principle of shared responsibility expressed in the 5th Environmental Action Programme, the Commissioners for Energy, Environment and Industry, at the end of 1992, decided to initiate a technical scientific work programme for the purpose of providing a solid technical foundation upon which to base its future legislative proposals. The Commission invited the European Automobile manufacturers and Oil industry trade associations (ACEA and EUROPIA) to make available their considerable know-how and expertise. The two industries responded positively to this invitation and together with the Commission services designed, planned and executed the programme which subsequently became known as the Auto/Oil Programme. 88 The objective of the Auto/Oil Programme was to provide policy-makers with an objective assessment of the most cost-effective package of measures including vehicle technology, fuel quality, inspection and maintenance measures and non-technical measures, necessary to reduce emissions from the road transport sector to a level consistent with the attainment of the new air quality standards being developed for adoption across the European Union. The work organization, assumptions and outcomes of the Auto/Oil Programme are described in the accompanying Commission Communication on the Auto/Oil Programme and Future Strategies to Reduce Emissions(2). 3. Changes to vehicle technology Within the framework of the Auto/Oil Programme, European vehicle manufacturers were asked to provide estimates of the additional costs which would be required in order to equip their vehicles with the technology necessary to achieve a series of progressively more stringent emission scenarios. The main findings of the cost analysis of vehicle technologies are that: significant vehicle technology; reductions in pollutant emissions are possible through improved applying the most stringent reduction scenario to all vehicle categories would represent an annual cost of ECU 5. 5 billion (in 1995 ECU) to the Union; when expressed as a cost per vehicle, the most stringent packages for which cost data increase of 3-5% on current purchase price were provided equate (excluding taxation). to an In addition, as part of the Auto/Oil Programme, data were collected with regard to cost and to the efficiency of the various mechanisms designed to reduce the rate of deterioration of the emission control systems. Two technical devices by which such improvements can be achieved have been studied: electronic sensors installed on the vehicle to monitor the performance of the emission control systems - referred to commonly as on-board diagnostics (OBD); "In-use compliance testing" procedures whereby vehicles can be recalled by authorities and if necessary repaired if their emission performance deteriorates beyond an acceptable level; Inspection and maintenance requirements have also been shown to be particularly cost-effective. — 4. Cost effectiveness optimization On the basis of the data available on the costs and potential benefits of the various technical measures (engine technology, fuel quality and improved inspection and maintenance of emissions control systems), it has been possible to identify the most cost/effective packages of technical measures necessary to achieve a significant reduction of urban NOx, particulate matters in the most polluted areas and ozone precursors at European level. (2) COM(96) of June 1996. 89 D. 1. Consultations of interested parties Position of industry throughout industries were associated and were consulted The motor and oil the Auto/Oil Programme. These industries accepted the methodology as well as the majority of the results. The car manufacturers would have liked a method of calculation from the emissions giving more weight to measures with an immediate effect, by the taking into account of an emission carry over method or "emission discounting". However, the Commission considers that a sustainable policy of improvement of the air quality shall be based on balanced mix of immediate and long-term measures which is the objective with the overall 2000 Stage strategy. The car manufacturers consider that the main cost burden falls on it and that a certain rebalancing of the measures should be carried out. The Commission considers nevertheless that the proposed measures have to fulfil cost/effectiveness criteria. In this respect, the optimisation made during the programme shows that, in general, the measures affecting the vehicles are the most effective ones. 2. Position of the Member States Member States were informed and were consulted regularly throughout the programme. They considered that the orientations described by the Commission, in particular at an informal meeting on 7 December 1995, were in general acceptable. Half of the Member States could support of stricter measures than those envisaged at the time, in particular for the petrol cars. The principle of a later "Stage 2005" serving as a basis for granting tax incentives was not disputed. A majority of the Member States experts were in favour of an ambitious regulatory stage with a review clause. 3. Position of the European Parliament Four specific meetings were organized to inform the Members of the European Parliament of the work carried out. While the members of the European Parliament expressed their sympathy with the principles underlying the programme, they expressed some regret that certain interested parties had been less consulted, notably equipment suppliers, the fuel additive producers and non governmental organizations. Members also regretted the delay in presenting of the proposals. They are awaiting the specific proposals before to take formally taking a position with the expectation that proposals will take into account of the precautionary principle of as well as the need to harmonize on the basis of the best available technology. E. 1. Content of the proposal Passenger car emission standards - modification of Directive 70/220/EEC In accordance with the results of the Auto/Oil Programme, the Commission proposes that emissions standards for passenger cars are tightened and improved by the adding of new requirements. It is proposed that these measures (discussed below in detail) should apply from the year 2000 for new vehicle types and from 2001 for all new vehicles. A second regulatory stage should also be envisaged to be applied from 2005 for new vehicle types and from 2006 for all new vehicles. This should however be confirmed (see below). 90 1. 1 Test of the tailpipe emissions after a cold start ("type I test") The Type I test constitutes the main element of the Directive. It aims at the effective limitation of the air-polluting emissions of motor vehicles with a total mass up to 3 500 kg driven in typical urban and extra-urban traffic conditions. The driving cycle which simulates such traffic conditions for the purpose of carrying out this test in the laboratory will be modified in order to better represent a typical vehicle cold start. As suggested by the Commission's Motor Vehicle Emission Group, the 40 second warm up period before the sampling of the exhaust gases permitted in the current test will be deleted. This change will result for gasoline vehicles in a considerable increase of the emissions of carbon monoxide (up to 40%) and hydrocarbons measured during the test. Notwithstanding changes of the limit values, this measure by itself constitutes a significant severisation of the requirements of the Type I test. 1. 2 Limit values in the year 2000 The proposed new limit values to be applied from the year 2000 represent reductions, against Stage 1996 emissions standards, of: 40% nitrogen oxides, 40% hydrocarbons, 30% carbon monoxide for petrol engined passenger cars; 20% nitrogen oxides, 20% for the combined value for hydrocarbons plus nitrogen oxides, 40% carbon monoxide, 35% particulate matter for diesel passenger cars equipped with indirect injection engine; 40% nitrogen oxides, 40% for the combined value for hydrocarbons plus nitrogen oxides, 40% carbon monoxide, 50% particulate matter for diesel passenger cars equipped with direct injection engines which presently comply with less stringent limit values. These reductions correspond to scenarios evaluated in the Auto/Oil Programme, as described in the Auto/Oil Communication. The new limit values for diesel vehicles no longer make a distinction between indirect and direct injection engines, since direct injection technology will be mature by year 2000 and will therefore be able to comply with the general requirements for diesel vehicles. In applying these reductions to the present limit values of Directive 94/12/EC the combined limit value for hydrocarbons and nitrogen oxides has to be broken down. In the past it has been assumed that the ratio of these pollutants in the exhaust emissions was 55 to 45 for petrol cars and 20 to 80 for diesel cars. These ratios were established when the limit values for hydrocarbons and nitrogen oxides were combined in Directive 83/351 /EEC. Recent data shows, however, that for modern diesel engines, in particular when equipped with oxidation catalysts, a ratio of 10 to 90 is more representative. time first the for For petrol cars separate limit values are now proposed for hydrocarbon and nitrogen oxide emissions, in order to achieve specific emission reductions for both pollutants. However, a combined limit value for these pollutants is still maintained for diesel cars for which the Stage 2000 standards are particularly demanding, in order to assure the flexibility necessary for the engineering of future diesel engines and associated emissions reduction technologies. In addition diesel cars emit unburned hydrocarbons at a very low level. However, in accordance with the emphasis which the Commission attributes to the control of nitrogen oxide emissions, the combined value is completed by a separate limit value for nitrogen oxides emissions. 91 The incremental costs of the proposed Stage 2000 standards have been assessed in the Auto-oil cost/effectiveness study, as has the technology require to fulfil these standards. The mean calculated costs are from ECU 113 for a small gasoline car to ECU 402 for diesel cars. The standards will require technologies like close coupled catalyst, improved injection, dual oxygen sensor for gasoline vehicles, and fully electronic pump and electronically-controlled exhaust gas recirculation for diesel vehicles. The Auto/Oil Programme has shown that they will be available by the year 2000. The proposed Stage 2000 limit values are therefore. Stage: Directive 94/12/EC CO HC+NOx HC NOx (limit values in g/km ) 2. 2 0. 5 Petrol cars Directive 94/12/EC Corrected values(3) 2. 7 0. 341 0. 252 Stage 2000 2. 3 0. 20 0. 15 _ Stage: Directive 94/12/EC Diesel cars Directive 94/12/EC Corrected values Stage 2000 CO HC + NOx NOx PM (limit values in g/km ) 1. 0 0. 7/0. 9w 0. 08/0. 10(4) 1. 06 0. 71/0. 91 0. 63/0. 81w 0. 08/0. 10(4) 0. 64 0. 56 0. 50 0. 05 1. 3 Test of evaporative emissions ("type TV test") This test became part of the European emission standards in 1991 in order to control the losses of hydrocarbons by evaporation from the fuel system of a petrol car. For this purpose the test simulates the conditions of a car which is parked after use under hot weather conditions. Following the recommendation of the Commission's Motor Vehicle Emission Group, the test will be improved to better represent the real conditions which determine the evaporative emissions as well as the state of the art of the relevant laboratory techniques. Based on the review of available emission and meteorological data, it is proposed to up-grade the test with more severe specifications for pre-conditioning the test vehicles, and with a new 24-hour diurnal test after soaking for an extended period at hot temperatures. (3) (4) Corrected to take account of change in test cycle caused by elimination of the 40 second idling period. For vehicles equipped with direct injection engine. 92 1. 4. Measures for ensuring the durability of the emission control systems There are three important ways in which the durability of emission control systems can be assured, relevant to the proposed directive: 1. 4. 1 Onboard Diagnostic Systems (OBD) OBD systems have been identified by the Auto/Oil Programme as a cost-effective means of assuring that the emissions of a car are effectively controlled during its useful life. OBD systems have a double purpose. They detect failures of the anti-pollution equipment of the car and indicate these to the driver so that he can have the vehicle fixed in a repair shop. In addition, they record the detected failures allowing stations carrying out the annual roadworthiness inspections to verify that the relevant repairs have been carried out. A new Annex XI in the directive incorporates the technical provisions necessary for the approval of OBD systems. The proposed OBD specifications do not require the direct measurement of emissions, but aim at ensuring a monitoring, through electronic computing and sensing, of the performance of related component or systems. While the technology has already been proven for gasoline powered vehicles, OBD technologies are at ^ far less developed stage for diesel vehicles. The Directive stipulates, therefore, that requirements for these vehicles are, in a first stage, optional. The proposal takes into account the most recent technological developments for both categories of vehicles. OBD requirements shall necessarily include anti-tampering provisions. A clause has been added to avoid that anti-tampering features preclude the use of aftermarket parts which give an equivalent level of emission control. 1. 4. 2 Control of compliance of vehicles in service The Auto/Oil Programme has highlighted the favourable cost/effectiveness potential of systems for verifying the compliance of vehicles in service with the regulatory requirements in force when these vehicles are approved. Such systems exist in the United States, in Sweden and, on a voluntary basis, in the Netherlands. The EC type-approval procedure contains, at present, only provisions allowing the control of conformity of production. The Commission is therefore proposing to introduce in the EC type-approval procedure for motor vehicles, provisions which will verify the compliance of manufacturer's vehicles with the durability requirements of the present directive with the help of surveys carried out on vehicles in service which have accumulated up to 80 000 km and/or an age of five years. In order to assure the application of such provisions at EU level, they must be closely linked to existing provisions relating to the responsibilities of the national authorities with respect to the control of conformity of production. The introduction of the proposed new system necessitates not only amendments of the present directive but also amendments of the framework directive relating to EC type-approval (70/156/EEC). The amendments to the latter directive and the detailed provisions relating to the statistical aspects of the surveys of vehicles in service and the remedial measures that should apply in case of non-compliance (e. g. "recall") will be subject of the new Annex X of this Directive. 1. 4. 3 Test for verifying the durability of anti-pollution devices ("type V test") This test was introduced in Directive 91/441/EEC in order to verify the requirement that the emission control measures taken by the manufacturers remain effective throughout the normal life of the vehicles and under normal conditions of use. The test is intended to simulate the ageing of anti-pollution devices during an operation of 80 000 km in accordance with a specified driving pattern. 93 The experience made by industry and the national approval authorities with this test has, however, shown a considerable lack of representativity in the way that emission control The devices deteriorate of the concerned devices under actual driving conditions. Commission has decided therefore to refrain from proposing an extension of this test to 160 000 km which would merely increase the costs of emission approvals of cars without noticeable environmental benefits. Hence, the present provisions of the Directive relating to the type V test remain unchanged. 1. 5 Reference fuels The characteristics of the reference fuels used for emission testing are also modified to reflect evolution of the specifications of the commercial fuels in year 2000. 1. 6 Low temperature testing The Commission does not propose that specific requirements relating to the emission performances of vehicles at low temperatures be introduced, because the typical conditions simulated by this test were not covered in the Auto/Oil Programme. Nevertheless, in the light of the interest shown by some Member States for such a new test, the Commission ^will study its potential costs and effectiveness at a later stage, and will, if necessary, bring forward proposals. 2. Second stage 2005 The proposal also sets out indicative limit values to be applied for a second Stage to reduce vehicle emissions in the year 2005. The purpose of the second stage is twofold. Firstly by setting indicative, but realistic limit values which could be applied from the year 2005, the Commission is giving advance notice to the automobile industry as to the measures it anticipates will need to be applied from that date. Secondly, the year 2005 values are proposed in order to provide uniform targets to Member States which would like to stimulate the improvement of environmental technologies through the granting of fiscal incentives. In view of the anticipatory nature of the second stage, the Commission proposes that the limit values proposed should be confirmed by decision of the European Parliament and the Council. To this end, the Commission will bring forward proposals to the Council and the Parliament within twelve months of the adoption of this Directive, but not later than 31 December 1999, as required in Article 4 of this proposal. Contemporaneously with the new proposals on vehicles, the Commission will also propose new fuels quality specification for application also in year 2005. The proposals on fuels and vehicles to reduce emissions for the year 2005, will be based on a further analysis of trends in air quality, technical developments in vehicle and refinery technologies, the-potential for alternative fuels to reduce vehicle emissions and the relative cost/effectiveness of the measures concerned. The indicative limit values are based on the most stringent packages of measures examined in the Auto/Oil Programme but not selected for the year 2000. The costs of the technologies necessary to meet these second stage standards are not precisely known at the present time. Stage 2005 proposed standards will require, especially for diesel vehicles, the development of technologies like deNOx catalytic converters which are not yet industrially proven. These will require the availability of improved fuels (for instance, low sulphur diesel fuel). This is another reason why the second stage on vehicles needs to be accompanied by a second stage on fuels. * 94 The proposed Stage 2005 limit values are therefore: Stage: CO HC NOx (limit values in g/km ) Directive 94/12/EC Corrected values 2. 7 0. 341 0. 252 Stage: CO H C + N Ox NOx PM Directive 94/12/EC Corrected values 1. 06 0. 71/0. 91(i) 0. 63/0. 81(4) 0. 08/0. 10w 3. Emission based fiscal incentives Petrol cars Stage 2000 Regulatory values 2. 3 0. 20 0. 15 Diesel cars Stage 2000 Regulatory values 0. 64 0. 56 0. 50 0. 05 Stage 2005 Indicative values 1. 00 0. 10 0. 08 Stage 2005 Indicative values 0. 50 0. 30 0. 25 0. 025 Since the adoption of Directive 89/458/EEC, Community decisions relating to the environmental aspects of motor vehicle emissions have contained a framework for the granting of fiscal incentives to encourage the early application of the new limit values. In these directives a balance has been struck between, on the one hand, the need to encourage the introduction of new technologies as quickly as possible, and, on the other hand, the need to avoid fragmenting the Single Market with diverse fiscal incentive programmes incentivising different limit values with the consequence that, de facto, there would be simultaneously a multitude of emission standards existing in the market. The principles adopted in the framework set out in Article 3 of Directive 94/12/EC have been to permit fiscal incentives only for vehicles complying with the Directive and provided that they comply with the provisions of the Treaty and that they are: non-discriminatory; limited in time and that they terminate when the limit values become mandatory; of an amount lower than the additional cost of the technical solutions introduced to ensure compliance with the new limit values and the cost of their installation on the vehicle. — (5) For vehicle equipped with direct injection engine. 95 It should be noted that this fiscal framework has been established within the context of a directive based on Article 100a of the Treaty a point which has been contested by a number of Member States. Legally speaking however this is perfectly justified since the main subject matter of the directive concerns questions of the internal market (harmonization of legislation). The fiscal incentive framework does not aim at harmonizing taxes but rather at preventing obstacles to the functioning of the Internal Market in this sector. Without a Community framework there would be nothing to prevent Member States, within the limits of the Treaty, from incentivising a wide range of emission limit values. This would be damaging for the proper functioning of the internal market. It is for this reason that Member States have agreed to establishing a framework within which fiscal incentives could be given. The Commission believes that it is essential that this policy continues in the future. The Commission has however re-examined the modalities of the framework with a view to ascertaining if any additional flexibility could be introduced into it without prejudicing the objectives outlined above. The Commission notes in this context that in the course of the discussions on Directive 94/12/EC it stated that with regard to the inclusion of pollutant emissions in the basis for calculating the annual road tax, any adjustment should be progressive and be based upon the actual performance of each vehicle. Fiscal incentives should not be given to incentivjse limit values not agreed at Community level (e. g. US standards) but can be given in the context of annual road taxes to incentivise actual emission standards. In the last whereas clause of Directive 94/12/EC the Council and the Parliament requested the Commission, when putting forward measures to apply after the year 2000, to put forward, if necessary, target values involving a further substantial reduction of emissions. Such target values clearly would be used for purposes of fiscal incentivisation. In examining the relative merits of such an approach the Commission notes that for some time a number of Member States - notably Germany and Sweden - have advocated the establishment of target limit values for incentivisation purposes. Sweden indeed has applied such a system (by means of environmental Classes I/n/ffi) despite the fact that it is in contradiction with current Community legislation. The European Parliament has also been in favour of a second stage. Against this a number of Member States have made clear their preference for the maintenance of a single stage of incentivised limit values, which has been the approach followed up to now. This issue was discussed by the Commission in 1991 during which time the responsible Commissioners agreed that there was a case for providing a second stage target limit value for fiscal incentive purposes which would be based upon the most advanced technologies. The Auto/Oil Programme has provided data on the most advanced technologies and the information therefore exists on which to base a second stage for incentivisation purposes. In addition this information has been gathered on a European wide basis and hence is likely to provide a sounder basis for a second stage than figures put forward in the past by Member States individually which would reflect their own national industries' capabilities. On balance therefore the Commission considers that there are strong grounds for liberalising the current framework and providing for a second stage of incentivisation. It has to be acknowledged that allowing a second level of incentivisation contains certain risks in terms of internal market. Jiowever since, given the legislative timetable, this proposal is unlikely to be applied before 1998 by Member States on an optional basis for vehicle types approved to Stage 2000 standards. This is only a short time before vehicles will mandatorily have to conform to emission performances corresponding to Stage 2000 standards. As a practical matter therefore, there will be only a very short period when, theoretically, there are three simultaneous standards existing in the market (actual, Stage 2000, indicative Stage 2005). This has to be seen in the light of the far greater danger 'in terms of negative effects on the internal market which would result from a failure to agree to any framework at all. This later scenario would have the consequence that unbridled fiscal incentives measures would be permitted leading to the risk of a proliferation of standards in the market and a threat to the functioning of the internal market. 96 towards The two-stage approach the clear understanding that these and only these limit values will be permitted to be incentivised and not others such as US standards or variants thereof. Article 4 of the draft Directive provides, that the regime governing fiscal incentives for the year 2005 will, if necessary, be revised, in the course of the proposals conforming or revising the limit values to be applied in 2005. incentivisation should be permitted on With regard to fiscal incentive measures given in the context of annual road taxes the Commission proposes that the policy it outlined in the course of the adoption of Directive 94/12/EC should be maintained. F. New measures for other categories of vehicles A proposal will be submitted in 1996 to modify the light commercial vehicles (LCV) standards included in Directive 70/220/EEC. In order to ensure parallelism and coherence between light commercial vehicles and passenger cars, limit values for these vehicles will be an extrapolation of limit values in this proposal. The Commission will examine closely the issue of whether limit values for Class I and II LCV should be the same. A proposal aimed at achieving a 30% NOx and particulate reduction will also be-proposed in 1996, for heavy duty diesel engines approved according Directive 88/77/EEC. Limit values will take into account the on-going discussions on revising the heavy vehicle test procedure. The implementation dates will be the same as those for passenger cars. As for passenger cars and light commercial vehicles, it is also foreseen to propose target values for 2005 for heavy duty vehicles. Provisions for LPG/CNG technologies in buses and city vehicles will also be developed. G. 1. Subsidiarity Objective of the proposed measures in relation to the obligations placed upon the Commission The objective of the measures is to adapt existing measures to the technical progress as well as to new knowledge in the field of environment. These existing measures have largely contributed to achieving the harmonization of the Community vehicle market since 1970. Their adaptation is explicitly requested by Directive 94/12/EC and is an element of a global consensus which had permitted the adoption of the last directive. 2. Compared competence of the Community and of the Member States With the Council Directive 89/458/EEC, the Community has decided to harmonize all emission related requirements for new vehicle type-approval on the base of total harmonization. The matter is therefore an issue of exclusive Community competence. 3. Forms of actions available for the Community — The only realistic form of action is legislation based either on a directive or a regulation. As a separate directive permitting the application of the EU type-approval put in place by Directive 70/156/EEC, the proposal adopts the legal forms of all requirements in this field. 97 4. Availability of an approach with general objectives leaving execution to Member States A uniform detailed regulation is necessary to be coherent with the requirements of the framework Directive 70/156/EEC. H. Conclusions With this present proposal for a European Parliament and Council Directive, the highest degree of environmental protection, consistent with a economically sound global approach, will be ensured. The proposals will contribute to the improved protection of public health within the Community by setting ambitious but realistic objectives, whilst giving a sufficient lead time to the automobile and components industries to develop the relevant technologies. The Commission has moreover taken care of the need to provide a stable framework for operators in the market, and the proposals have been made with this objective in mind. The ambitiousness of the changes will put the Community squarely at the head of the global effort to reduce emissions. Nevertheless, alongside measures taken out at the level of the European Union, cost effective measures implemented at local level will be necessary to achieve air quality objectives. 98 Proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE 96/0164 (COD) relating to measures to be taken against air pollution by emissions from motor vehicles and amending Council Directives 70/156/EEC and 70/220/EEC THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 100 thereof, Having regard to the proposal from the Commission(1), Having regard to the opinion of the Economic and Social Committee(2), Acting in accordance with the procedure referred to in Article 189b of the Treaty(3), Whereas measures should be adopted within the framework of the internal market; Whereas the first programme of action of the European Community on protection of the environment^, approved by the Council on 22 November 1973, called for account to be taken of the latest scientific advances in combating atmospheric pollution caused by gases emitted from motor vehicles and for directives adopted previously to be amended accordingly; whereas the fifth programme of action, which in its general approach was approved by the Council in its resolution of 1 February 1993 ((5)), provides for additional effort to be made for a considerable reduction in the present level of emissions of pollutants from motor vehicles; whereas this fifth programme also set targets in terms of emission reduction for various pollutants in the understanding that emissions from both mobile and stationary sources would have to be reduced; Whereas Council Directive 70/220/EEC(6) lays down the limit values for carbon monoxide and unburnt hydrocarbon emissions from the engines of such vehicles; whereas these limit values were first reduced by Council Directive 74/290/EEC(7) and supplemented, in accordance with Commission Directive 77/102/EEC(8), by limit values for permissible nitrogen oxides; whereas the limit values for these three types of pollution were successively reduced by Commission Directives 78/665/EEC(9), 83/351/EEC(10) and 88/76/EEC(U); whereas limit values for particulate pollutant emissions from diesel engines were introduced by Council Directive 88/436/EEC(12); whereas more stringent European standards for the emissions of gaseous pollutants of motor vehicles below 1 400 cm were introduced by Council Directive 89/458/EEC(l3); whereas these standards have been extended to all passenger (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) OJ No C OJ No C Opinion of the European Parliament of — , Common Position of the Council of , and Decision of the European Parliament of OJNoC 112, 20. 12. 1973, p. 1. OJNoC 138, 17. 5. 1993, p. 1. OJNoL 76, 6. 4. 1970, p. 1. OJNoL 159, 15. 6. 1974, p. 61. OJNoL 32, 3. 2. 1977, p. 32. OJ No L 223, 14. 8. 1978, p. 48. OJNoL 197, 20. 7. 1983, p. 1. OJNoL 36, 9. 2. 1988, p. 1. OJNoL 214, 6. 8. 1988, p. 1. OJNoL 226, 3. 8. 1989, p. 1. 99 cars independently of their engine capacity on the basis of an improved European test procedure comprising an extra-urban driving cycle and, whereas requirements relating to evaporative emissions and to the durability of emissions-related vehicle components as well as more stringent particulate pollutant standards for motor vehicles equipped with diesel introduced by Council Directive 91/441/EEC(U); whereas engines which were Directive 94/12/EC of the European Parliament and of the Council(15) introduced more stringent limit values for all pollutants and a modification of the control of conformity of the production; whereas passenger cars designed to carry more than six passengers and having a maximum mass of more than 2 500 kg, light commercial vehicles, and off-road vehicles, covered by Directive 70/220/EEC, which benefited until then from less stringent standards, have been submitted by Council Directive 93/59/EEC(16) and Directive 96/. /EC of the European Parliament and of the Council(17), to standards as severe as the respective standards for passengers cars, taking into account the specific conditions of these vehicles; Whereas Article 4 of Directive 94/12/EC requires that the Commission proposes standards which will be enforced after the year 2000, according to a new multi-faceted approach, based on a comprehensive assessment of costs and efficiency of all measures aimed at reducing road transport pollution; whereas the proposal should include, besides car emission standard tightening, complementary measures, like an improvement in fuel quality and a strengthening of the car fleet inspection and maintenance programme; whereas the proposal should be based on the establishment of air quality criteria and associated emission reduction objectives and an evaluation of the cost/effectiveness of each package of measures, taking into account the potential contribution of other measures such as, inter alia, traffi z management, enhancement of urban public transport, new propulsion technologies, or the use of alternative fuels; Whereas the Commission has implemented a European programme on air quality, road traffic emissions, fuels and engines technologies (the Auto/Oil Programme08') with a view to fulfilling the requirements of Article 4 of Directive 94/12/EC; whereas the European car and oil industries have carried out the European Programme on Engines Fuels and Emissions (EPEFE) to determine the contribution which can be made both by future vehicles and the fuels which propels them; whereas the auto/oil and EPEFE programmes strove for ensuring that proposals for directives on polluting emissions seek the best solutions for both the citizen and for the economy; whereas a cost/effectiveness study within the Auto/Oil Programme has shown that a further improvement of car emission technology was necessary with a view to achieving air quality in year 2010 as described in the Communication by the Commission on the Auto/Oil Programme; Whereas improvement of requirements for new passenger cars in Directive 70/220/EEC constitute a part of a consistent global Community strategy which will also include a revision of standards for light commercial vehicles and heavy duty vehicles from year 2000, an improvement of motor fuels and more accurate assessment of in-use vehicle emission performances; whereas alongside these measures, additional cost/effective local measures will nevertheless be needed to achieve the air quality criteria in the most polluting areas; Whereas Directive 70/220/EEC is one of the separate directives under the type-approval procedure laid down by Council Directive 70/156/EEC of 6 February 1970 on the approximation of the laws of the Member States relating to the type-approval of motor vehicles and their trailers(l9), as last amended by Directive 96/27/EC of the European Parliament and of the Council(20); whereas the objective of reducing the level of (14) (15) (16) (,7) (18) (19) (20) OJNoL 242, 30. 8. 1991, p. 1. OJ No L 100, 19. 4. 1994, p. 42. OJNoL 186, 28. 7. 1993, p. 21. OJ No L Commission Communication. OJNoL 42, 23. 2. 1970, p. 1. OJNoL 169, 8. 7. 1996, p. 1. 100 pollutant emissions from motor vehicles cannot be sufficiently achieved by individual Member States and can therefore be better achieved by the approximation of the law of the Member States relating to measures to be taken against air pollution by motor vehicles; Whereas reductions of the Type I test limits applicable from year 2000 corresponding to abatements of 40% nitrogen oxides, 40% total hydrocarbons, 30% carbon monoxide for gasoline passenger cars, 20% nitrogen oxides, 20% for the combined value for hydrocarbons plus nitrogen oxides, 40% carbon monoxide, 35% particulate matters for indirect injection diesel passenger cars and 40% nitrogen oxides, 40% for the combined value for hydrocarbons plus nitrogen oxides, 40% carbon monoxides and 50% particulate matters have, for direct injection diesel passenger cars, been identified as key measures to achieve sufficient medium-term air quality; whereas these reductions have been applied to hydrocarbons and nitrogen oxides with the assumption that nitrogen oxides represent respectively 45% and 80% of the weight of the combined value measured for gasoline/diesel light duty vehicles complying with Directive 94/12/EC; whereas separate limit values are now normally fixed for gasoline vehicles in order to monitor the emissions of both pollutants; whereas a combined limit value is maintained for diesel vehicles for which the Stage 2000 standards are the most demanding, with a view to facilitating engineering of future engines; whereas these reductions will take into account the effect on real emissions of a modification also adopted for the test cycle with a view to better representing emissions after a cold start ("deletion of 40 s"); Whereas new provisions for on-board diagnostics (OBD) should be introduced with a view to permitting an immediate detection of failure of anti-pollution vehicle equipment and thus allowing a significant up-grading of the maintenance of initial emissions performances on in-use vehicles through periodical or kerbside control; whereas, however, OBD are at a less developed stage for diesel vehicles and can be fitted on such vehicles only as an option; Whereas the Type IV test which makes it possible to determinate the evaporative emissions of spark-ignition engines can be improved to better represent real evaporative emissions as well as the status of measuring techniques; Whereas the characteristics of the reference fuels used for emission testing should reflect the evolution of the market fuel specifications to be available in year 2000, following legislation on the quality of petrol and diesel fuels; Whereas a new method for conformity of production checking on in-use vehicles has been identified as a cost/effective accompanying measure; and is included in the emission directive with the objective of implementation in year 2001; whereas Directive 70/156/EEC should be amended accordingly; Whereas Member States should be allowed to encourage, by means of tax incentives, the introduction of vehicles which satisfy the improved requirements of this Directive; Whereas, it is necessary to establish indicative limit values to be applied from 2£05 which can also be used for the purposes of, inter alia, encouraging the early introduction of vehicles containing the most advanced anti-pollution equipment; these indicative limit values should be confirmed by a directive of the Whereas European Parliament and of the Council on the basis of a proposal to be made by the Commission not later than 31 December 1998; whereas the Commission will simultaneously propose measures to improve the quality of fuels for the year 2005; whereas both directives should enter into force together in 2005; Whereas Directive 70/220/EEC should be amended accordingly, 101 HAVE ADOPTED THIS DIRECTIVE: Article 1 Directive 70/156/EEC is amended as follows: 1. Article 10 is amended as follows: Article 10 (a) the heading is replaced by the following: "Conformity of production and in-service compliance arrangements" (b) the following paragraph 3 is added: "3. A Member State granting type-approval in relation to separate directives which contain quantified provisions for in-service durability of the systems, components or technical units, covered by these directives, shall make the necessary arrangements for verification to ensure compliance with these provisions by survey on vehicles in service in accordance with the procedures laid down in the directives concerned. " 2. Article 11 is amended as follows: (a) the heading is replaced by the following: "Non-conformity and non-compliance" (b) the following paragraph 4a is inserted: "4a. There shall be failure to comply with quantified durability provisions of a separate directive where a survey on vehicles in service, carried out in accordance with the relevant specifications of the directive, establish that a vehicle type concerned does not meet these durability requirements. If a Member State which has granted type-approval finds that vehicles in service accompanied by a certificate of conformity do not comply with the quantified durability provisions of a separate directive pursuant to which they have been type-approved, it shall decide on measures to be taken in order to ensure that vehicles in service will again comply with these provisions. The approval authorities of the Member State shall advise those of the other Member States of the measures planned. The relevant authorities in each Member State are competent to decide on the advisability of implementation in their territory of the planned measures. If a Member State demonstrates that vehicles in service accompanied by a certificate of conformity do not comply with the quantified durability provisions of a separate directive pursuant to which they have been type-approved, it shall request the Member State which granted the type-approval to verify that by survey on vehicles in use, if necessary in cooperation with the competent authorities of the other Member States vehicles in service comply with these provisions. Such action shall be taken as soon as possible and in any case within the six months of the date of the request. When non-compliance for a vehicle in service is established in accordance with the third subparagraph, the vehicle approval authority takes the measures referred to in the second subparagraph. " 102 (c) paragraphs 5 and 6 are replaced by the following: "5. The approval authorities of the Member States shall inform each other within one month of any withdrawal of type-approval and of the reasons for such a measure. In case of in-service survey under Article 10(2), the approval authorities of the Member State shall inform each other of the decisions taken on the basis of the results of the survey. 6. If the Member State which granted type-approval disputes the failure to conform or to comply demonstrated to it, the Member States concerned shall endeavour to settle the dispute. The Commission shall be kept informed and shall, where necessary, hold appropriate consultations for the purpose of reaching a settlement. " 3. In Article 12, the following subparagraph is added: "All decisions taken pursuant to the provisions adopted in implementation of this Directive and adopting planned measures to restore the conformity of vehicles in service, shall state in detail the reasons on which they are based. The competent authorities of each Member State which decide to initiate the planned measures shall notify the party concerned who shall, at the same time, be informed of the remedies available to him under the laws in force in the Member States and of the time limits allowed for the exercise of such remedies. " Article 2 The Annexes to Directive 70/220/EEC are amended in accordance with the Annex hereto. Article 3 1. Subject to the provisions of Article 6, with effect from 1 January 1998, no Member State may, on grounds relating to air pollution by their emissions: refuse to grant EC Directive 70/156/EEC, or type-approval pursuant to Article 4(1) of refuse to grant national type-approval, or prohibit the registration, sale or entry into service of vehicles, if the vehicles comply with the requirements of Directive 70/220/EEC, as amended by this Directive. 2. Subject Member States: to the provisions of Article 6, with effect from 1 January 2000, may no Directive 70/156/EEC, and longer grant EC type-approval pursuant to Article 4(1) of shall refuse national type-approval, for a new type of vehicle on grounds relating to air pollution by emissions if it fails to comply with the provisions of Directive 70/220/EEC, as amended by this Directive. For the Type I test the limit values set out in row A of the Table in Section 5. 3. 1. 4 of Annex I to Directive 70/220/EEC are to be used. 103 3. With effect from 1 January 2001, Member States shall: consider certificates of conformity which accompany new vehicles pursuant to Directive 70/156/EEC as no longer valid for the purpose of Article 7(1) of that Directive, and refuse the registration, sale or entry into service of new vehicles which are not accompanied by accordance with of a Directive 70/156/EEC, conformity certificate in on grounds relating to air pollution by emissions, if the vehicles fail to comply with the provisions of Directive 70/220/EEC, as amended by this Directive. For the Type I test the limit values set out in row A of the Table in Section 5. 3. 1. 4 of Annex I to Directive 70/220/EEC are to be used. Article 4 Member States may make provision for tax incentives only in respect of motor vehicles which comply with Directive 70/220/EEC, as amended by this Directive. Such incentives shall comply with the provisions of the Treaty and satisfy the following conditions: they shall apply to all new vehicles offered for sale on the market of a Member State which comply in advance with either the mandatory limit values set out in row A of the Table in Section 5. 3. 1. 4 of Annex I to Directive 70/220/EEC, as amended by this Directive, or, the indicative limit values set out in row B of the same Table; they shall be terminated with effect from the mandatory application of the emission limit values laid in Article 3(3) for new motor vehicles, or by 1 January 2005 in the case of the indicative limit values set out in row B of the Table in Section 5. 3. 1. 4 of Annex I to Directive 70/220/EEC, as amended by this Directive; for each type of motor vehicle, they shall be for an amount lower than the additional cost of the technical solutions introduced to ensure compliance with the values set in Article 3(3), or the indicative limit values set out in row B of the Table in Section 5. 3. 1. 4 of Annex I to Directive 70/220/EEC, as amended by this Directive, and of their installation on the vehicle. The Commission shall be informed in sufficient time of plans to institute or change the tax incentives referred to in the first paragraph, so that it can submit its observations. Article 5 The Commission will propose to the European Parliament and the Council a further-tightening of the emission standards of vehicles falling within the scope of this Directive no later than 12 months from the date of adoption of this Directive but in any event not later than 31 December 1998. It shall be based on a revised and enhanced version of the methodology used to prepare measures for this Directive. The strategy put forward in the proposal shall be designed to produce effects to meet the requirements of the Community air quality standards and related objectives at least cost and shall take account of: trends in air quality; noxious* pollutant emissions in Europe from transport and non-transport sources and the contribution that existing, pending and potential emission reduction measures from all sources could make to improve air quality; 104 technical developments with regard to vehicle technologies as well as new propulsion technologies (e. g. electric propulsion, fuel cells); and refinery technologies; the potential of alternative fuels such as compressed natural gas (CNG), Liquid Petroleum Gas (LPG), Dimethyl Ether (DME) and biofuels to reduce vehicle emissions; possible improvements in the test procedures, in particular the addition of a new test procedure at low temperatures; the potential of technical, non-technical and local measures to reduce emissions; in this context the contribution of transport and other policy measures such as traffic management, enhanced urban public transport and vehicles scrappage schemes should be evaluated; the contribution that selective and differentiated fiscal measures could make to reducing emissions, whilst not negatively the internal market; the functioning of impacting the effects of any measures on C02 emissions; the strategies followed by non-member countries to improve air quality and the emission limit values applied therein; the supply situation and qualities of crude oil available to Europe. The proposal shall contain, inter alia, mandatory emission limit values to be applied from 1 January 2005 confirming or modifying in Section 5. 3. 1. 4, row B of Annex 1 to Directive 70/220/EEC, as amended by this Directive. In addition, the proposal shall establish whether the framework under which Member States can make provision for tax incentives established in Directive 70/220/EEC, as amended by this Directive, should be revised. limit values stipulated indicative the p The proposal shall be submitted to the European Parliament and the Council at the same time /EC of the European Parliament and as the proposALreferred to in Article 9 of Directive 96/ of the Coun<pfc*/on the quality of petrol and diesel fuels]; the measures shall enter into effect at the same time as the measures foreseen in the proposal to be submitted in accordance with Article 9 of that Directive. Article 6 The provisions of this Directive will enter into force simultaneously with and in accordance with the same timetable for the introduction of measures specified in the Directive for a European Parliament and Council Directive related to the quality of petrol and dresel fuels. Article 7 1. Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive before 31 December 1997. They shall immediately inform the Commission thereof. When Member States adopt these provisions, these shall contain a reference to this Directive or shall be accompanied by such reference at the time of their official publication. The procedure for such reference shall be adopted by Member States. f«l) See p. of this Official Journal. 105 2. Member States shall communicate to the Commission the texts of the main provisions of national law which they adopt in the field covered by this Directive. Article 8 This Directive shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Communities. This Directive is addressed to the Member States. Article 9 Done at Brussels, For the European Parliament The President For the Council The President 106 ANNEX AMENDMENTS TO THE ANNEXES TO DIRECTIVE 70/220/EEC AS AMENDED BY DIRECTIVE. List of Annexes 1. The list of Annexes is amended as follows: The indication to Annex VI reads as follows: 'Annex VI: Type IV test (Determination of evaporative emissions from vehicles with spark-ignition engines) Appendix 1 : Calibration frequency and methods Appendix 2: Diurnal ambient temperature profile for the diurnal emission test' Annex VIII: The title reads as follows: 'Specifications of reference fuels' The following items are added: 'Annex X: Control of compliance of vehicles in service Annex XI: On-board diagnostics (OBD) for motor vehicles Appendix 1 : Functional aspects of OBD systems Appendix 2: Diagnostic services (Test Modes) Appendix 3: OBD tools Appendix 4: Numeric codes Appendix 5: Addendum to the Information Document Appendix 6: Essential characteristics of the vehicle family- Appendix 7: Addendum to the EC type-approval certificate' 107 Annex I 2. The heading reads as follows: 'SCOPE, DEFINITIONS, APPLICATION FOR EC-TYPE APPROVAL, EC TYPE APPROVAL, REQUIREMENTS AND TESTS, EXTENSION OF EC TYPE- APPROVAL, CONFORMITY OF PRODUCTION, COMPLIANCE IN SERVICE, ON BOARD DIAGNOSTIC (OBD) SYSTEMS' 3. Section 1: The first sentence reads as follows. 'This Directive applies to - the tailpipe emissions, evaporative emissions, emissions of crankcase gases, the durability of anti-pollution devices and on-board diagnostic (OBD) systems for all motor vehicles equipped with positive-ignition engines and the tailpipe emissions, the durability of anti-pollution devices and on-board diagnostic (OBD) systems from vehicles of category Mj and Nj(1), equipped with compression-ignition engines covered by Article 1 of Directive 70/220/EEC in the version of Directive 83/351/EEC(2), with the exception of those vehicles of categ with the exception of those vehicles of categories Nj for which type-approval has been granted pursuant to Directive 88/77/EEC( V 4. A new Section 2. 13 is added to read as follows '2. 13. 'OBD' means an on-board diagnostics system for emission control which shall have the capability of identifying the likely area of malfunction by means of fault codes stored in computer memory. ' Sections 3 to 3. 2. 1 read as follows: '3. APPLICATION FOR EC TYPE-APPRO VAL 3. 1. for EC The application to Article 3(4) of Directive 70/156/EEC of a vehicle type with regard to its tailpipe emissions, evaporative emissions, durability of antipollution devices as well as to its the diagnostic on-board vehicle manufacturer. type-approval pursuant submitted (OBD) system shall — by be As far as the application concerns an on-board diagnostic (OBD) system the procedure described in Annex XI, Section 3 has to be followed. 3. 2. A model for the information document relating to tailpipe emissions, evaporative emissions and durability is given in Annex II; concerning an on-board diagnostic (ODB) system a model is given in Annex XI, Appendix 5. 3. 2. 1. Where appropriate, copies of other type-approvals with the relevant data to enable extension of approvals and establishment of deterioration factors shall be submitted. ' 108 6. Sections 4 to 4. 2 read as follows: •4. GRANTING OF EC TYPE-APPROVAL 4. 1. If the relevant requirements are satisfied, EC type-approval shall be granted to Article 4 (3) of Directive 70/156/EEC. 4. 2. A model for the EC type-approval certificate relating to tailpipe emissions, evaporative emissions and durability is given in Annex DC, concerning an on board diagnostic (OBD) system a model is given in Annex XI, Appendix 7. ' 7. Section 5: The note is deleted. 8. Section 5. 1. 1: The second paragraph reads as follows: ' The technical measures taken by the manufacturer must be such as to ensure that the tailpipe and evaporative emissions are effectively limited, pursuant to this Directive, throughout the normal life of the vehicle and under normal conditions of use. This will include the security of those hoses, their joints and connections, used within the emission control systems, which must be so constructed as to conform with the original design intent. For tailpipe emissions, these provisions are deemed to be met if the provisions of Section 5. 3. 1. 4 (type-approval), Section 7 (conformity of production) and Section 8 (compliance of vehicles in service) are respectively complied with. For evaporative emissions, these provisions are deemed to be met if the provisions of Section 5. 3. 4 (type-approval), Section 7 of Annex VI (conformity of production) and Section 8 (compliance of vehicles in service) are respectively complied with. ' 9. A new Section 5. 1. 3 is added to read as follows: T '5. 1. 3. Provision must be made to prevent excess evaporative emissions caused by a missing fuel filler cap. This may be achieved by using: - an automatically opening and closing, non-removable fuel filler cap; - design features which avoid excess evaporative emissions in the case of a missing fuel filler cap; - a malfunction indicator different from the OBD malfunction indicator to signal a missing fuel filler cap; or any other provision which has the same effect. ' 109 10. Figure 1. 5. 2 is replaced by the following new figure: Figure 1. 5. 2 Different routes for type-approval and extensions Type approval test Type I Type II Type III Type IV Type V In Service Compliance (Section 8) On Board Diagnostics (Section 9) Extension conditions Positive-ignition engined vehicles of categories M and N Yes (mass £ 3,5 t) Yes (mass <> 3,5 t) Yes Yes (mass £ 3,5 t) Yes (mass £ 3,5 t) Yes (mass <. 3,5 t) Yes (Capacity <, 6 occupants) (mass £ 2,5 t) Section 6 Compression ignition engined vehicles of categories Mt and N, Yes (mass <> 3,5 t) -. Yes (mass <. 3,5 t) Yes (mass <; 3,5 t) Optional - Section 6 - M2 and N2 with reference mass not more than 2 840 kg' I 110 11. Section 5. 3. 1. 4: - After the first paragraph a new Table is inserted to read as follows: Limit values. Category of vehicle Reference Mass of carbon Mass of Mass of oxides Combined mass Mass of mass monoxide hydrocarbons of nitrogen of hydrocarbons particulates (CO) (HC) (NO. ) (HC + NO,) (PM) and oxides of nitrogen RW 0<g) (g/km) (g/km) L3 (g/km) (g/km) (g/km) Category Class Petrol Diesel Petrol Diesel Petrol Diesel Petrol Diesel Diesel A(2000) B (2005)* M(2) MO - - all all 2,3 1,00 0,64 0,50 0,20 0,10 - - 0,15 0,08 0,50 0,25 - - 0,56 0,30 0,05 0,025 (*) Indicative limit values to be applied to new types of vehicles from 1 January 2005 which are subject to confirmation by the Council and the European Parliament. These limit values can be the subject of tax incentives referred to in Article 3 of Directive [number of current amending directive]. - The first line of the present Table relating to vehicles of category M is deleted. 12. A new Section 7. 1. 4 is added to read as follows: 7. 1. 4. If a verification of the performance of the OBD system is to be carried out, it must be conducted in accordance with Section 7 of Annex XI. ' 13. Section 8 is deleted. 14. A new Section 8 and 9 are added to read as follows: •8. CONTROL OF COMPLIANCE OF VEHICLES IN SERVICE 8. 1 In order to satisfy the provisions of Section 5. 1. 1, vehicles in service-properly used and maintained shall comply with the provisions of Sections 5. 3. 1. 4 (tailpipe emissions) and 5. 3. 4 (evaporative emissions) for up to 5 years of age or 80 000 km, which occurs first. Compliance with these provisions will be verified in accordance with the provisions of Article 11 of Directive 70/156/EEC by the authorities which have approved the vehicle type concerned with the help of surveys on vehicles in service belonging to this vehicle type. The procedure to be followed for such in service survey is laid down in Annex X. Any vehicle being accompanied by a valid certificate of conformity in accordance with Directive 70/156/EEC may be subject of an in-service survey. I ll Where non-compliance is established in accordance with the provisions of Annex X, the manufacturers of the vehicle type concerned shall carry out the measures notified to him by the authorities of the Member States in accordance with the provisions of Article 11(2) and 12(2) of Directive 70/156/EEC. 9. ON-BOARD DIAGNOSTIC (OBD) SYSTEM FOR MOTOR VEHICLES 9. 1. Vehicles of category M°} equipped with positive-ignition engines, except - vehicles designed to carry more than six occupants including the driver, - vehicles whose maximum mass exceeds 2 500 kg, shail be fitted with an on-board diagnostic (OBD) system for the emission control in accordance with Annex XI. If other vehicles of category M are fitted with an on-board diagnostic (OBD) system, the OBD system must meet the requirements of Annex XI. ' (1) As defined in Annex II Section A to Directive 70/156/EEC. 112 Annex III 15. Section 2. 3. 1: - Paragraph 2 and 3 are deleted. - Paragraph 2 (former paragraph 4) reads as follows: 'Vehicles which do not attain the acceleration. ' (rest unchanged). 16. Section 6. 1. 3: The first sentence reads as follows: 'A current of air of variable speed shall be blown over the vehicle. ' 17. Section 6. 2. 2 is deleted. Appendix 1 18. Section 1. 1: - Figure III. 1. 1 is replaced by the following new figure: Figure III. 1. 1 Operating cycle for the Type I test Speed (km/h) 1 20 1 00 + BS BS: Beginning of sampling, engine start ES: End of sampling 113 - In the English version in column 5 of Table III. 1. 2 (entitled: 'Speed (km/h)'); operation 23 reads as follows: '35 - 10' 19. Sections 4 to 4. 3 including Table III. 1. 4 and Figure III. 1A are deleted. Appendix 3 20. Section 5. 1. 1. 2. 7: In the English version, the formula reads as follows: • p _ M V AV ' 500T 114 Annex VI 21. Sections 1 to 6 read as follows: '1. INTRODUCTION This Annex describes the procedure of the Type IV test according to Section 5. 3. 4 of Annex 1. This procedure describes a method for the determination of the loss of hydrocarbons by evaporation from the fuel systems of vehicles with spark ignition engines. 2. DESCRIPTION OF TEST The evaporative emission test (Figure VI. 1) is designed to determine HC evaporative emissions as a consequence of diurnal temperatures fluctuation, hot soaks during parking, and urban driving. The test consists of these phases: - test preparation including an urban (Part One) and extra-urban (Part Two) driving cycle, - hot soak loss determination, - diurnal loss determination. Mass. emissions of hydrocarbons from the hot soak and the diurnal loss phases are summed up to provide an overall result for the test. 3. VEHICLE AND FUEL 3 1 Vehicle 3. 1. 1. The vehicle must be in good mechanical condition and have been ran in and driven at least 3 000 km before the test. The evaporative emission control system must be connected and have been functioning correctly over this period and the carbon canister(s) shall have been subject to normal use, neither undergoing abnormal purging nor abnormal loading. 32 Fuel 3. 2. 1. The appropriate reference fuel must be used, as defined in Annex VIII to this Directive. 4. TEST EQUIPMENT FOR EVAPORATIVE TEST 4. 1. Chassis dynamometer The chassis dynamometer must meet the requirements of Annex III. 115 4. 2. Evaporative emission measurement enclosure The evaporative emission measurement enclosure must be a gas-tight rectangular measuring chamber able to contain the vehicle under test. The vehicle must be accessible from all sides and the enclosure when sealed must be gas tight in accordance with Appendix 1. The inner surface of the enclosure must be impermeable and non-reactive to hydrocarbons. The temperature conditioning system shall be capable of controlling the internal enclosure air temperature to follow the prescribed temperature versus time profile throughout the test, and an average tolerance of ± 1 K over the duration of the test. The control system shall be tuned to provide a smooth temperature pattern that has a minimum of overshoot, hunting, and instability about the desired long- term ambient temperature profile. Interior surface temperatures shall not be less than 278 K (5 °C) nor more than 328 K (55 "Q at any time during the diurnal emission test. Wall design must be such as to promote good dissipation of heat. Interior surface temperatures shall not be below 293 K (20 °C), nor above 325 K (52 °C) for the duration of the hot soak test. To accommodate the volume changes due to enclosure temperature changes, either a variable-volume or fixed-volume enclosure may be used. 4. 2. 1. Variable-volume enclosure The variable-volume enclosure expands and contracts in response to the temperature change of the air mass in the enclosure. Two potential means of accommodating the internal volume changes are movable panel(s), or a bellows design, in which impermeable bag(s) inside the enclosure expand and contract in response to internal pressure changes by exchanging air from outside the enclosure. Any design for volume accommodation must maintain the integrity of specified temperature range. the enclosure as specified in Appendix 1 over the Any method of volume accommodation shall limit the differential between the enclosure internal pressure and the barometric pressure to a maximum value of± 5 hPa. The enclosure shall be capable of latching to a fixed volume. A variable volume enclosure must be capable of accommodating a ± 7 percent change from its "nominal volume" (see Appendix 1 Section 2. 1. 1), accounting for temperature and barometric pressure variation during testing. 4. 2. 2. Fixed-volume enclosure The fixed-volume enclosure shall be constructed with rigid panels that maintain a fixed enclosure volume, and meet the following requirements. 116 4. 2. 2. 1. The enclosure shall be equipped with an outlet flow stream that withdraws air at a low, constant rate from the enclosure throughout the test. An inlet flow stream may provide make-up air to balance the outgoing flow with incoming ambient air. Inlet air must be filtered with activated carbon to provide a relatively constant hydrocarbon level. Any method of volume accommodation shall maintain the differential between the enclosure internal pressure and the barometric pressure between 0 and -5 hPa. 4. 2. 2. 2. The equipment shall be capable of measuring the mass of hydrocarbon in the inlet and outlet flow streams with a resolution of 0,01 gram. A bag sampling system may be used to collect a proportional sample of the air withdrawn from and admitted to the enclosure. Alternatively, the inlet and outlet flow streams may be continuously analyzed using an on-line FID analyzer and integrated with the flow measurements to provide a continuous record of the mass hydrocarbon removal. 117 r Fuel drain and refill max 1 h Canister load to breakthrough (gasoline) u Repeated diurnal heat builds to 2-gram breakthrough Tflm= 293 K (20 °C) A T= 15 K Figure VIA Evaporative emission determination 3000 km run-in period (no excessive purge/load) Ageing of canister(s) verified Steam clean of vehicle (if necessary) Start ' ' Fuel T: 283 to 287 K (10-14 'C). 40% ± 2% of nominal tank capacity Ambient T: 293 to 303 K (20-30 C). Canister load to breakthrough (butane) Butane/nitrogen loading to 2-grams breakthrough max 1 h Fuel drain and refill _L | 12 to 36 h max 5 min max 2 min max 7 min and max 2 min from engine shut-off Hot soak test 6 to 36 h JL FuelT: 291 ±8 K (18 8 °C) 40% _ 2% of nominal tank capacity Ambient T: 293 to 303 K (20-30 °C) Type I: one Part 1 + two Parts 2. = 293 to 303 K (20-30 'C). Ambient T = 293 to 303 K (20-30 C). Type I: one Part 1 + one Part 2. T^ = 293 to 303 K (20-30 'C). Type I: Part 1. Tmin = 296 K (23 'C). T^ = 304 K (31 C). 60 min ± 0,5 min T = 293 ± 2 K (20 ± 2 CC) last 6 hours. T ,^ = 293 K (20 °C) T„„ = 3 0 8 K; AT = 15 K 24 hours, No. l of diumals = 1 Note: 1. Evaporative emission control families - details clariiled. • 2. Tailpipe emissions may be measured during type I test drive, but these are not used for legislative purposes. Exhaust emission legislative test remains separate. 118 4. 3. Analytical systems 4. 3. 1. Hydrocarbon analyzer 4. 3. 1. 1. The atmosphere within the chamber is monitored using a hydrocarbon detector of the flame ionization detector (FID) type. Sample gas must be drawn from the mid-point of one side wall or roof of the chamber and any bypass flow must be returned to the enclosure, preferably to a point immediately downstream of the mixing fan. 4. 3. 1. 2. The hydrocarbon analyzer must have a response time to 90% of final reading of less than 1,5 seconds. Its stability shall be better than 2% of full scale at zero and at 80 ± 20% of full scale over a 15-minute period for all operational ranges. 4. 3. 1. 3. The repeatability of the analyzer expressed as one standard deviation shall be better than 1% of full scale deflection at zero and at 80 ± 20% of full scale on all ranges used. 4. 3. 1. 4. The operational ranges of the analyzer must be chosen to give best resolution over the measurement, calibration and leak checking procedures. 4. 3. 2. Hydrocarbon analyzer data recording system 4. 3. 2. 1. The hydrocarbon analyzer must be fitted with a device to record electrical signal output either by strip chart recorder or other data processing system at a frequency of at least once per minute The recording system must have operating characteristics at least equivalent to the signal being recorded and must provide a permanent record of results. The record shall show a positive indication of the beginning and end of the hot soak or diurnal emission test (including beginning and end of sampling periods along with the time elapsed between start and completion of each test). 4. 4. Fuel tank heating (only applicable for gasoline canister load option) 4. 4. 1. The fuel in the vehicle tank(s) must be heated by a controllable source of heat, for example a heating pad of 2 000 W capacity is suitable. The heating system must apply heat evenly to the tank walls beneath the level of the fuel so as not to cause local overheating of the fuel. Heat must not be applied to the vapour in the tank above the fuel. 4. 4. 2. The tank heating device must make it possible to evenly heat the fuel in the tank by 14 K from 289 K (16 °C) within 60 minutes, with the temperature sensor position as in Section 5. 1. 1. The heating system must be capable of controlling the fuel temperature to ± 1,5 K of the required temperature during the tank heating process. 119 4. 5. Temperature recording 4. 5. 1. The temperature in the chamber is recorded at two points by temperature sensors which are connected so as to show a mean value. The measuring points are extended approximately 0,1 m into the enclosure from the vertical centre line of each side wall at a height of 0,9 ± 0,2 m. 4. 5. 2. The temperatures of the fuel tank(s) shall be recorded by means of the sensor positioned in the fuel tank as in Section 5. 1. 1 in the case of use of the gasoline canister load option (Section 5. 1. 5). 4. 5. 3. Temperatures must, throughout the evaporative emission measurements, be recorded or entered into a data processing system at a frequency of at least once per minute. 4. 5. 4. The accuracy of the temperature recording system must be within ± 1,0 K and the temperature must be capable of being resolved to 0,4 K. 4. 5. 5. The recording or data processing system must be capable of resolving time to ± 15 seconds. 4. 6. Pressure recording 4. 6. 1. The difference Ap between barometric pressure within the test area and the enclosure internal pressure must, throughout the evaporative emission measurements, be recorded or entered into a data processing system at a frequency of at least once per minute. 4. 6. 2. The accuracy of the pressure recording system must be within ± 2 hPa and the pressure must be capable of being resolved to 0,2 ± hPa. 4. 6. 3. The recording or data processing system must be capable of resolving time to ± 15 seconds. 4. 7. Fans 4. 7. 1. By the use of one or more fans or blowers with the SHED door(s) open it must be possible to reduce the hydrocarbons concentration in the chamber to the ambient hydrocarbon level. 4. 7. 2. The chamber must have one or more fans or blowers of likely capacity 0,1 to 0,5 mV1 with which to thoroughly mix the atmosphere in the enclosure. It must be possible to attain an even temperature and hydrocarbon concentration in the chamber during measurements. The vehicle in the enclosure must not be subjected to a direct stream of air from the fans or blowers. 120 4. 8. v Gases 4. 8. 1. The following pure gases must be available for calibration and operation: - purified synthetic air (purity: < 1 ppm Cj equivalent £ 1 ppm CO, £ 400 ppm C02, £ 0,1 ppm NO); oxygen content between 18 and 21% by volume. - hydrocarbon analyzer fuel gas (40 ± 2% hydrogen, and balance helium with less than 1 ppm CY equivalent hydrocarbon, less than 400 ppm C02), - propane (C3H8), 99,5% minimum purity; - butane (C4H10), 98% minimum purity; - nitrogen (N2), 98% minimum purity. 4. 8. 2. Calibration and span gases shall be available containing mixtures of propane (C3H8) and purified synthetic air. The true concentrations of a calibration gas must be within ± 2% of stated figures. The accuracy of the diluted gases obtained when using a gas divider must be to within ± 2% of the true value. The concentrations specified in Appendix 1 may also be obtained by the use of a gas divider using synthetic air as the diluent gas. 4. 9. Additional equipment 4. 9. 1. The absolute humidity in the tests area must be measurable to within ± 5%. 5. TEST PROCEDURE 5. 1. Test preparation 5. 1. 1. The vehicle is mechanically prepared before the test as follows: - the exhaust system of the vehicle must not exhibit any leaks, - - the vehicle may be steam cleaned before the test, in the case of use of the gasoline canister load option (Section 5. 1. 5) the fuel tank of the vehicle must be equipped with a temperature sensor to enable the temperature to be measured at the mid-point of the fuel in the fuel tank when filled to 40% of its capacity, - additional fittings, adapters of devices must be fitted to the fuel system in order to allow a complete draining of the fuel tank. For this purpose it is not necessary to modify the shell of the tank. 5. 1. 2. The vehicle is taken into the test area where the ambient temperature is between 293 and 303 K (20 and 30 °C). 5. 1. 3. The ageing of the canister(s) has to be verified. This may be done by demonstrating that it has accumulated a minimum of 3 000 km. If this demonstration is not given, the following procedure is used. In the case of a multiple canister system each canister shall undergo the procedure separately. 5. 1. 3. 1. The canister shall be removed from the vehicle. Special care shall be taken during this step to avoid damage to components and the integrity of the fuel system. 121 5. 1. 3. 2. Check the weight of the canister. 5. 1. 3. 3. Connect the canister to a fuel tank, possibly an external one, filled with reference fuel, to 40% volume of the fuel tank(s). 5. 1. 3. 4. The fuel temperature in the fuel tank should be between 283 K (10 °C) and 287 K (14 °C). 5. 1. 3. 5. Heat the (external) fuel tank from 288 to 318 K (15 to 45 °C) (1 °C increase every 9 minutes). 5. 1. 3. 6. If the canister reaches breakthrough before the temperature reaches 318 K (45 *C), the heat source shall be turned off. Then weigh the canister. If the canister did not reach breakthrough during the heating to 318 K (45 °C), the procedure shall be repeated from Section 5. 1. 3. 3 until breakthrough occurs. 5. 1. 3. 7. Breakthrough may be checked as is described in Sections 5. 1. 6. 1 and 5. 1. 6. 2 of this Annex, or with the use of another sampling and analytical arrangement capable of detecting the emission of hydrocarbons "from the canister at breakthrough. 5. 1. 3. 8. Purge the canister with 25 _ 5 liters per liter of charcoal and per minute laboratory air until 300 bed volume exchanges the emission using are reached. 5. 1. 3. 9. Check the weight of the canister. 5. 1. 3. 10 Repeat nine times the steps of the procedure in Sections 5. 1. 3. 4 to 5. 1. 3. 9. The test may be terminated prior to that, after not less than three ageing cycles, if the weight of the canister after the last cycles has stabilized. 5. 1. 3. 11 Reconnect the evaporative emission canister and restore the vehicle to its normal operation condition. 5. 1. 4. One of the methods specified in Sections 5. 1. 5 and 5. 1. 6 shall be used to precondition the evaporative canister. For vehicles with multiple canisters, each canister shall be preconditioned separately. 5. 1. 4. 1. Canister emissions are measured to determine breakthrough. Breakthrough is here defined as the point at which the cumulative quantity of hydrocarbons emitted is equal to 2 grams. 5. 1. 4. 2. Breakthrough may be verified using the evaporative emission enclosure as described in Sections 5. 1. 5 and 5. 1. 6 respectively. Alternatively, breakthrough may be determined using an auxiliary evaporative canister connected downstream of the vehicle's canister. The auxiliary canister shall be well purged with dry air prior to loading. 122 5. 1. 4. 3. The measuring camber shall be purged for several minutes immediately before the test until a stable background is obtained. The chamber air mixing fan(s) must be switched on at this time. The hydrocarbon analyzer must be zeroed and spanned immediately before the test. 5. 1. 5. Canister loading with repeated heat builds to breakthrough 5. 1. 5. 1. The fuel tank(s) of the vehicle(s) is (are) emptied using the fuel tank drain(s). This must be done so as not to either abnormally purge nor abnormally load the evaporative control devices fitted to the vehicle. Removal of the fuel cap will normally be sufficient to achieve this. 5. 1. 5. 2. The fuel tank(s) is (are) refilled with test fuel at a temperature of between 283 and 287 K (10 and 14 °C) to 40 ± 2% of the tank's normal volumetric capacity. The fuel cap(s) of the vehicle must be fitted at this point. 5. 1. 5. 3. Within one hour of being refuelled the vehicle shall be placed,"with the engine shut off, in the evaporative emission enclosure. The fuel tank temperature sensor shall be connected to the temperature recording system. A heat source shall be properly positioned with respect to the fuel tank(s) and connected to the temperature controller. The heat source is specified in Section 4. 4. In the case of vehicles fitted with more than one fuel tank, all the tanks must be heated in the same way as described below. The temperatures of the tanks must be identical to within ± 1,5 K. 5. 1. 5. 4. The fuel may be artificially heated to the starting diurnal temperature of 293 K (20 °C) ± 1 K. 5. 1. 5. 5. When the fuel temperature reaches at least 292 K (19 °C), immediately: turn initiate the purge blower; close and seal enclosure doors; and off measurement of the hydrocarbon level in the enclosure. 5. 1. 5. 6. When the fuel temperature of the fuel tank reaches 293 K (20 °C) a linear ' heat build of 15 K (15 °C) begins. The fuel shall be heated in such a way that the temperature of the fuel during the heating shall conform to the function below to within i 1,5 K. The elapsed time of the heat build and temperature rise is recorded. where: Tr = T0 + 0,2333 - t Tr = required temperature (K), T0 = initial temperature (K); t = time from start of the tank heat build in minutes. — 123 5. 1. 5. 7. As soon as breakthrough occurs or when the fuel temperature reaches 308 K (35 °C), whichever occurs first, the heat source shall be turned off, the enclosure doors shall be unsealed and opened, and the vehicle fuel tank cap(s) shall be removed. If breakthrough has not occurred by the time the fuel temperature reaches 308 K (35 °C), the heat source shall be removed from the vehicle, the vehicle shall be removed from the evaporative emission enclosure and the entire procedure outlined in Section 5. 1. 7. shall be repeated until breakthrough occurs. 5. 1. 6. Butane loading to breakthrough 5. 1. 6. 1. If the enclosure is used for the determination of the breakthrough (see Section 5. 1. 4. 2) the vehicle shall be placed, with the engine shut off, in the evaporative emission enclosure. 5. 1. 6. 2 Prepare the evaporative emission canister for the canister loading operation. The canister shall not be removed from the vehicle, unless access to the canister in its normal location is so restricted that loading can only reasonably be accomplished by removing the canister from the-vehicle. Special care shall be taken during this step to avoid damage to the components and the integrity of the fuel system. 5. 1. 6. 3. Load the canister with a mixture composed of 50 percent butane and 50 percent nitrogen by volume at a rate of 40 grams butane per hour. 5. 1. 6. 4. As soon as the canister reaches breakthrough, the vapour source shall be shut off. 5. 1. 6. 5. Reconnect the evaporative emission canister and restore the vehicle to its normal operation condition. 5. 1. 7. Fuel drain and refill 5. 1. 7. 1. The fuel tank(s) of the vehicle(s) is (are) emptied using the fuel tank drain(s). This must be done so as not to either abnormally purge nor abnormally load the evaporative control devices fitted to the vehicle. Removal of the fuel cap will normally be sufficient to achieve this. 5. 1. 7. 2. The fuel tank(s) is (are) refilled with test fuel at a temperature of between 291 ± 8 K (18 ± 8 °C) to 40 ± 2% of the tank's normal volumetric capacity. The fuel cap(s) of the vehicle must be fitted at this point. 5. 2. Preconditioning drive 5. 2. 1. Within one hour from the completing of canister loading in Section 5. 1. 5. or 5. 1. 6 the vehicle is placed on the chassis dynamometer and is driven through one Part One and two Part Two driving cycles of Type I test as specified in Annex III. Exhaust emissions are not sampled during this operation. 124 5. 3. Soak 5. 3. 1. Within five minutes of completing the preconditioning operation specified in Section 5. 2. 1 the engine bonnet must be completely closed and the vehicle driven off the chassis dynamometer and parked in the soak area. The vehicle is parked for a minimum of 12 hours and a maximum of 36 hours. The engine oil and coolant temperatures must have reached the temperature of the area of within ± 3 K at the end of the period. 5. 4. Dynamometer test 5. 4. 1. After conclusion of the soak period the vehicle is driven through a complete Type I test drive as described in Annex III (cold start urban and extra urban test). Then the engine is shut off. Exhaust emissions may be sampled during this operation and the results are not used for the purpose of exhaust emission type approval. 5. 4. 2. Within two minutes of completing the Type I test drive specified in Section 5. 4. 1 the vehicle is driven a further conditioning drive consisting of one urban test cycle (hot start) of a Type I test. Then the engine is shut off again. Exhaust emissions need not to be sampled during this operation. 5. 5. Hot soak evaporative emissions test 5. 5. 1. Before the completion of the conditioning drive the measuring chamber must be purged for several minutes until a stable hydrocarbon background is obtained. The enclosure mixing fan(s) must also be turned on at this time. 5. 5. 2. The hydrocarbon analyzer must be zeroed and spanned immediately prior to the test. 5. 5. 3. At the end of the conditioning drive the engine bonnet must be completely closed and all connections between the vehicle and the test stand disconnected. The vehicle is then driven to the measuring chamber with a minimum use of the accelerator pedal. The engine must be turned off before any part of the vehicle enters the measuring chamber. The time at which the engine is switched off is recorded on the evaporative emission measurement data recording system and temperature recording begins. The vehicle's windows and luggage compartments must be opened at this stage, if not already opened. 5. 5. 4. The vehicle must be pushed or otherwise moved into the measuring chamber with the engines switched off. 5. 5. 5. The enclosure doors are closed and sealed gas-tight within two minutes of the engine being switched off and within seven minutes of the end of the conditioning drive. 5. 5. 6. The. start of a 60 ± 0,5 minute hot soak period begins when the chamber is sealed. The hydrocarbon concentration, temperature and barometric pressure are measured to give the initial readings CHçi5 Pj and T} for the hot soak test. These figures are used in the evaporative emission calculation, Section 6. The ambient SHED temperature T must not be less than 296 K and no more than 304 K during the 60-minute hot soak period. 125 5. 5. 7. The hydrocarbon analyzer must be zeroed and spanned immediately before the end of the 60 ± 0,5 minute test period. 5. 5. 8. At the end of the 60 ± 0,5 minute test period measure the hydrocarbon concentration in the chamber. The temperature and the barometric pressure are also measured. These are the final readings CHCf, Pf and Tf for the hot soak test used for the calculation in Section 6. 5. 6. Soak 5. 6. 1. The test vehicle shall be pushed or otherwise moved to the soak area without use of the engine and shall be soaked for not less than 6 hours and not more than 36 hours between the end of the hot soak test and the start of the diurnal emission test. For at least 6 hours of this period; the vehicle shall be soaked at 293 K ± 2 K (20 °C ± 2 °C). 5. 7. Diurnal test 5. 7. 1. The test vehicle shall be exposed to one cycle of ambient temperature according to the profile specified in Appendix 2 with a maximum deviation of ± 2 K at any time. The average temperature deviation from the profile, calculated using the absolute value of each measured deviation, shall not exceed 1 K. Ambient temperatures shall be measured at least every minute. Temperature cycling shall begin when time tstart = 0, as specified in Section 5. 7. 6. 5. 7. 2. The measuring chamber shall be purged for several minutes immediately before the test until a stable background is obtainable. The chamber mixing fan(s) must also be switched on at this time. 5. 7. 3. The test vehicle, with the engine shut off and the test vehicle windows and luggage compartment(s) opened shall be moved into the measuring chamber. The mixing fan(s) shall be adjusted in such a way that it (they) maintain a minimum air circulation of 8 km/h under the fuel tank of the test vehicle. 5. 7. 4. The hydrocarbon analyser must be zeroed and spanned immediately before the test. 5. 7. 5. The enclosure doors are closed and gas-tight sealed. 5. 7. 6. Within 10 minutes of closing and sealing the doors, the hydrocarbon concentration, temperature and barometric pressure are measured to give the initial readings CHci, Pj and T{ for the diurnal test. This is the point where time tstart = 0. ' 126 5. 7. 7. The hydrocarbon analyser must be zeroed and spanned immediately before the end of the test. 5. 7. 8. The end of the emission sampling period shall occur 24 hours ± 6 minutes after the beginning of the initial sampling, as specified in Section 5. 7. 6. The time elapsed is recorded. The hydrocarbon concentration, temperature and barometric pressure are measured to give the final readings CHCf, Pf and Tf for the diurnal test used for the calculation in Section 6. This completes the evaporative emission test procedure. 6. CALCULATION The evaporative emission tests described in Section 5 allow the hydrocarbon emissions from the diurnal and hot soak phases to be calculated. Evaporative losses from each of theses phases is calculated using the initial and final hydrocarbon concentrations, temperatures and pressures in the enclosure, ' together with the net enclosure volume. The formula below is used: MHC-k V 10"4 ( ^ | - 5- <*£!-?)+ M H * « I- MHC,. Tf Ti where: MHC MHc CHC V T P = mass of hydrocarbon exiting the enclosure, in the case of fixed-volume enclosures for diurnal emission testing (grams). ,i= m a ss °f hydrocarbon entering the enclosure, in the case of fixed-volume enclosures for diurnal emission testing (grams). = measured hydrocarbon concentration in the enclosure (ppm (volume) C, equivalent), = net enclosure volume in cubic metres corrected for the volume of. the vehicle, with the windows and the luggage compartment open. If the volume of the vehicle is not determined a v o l u me of 1,42 m3 is subtracted. = ambient chamber temperature, K, = barometric pressure in kPA, - H/C = hydrogen to carbon ration, k = 1,2 • (12 + H/C); when: i f H /C H /C is the initial reading is the final reading is taken to be 2,33 for diurnal test losses, is taken to be 2,20 for hot soak losses. 127 6. 2. Overall results of test The overall hydrocarbon mass emission for the vehicle is taken to be: Houi = MDI + MHS where: Houi MDI MHs overall mass emissions of the vehicle (grams), = = hydrocarbon mass emission for diurnal test (grams). = hydrocarbon mass emission for the hot soak (grams). ' 128 Appendix 1 22. Sections 1 and 2 read as follows: • 1. 1. 1. 1. 2. CALIBRATION FREQUENCY AND METHODS All equipment must be calibrated before its initial use and then calibrated as often as necessary and in any case in the month before type-approval testing. The calibration methods to be used are described in this Appendix. Normally the series of temperatures which are mentioned firstly should be used. The series of temperatures within square brackets can alternatively be used. 2. CALIBRATION OF THE ENCLOSURE 2. 1. Initial determination of enclosure internal volume 2. 1. 1. Before its initial use, the internal volume of the chamber must be determined as follows. The internal dimensions of the chamber are carefully measured, allowing for any irregularities such as bracing struts. The internal volume of the chamber is determined from these measurements. For variable-volume enclosures, latch the enclosure to a fixed volume when the enclosure is held at an ambient temperature of 303 K (30 °C) [302 K (29 °C)]. This nominal volume shall be repeatable within ± 0,5 percent of the reported value. 2. 1. 2. The net internal volume is determined by subtracting 1,42 m3 from the internal volume of the chamber. Alternatively the volume of the test vehicle with the luggage compartment and windows open may be used instead of the 1,42 m\ 2. 1. 3. The chamber must be checked as in Section 2. 3. If the propane mass does not agree with the injected mass to within ± 2% then corrective action is required. 2 2 Determination of chamber background emissions This operation determines that the chamber does not contain any materials that emit significant amounts of hydrocarbons. The check must be carried out at the enclosure's introduction to service, after any operations in the enclosure which may affect background emissions and at a frequency of a least once per year. - 2. 2. 1. Variable-volume enclosures may be operated in either latched or unlatched volume configuration, as described in Section 2. 1. 1. Ambient temperatures shall be maintained at 308 ±2 K (35 ± 2 °C) [309 ± 2 K (36 ±2 °C)], throughout the 4-hour period mentioned below. 129 2. 2. 2. Fixed volume enclosures shall be operated with inlet and outlet flow streams closed. Ambient temperatures shall be maintained at 308 ± 2 K (35 ± 2 °C) [309 ± 2 K (36 ± 2 °C)] throughout the 4-hour period mentioned below. 2. 2. 3. The enclosure may be sealed and the mixing fan operated for a period of up to 12 hours before the 4-hour background sampling period begins. 2. 2. 4. Calibrate the analyzer (if required), then zero and span. 2. 2. 5. 2. 2. 6. 2. 2. 7. 2. 2. 8. 2. 2. 9. Purge the enclosure until a stable hydrocarbon reading is obtained. The mixing fan is turned on if not already on. Seal the chamber and measure the background hydrocarbon concentration, temperature and barometric pressure. These are the initial readings CHCi, Pj and ^ used in the enclosure background calculation. The enclosure is allowed to stand undisturbed with the mixing fan on for a period of four hours. At the end of this time use the same analyzer to measure the hydrocarbon concentration in the chamber. The temperature and the barometric pressure are also measured. These are the final readings CHCf, Pf and Tf. Calculate the change in mass of hydrocarbons in the enclosure over the time of the test according to Section 2. 4. The background emission of the enclosure must not exceed 0,05 g. 2. 3. Calibration and hydrocarbon retention test of the chamber The calibration and hydrocarbon retention test in the chamber provides a check on the calculated volume in Section 2. 1 and also measures any leak rate. The enclosure leak rate shall be determined at the enclosure's introduction to service, after any operations in the enclosure which may effect the integrity of the enclosure, and at least monthly thereafter. If six consecutive monthly retention checks are successfully completed without corrective action, the enclosure leak rate may be determined quarterly thereafter as long as no corrective action is required. 2. 3. 1. 2. 3. 2. 2. 3. 3. Purge the enclosure until a stable hydrocarbon concentration is reached. Turn on the mixing fan, if not already switched on. The hydrocarbon analyzer is zeroed, calibrated if required, and spanned. On variable-volume enclosures latch the enclosure to the nominal volume position. On fixed-volume enclosures close the outlet and inlet flow streams. Turn on the ambient temperature control system (if not already on) and adjust it for an initial temperature of 308 K (35 °C) [309 K (36 °C)]. 130 2. 3. 4. When the enclosure stabilizes at 308 ± 2 K (35 ± 2 "C) [309 ± 2 K (36 ± 2 °C)], seal the enclosure and measure the background concentration, temperature and barometric pressure. These are the initial readings CHCi, P{ and Tj used in the enclosure calibration. 2. 3. 5. Inject a quantity of approximately 4 grams of propane into the enclosure. The mass of propane must be measured to an accuracy and precision of ± 0,2% of the measured value. 2. 3. 6. Allow the contents of the chamber to mix for five minutes and then measure the hydrocarbon concentration, temperature and barometric pressure. These are the final readings CHCft Tf and Pf for the calibration of the enclosure as well as the initial readings CHCi, T} and P} for the retention check. 2. 3. 7. Using the readings taken in Sections 2. 3. 4 and 2. 3. 6 and the formula in Section 2. 4, calculate the mass of propane in the enclosure. This must be within ± 2% of the mass of propane measured in Section 2. 3. 5. 2. 3. 8. 2. 3. 9. For variable-volume enclosures unlatch the enclosure from the" nominal volume configuration. For fixed-volume enclosures, open the outlet and inlet flow streams. Start cycling the ambient temperature from 308 K (35 °C) to 293 K (20 °C) and back to 308 K (35 °C) [308,6 K (35,6 °C) to 295,2 K (22,2 °C) and back to 308,6 K (35,6 °C)] over a 24-hour period according to the profile [alternative profile] specified in Appendix 2 within 15 minutes of sealing the enclosure. (Tolerances as specified in Section 5. 7. 1 of Annex VI) 2. 3. 10. At the completion of the 24-hour cycling period, measure and record the final hydrocarbon concentration, temperature and barometric pressure. These are the final readings CHCf, Tf and Pf for the hydrocarbon retention check. 2. 3. 11. Calculate using the formula in Section 2. 4, the hydrocarbon mass from the readings taken in Sections 2. 3. 10 and 2. 3. 6. The mass may not differ by more than 3% from the hydrocarbon mass given by Section 2. 3. 7. 131 2. 4. Calculations The calculation of net hydrocarbon mass change within the enclosure is used to determine the chamber's hydrocarbon background and leak rate. Initial and final readings of hydrocarbon concentration, temperature and barometric pressure are used in the following formula to calculate the mass change. Mnc-k V 10"4 {9^L- Ç ^J + MHC. M-MHC,. where: MHc = hydrocarbon mass in grams MHCou1 = mass of hydrocarbon exiting the enclosure, in the case of fixed-volume enclosures for diurnal emission testing (grams) MHc,i = m a ss °f hydrocarbon entering the enclosure, in the case of fixed volume enclosures for diurnal emission testing (grams) hydrocarbon concentration (NB: ppm carbon = ppm propane x 3)) in the enclosure (ppm carbon = enclosure volume in cubic mêtrbslas measured in Section = ambient temperature in the enclosure, K, = barometric pressure, kPa, = 17,6; 'HC V T P k when: i f is the initial reading. is the final reading' 132 Appendix 2 23. The following new Appendix 2 is added: 'Appendix 2 Diurnal Ambient Temperature Profile for the Calibration of the Enclosure and the Diurnal Emission Test Alternative Diurnal Ambient Temperature Profile for the Calibration of the Enclosure in Accordance with Annex I Section 1. 2 , Time (hours) Temperature (°Q) calibratio test Time (hours) Temperature (°C. ) 16 17 18 19 20 21 22 23 24 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 20 20,2 20,5 21,2 23,1 25,1 27,2 29,8 31,8 33,3 34,4 35 34,7 33,8 32 30 28,4 26,9 25,2 24 23 22 20,8 20,2 20 Ô 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 35^1 35,3 34,5 33,2 31,4 29,7 28,2 27,2 26,1 25,1 24,3 23,7 23,3 22,9 22,6 22,2 22,5 24,2 26,8 29,6 31,9 33,9 35,1 35,4 35,6 133 Annex VIII 24. Annex VIII reads as follows: •ANNEX VIII SPECIFICATIONS OF REFERENCE FUELS 1 TECHNICAL DATA OF THE REFERENCE FUEL TO BE USED FOR TESTING VEHICLES EQUIPPED WITH POSITIVE-IGNITION ENGINES Type: petrol, unleaded (regular, premium, super) Parameter Unit Limits(1) Test Method(2) Minimum Maximum Research octane number, RON Motor octane number, MON Density at 15 °C Reid vapour pressure, - summer period*} Distillation(4): - initial boiling point - evaporated at 100 °C - evaporated at 150 °C - final boiling point Residue Hydrocarbon analysis: - olefins - aromatics - benzene - saturates Carbon/hydrogen ratio Oxidation staf3ility(} Oxygen content Existent gum Sulphur content Copper corrosion at 50 °C Lead content Phosphorous content 95,0 85,0 0,748 56,0 24 49,0 81,0 190 8 29,0 balance r a 480 ISO 5164 ISO 5163 0,762 ASTM D 1298 60,0 40 57,0 87,0 215 2 14 41,0 2,0 t i o 2Ï3 0,04 150 1 0,005 0,0013 EN 12 ASTM D 86 ISO 3405 ISO 3405 ASTM D 86 ASTM D 86 ASTMD1319 ASTMD1319 EN 238 ASTMD 1319 ASTM D 525 pr EN 1601 ASTMD 381 ISO 8754 ASTMD 130 EN 237 ASTMD 3231 kg/l kPa °C % v/v % v/v °C % , % v/v % v/v % v/v min % m/m mg/ml % ppm g/l (1) (2) (3) (4) (5) The values quoted in the specification are 'true values'. In establishment of their limit values the terms of ISO 4259 'Petroleum products - Determination and application of precision data in relation to methods of test' have been appliea and in fixing a minimum value, a minimum difference of_2R above zero has been taken into account; in fixing a maximum and minimum value, the minimum difference is 4R (R = reproducibility). Notwithstanding this measure which is necessary for statistical reasons, the manufacturer or fuels should nevertheless aim at a zero value where the stipulated maximum value is 2R and at the mean value in the case of quotations of maximum and minimum limits. Should it be necessary to clarify the question as to whether a fuel meets the requirements of the specifications, the terms of ISO 4259 should be applied. Equivalent ISO methods will be adopted when issued for all properties listed above. The summer period extends from 1 April to 30 September of each year. The figures quoted shows the evaporated quantities (percentage recovered + percentage loss). The fuel may contain exidation inhibitors and metal deactivators normally used to stabilize refinery gasoline streams, but détergent/dispersant additives and solvent oils must not oe added. 134 TECHNICAL DATA OF THE REFERENCE FUEL TO BE USED FOR TESTING VEHICLES EQUIPPED WITH A DIESEL ENGINE Type: Diesel fuel Parameter Unit Limits(1) Test Method(2) Minimum Maximum 52,0 833 245 345 55 2,5 3 Cetane number1^ Density at 15 °C Distillation(4): - 50% point - 95% point - final boiling point Flash point CFPP Viscosity at 40 °C Polycyclic aromatic hydrocarbons Sulphur content Copper corrosion Conradson carbon residue (10% DR) Ash content Water content Neutralization (strong acid) number Oxidation stability(6) kg/m3 °C °C °c °c °c mm2/s % m/m % m/m % mass % mass % mass mg KOH/g mg/ml 54 837 350 370 -5 3,5 6,0 0,03 1 0,2 0,01 0,05 0,02 2,5 ISO 5163 ISO 3675 ISO 3405 ISO 3405 ISO 3405 ASTM D 93 EN 116 ASTM D 445 prIP 391 ISO 8754 ASTMD 130 ASTMD 189 ASTM D 482 ASTM D95/D 1744 ASTM 2274 (1) (2) (3) (4) (5) (6) The values quoted in the specification are 'true values'. In establishment of. their limit values the terms of ISO 4259 'Petroleum products - Determination and application of precision data in relation to methods of test' have been applied and in fixing a minimum value, a minimum difference of 2R above zero has been taken into account; in fixing a maximum and minimum value, the minimum difference is 4R (R = reproducibility). Notwithstanding this measure, which is necessary for statistical reasons, the manufacturer of fuels should nevertheless aim at a zero value where the stipulated maximum value is 2R and at the mean value in the case of quotations of maximum and minimum limits. Should it be necessary jto clarify the question as to whether a fuel meets the requirements of the specifications, the terms of ISO 4259 should be applied. Equivalent ISO methods will be adopted when issued for all properties listed above. The range for cetane number is not in accordance with the requirement of a minimum range of 4R. However, in the case of dispute between fuel supplier and fuel user, the terms in ISO 4259 can be used to resolve such disputes provided replicate measurements of sufficient number to archive the necessary precision, are made in preference to single determinations. The figures quoted shows the evaporated quantities (percentage recovered + percentage loss). As from 1 January 2005. Even though oxidation stability is controlled, it is likely that self life will be limited. Advice should be sought from the supplier as to storage conditions and life. 135 Annex X 25. A new Annex X is added to read as follows: Annex X CONTROL OF COMPLIANCE OF VEHICLES IN SERVICE 1. INTRODUCTION 1. 1. This Annex describes the procedure referred to in Section 8 of Annex I for the control of compliance of vehicles in service. The procedure describes the selection and handling of test vehicles, in service survey testing and evaluation, the plan of remedial measures and its implementation. 2. IN SERVICE SURVEY 2. 1. 2. 2. 2. 3. The in service survey will be performed by the approval authority which granted the original type-approval according to this Directive, according to procedures laid down in Section 5. The manufacturer shall be notified whenever the approval authority in a Member State, which granted the original type-approval in accordance with this directive, has determined that a vehicle type produced by that manufacturer, although properly maintained and used, does not conform to these provisions. When a manufacturer is notified that a vehicle type is in non-compliance with applicable requirements (including emission limit values) of this Directive, the manufacturer shall submit a plan of measures to the approval authority to remedy such non-compliance. 2. 4. Any vehicle approved according to the requirements of this Directive is subject to the provisions in this Annex. 3. DEFINITIONS For the purpose of this Annex the following definitions apply. 3. 1. 3. 2. 3. 3. The terms used in this Annex X and not specifically defined shall have the meaning assigned to such terms in Annex I to this Directive, or if not defined in Annex I to this Directive, the meaning assigned to such terms in Directive 70/156/EEC. Tn Service Survey' means tests and evaluations of compliance conducted according to this Annex. 'Properly maintained and used' means for the purpose of a test vehicle that such a vehicle satisfies the criteria for acceptance of a selected vehicle of Section 5. 4. SURVEY SCHEDULE 4. 1. 4. 2. The manufacturer will be notified 45 working days before the initiation of the in service survey of a vehicle type. * The manufacturer may submit a voluntary plan of remedial measures, drafted according to Section 6 at any time prior to completion of an in service survey. 136 5. SELECTION CRITERIA, MAINTENANCE, AND SURVEY TEST 5. 1. 5. 2 Emission tests and evaluations to determine whether a vehicle type conforms to the requirements shall be performed in accordance with the procedures of Section 5. The manufacturer shall have an opportunity to observe all the selection and testing and to inspect all vehicles tested under Section 5. In service survey testing of the on-board diagnostic system shall be performed in accordance with Section 5. 5. Sections 5. 2, 5. 3 and 5. 4 do not apply under OBD survey. The approval authority shall select vehicles for in service survey on a random base chosen in accordance with Appendix 1 to this Annex from vehicles within the selected vehicle type. The approval authority determines the vehicle selection. The vehicles for testing shall be representative of the vehicle type which they belong to and available for sale or sold in the EU. Selection criteria 5. 3. The criteria for acceptance of a selected vehicle follows from Sections 5. 3. 1 - 5. 3. 8. Information will be gathered through vehicle examination and a interview with the owner which may include a written survey by the manufacturer. 5. 3. 1. The vehicle belongs to a vehicle type that is type-approved under this Directive and is accompanied with a Certificate of Conformity according to Directive 70/156/EEC. It shall be registered and privately used in the EU. 5. 3. 2. The vehicle has been in service for less than 80 000 km or 5 years which ever occurs first. 5. 3. 3. There is a maintenance record to show that the vehicle has been properly maintained, e. g. has been serviced in accordance with the manufacturer's recommendations. 5. 3. 4. There is no indication of abuse (e. g. , racing, overloading, misfuelling, or other misuse), or other factors (e. g. , tampering) that would affect emissions performance. In the case of vehicles fitted with an OBD system, the information stored in its memory shall be taken into account. 5. 3. 5 There has been no unauthorized major repair to the engine or major repair of the vehicle. 5. 3. 6. Lead content and sulphur content of fuel sample from the vehicle tank meets applicable standards and there is no other evidence of misfuelling. Checks may be done in the exhaust pipe, etc. 5. 3. 7. There is no indication of any problem that might jeopardize the safety of laboratory personnel. 5. 3. 8. All emission control system components on the vehicle shall be in conformity with applicable type approval. 137 Diagnosis and restorative maintenance 5. 4. Diagnosis and restorative maintenance will be performed on vehicles accepted for testing, prior to in service survey testing, according to Sections 5. 4. 1-5. 4. 8. 5. 4. 1. Check air filter, all drive belts, all fluid levels, radiator cap, all vacuum hoses and electrical wiring related to emissions control for integrity; check ignition, fuel metering and emission control system components for maladjustments and/or tampering. Record all discrepancies. 5. 4. 2. Check the integrity of the OBD system; record all malfunction information stored in the OBD memory; make all repairs necessary for extinguishing all malfunction indications. 5. 4. 3. If the OBD malfunction indicator registers a malfunction during a preconditioning cycle or emission test cycle, the fault may be identified and repaired. The test may be rerun, and the results from that repaired vehicle may be used. 5. 4. 4. Check ignition system and replace defective components; i. e. , spark plugs, wires, etc. 5. 4. 5. Check compression. 5. 4. 6. Check and adjust engine parameters to manufacturer's specifications. 5. 4. 7. If the vehicle is [before]within 800 km of a scheduled maintenance service, that maintenance will be performed according to the manufacturer's service instructions. Regardless of odometer reading, change of oil and air filter may be performed at the request of the manufacturer. 5. 4. 8. Upon acceptance of the vehicle the fuel shall be replaced with appropriate emission test reference fuel, unless the manufacturer accepts1 the use of market fuel. 5. 5. 5. 6. In service survey testing and evaluation of results Applicable emission tests in accordance with this Directive will be performed on vehicles selected in accordance with the requirements of Sections 5. 3 and 5. 4 and after being pre-conditioned. Vehicles equipped with an OBD system will be checked for proper durability indication, etc. , in relation to levels of -emissions of the malfunction (e. g. malfunction the indication type-approved specification. in Annex XI) limits defined for 5. 6. 1. The OBD system may be tested for, e. g. , levels of emissions above applicable limit values with no malfunction indication, systematic erroneous activation of faulty or deteriorated components in the OBD system. the malfunction indication, and identified 5. 6. 2. If a component or system that operates outside of the particulars in the type- approval certificate and/or information package for such vehicle type and such deviation has not been authorized under Article 5 (3) or 5 (4) of Directive 70/156/EEC with no malfunction indication by the OBD, the component or system shall not be replaced prior to emission testing, unless it is determined that the component or system has been tampered with or abused in such a manner that the OBD does not detect the resulting malfunction. 138 5. 7. 5. 8. 5. 9. The test results are submitted to the evaluation procedure in accordance with Appendix 1 of this Directive. Within 10 working days after concluding the test, the results of the test and of the evaluation referred to in Section 5. 7 shall be submitted to the manufacturer. The manufacturer shall have, as far as possible, the opportunity to make such inspections and investigations of vehicles whose test results do not comply with the limit value for any pollutant applicable under this Directive to determine the existence of any improper maintenance, misuse, misfuelling, tampering or abuse that was not reasonably discoverable prior to the commencement of testing. 5. 10. Within 25 working days from receiving the test results, the manufacturer may submit a statement based on additional investigation on sample vehicles to the authority concerning the performance of the testing or the determination of a non-compliance. The statement, if any, will be enclosed in the test report. The authority shall give due regard to the manufacturer's statement in determing whether a non-compliance exists. 5. 11. Within 10 working days after the time limit of Section 5. 10 has elapsed, the authority shall finalize the test report and take a decision on compliance and non-compliance. Non-compliance shall be declared when for any single pollutant the result of the evaluation referred in Section 5. 7 exceed the limit values given in Section 5. 3. 1. 4 of Annex I to this Directive. Test results shall not be multiplied by deterioration factors. 6. PLAN OF REMEDIAL MEASURES 6. 1. 6. 2. When the manufacturer is notified that a vehicle type is in non-compliance according to the requirements of these provisions, the manufacturer shall submit to the approval authority a plan of remedial measures to remedy the non-compliance. These plan of remedial measures can address vehicles in service, vehicles under production as well as amendements to the type- approval, if appropriate. The plan of remedial measures shall be filed with the approval authority not later than 45 working days from the date of the notification issued according to Section 5. 10. The approval authority shall within 20 working days declare the approval or disapproval of the plan of remedial measures. 6. 2. 1. The accaptence of the plan of remedial measures may be subject to conditions required by the approval authority. - 6. 2. 2. The approval authority may specify an extended time limit for submitting a plan of remedial measures by up to 60 working days if the manufacturer in writing showed good cause for such extension. 6. 2. 3. When the approval authority cannot approve the plan of remedial measures it may take other measures in accordance with Article 11 (2) (a) to Directive 70/156/EEC. 6. 3. The approval authority shall notify all Member States of its decision concerning the plan of remedial measures and supply all Member States with the plan of remedial measures. 139 The plan of remedial measures 6. 4. The plan of remedial measures shall have the content specified in Sections 6. 4. 1 - 6. 4. 11. The manufacturer shall give the plan of remedial measures a unique identifying name or number. 6. 4. 1. A description of each vehicle type included in the plan of remedial measures. 6. 4. 2. A description of the specific modifications, alterations, repairs, corrections, adjustments, or other changes to be made to bring the vehicles into conformity including a brief summary of the data and technical studies which support the manufacturer's decision as to the particular remedial changes to be used in correcting the non-compliance. 6. 4. 3. A description of the method by which the manufacturer will inform the vehicle owners. 6. 4. 4. A description of the proper maintenance or use, if any, upon which the manufacturer conditions eligibility for repair under the plan of "remedial measures, and an explanation of the manufacturer's reasons for imposing any such condition. No maintenance or use conditions may be imposed unless it is demonstrably related to the non-compliance and the remedial measures. 6. 4. 5. A description of the procedure to be followed by vehicle owner to obtain correction of the non-compliance. This shall include a date after which when the non-compliance may be remedied, the estimated time for the workshop to perform the remedy, and where the remedy can be done. The repair shall be done expediently, within a reasonable time after delivery of the vehicle. 6. 4. 6. A copy of the information transmitted to the vehicle owner. 6. 4. 7. A brief description of the system which the manufacturer will use to assure an adequate supply of component or system, for fulfilling the remedial action. It shall be indicated when there will be an adequate supply of component or system to initiate the campaign. 6. 4. 8. A copy of all instructions to be sent to those persons who are to perform the repair. 6. 4. 9. A description of the impact of the proposed remedy on the emissions, fuel consumption, driveabiliry, and safety of each vehicle type, included the plan of remedial measures with data, technical studies etc. which supports these conclusions. 6. 4. 10. Any other information, reports or data the approval authority reasonably may determine is necessary to evaluate the plan of remedial measures. 6. 4. 11. In the case the plan of remedial measures includes a recall, a description of the méthode for recording the repair shall be submitted to the type approval authority. In the case a label is used an exemple of it shall be submitted. 6. 5. 6. 6. The manufacturer may be required to conduct tests on components and vehicles incorporating a proposed change, repair, or modification reasonably designed and necessary to demonstrate the effectiveness of the change, repair, or modification. The manufacturer is responsible for keeping a record of every vehicle recalled and repaired and the workshop which performed the repair. The approval authority shall have access to the record after request for a period of 5 years from the implementation of the plan of remedial measures. 140 7. 7. 1. IMPLEMENTATION OF THE PLAN OF REMEDIAL MEASURES A recall campaign is commencing after decision by the Member State, based on the approved plan of remedial measures. The manufacturer, or his/her representative, is responsible for conducting the campaign according to the approved plan of remedial measures. 7. 1. 1. If theplan of remedial measures is not carried in the approved time limits fixed in the remedial plan and the manifacturer cannot justify the exceed of the time limits, the approval authority can take measures in accordance with Article ll(2)(a) to Directive 70/156/EEC. 7. 2. 7. 3. The notification of the vehicle owner shall be done expeditiously. This notification shall include all relevant information relating the necessary repair of the vehicle. The manufacturer shall provide a copy of all communication related to the plan of remedial measures. He/she shall also maintain a record onlhe recall campaign, and supply regularly status reports to the approval authority. 141 Annex XI 26. A new Annex XI is added to read as follows: Annex XI ONBOARD DIAGNOSTICS (OBD) FOR MOTOR VEHICLES 1. SCOPE This Annex applies to the functional aspects of on-board diagnostic (OBD) systems for the emission control of all motor vehicles of category M,(1)) equipped with positive-ignition engines and all motor vehicles of categories Mi equipped with compression-ignition engines covered by Article 1 of this Directive. 2. DEFINITIONS For the purposes of this Annex: 2. 1. 2. 2. 2. 3. 2. 4. 2. 5. 2. 6. 2. 7. 'OBD' means an on-board diagnostics system for emission control which shall have the capability of identifying the likely area of malfunction by means of fault codes stored in computer memory. 'Vehicle type' means a category of power driven vehicles which do not differ in such essential engine and OBD system characteristics as defined in Appendix 5. 'Vehicle family' means a manufacturer's grouping of vehicles which, through their design, are expected to have similar exhaust emission and OBD system characteristics. Each engine of this family must have complied with the requirements of this Directive. 'Emission control system' means the electronic engine management controller and any emission related component in the exhaust or evaporative system which supplies an input to or receives an output from this controller. 'Malfunction indicator (MI)' means a visible or audible indicator that clearly informs the driver of the vehicle in the event of a malfunction of any emission related component connected to the OBD system, or the OBD system itself. 'Malfunction' means the failure of an emission related component or system that would result in emissions exceeding the limits in Section 5. 3. 2 of this Annex. 'Secondary air' refers to air introduced into the exhaust system by means of a pump or aspirator valve or other means that is intended to aid in the oxidation of HC and CO contained in the exhaust gas stream. (1) As defined in Annex II Section A of Directive 70/156/EEC. 142 2. 8. 2. 9. 2. 10. 2. 11. 2. 12. 2. 13. 'Engine misfire' means lack of combustion in the cylinder of a positive ignition engine due to absence of spark, poor fuel metering, poor compression or any other cause. In terms of OBD monitoring it is that percentage of misfires out of a total number of firing events (as declared by the manufacturer) that would result in emissions exceeding the limits given in Section 5. 3. 2 or that percentage that could lead to an exhaust catalyst, or catalysts, overheating causing irreversible damage. 'Type I test' means the driving cycle (Parts One and Two) used for emission approvals, as detailed in Annex III, Appendix 1. 'A driving cycle' consists of engine start-up, a driving mode where a malfunction would be detected if present, and engine shut-off. 'A warm-up cycle1 means sufficient vehicle operation such that the coolant temperature has risen by at least 22 K from engine starting and reaches a minimum temperature of 343 K (70 °C). 'Fuel trim' refers to feedback adjustments to the base fuel schedule. Short-term fuel trim refers to dynamic or instantaneous adjustments. Long-term fuel trim refers to much more gradual adjustments to the fuel calibration schedule than short-term trim adjustments. These long-term adjustments compensate for vehicle differences and gradual changes that occur over time. 'Calculated load value' refers to an indication of the current airflow divided by peak airflow, where peak airflow is corrected for altitude, if available. This definition provides a dimensionless number that is not engine specific and provides the service technician with an indication of the percent engine capacity that is being used (with wide open throttle as 100%); CLV - Current airflow Peak aIrflow(al sea lev$l , Atm. pressure(at sea levfl Barometric pressure 2. 14. 'Permanent emission default mode' refers to a case where the engine management controller permanently switches to a setting that does not require an input from a failed component or system where such a failed component or system would result in an increase in emissions from the vehicle to a level above the limits given in Section 5. 3. 2 of this Annex. 2. 15. 'Power Take-Off unit' means an engine driven output provision for the purposes of powering auxiliary, vehicle mounted, equipment. 143 3. 3. 1. APPLICATION FOR EC TYPE-APPRO VAL The application conforming to Annex I, Section 3 is accompanied by the additional information required in Appendix 5 together with: 3. 1. 1. a declaration by the manufacturer of: 3. 1. 1. 1. in the case of vehicles equipped with positive-ignition engines, the percentage of misfires out of a total number of firing events that would result in emissions exceeding the limits given in Section 5. 3. 2 of this Annex if that percentage of misfire had been presem from the start of a Type I test as described in Section 5. 3. 1 of Annex III; 3. 1. 1. 2. in the case of vehicles equipped with positive-ignition engines, the percentage of misfires out of a total number of firing events that could lead to an exhaust catalyst, or catalysts, overheating prior to causing irreversible damage; 3. 1. 2. 3. 1. 3. 3. 1. 4. 3. 1. 5. detailed written information fully describing the functional "operation characteristics of the OBD system, including a listing of all relevant parts of the vehicle's emission control system, i. e. sensors, actuators and components, that are monitored by the OBD system; a description of the MI used by the OBD system to signal the presence of a fault to the driver of the vehicle; the manufacturer shall describe provisions taken to prevent tampering and modification of the emission control computer; when appropriate, copies of other type-approvals with the relevant data to enable extensions of approvals; 3. 1. 5. 1. if applicable, the particulars of the vehicle family as referred to in Appendix 6. 3. 2. 4. 4. 1. 5. 5. 1. For the tests described in Section 5 of this Annex, a vehicle representative of the vehicle types or vehicle family fitted with the OBD system to be approved must be submitted to the technical service responsible for the type-approval test. If the technical service determines that the submitted vehicle does not fully represent the vehicle type or vehicle family described in Appendix 6, an alternative, and if necessary, an additional vehicle shall be submitted for test according to Section 5 of this Annex. GRANTING OF EC TYPE-APPROVAL The certificate conforming to Annex I, Section 4, is accompanied by the Addendum for which a model is given in Appendix 7. REQUIREMENTS AND TESTS All vehicles shall be equipped with an OBD system so designed, constructed and installed in a vehicle to enable it to identify types of deterioration or malfunction over the entire life of the vehicle. In achieving this objective the approval authority shall accept that vehicles which have travelled distances in excess of the Type V durability distance, referred to in Section 5. 3. 1, may show some deterioration in OBD systeih performance such that the emission limits given in Section 5. 3. 2 may be exceeded before the OBD system signals a failure to the driver of the vehicle. 144 5. 2. The OBD system must be so designed, constructed and installed in a vehicle to enable it to comply with the requirements of this Annex during conditions of normal use. 5. 2. 1. Temporary disablement of the OBD system. 5. 2. 1. 1. A manufacturer may disable the OBD system if its ability to monitor is affected by low fuel levels. Disablement shall not occur when the fuel tank level is above 15 percent of the nominal capacity of the fuel tank. level provided 5. 2. 1. 2. A manufacturer may disable the OBD system at ambient engine starting temperatures below 266 K (-7 °C) or at elevations over 2 500 metres above sea an engineering evaluation which adequately demonstrate that monitoring would be unreliable when such conditions exist. A manufacturer may also request disablement engine system starting temperatures if he demonstrates to the authority with data and/or an engineering evaluation that mis-diagnosis would occur under such conditions. the manufacturer submits data the OBD ambient and/or other of at 5. 2. 1. 3. For vehicles designed to accommodate the installation of Power Take-Off units, disablement of affected monitoring systems is permitted provided disablement occurs only when the Power Take-Off unit is active. 5. 2. 2. Engine Misfire - vehicles equipped with positive-ignition engines. 5. 2. 2. 1. Manufacturers may adopt higher misfire percentage malfunction criteria, than that declared to the authority, under specific engine speed and load conditions where it can be demonstrated to the authority that the detection of lower levels of misfire wouH be unreliable. 5. 2. 2. 2. Manufacturers who can demonstrate to the authority that the adoption of higher misfire percentages would still lead to unreliable detection may disable the monitoring system when such conditions exist. 5. 3. Description of tests. 5. 3. 1. The tests are carried out on the vehicle used for the Type V durability test, given in Annex VII, and using the test procedure in Appendix I to this Annex. Tests are carried out at the conclusion of the Type V durability testing. When no Type V durability testing is carried out, or at the request of the manufacturer, a suitably aged and representative vehicle may be used for these OBD demonstration tests. 5. 3. 2. The OBD system shall indicate the failure of an emissions related component or system when that failure results in an increase in emissions above the limits given below: Engine Type Positive-ignition Compression-ignition CO (g/km) 3,2 3,2 HC (g/km) 0,4 0,4 NOx (g/km) 0,6 1,2 PM°> (g/km) 0,18 (1) for compression-ignition engines only 145 5. 3. 3. Monitoring requirements for vehicles equipped with positive-ignition engines In satisfying the requirements of Section 5. 3. 2 the OBD system shall, at a minimum, monitor for: 5. 3. 3. 1. Reduction in the efficiency of the catalytic converter with respect to the emissions of HC only; 5. 3. 3. 2. The presence of engine misfire in the engine operating region bounded by the following lines: (a) A maximum speed of 4 500 min"1 or 1 000 min"1 greater than the highest speed occurring during a Type I test cycle, whichever is the lower; (b) The positive torque line (i. e. engine load with the transmission in neutral); (c) A line joining the following engine operating points: the positive torque line at 3 000 min"1 and a point on the maximum speed line defined in (a) above with the engine's manifold vacuum at 13,33 kPa lower than that at the positive torque line. 5. 3. 3. 3. Oxygen sensor deterioration 5. 3. 3. 4. Other emission control system components or systems, or emission-related powertrain components or systems which are connected to a computer, the failure of which may result in tailpipe emissions exceeding the limits given in Section 5. 3. 2; 5. 3. 3. 5. Any other emission-related powertrain component connected to a computer shall be monitored for circuit continuity; 5. 3. 3. 6. The electronic evaporative emission purge control shall, at a minimum, be monitored for circuit continuity. 5. 3. 4. Monitoring requirements for vehicles equipped with compression-ignition engines. In satisfying shall monitor: the requirements of Section 5. 3. 2 the OBD system 5. 3. 4. 1. Where fitted, reduction in the efficiency of the catalytic converter; 5. 3. 4. 2. Where fitted, the functionality and integrity of the particulate trap; 5. 3. 4. 3. The fuel injection system electronic fuel quantity and timing actuator(s) will be. monitored for circuit continuity and total functional failure; 5. 3. 4. 4. Other emission control system components or systems, or emission-related powertrain components or systems, which are connected to a computer, the failure of which may result in tailpipe emissions exceeding the limits given in Section 5. 3. 2. Examples of such systems or components are those for monitoring and control of air mass-flow, air volumetric flow (and temperature), boost pressure and inlet manifold pressure (and relevant sensors to enable these functions to be carried out). 5. 3. 4. 5. Any other emission-related powertrain component connected to a computer shall be monitored for circuit continuity. 146 5. 3. 5. Manufacturers may demonstrate to the approval authority that certain components or systems need not be monitored if, in the event of their total failure or removal, emissions do not exceed the emission limits given in Section 5. 3. 2 of this Annex. 5. 4. A sequence of diagnostic checks will be initiated at each engine start and completed at least once provided that the correct test conditions are met. The test conditions shall be selected in such a way that they all occur under normal driving as represented by the Type I test. 5. 5. Activation of malfunction indicator. 5. 5. 1. 5. 5. 2. The OBD system shall incorporate a malfunction indicator (MI) readily perceivable to the vehicle operator. The MI shall not be used for any other purpose except to indicate emergency start-up or limp-home routines to the driver. The MI shall be in all reasonable lighting conditions. When activated, it shall display a symbol in conformance with ISO 2575(2)). A vehicle shall not be equipped with more than one general purpose MI for emission-elated problems. Separate specific purpose warning lights (e. g. brake system, fasten seat belt, oil pressure, etc. ) are permitted. The use of red for a MI is prohibited. For strategies requiring on average between three and ten driving cycles for MI activation, the manufacturer shall provide data and/or an engineering evaluation which adequately demonstrates that the monitoring system is equally effective and timely in detecting component deterioration. Strategies requiring on average more than ten driving cycles for MI activation shall not be accepted. The MI shall also activate whenever the engine control enters a permanent emission default mode of operation if the emission limits given in Section 5. 3. 2 are exceeded. The MI shall operate in a distinct warning mode, e. g. a flashing light, under any period during which engine misfire occurs at a level likely to cause catalyst damage, as specified by the manufacturer. The MI shall also activate when the vehicle's ignition is in the "key-on" position before engine starting or cranking and de activate after engine starting if no malfunction has previously been detected. 5. 6. Fault code storage. The OBD system shall record code(s) indicating the status of the emission control system. Separate status codes shall be used to identify correctly functioning emission control systems and those emission control systems which need further vehicle operation to be fully evaluated. Fault codes that cause MI activation due to deterioration or malfunction or permanent emission default modes of operation shall be stored and that fault code shall identify the type of malfunction. 5. 6. 1. In the case of vehicles equipped with positive-ignition engines, misfiring cylinders need not be uniquely identified if a distinct single or multiple cylinder misfire fault code is stored. (2) International Standard ISO 2575-1982 (E), entitled "Road vehicles - Symbols for controls, indicators and tell-tales", Symbol Number 4. 36. 147 5. 7. Extinguishing the MI. 5. 7. 1. 5. 7. 2. For misfire malfunctions at levels likely to cause catalyst damage (as specified by the manufacturer), the MI may be switched to the normal mode of activation if the misfire is not present any more, or if the engine is operated after changes to speed and load conditions where the level of misfire will not cause catalyst damage. For all other malfunctions, the MI may be de-activated after three subsequent sequential driving cycles during which the monitoring system responsible for activating the MI ceases to detect the malfunction and if no other malfunction has been identified that would independently activate the MI. 5. 8. Erasing a fault code. 5. 8. 1. The OBD system may erase a fault code and freeze-frame information if the same fault is not re-registered in at least 40 engine warm-up cycles. 5. 9. Provisions for system security. 5. 9. 1. 5. 9. 2. 5. 9. 3. 5. 9. 4. Any vehicle with an emission control computer shall include features to deter modification, except as authorized by the manufacturer. Any reprogrammable computer codes or operating parameters must be resistant to tampering and the computer and any related maintenance instructions must conform to the provisions in SAE J2186 "E/E Data Link Security" (ISO XXX-8). Any removable calibration memory chips shall be potted, encased in a sealed container or protected by electronic algorithms and shall not be changeable without the use of specialised tools and procedures. Computer-coded engine operating parameters shall not be changeable without the use of specialised tools and procedures (e. g. soldered or potted computer components or sealed (or soldered) computer enclosures). In the case of mechanical fuel injection pumps fitted to compression- ignition engines, manufacturers shall take adequate steps to protect the maximum fuel delivery setting from tampering while the vehicle is in service. Manufacturers may apply to the approval authority for an exemption to this requirement for those vehicles which are unlikely to require protection. The criteria that the approval authority will evaluate in considering an exemption will include, but are not limited to, the current availability of performance chips, the high performance capability of the vehicle and the probable sales volume of the vehicle. 5. 9. 5. Manufacturers using programmable computer code systems (e. g. Electrical Erasable Programmable Read-Only Memory, EEPROM) shall employ proven methods to deter unauthorized reprogramming. Manufacturers shall include enhanced tamper protection strategies including data encryption using methods to secure the encryption algorithm and write protect features requiring electronic access to an off-site computer maintained by the manufacturer. Equivalent methods may be considered by the authority. 5. 9. 6. Anti-tampering features should not preclude the use of replacement parts which give the equivalent level of emission control. 148 6. 6. 1. EXTENSION OF EC TYPE-APPROVAL Approval granted to a vehicle type with respect to the OBD system may be extended to different vehicle types belonging to the same vehicle-OBD family as described in Appendix 6. The engine emission control system must be identical to that or the vehicle already approved and comply with the description of the OBD engine family given in Appendix 6, regardless of the following vehicle characteristics: - combustion process - engine accessories - method of engine fuelling - tyres - equivalent inertia - cooling system - overall gear ratio - transmission type - type of bodywork 7. 7. 1. 7. 2. 7. 3. 8. 8. 1. 8. 1. 1. 8. 1. 2. CONFORMITY OF PRODUCTION OF A VEHICLE EQUIPPED WITH AN OBD SYSTEM When the approval authority determines that the quality of production seems unsatisfactory a vehicle is randomly taken from the series and subjected to the tests described in Appendix 1. If the vehicle taken from the series does not satisfy the requirements of Section 7. 1. 5. 2 a further random sample of three vehicles shall be taken from the series and subjected to the tests described in Appendix 1. The tests may be carried out on vehicles which have been run-in a minimum of 3 000 km. The production is deemed to conform if at least 3 vehicles meet the requirements of the tests described in Appendix 1. ALTERNATIVE REQUIREMENTS Manufacturers may obtain type-approval on the basis of the alternative technical requirements given in Section 8. 1. 1 and 8. 1. 2, subject to the additional requirements of Sections 8. 1. 3, 8. 1. 4 and 8. 1. 5: Federal Register 40 CFR Part 86 Subpart A, entitled "Control of Air Pollution From New Motor Vehicles and New Motor Vehicle Engines; Regulations Requiring On-Board Diagnostic Systems on 1994 and Later Model Year Light-Duty Vehicles and Light-Duty Trucks", published by the US Government Printing Office, Washington, DC 20402. Section 1968. 1 of Title 13, California Code of Regulations (CCR), entitled "Malfunction and Diagnostic Systems Requirements - 1994 and Subsequent Model Year Passenger Cars, Light-Duty Trucks and Medium-Duty Vehicles and Engines". 149 8. 1. 3. The application for approval shall include a written statement that the vehicle family conforms to this Annex. The application for approval to this Annex shall include the complete documentation to meet the requirements of either Section 8. 1. 1 or 8. 1. 2 and the documentation required in Appendix 5 of this Annex. 8. 1. 4. The MI shall comply with the requirements of Section 5. 5 of this Annex. 8. 1. 5. If type-approval is granted according to the requirements of this Section, Section 7 of this Annex shall continue to apply for conformity of production checking. 150 Appendix 1 FUNCTIONAL ASPECTS OF ON-BOARD DIAGNOSTIC (OBD) SYSTEMS 1. INTRODUCTION This Appendix describes the procedure of the test according to Section 5 of this Annex. The procedure describes a method for checking the function of the on-board diagnostic (OBD) system installed on the vehicle by failure simulation of relevant systems in the engine management or emission control system. It also sets procedures for determining the durability of OBD systems. The manufacturer shall make available the defective components and/or electrical devices which would be used to simulate failures. Having simulated a failure the OBD system is approved if the MI is activated when the vehicle emissions exceed die limits of Section 5. 3. 2 by less than [20%]. DESCRIPTION OF TEST The testing of OBD systems consists of the following phases: - simulation of malfunction of a component of the engine management or emission control system; - preconditioning of the vehicle with a simulated malfunction over at least one Type I test or specific preconditioning cycle specified by the manufacturer; - driving the vehicle with a simulated malfunction over the Type I test cycle and measuring the emissions of the vehicle; - determining whether the OBD system reacts to the simulated malfunction and indicates malfunction in an appropriate manner to the vehicle driver. Alternatively, at the request of the manufacturer, malfunction of one or more components may be electronically simulated according to the requirements of Section 6 of this Appendix. Manufacturers may request that monitoring take place outside the Type I test cycle if it can be demonstrated to the authority that monitoring during conditions encountered during the Type I test cycle would impose restrictive monitoring conditions when the vehicle is used in service. TEST VEHICLE AND FUEL Vehicle 2. 2. 1. 2. 2. 2. 3. 3. 3. 1. The test vehicle must meet the requirements of Section 3. 1 of Annex III. 3. 2. Fuel The appropriate reference fuel as described in Annex IX must be used for testing. 151 4. 4. 1. 5. 5. 1. 6. 6. 1. TEST TEMPERATURE AND PRESSURE The test temperature and pressure must meet the requirements of the Type I test as described in Annex III. TEST EQUIPMENT Chassis dynamometer The chassis dynamometer must meet the requirements of Annex III. OBD TEST PROCEDURE The operating cycle on requirements of Annex III. the chassis dynamometer shall meet the 6. 2. Vehicle preconditioning 6. 2. 1. According to the engine type and after introduction of one of the failure modes given in Section 6. 3, the vehicle shall be preconditioned by driving at least two consecutive Type I tests (Parts One and Two). For compression ignition engined vehicles an additional preconditioning of two Part Two cycles is permitted. At the request of the manufacturer, alternative preconditioning methods may be used. 6. 3. Failure modes to be tested. 6. 3. 1. Positive-ignition engined vehicles. 6. 3. 1. 1. Replacement of the catalyst with a deteriorated or defective catalyst or electronic simulation of such a failure. 6. 3. 1. 2. Engine misfire conditions according to the conditions for misfire monitoring given in Section 5. 3. 3. 2 of this Annex. 6. 3. 1. 3. Replacement of the oxygen sensor with a deteriorated or defective oxygen sensor or electronic simulation of such a failure. 6. 3. 1. 4. Electrical disconnection of any other emission-related powertrain component connected to a computer. 6. 3. 1. 5. Electrical disconnection of the electronic evaporative purge control device (if equipped). 6. 3. 2. Compression-ignition engined vehicles. 6. 3. 2. 1. Where fitted, replacement of the catalyst with a deteriorated or defective catalyst or electronic simulation of such a failure. 6. 3. 2. 2. Where fitted, total removal of the particulate trap or, where sensors are an integral part of the trap, a defective trap assembly. 6. 3. 2. 3. Electrical disconnection of any fuelling system electronic fuel quantity and timing actuator. 6. 3. 2. 4. #Electrical disconnection of any other emission-related powertrain component connected to a computer. 152 6. 3. 2. 5. In meeting the requirements of Sections 6. 3. 2. 3 and 6. 3. 2A, and with the agreement of the approval authority, the manufacturer shall take appropriate steps to demonstrate that the OBD system will indicate a fault when disconnection occurs. 6. 4. OBD system test. 6. 4. 1. Vehicles fitted with positive-ignition engines. 6. 4. 1. 1. After vehicle preconditioning according to Section 6. 2 above, the test vehicle shall be driven over a Type I test (Parts One and Two). The MI must activate before the end of this test under any of the conditions given in Sections 6. 4. 1. 2 to 6. 4. 1. 5 of this Appendix. The technical service may substitute those conditions by others in accordance with Section 6. 4. 1. 6. However, the total number of failures simulated shall not exceed 4 for the purpose of type-approval. 6. 4. 1. 2. Replacement of a catalyst with a deteriorated or defective catalyst or electronic simulation of a deteriorated or defective catalyst that "results in emissions exceeding the HC limit given in Section 5. 3. 2 of this Annex. 6. 4. 1. 3. An induced misfire condition according to the conditions for misfire monitoring given in Section 5. 3. 3. 2 of this Annex that results in emissions exceeding any of the limits given in Section 5. 3. 2 of this Annex. 6. 4. 1. 4. Replacement of an oxygen sensor with a deteriorated or defective oxygen sensor or electronic simulation of a deteriorated or defective oxygen sensor that results in emissions exceeding any of the limits given in Section 5. 3. 2 of this Annex. 6. 4. 1. 5. Electrical disconnection of the electronic evaporative purge control device (if equipped). 6. 4. 1. 6. Electrical disconnection of any other emission-related powertrain component connected to a computer that results in emissions exceeding any of the limits given in Section 5. 3. 2 of this Annex. 6. 4. 2. Vehicles fitted with compression-ignition engines. 6. 4. 2. 1. After vehicle preconditioning according to Section 6. 2 above, the test vehicle shall be driven over a Type I test (Parts One and Two). The MI must activate before the end of this test under any of the conditions given in Sections 6. 4. 2. 2 to 6. 4. 2. 5 of this Appendix. 6. 4. 2. 2. Where fitted, replacement of a catalyst with a deteriorated or defective catalyst or electronic simulation of a deteriorated or defective catalyst that results in emissions exceeding limits given in Section 5. 3. 2 of this Annex. 6. 4. 2. 3. Where fitted, total removal of the particulate trap or replacement of the particulate trap with a defective particulate trap meeting the conditions of Section 6. 3. 2. 2 of this Appendix that results in emissions exceeding the limits given in Section 5. 3. 2 of this Annex. 6. 4. 2. 4. With reference to Section 6. 3. 2. 5 of this Appendix, disconnection of any fuelling system electronic fuel quantity and timing actuator that results in emissions exceeding any of the limits given in Section 5. 3. 2 of this Annex. 153 6. 4. 2. 5. With reference to Section 6. 3. 2. 5 of this Appendix, disconnection of any other emission-related powertrain component connected to a computer that results in emissions exceeding any of the limits given in Section 5. 3. 2 of this Annex. 6. 5. Diagnostic Signals 6. 5. 1. 1. Upon determination of the first malfunction of any component or system, "freeze frame" engine conditions present at the time shall be stored in computer memory. Should a subsequent fuel system or misfire malfunction occur, any previously stored freeze frame conditions shall be replaced by the fuel system or misfire conditions (whichever occurs first). Stored engine conditions shall include, but are not limited to calculated load value, engine speed, fuel trim value(s) (if available), fuel pressure (if available), vehicle speed (if available), coolant temperature, intake manifold pressure (if available), closed- or open-loop operation (if available) and the fault code which caused the data to be stored. The manufacturer shall choose the most appropriate set of conditions facilitating effective repairs for freeze frame storage. Only one frame of data is required. Manufacturers may "choose to store additional frames provided that at least the required frame can be read by a generic scan tool meeting the specifications of Sections 6. 5. 3. 2 and 6. 5. 3. 3. If the fault code causing the conditions to be stored is erased in accordance with Section 5. 7 of this Annex, the stored engine conditions may also be erased. 6. 5. 1. 2. If available, the following signals in addition to the required freeze frame information shall be made available on demand through the serial port on the standardised data link connector, if the information is available to the on-board computer or can be determined using information available to the on-board computer: diagnostic trouble codes, engine coolant temperature, fuel control system status (closed loop, open loop, other), fuel trim, ignition timing advance, intake air temperature, manifold air pressure, air flow rate, engine speed, throttle position sensor output value, secondary air status (upstream, downstream or atmosphere), calculated load value, vehicle speed and fuel pressure. The signals shall be provided in standard units based on the specifications given in Section 6. 5. 3 of this Appendix. Actual signals shall be clearly identified separately from default value or limp home signals. In addition, the capability to perform bi-directional diagnostic control based on the specifications given in Section 6. 5. 3 of this Appendix shall be made available on demand through the serial port on the standardised data link connector according to the specifications given in Section 6. 5. 3 of this Appendix. 6. 5. 1. 3. For all emission control systems for which specific on-board evaluation tests are conducted (catalyst, oxygen sensor, etc. ), except misfire detection, fuel system monitoring and comprehensive component monitoring, the results of the most recent test performed by the vehicle and the limits to which the system is compared shall be made available through the serial data port on the standardised data link connector according to the specifications given in Section 6. 5. 3 of this Appendix. For the monitored components and systems excepted above, a pass/fail indication for the most recent test results shall be available through the data link connector. 154 6. 5. 1. 4. The OBD requirements to which the vehicle is certified (i. e. this Annex or the alternative requirements specified in Section 8 of this Annex) and the major emission control systems monitored by the OBD system consistent with Section 6. 5. 3. 3 of this Appendix shall be available through the serial data port on the standardised data link connector according to the specifications given in Section 6. 5. 3 of this Annex. 6. 5. 2. 6. 5. 3. The emission control diagnostic system is not required to evaluate components during malfunction if such evaluation would result in a risk to safety or component failure. The emission control diagnostic system shall provide for standardised access and conform with the following ISO and/or SAE standards. Some of the ISO standards have been derived from Society of Automotive Engineers standards and Recommended Practices. Where this is the case the appropriate SAE reference appears in parenthesis. 6. 5. 3. 1. One of the following standards with the restrictions as described shall be used as the on-board to off-board communications link: ISO 9 1 4 1 -2 "Road Vehicles - Diagnostic Systems - CARB Requirements for the Interchange of Digital Information"; ISO 11519-4 "Road Vehicles - Low Speed Serial Data Communication - Part 4: Class B Data Communication Interface (SAE J1850)". Emission related messages shall use the cyclic redundancy check and the three byte header and shall not use inter-byte separation or checksums. ISO DIS 14230 - Parts 1, 2 and 3 "Road Vehicles - Diagnostic Systems - Keyword Protocol 2000". Either the CARB mode shall be used (directly equivalent to ISO 9141-2) or with fast initialisation at the address specified in Appendix 2 and with the format specified by using keybytes with the decimal value of 2025 (three byte header with normal timing). 6. 5. 3. 2. Test equipment and diagnostic tools needed to communicate with OBD systems shall meet or exceed the functional specification given in Appendix 3. 6. 5. 3. 3. Basic diagnostic data, (as specified in Section 6. 5. 1 of this Appendix) and bi-directional control information shall be provided using the format and units described in Appendix 2 and shall be available using a diagnostic tool meeting the requirements of Appendix 3. 6. 5. 3. 4. Fault codes selected by the manufacturer shall be consistent with those given in Appendix 4. 6. 5. 3. 5. The connection interface between the vehicle and the diagnostic tester shall meet the all requirements of SAE J1962 "Diagnostic Connector, June 1992" (ISO XXX-A "Road vehicles - Diagnostic systems - On-board connector"). The installation position shall be subject to agreement of the approval. authority such that it is readily accessible by service personnel but protected from tampering by non-qualified personnel. 155 Appendix 2 1. Scope This Apppendix defines diagnostic services and functionally addressed request- response messages required to be supported by vehicles and test tools for diagnostic purposes which pertain to vehicle emission-related data. These messages are intended to be used by any service tool meeting the requirements of Appendix 3. Seven Diagnostic Services (Test Modes) are defined and these are detailed in Section four. This Appendix is based on draft ISO CD XXXI and SAE J1979, "E/E Diagnostic Test Modes". 2. References 2. 1. Applicable Documents The following publications form a part of this specification to the extent specified herein. 2. 1. 1. Normative References ISO Documents: ISO 9141-2 Road vehicles - Diagnostic requirements for interchange of digital information systems - CARB ISO CD 14230 Keyword Protocol 2000, Parts 1/2/3 ISO 11519-4 Road Vehicles Low speed Serial Data Communication Class B - Data Communications Interface (SAE J1850) ISO CD 14229 Diagnostic Services 2. 1. 2. Informative References J1850 FEB94 Class B Data Communication Network Interface J1930 JUN93 Systems Diagnostic Terms, Definitions, E/E Abbreviations and Acronyms J1962 JUN93 Diagnostic Connector J1978 MAR92 OBD II Scan Tool J2012 MAR92 Recommended Format and Messages for Diagnostic Trouble Codes J2186 SEP91 Diagnostic Data Link Security J2190 JUN93 Enhanced E/E Diagnostic Test Modes 156 3. Definitions Most terms for components and systems contained in this document are included in ISO CD XXX3 (SAE J1930) - Terms, Definitions, and Acronyms. This section includes additional definitions of terms used in this document, not included in ISO CD XXX3. 3. 1. # = number 3. 2. "Service" in ISO diagnostic communication documents is the equivalent of "Test Mode" or "Mode" in the SAE documents. 3. 3. No further definitions. 4. Technical Requirements 4. 1. Diagnostic Service General Conditions These guidelines are necessary to ensure proper operation of both the test equipment and the vehicle during diagnostic procedures. Test equipment, when using messages defined in this document, should not affect normal operation of the emission control system. 4. 1. 1. Multiple Responses to a Single Data Request The messages contained in this Appendix are functional messages, which means the off-board test equipment will request data without knowledge of which module on the vehicle will respond. In some vehicles, multiple modules may respond with the information requested. In addition, a single module may send multiple responses to a single request. Any test device requesting information must, therefore, have provisions for receiving multiple responses. 4. 1. 2. Response Time For ISO 9141-2 and ISO 14230-2 interfaces, response time requirements are specified in these documents. For ISO CD 11519-4(SAE J1850) network interfaces, the on-board systems should respond to a request within 100 milliseconds of a request or a previous response. With multiple responses possible from a single request, this allows as much time as is necessary for all modules to access the data link and transmit their response(s). If there is no response within this time period, the tool can either assume no response will be received, or if a response has already been received, that no more responses will be received. 4. 1. 3. Minimum Time Between Requests from Scan Tool For ISO 9141-2 interfaces, the required times between requests are specified in the^ISO 9141-2 document. For SAE 11850 network interfaces, a tool should always wait for a response from the previous request, or "no response" timeout before sending another request. In no case should a request be sent less than 100 msec, after the previous request. 157 4. 1. 4. Data not Available There are two conditions for which data is not available. One condition is that the Service is not supported, and the other is that the Service is supported but data is not currently available. There will be no reject message to a functional request if the request is not supported by the module. This prevents responses from all modules that do not support a Service or a specific data value. Some Services are supported by a vehicle, but data may not always be available when requested. For Services $05 and $06, if the test has not been run since test results were cleared, or for Service $02 if freeze frame data has not been stored, valid data will not be available. For these conditions, the manufacturer has the option either to not respond or to respond with data that is invalid. The functional description for these Services discuss the method to determine if the data is valid. 4. 1. 5 Maximum Values If the data value exceeds the maximum value possible to be sent, the on-board system should send the maximum value possible ($FF or $FFFF). The tool should display the maximum value or an indication of data too high. This is not normally critical for real time diagnostics, but in the case of a misfire at 260 km/h with resulting freeze frame data stored, this will be very valuable diagnostic information. 4. 2. Diagnostic Message Format 4. 2. 1. Addressing method Functional addressing will be used for all generic Diagnostic Service messages because the test tool does not know which system on the vehicle has the information that is needed. 4. 2. 2. Maximum message length Is defined in Figure 1 below. 158 4. 2. 3. Diagnostic Message Format Is defined in Figure 1 below. Header Bytes Data Bytes Priority - Type Target Address Source Address #1 #2 #3 #4 #5 #6 #7 ERR RSP Diagnostic Request at 10. 4 Kbps (ISO 11519-4 [J1850] and ISO 9141-2) 68 48 61 41 61 41 6A Tester Address Fx Maximum 7 data bytes Yes No Diagnostic Response at 10. 4 \ Kbps (ISO 11519-4 [J1850] and ISO 9 L41-2) 6B ECU Addr Maximum 7 data bytes Yes No Diagnostic Response at 41. 6 Kbps (ISO 11519-4 [J1850]) 6A Fx Maximum 7 data bytes Yes No Diagnostic Response at 41. 6 Kbps (ISO 11519-4 [J1850]) 6B ECU Addr Maximum 7 data bytes Yes No Diagnostic Request at 41. 6 Kbps (ISO 14230) 6A Fx Maximum 7 data bytes Diagnostic Request at 41. 6 Kbps (ISO 14230) 6B ECU Addr Maximum 7 data bytes Figure 1 - Diagnostic Message Format 4. 2. 4. 'Header bytes The first three bytes of all diagnostic messages are the header bytes. The value of the first header byte is dependent on the bit rate of the data link and the type of message. The second byte has a value that depends on the type of message, either a request or a response. The third header byte is the physical address of the device sending the message. OBD Scan Tools have the address $F1. Other service tools should use addresses in the range from $F0 to $FD. The response to all request messages in this document will be independent of the address of the test equipment requesting the information. Vehicle manufacturers should not use the ISO CD XXX1(J1979) header bytes for any purpose other than diagnostic messages. When they are used, they must conform to this specification. 159 4. 2. 5. Data bytes The maximum number of data bytes available to be specified in this Appendix is 7. The first data byte following the header is the Diagnostic Service Type, and the remaining 6 bytes vary depending on the specific Diagnostic Service. For services $01 and $02, message length is determined by Parameter Identification (PID). For Service $05, message length is determined by Test ID. For other services, the message length is determined by the service. This enables the tools to check for proper message length, and to recognize the end of the message without waiting for possible additional data bytes. 4. 2. 6. Non-data bytes included in diagnostic messages with ISO 11519-4 (J1850) All diagnostic messages will use a Cyclic Redundancy Check (CRC), as defined in ISO 11519-4 (J185Ô), as the error detection (ERR) byte. In-frame response (RSP) is defined as optional in ISO 11519-4 (J1850). For messages defined in this document, the RSP byte is required in all request and response messages at 41. 6Kbps, and is not allowed for messages at 1X3. 4 Kbps. ISO 11519-4 (SAE J1850) defines additional message elements that may be included in Diagnostic Messages. Use of these message elements is beyond the scope of this specification, but needs to be considered when defining total diagnostic messages. 4. 2. 7. Non-data bytes included in diagnostic messages with ISO 9141-2 and ISO 14230 (Keyword Protocol 2000) Messages will include a checksum, defined in those documents, after the data bytes as the Error Detection Byte (ERR). There is no provision for an in-frame response. 4. 2. 8. Bit position convention Some data byte values in this document include descriptions that are based on bit positions within the byte. The convention used in this document is that the Most Significant Bit (MSB) is referred to as "bit 7", and the Least Significant Bit (LSB) is referred to as "bit 0," as shown below: MSB LSB 7 | 6 | 5 | 4 | 3 | 2 | 1 |0 Figure 2 - Bit position within a data byte 4. 3. Allowance for Expansion and Enhanced Diagnostic Services This Appendix allows for the addition of Diagnostic Services both as industry standards and manufacturer specific services. The Diagnostic Services $00 through $0F are reserved to be defined in ISO CD XXXI (J1979). 160 4. 4. Format of Data to be Displayed The format of data to be displayed to the user of the data obtained with these test needs to be standardised so that vehicle manufacturers can write generic service information. Data is transmitted from the vehicle in metric units. The following Table indicates the type of data and minimum requirements for format of the data. See Figure 3. Data Device ID - source address of response Parameter ID (PIP) Frame number Data values Diagnostic Trouble Codes Test ID | Services all $01 & $02 $02 "" $01 & $02 $03 & $07 Display Format Hexadecimal (00 to FF) __ Hexadecimal (00 to FF) description (see Table in Section 5. 3) Decimal (0 to 255) see Table in Section 5. 3 "P", "B", "C" or "U", plus 4 digits and/or DTC definition - see ISO CD XXX2 (SAE J2012) I Test value and test limits Test value and test limits Component ID Optional Data Bytes I $05, $06 & ~T " Hexadecimal (00 to FF) $08 $05 $06 Engineering units for Test IDs icss than $80 (see Section 5. 6. 2) - Decimal (0 ':o 255) for Test IDs grgater than $80 Decimal (0 to 65535) $06 (part of data byte #3) $08 J Hexadecimal (00 to 7F) 4 bytes, each decimal (0 to 255) Figure 3 - Format of Data to be Displayed 5. Services 5. 0. Diagnostic Services included in this document are: Service $01 - Request Current Powertrain Diagnostic Data Analogue inputs and outputs Digital inputs and outputs System status information Calculated values Service $02 - Request Powertrain Freeze Frame Data Analogue inputs and outputs Digital inputs and outputs System status information Calculated values 161 Service $03 Request Emission-Related Powertrain Diagnostic Trouble Codes Service $04 Clear/Reset Emission-Related Diagnostic Information Service $05 Request Oxygen Sensor Monitoring Test Results Service $06 Service $07 Request On-Board Monitoring Test Results for Non- continuously Monitored Systems Request On-Board Monitoring Test Results Continuously Monitored Systems for Service $08 - Request Control of on-board system, test or component For each Service this definition includes: Functional descriptions of service Request and response message formats For some of the more complex services, an example of messages and an explanation of the interpretation of those messages is included. 5. 1. Service $01 - Request Current Powertrain Diagnostic Data 5. 1. 1. Functional Description The purpose of this service is to allow access to current emission related data values, including analogue inputs and outputs, digital inputs and outputs, and system status information. The request fcr information includes a Parameter Identification (PDD) value that indicates to the on-board system the specific information requested. PED definitions, scaling information, and display formats are included in this document. The on-board module will respond to this message by transmitting the requested data value last determined by the system. All data values returned for sensor readings will be actual readings, not default or substitute values used by the system because of a fault with that sensor. Not all PIDs are applicable or supported by all systems. PID $00 is a bit- encoded PID that indicates, for each module, which PIDs that module supports. PID $00 must be supported by all modules that respond to a service $01 request as defined in this document, because diagnostic tools that conform to Appendix 3 use the presence of a response by the vehicle to this request to determine which protocol is supported for diagnostic communications. 162 5. 1. 2. Message Data Bytes Data Bytes (Hex) #1 #2 #3 | #4 | #5 | #6 #7 Request Current Powertrain Diagnostic Data Request Powertrain Diagnostic Data 01 PID Report Current Powertrain Diagnostic Data Report Powertrain Diagnostic Data 41 PID data A data B (*) data C (*) data D (*) Figure 4 - Message data Bytes (*) conditional - number of bytes depends on PID - see Figure 6 5. 2. Service $02 - Request Powertrain Freeze Frame Data 5. 2. 1. Functional Description The purpose of this service is to allow access to emission related data values in a freeze frame. This allows expansion to meet manufacturer specific requirements not necessarily related to the required freeze frame, and not necessarily containing the same data values as the required freeze frame. The request for information includes a Parameter Identification (PID) value that indicates to the on-board system the specific information requested. PID definitions, scaling information, and display formats for the freeze frame are included in this document. The on-board module will respond to this message by transmitting the requested data value stored by the system. All data values returned for sensor readings will be actual stored readings, not default or substitute values used by the system because of a fault with that sensor. Not all PIDs are applicable or supported by all systems. PID $00 is a bit-encoded PID that indicates, for each module, which PIDs that module supports. Therefore, PID $00 must be supported by all modules that respond to a Service $02 request as defined in this document. -- PDD $02 indicates the DTC that caused the freeze frame data to be stored. If freeze frame data is not stored in the module, the system should report $00 00 as the DTC. Any data reported when the stored DTC is $00 00 may not be valid. The frame number byte will indicate $00 for the freeze frame data. Manufacturers may optionally save additional freeze frames and use this service to obtain that data by specifying the freeze frame number in the request. If a manufacturer uses these additional freeze frames, they will be stored under conditions defined by the manufacturer, and contain data specified by the manufacturer. 163 5. 2. 2. Message Data Bytes #1 #2 Data Bytes (Hex) #5 #4 #3 #6 #7 Request Powertrain Freeze Frame Data Request Powertrain Freeze Frame Data 02 PID frame no. Report Powertrain Freeze Frame Data (only valid if Service $02 PID $02 DTC is not $00 00) Report Powertrain Freeze Frame Data 42 PID frame no. data A data B. (*) data C (*) data D (*) Figure 5 - Message Data Bytes (*) conditional - number of bytes depends on PID - see Figure 6 164 5. 3. PIDs for Services $01 and $02 - see Figure 6 Service ID (see note 1) PID (Hex) Description Min ($00) or ($0000) Max ($FF) or ($FFFF) $01 A $02 A 00 PIDs supported ($01 - $20): A 01 Module responds with a message that contains 4 bytes ojf bit-cncodcd information, each bit indicating support or non-support of a PID where: 0 = PID not supported by this module 1 = PID supported by this module Data A - Number of emission-related powertrain trouble codes and MI status: bits 0-6: Number of codes stored in this module bit 7: 0 = MI not commanded ON by this module 1 = MI commanded ON by this module Data B (bits 0 to 3) and Data C - Each bit indicates support or non- support of an on-board diagnostic evaluation: Data B: covers continuous monitoring tests Data C: covers tests run at least once per trip where: 0 = test not supported by this module 1 = test supported by this module Data B (bits 4 to 7) and Data D - Each bit indicates status of on-board diagnostic evaluation for this module, corresponding to tests included in Data B (bits 0 to 3) and Data C: 0 = test complete, or not applicable 1 = test not complete Note: Data B. bits 4 to 7, are required only for vehicles that do not support any non-continuous tests. Figure 6 PIDs for Services $01and $02 165 English display SI (Metric) Scaling/bit and display Byte bit PID Data A 7 $01 Data A 6 $02 DataB 7 $09 Data D 0 $20 Data B: bit Evaluation supported / status 0 Misfire monitoring supported 1 Fuel system monitoring supported 2 Comprehensive component monitoring supported 3 reserved (report as 0) 4 misfire monitoring status 5 fuel system monitoring status 6 Comprehensive component monitoring status 7 reserved (report as 0) Data C and Data D: bit Evaluation supported / status 0 Catalyst monitoring 1 Heated catalyst monitoring 2 Evaporative system monitoring 3 Secondary air system monitoring 4 A/C system refrigerant monitoring 5 Oxygen sensor monitoring 6 Oxygen sensor heater monitoring 7 EGR system monitoring i Service ID (see note 1) PID (Hex) Description Min ($00) or ($0000) Max ($FF) or ($FFFF) SI (Metric) Scaling/bit and display English display $01 $02 A 02 A A 03 DTC that caused required freeze frame data storage (2 byte value - $0000 indicates no freeze frame data) Data A: Fuel system 1 status Data B: Fuel system 2 status ($00 if not used) 00 00 09 99 Pxxxx, Cxxx, Bxxx or Uxxx Pxxxx, Cxxx, Bxxx or Uxxx For each data byte, no more than one bit at a time can be set to a 1 to indicate the status of that bank, where: bit 0 = Open loop - lias not yet satisfied conditions to go closed loop bit 1 = Closed loop - using oxygen sensor(s) as feedback for fuel control bit 2 = Open loop due to driving conditions (e. g. power enrichment, deceleration enleanment) bit 3 = Open loop due to detected system fault bit 4 = Closed loop, but fault with at least one oxygen sensor - may be using single oxygen sensor for fuel control bits 5-7 = reserved (report as 0) 04 05 06 07 08 09 0A Calculated load value Engine coolant temperature Short term fuel trim - Bank 1 (use if only 1 fuel trim value) Long term fuel trim - Bank 1 Short term fuel trim - Bank 2 Long term fuel trim - Bank 2 Fuel pressure gauge A A A A A A A A A A A A A A A A A A 0% -40°C 100% +215°C -100. 00% (lean) +99. 22% (rich) x » n 0 kPaG(gauge) n »» n 765 kPaG (gauge) 255 kPaA 100/255% xxx. x% xxx°F 100/128% (0% at 128) xxx. x% xx. x psig(gaugc) xx. x in. Hg 100/255% XXX. x% 1°C with -40°C offset xxx°C 100/128% (0% at 128) XXX. x% II II II 3 kPaG(gauge) xxx kPaG(gauge) 1 kPaA xxx kPaA 1/4 rpm xxxxx rpm OB Intake manifold absolute pressure OkPaA j Engine R1. PM (2 byte value - high byte/low byte) OC 0 rpm 16,383. 75 rpm Figure 6 PIDs for Services $01 and $02 (continued) 166 A A A A A A A X or PID $1D 10 11 12 13 Service ID (sec note 1) PID (Hex) Description $01 $02 Min ($00) or ($0000) Max ($FF) or ($FFFF) SI (Metric) Scaling / bit and display English display A 0D Vehicle speed 0 km/h 255 km/h 0E Ignition timing advance for #1 cylinder (not including mechanical advance) -64° +63,5° OF Intake air temperature -40°C +215°C Air flow rate from MAF sensor (2 byte value - high byte/low byte) Absolute throttle position 0 gm/scc 0% 655. 35 gm/scc 100% xxx mph xxx°F xxxx. x lb/min 1 km/h xxx km/h l/2°with 0° at 128 xx. x° 1°C with -40°C offset xxx°C. 01 gm/sec xxx. xx grh/sec 100/255% xxx. x% Commanded secondary air status (if supported, one, and only one bit at a time can be set to a 1) bit 0 bit 1 bit 2 bits 3 -7 = reserved (report as 0) I = upstream of first catalytic converter 1 = downstream of first catalytic converter inlet 1 = atmosphere / off Location of oxygen sensors, where sensor 1 is closest to the engine. Each bit indicates the presence or absence of an oxygen sensor at the following location: bit Sensor location 0 Bank 1 - Sensor 1 1 Bank 1 - Sensor 2 2 Bank 1 - Sensor 3 3 Bank 1 - Sensor 4 4 Bank 2 - Sensor 1 5 Bank 2 - Sensor 2 6 Bank 2 - Sensor 3 7 Bank 2 - Sensor 4 where: I 1 = sensor present at that location 0 = sensor not present at that location ' Figure 6 PIDs for Services $01 and $02 (continued) 167 Service ID (see note 1) PID (Hex) Description Min ($00) or($0000) Max ($FF) or ($FFFF) SI (Metric) Scaling/bit and display English display J $01 $02 A % 14 15 16 17 18' 19 1A IB Bank 1 - Sensor 1 Bank 1 - Sensor 2 Bank 1 - Sensor 3 Bank 1 - Sensor 4 Bank 2 - Sensor 1 Bank 2 - Sensor 2 Bank 2 - Sensor 3 Bank 2 - Sensor 4 for each sensor: Data A - Oxygen sensor output 0 volt 1. 275 volt B 1C voltage Data B - short term fuel trim associated with this sensor ($FF if this sensor is not used in the calculation) OBD requirements to which vehicle is designed, where: $ 01 - OBD II (California ARB) $ 02 - OBD (Federal EPA) $ 03 - OBD and OBD II $ 04 - OBD I $ 05 - Not intended to meet any OBD requirements Figure 6 PIDs for Services $01 and $02 (continued) -100. 00% (lean) 99. 22% (rich) This scaling assumes a nominal 1 volt full scale oxygen sensor; any sensor with a different full scale value should be normalised to provide nominal full scale at $C8 (200 decimal). 005 volt x. xxx volt 100/128% (0% at 128) xxx. x% 68 Service ID (sec note 1) PID (Hex) Description Min ($00) or ($0000) Max ($FF) or ($FFFF) SI (Metric) Scaling/bit and display English display $01 $02 A or PID S13 ID Location of oxygen sensors, where 1 is closest to the engine. Each bit indicates the presence or absence of an oxygen sensor at the following location: bit Alternate sensor location 0 Bank 1 - Sensor 1 1 Bank 1 - Sensor 2 2 Bank 2 - Sensor 1 3 Bank 2 - Sensor 2 4 Bank 3 - Sensor 1 5 Bank 3 - Sensor 2 6 Bank 4 - Sensor 1 7 Bank 4 - Sensor 2 Where 1 = sensor present at that location 0 = sensor not present at that location A IE Auxiliary Input Status bit 0:Powcr Take Off (PTO) Status where 0 =PTO not active 1 = PTO active bits 1 to 7 reserved for future expansion report as 0 Waive continuous monitoring tests during PTO Unused - reserved for future expansion. IF i Figure 6 PIDs for Services $01 and $02 (continued) 169 Service ID (see note 1) PID (Hex) Description $01 $02 A 20 PIDs supported ($21 - $40): Min ($00) or($0000) Max ($FF) or ($FFFF) SI (Metric) Scaling / bit and display English display Bvte bit PID Data A 7 $21 Data A 6 $22 Data B 7 $29 DataD 0 $40 21-3F 40 41-FF Reserved - to be specified in ISO 14230 - 3 (SAE J2190). if needed PIDs supported ($41 - $60): Reserved for future expansion A A Figure 6 PIDs for Services $01 and $02 (continued) NOTE 1 : Letters in the column under Service $01 or $02 indicate that this value is included in OBD legislation as indicated below. This information is for guidance only and may be out of date. Refer to the latest appropriate regulations to determine if each value is required to be supported on a given vehicle, or only required if available. 170 5. 4. Service $03 - Request Emission-Related Powertrain Diagnostic Trouble Codes 5. 4. 1. Service $03 Functional Description The purpose of this service is to enable the off-board test device to obtain stored emission-related powertrain trouble codes. This shall be a two step process for the test equipment but a module may respond to a Service $03 request without a Service PID $01 request. If a tester establishes that the Service $01, PID $01 is not supported by all of the modules on the vehicle it may send only Service $03 requests on all subsequent DTC requests. Step 1 - Send a Service $01, PID $01 request to get the number of stored emission-related powertrain trouble codes from all modules that have this available. Each on-board module that has codes stored will respond with a message that includes the number of stored codes to be reported. If a module capable of storing powertrain codes does not have stored codes, then that module shall respond with a message indicating zero codes are stored. Step 2 - Send a Service $03 request for all stored emission-related powertrain codes. Each module that has codes stored will respond with one or more messages, each containing up to 3 codes. If no codes are stored in the module, then the module may not respond to this request. If additional trouble codes are set between the time that the number of codes are reported by a module, and the stored codes are reported by a module, then the number of codes reported could exceed the number expected by the tool. In this case, the tool should repeat this cycle until the number of codes reported equals the number expected based on the Service 1 response. Diagnostic trouble codes are transmitted in two bytes of information for each code. The first two bits (high order) of the first byte for each code will be zeros to indicate a powertrain code (refer to Appendix 3 for additional interpretation of this structure). The second two bits will indicate the first digit of the diagnostic code (0 through 3). The second nibble of the first byte and the entire second byte are the next three digits of the actual code reported as * Binary Coded Decimal (BCD). A powertrain trouble code transmitted as $0143 should be displayed as P0143. See Figure 7 0 | 0 | 0 | 0 | 0 | 0 | 0 | 1 — 0 1 1 | 0 | 0 | 0 | 0 | 1 |1 P 0 1 I 4 i Figure 7 - Diagnostic Trouble Code Encoding Example If less than 3 trouble codes are reported, the response messages used to report diagnostic trouble codes should have their unused bits set to zero to maintain the required fixed message length for all messages. If there are no diagnostic trouble codes to report, no response is required. 171 5. 4. 2. Message Data Bytes Data Bytes (Hex) #1 | #2 J #3 #6 Request number of codes from all modules | #4 | #5 #7 Request number of Powertrain DTC 01 01 1 Report number of codes (each module] Report number of stored powertrain DTC 41 Request Request powertrain DTC 03 01 #DTC & MI codes from all modules Eval. Supp. #1 Eval. Supp. #2 Eval. Status - Report codes (each module) Report powertrain DTC 43 Code #1 or 00 00 Code #2 or 00 00 Code #3 or 00 00 Figure 8 - Message Data Bytes NOTE: Refer to Appendix 2 (ISO CD XXX2 - SAE J2012, Recommended Format and Messages for Diagnostic Trouble Codes), the encoding method for trouble codes. 172 5. 4. 3. Powertrain Diagnostic Trouble Code Example (assume 10. 4 Kbps) Header Bytes (Hex) Data Bytes (Hex) Pty/ Type Tgt Addr Src Addr #1 #2 #3 M #5 #6 #7 Request Powertrain DTC 68 6A FI 01 01 Report Number of Powertrain DTC 48 48 48 48 6B 6B 6B 6B 06 41 01 C3 41 01 2B 41 01 ^F 41 01 06 01 00 82 00 00 00 00 00 00 00 00 00 00 00 00 Request All Stored Powertrain DTC Request number of Powertrain DTC Module 06 has 6 stored DTC Module C3 has 1 stored DTC Module 2B has 0 stored DTC Module 3E has 2 stored DTC and MI ON Request powertrain DTC 1 68 | 6A FI | 03 1 Report All Stored Powertrain DTC Module 06 send codes P0143,P0196, & P0234 Module C3 send code P0443 Module 06 send codes P0357,P0531, & P0661 Module 3E send codes P0112 & P0445 48 6B 06 43 Code #1 Code #2 Code #3 01 43 01 96 02 34 48 6B C3 43 Code #1 48 6B 06 43 04 43 Code #4 Code #5 Code #6 00 00 00 00 48 6B 3E 43 03 57 Code #1 -3-1 05 Code #2 06 61 01 12 04 45 00 00 Figure 9 Powertrain Diagnostic Trouble Code Example 173 5. 5. Service $04 - Clear/Reset Emission-Related Diagnostic Information 5. 5. 1. Functional Description The purpose of this service is to provide a means for the external test device to command on-board modules to clear all emission-related diagnostic information. This includes: Clear number of diagnostic trouble codes (Service $01, PID $01) Clear diagnostic trouble codes (Service $03) Clear trouble code for freeze frame data (Service $01, PED $02) Clear freeze frame data (Service $02) Clear oxygen sensor test data (Service $05) Reset status of system monitoring tests (Service $01, PID $01) Clear on-board monitoring test results (Services $06 and $07) Other manufacturer specific "clearing/resetting" actions may also occur in response to this request. For safety and/or technical design reasons, some modules may not respond to this test service under all conditions. All modules must respond to this test service request with the ignition ON and with the engine not running. Modules that cannot perform this operation under other conditions, such as with the engine running, will ignore the request. 5. 5. 2. Message Data Bytes #6 Request to Clear/Reset Emission-Related Diagnostic Information #5 #2 #1 Data Bytes (Hex) #4 #3 #7 Clear Powertrain DTC 04 Report when Emission-Related Diagnostic Information is Reset Powertrain -DTC- cleared 44 Figure 10 Message Data Bytes 174 5. 6. Service $05 - Request Oxygen Sensor Monitoring Test Results 5. 6. 1. Functional Description The purpose of this service is to allow access to the on-board oxygen sensor monitoring test results. The same information may be obtained by the use of Service $06 The request for test results includes a Test ID value that indicates the information requested. Test value definitions, scaling information, and display formats are included in this document. Many methods may be used by different manufacturers to comply with this requirement. If data values are to be reported using these messages that are different from those predefined in this document, ranges of test values have been assigned that can be used which have standard units of measure. The tool can convert these values and display them in the standard units. The on-board module will respond to this message by transmitting the requested test data last determined by the system. The operation of this diagnostic service in the on-board module is different from Service $01. Service $01 reports data value(s) that are stored internally at a single, or multiple contiguous, locations in memory. Service $05 can report data values that are stored in non-contiguous memory locations. As an example, test results may be stored in RAM, and test limits, (if the value is a calculated value), would normally be stored in ROM. Therefore, the on-board software has additional requirements to respond to this request than it does for Service $01 requests. Not all test values are applicable or supported by all vehicles. An optional feature of this test service is for the on-board module to indicate which test IDs are supported. Test ID $00 is a bit-encoded value that indicates support for test IDs from $01 to $20. Test ID $20 indicates support for test IDs $21 through $40, etc. This is the same concept as used for PID support in test services $01 and $02. If Test ID $00 is not supported, then the module does not use this feature to indicate test ID support. 175 5. 6. 2. Message Data Bytes #1 #2 Data Bytes (Hex) #4 #3 #5 #6 #7 Request Oxygen Sensor Test Results 05 Test ID 02S Sens# Request Oxygen Sensor Test Results Report Oxygen Sensor Test ID Support - Optional (Test IDs $00, $20, $40, $60, $80, $A0, $C0, $E0) Report Oxygen Sensor Test ID Support 45 Test ID 02S Sens# Support for the next 32 test IDs following the requested ID is indicated in data bytes #4 through #7 Report Oxygen Sensor Test Results (All Test IDs That Do Not Indicate Test ID Support) Data is only valid if Service $01 PID $01 indicates Oxygen Sensor monitoring is supported and the test is complete. Report Oxygen Sensor Test Results 45 Test ID 0 2 S# test value min limit * max limit * Figure 11 - Message data Bytes * NOTE: report limits if value is a test result - not required for test constants, such as ID $01 to $04 Results of latest mandated on-board oxygen sensor monitoring test Oxygen Sensor Output Figure 12 - Test ID Value Example - Note: Numbers refer to Test ID 176 Data Description Byte 2 Which Test ID: ' ~ $00 - Test ID's supported - optional ($01 to $20) $01 - Rich to lean sensor threshold voltage (constant) $02 - Lean to rich sensor threshold voltage (constant) $03 - Low sensor voltage for switch time calculation (constant) $04 - High sensor voltage for switch time calculation (constant) $05 - Rich to lean sensor switch time (calculated) $06 - Lean to rich sensor switch time (calculated) $07 - Minimum sensor voltage for test cycle (calculated) $08 - Maximum sensor voltage for test cycle (calculated) $09 - Time between sensor transitions (calculated) $0A-$1F - reserved $20 - Test ID's supported - optional ($21 to $40) $21-$2F - values with units of time less than 1. 02 seconds $30-$3F - values with units of time less than 10. 2 seconds $40 - Test ID's supported - optional ($41 to $60) $41-$4F - values with units of voltage less than 1. 275 volts $50-$5F - values with units of voltage less than 12. 75 volts $60 - Test ID's supported - optional ($61 to $80) $61-$6F - values with units of Frequency less than 25. 5 Hz $70-$7F - values with units of counts less than 255 counts $80 - Test ID's supported - optional ($81 to $A0) $81-$9F - manufacturer specific values / units $A0 - Test ID's supported - optional ($A1 to $C0) $A1-$BF - manufacturer specific values ! units $C0 - Test ID's supported - optional ($C1 to $E0) $C1-$DF - manufacturer specific values / units $E0 - Test ID's supported - optional ($E1 to $FF) $E1-$FF - manufacturer specific values / units 3 Oxygen sensor location (one, and only one bit can be set to a 1): bit Sensor location * Alternative sensor location + 0 Bank 1 - Sensor 1 Bank 1 - Sensor 1 1 Bank 1 - Sensor 2 Bank 1 - Sensor 2 2 Bank 1 - Sensor 3 Bank 2 - Sensor 1 3 Bank 1 - Sensor 4 Bank 2 - Sensor 2 4 Bank 2 - Sensor 1 Bank 3 - Sensor 1 5 Bank 2 - Sensor 2 Bank 3 - Sensor 2 6 Bank 2 - Sensor 3 Bank 4 - Sensor 1 7 Bank 2 - Sensor 4 Bank 4 - Sensor 2 * If Service $01 PID $13 supported +If Service $01 PID $ ID supported ~~ The following 4 bytes define data bytes for Test IDs that indicate support of other Test IDs - optional ($00, $20, $40, $60, $80, $A0, $C0, and $E0) 4 Support for Test ID, where l=support, 0=non-support: bit 7 - support for Test ID request + $01 bit 6 - support for Test ID request + $02 bit 0 - support for Test ID request + $08 177 Support for Test ED, where l=support, O=non-support: bit 7 - support for Test ID request + $09 bit 6 - support for Test ID request + $0A bit 0 - support for Test ID request + $10 Support for Test ID, where l=support, 0=non-support: bit 7 - support for Test ID request + $11 bit 6 - support for Test ID request + $12 bit 0 - support for Test ID request + $18 Support for Test ID, where l=support, 0=non-support: bit 7 - support for Test ID request + $19 bit 6 - support for Test ID request + $1A bit 0 - support for Test ID request + $20 The following 3 bytes define data bytes for Test IDs that report data values Test ID: Test ID $01 Test ID $02 Test ID $03 Test ID $04 Test ID $05 Test ID $06 Test ID $07 Test ID $08 Test ID $09 Test ID $21-$2F Test ID $30-$3F Test ID $41-$4F Test ID $50-$5F Test ID $61-$6F Test ED $70-$7F Min ($00): 0 volt 0 volt Ovolt 0 volt 0 sec. 0 sec. Ovolt Ovolt 0 sec. 0 sec. 0 sec. Ovolt 0 volt 0 Hz 0 counts Max ($FF): 1. 275 v. 1. 275 v. 1. 275 v. 1. 275 v. 1. 02 sec. 1. 02 sec. 1. 275 v. 1. 275 v. 10. 2 sec. 1. 02 sec. 10. 2 sec. 1. 275 v. Scaling/bit. 005 v. 005 v. 005 v. 005 v. 004 sec. 004 sec. 005 v. 005 v. 04 sec. 004 sec. 04 sec. 005 volt. 05 volt. 1 Hz 12. 75 v. 25. 5 Hz 255 counts Minimum test limit (only for calculated test result) see Data Byte #4 for minimum value, maximum value, and scaling Maximum test limit (only for calculated test result) see Data Byte #4 for minimum value, maximum value, and scaling 1 count *NOTE: Current oxygen sensors are nominally 1 volt full scale. If an oxygen sensor is used with a different nominal output, the output voltage should be normalised to 1 volt. Full scale should be reported as $C8 (decimal 200), which allows for reporting an overvoltage condition. Figure 13 - Message Data Byte Description 178 5. 7. Service continuously Monitored Systems $06 - Request On-Board Monitoring Test Results for Non- 5. 7. 1. Functional Description The purpose of this test service is to allow access to the results for on-board diagnostic monitoring tests of specific components/systems that are not continuously monitored. Examples are catalyst monitoring and the evaporative system monitoring. The vehicle manufacturer is responsible for assigning test IDs and component IDs for tests of different systems and components. Test results are requested by test ID. Only one test limit is included in a response message, but that limit could be either a minimum or a maximum limit. If both a minimum and maximum test limit are to be reported, then two response messages will be transmitted, in any order. The most significant bit of the "test limit type / component ED" byte will be used to indicate the test limit type. This test service can be used as an alternative to Service oxygen sensor test results. $05 no report 5. 7. 2. Message Data Bytes Request Test Results #1 06 #2 Data Bytes (Hex) #3 | #4 | #5 #6 #7 Request Test Results Test ID Report Test ID Support (Test IDs $00, $20, $40, $60, $80, $A0, $C0, $E0) Report Test ED Support 46 Test ID FF Support for the next 32 test IDs following the requested ID for any component is indicated in data bytes #4 through #7 Report 1 Multiple Response (Test IDs other than $00, $20 Data is only valid if Service $01 P supported and t Test ID Report Test Results 46 rest Results s may be Transmitted , $40, $60, $80, $A0„$C0, $E0) ID $01 indicates the monitoring test is le test is complete. Test Limit Type & Component ID test value test limit MSB LSB MSB LSB 179 Data Byte 2 Description Test ID: $00 - Test ID's supported ($01 to $20) $01-$ IF - values defined by manufacturer $20 - Test ED's supported ($21 to $40) $21-$3F - values defined by manufacturer $40 - Test ID's supported ($41 to $60) $41-$5F - values defined by manufacturer $60 - Test ID's supported ($61 to $80) $61-$7F - values defined by manufacturer $80 - Test ID's supported ($81 to $A0) $81-$9F - values defined by manufacturer $A0 - Test ID's supported ($A1 to $C0) $A1-$BF - values defined by manufacturer $C0 - Test ID's supported ($C1 to $E0) $C1-$DF - values defined by manufacturer $E0 - Test ID's supported ($E1 to $FF) $E1-$FF - values defined by manufacturer bit 7: Most significant bit indicates type of test limit, where: 0 - test limit is maximum value - test fails if test value is greater than this value 1 - test limit is minimum value - test fails if test value is less than this value If the test result should be within a range of values, two messages will be returned, one with the maximum value and one with the minimum value bit 6 - bit 0: Component ID - manufacturer defined - necessary when multiple components or systems are present on the vehicle and have the same definition of test ID 180 The following 4 bytes define data bytes for Test IDs that indicate support of other Test IDs (Services $00, $20, $40, $60, $80, $A0, $C0, and $E0) Support for Test ID, where l=support, 0=non-support: bit 7 - support for Test ID request + $01 bit 6 - support for Test ID request + $02 bit 0 - support for Test ID request + $08 Support for Test ID, where l=support, 0=non-support: bit 7 - support for Test ID request + $09 bit 6 - support for Test ED request + $0A bit 0 - support for Test ID request + $10 Support for Test ID, where l=support, 0=non-support: bit 7 - support for Test ID request + $11 bit 6 - support for Test ID request + $12 bit 0 - support for Test ID request + $18 Support for Test ID, where l=support, 0=non-support: bit 7 - support for Test ID request + $19 bit 6 - support for Test ID request + $1A bit 0 - support for Test ID request + $20 The following 4 bytes define data bytes for Test EDs that report data values (multiple response messages will be received if there are multiple components that support the same test ID and $FF is included as data byte #3 in the request ) m g e a e s s 4-5 Test result (two byte value) - this value should be less than or equal to the test limit if most significant bit of data byte #3 is '0', and should be greater than or equal to the test limit if most significant bit of data byte #3 is '1' [Integer values] 6-7 Test limit (two byte value) [Integer values] Figure 14 - Message Data Bytes 181 5. 7. 3. Message Example #1 06 46 06 46 06 46 06 46 06 46 06 46 Request Test ID Support - ID in Hex Report Support for Test IDs 06, 10, IE and 20 Request Test ID Support Report Support for Test ID 40 Request Test ID Support Report Support for Test ID 60 Request Test ED Support Report Support for Test ID 80 Request Test ID Support Report Support for Test ID A0 Request Test ID Support Report Support for Test ID Al - no additional test IDs supported #2 #3 Determine Test ID Support #4 Data Bytes (Hex) #5 #6 #7 00 00 20 20 40 40 60 60 80 80 A0 A0 FF FF FF FF FF FF 00000100 =04 00000001 =01 00000000 =00 00000000 =00 00000000 =00 00000000 =00 00000000 =00 00000000 =00 00000000 =00 00000000 =00 10000000 =10 00000000 =00 0000000 0 =00 0000010 1 =05 0000000 0 =00 0000000 1 =01 0000000 0 - =00 0000000 1 =01 0000000 0 =00 0000000 1 =01 0000000 0 =00 0000000 1 =01 0000000 0 =00 0000000 0 =00 Following messages indicate test results for component 01 greater than the minimum Request Results for Test ID 06 Repou Results for component 01 - test value exceeds minimum - passed 06 46 06 06 81 test value minimum test limit 32 C4 16 00 cate test results greater than the maximum for component ID 01 less than the maximum for component 02 Following messages indi anc Request Results for Test ED 10 Report Results for component 01 - test value greater tfian maximum - failed Report Results for component 02 - test value less than maximum - passed 06 46 10 10 01 test value maximum test limit 46 10 02 • 92 36 test value 7F FF maximum test limit 06 61 58 43 182 Following messages indicate test results for component 31 between the minimum and maximum limits Request Results for Test ID Al Report Results for component 31 - test value greater than minimum - passed 06 46 Al Al Bl test value 46 Al 31 35 95 test value Report Results for component 31 - test value less than maximum - passed minimum test limit 14 00 maximum test limit 35 95 66 53 Figure 15 - Message Example 5. 8. Service $07 - Request On-Board Monitoring Test Results for Continuously Monitored Systems 5. 8. 1. Functional Description for emission-related powertrain components/systems The purpose of this service is to enable the off-board test device to obtain test results that are continuously monitored during normal driving conditions. The intended use of this data is to assist the service technician after a vehicle repair, and after clearing diagnostic information, by reporting test results after a single driving cycle. If the test failed during the driving cycle, the DTC associated with that test will be reported. Test results reported by this service do not necessarily indicate a faulty component/system. If test results indicate a failure after additional driving, then the MI will be illuminated and a DTC will be set and reported with Service $03, indicating a faulty component/system. Test results for these components/systems are reported in the same format as •the diagnostic trouble codes in Test Service $03 - refer to the functional description for Service $03. If less than 3 DTC values are reported for failed tests, the response messages used to report the test results should be padded with $00 to fill 7 data bytes. This maintains the required fixed message length for all messages. If there are no test failures to report, no response is required. 5. 8. 2. Message Data Bytes Data Bytes (Hex) #1 #2 #3 | #4 | #5 #6 #7 Request test results for continuously monitored systems Request test results | Report test results for continuously monitored systems | 07 | Report test results 47 Code #1 or 00 00 Code #2 or 00 00 Code #3 or 00 00 Figure 16 - Message Data Bytes 183 5. 9. Service $08 - Request Control of on-board system, test or component 5. 9. 1. Functional Description The purpose of this service is to enable the off-board test device to control the operation of an on-board system, test or component. The data bytes will be defined, if necessary, for each Test ED, and will be unique for each Test ID. If any data bytes are unused for any test, they should be filled with $00 to maintain a fixed message length. Possible uses for these data bytes in the request message are: Turn device ON Turn device OFF Cycle device for nn seconds. Possible uses for these data bytes in the response message are: Data Bytes (Hex) #4 #3 #5 #6 #7 Data C or $00 DataD or $00 DataE or $00 DataC or $00 DataD or $00 DataE or $00 - Report system status - Report test results 5. 9. 2. Message Data Bytes #1 #2 Request control of on board device 08 Test ID Request control o ? on-board device DataB Data A or or $00 $00 Report control of on board device 48 Report control of on-board device DataB or $00 Data A or $00 Test ID Figure 17 - Message Data Bytes 184 5. 9. : Test ID and Data Byte Description Test ID (Hex) 00 I Test ID and Data Byte Description Test IDs supported ($01 to $20) Request: Data bytes A to E should be set to $00 Response: Data A - $00 Data B - Same as Data Byte #4 in Service $06 Data C - Same as Data Byte #4 in Service $06 Data D - Same as Data Byte #4 in Service $06 Data E - Same as Data Byte #4 in Service $06 01 Evaporative system leak test Data bytes A to E should be set to $00 for request and response. If the conditions are not proper to run the test, the vehicle may either not respond to the request, or may respond with a manufacturer defined value as Data A which corresponds to the reason the test cannot be run. This test mode enables the conditions required to conduct an evaporative system leak test, but does not actually run the test. An example is to close a purge solenoid, preventing leakage if the system is pressurised. The vehicle manufacturer is responsible to determine the criteria to automatically stop the test (open the solenoid in the example), such as engine running, vehicle speed greater than zero, or exceeding a specified time period. 02-FF J Reserved - to be defined by ISO / SAE Figure 18 Test ED and Data Byte Description 185 Appendix 3 Scope This Appendix defines the requirements of OBD tools, i. e. test equipment that will interface with vehicle modules in support of the OBD diagnostic requirements. It covers the required capabilities of and conformance criteria for OBD Scan Tools. This Appendix is based on ISO CD XXX4 and SAE J1978, "OBD II Scan Tool". 2. References 2. 1. Applicable Documents: The following publications form a part of this Appendix to the extent specified herein. 2. 1. 1. Normative References ISO Documents: ISO 9141-2: 1994 (E) 2. 1. 2. Informative References SAE Documents: "Road Vehicles - Diagnostic Systems - CARB Requirements of Digital Information" Interchange for SAE J1850 SAE J1930 SAE J1962 SAE J1979 SAE J2012 SAE J2201 SAE J2205 Class B Data Communication Network Interface Electrical / Electronic Systems Diagnostic Terms, Acronyms, and Definitions Diagnostic Connector E/E Diagnostic Test Modes Recommended Diagnostic Trouble Codes Format and Messages for Universal Interface for OBD II Scan Tools DRAFT - Expanded Diagnostic Protocol California Code of Regulations, Section 1968. 1 Title 13 - "Malfunction and Diagnostic System Requirements 1994 and Subsequent Model Year Passenger Cars, Light Duty Trucks, and Medium Duty Vehicles With Feedback Control Systems" Environmental Protection Agency 40 CFR Part 86 Control of Air Pollution From New Motor Vehicles and New Motor Vehicle engines; Regulations Requiring On-Board Diagnostic Systems on 1994 and later Model Year Light- Duty Vehicles and Light-Duty trucks 186 4. Most terms for components and systems, contained in this document are included in ISO CD XXX3 (SAE J1930) - Terms, Definitions, and Acronyms. This Section includes additional definitions of terms used in this document, not included in ISO CD XXX3. 4. 1. Service = Test Mode 4. 2. No further definitions 5. Required Functions The following are the basic functions that the OBD Scan Tool is required to support or provide: - Automatic hands-off determination of the communication interface used, - Obtaining and displaying the status and results of vehicle on-board emission related diagnostic evaluations, - Obtaining and displaying OBD emissions related diagnostic trouble codes (DTCs), - Obtaining and displaying OBD emissions related current data, - Obtaining and displaying OBD emissions related freeze frame data, - Clearing the storage of OBD emissions related diagnostic trouble codes, OBD emissions related freeze frame data storage and OBD emissions related diagnostic tests status, - Ability to perform Expanded Diagnostic Protocol functions as described in ISO CD XXX6 (SAE J2205), - Obtaining and displaying OBD II emissions related test parameters and results as described in Appendix 2, - Provide a user manual and/or help facility. 6. Vehicle Interface The following specifies the minimum vehicle interfaces to be supported by an OBD Scan Tool. 6. 1. Communication Data Link and Physical Layers — The OBD Scan Tool must be able to communicate with vehicle control modules using the communication interfaces described as follows. ISO CD XXX6(SAE J2205) describes a set of functions and communication criteria. 6. 1. 1. ISO 11519-4 Recommended Practice Class B Data Communication Network Interface ISO 11519-4 describes two sets of data link and physical layers for class B vehicle serial multiplex bus networks. The OBD Scan Tool must support both ISO 11519-4 protocols in a manner that is transparent to the user. 187 6. 1. 2. ISO 9141-2: 1994 (E) Road Vehicles - Diagnostic Systems - CARB Requirements for Interchange of Digital Information ISO 9141-2 describes the physical and data link layers of a vehicle serial diagnostic bus. Refer to ISO CD XXX9 for further clarification regarding the use of ISO 9141-2. 6. 1. 3. ISO CD 14230-1,2 Road Vehicles - Diagnostic Sytems - Keyword Protocol 200 - Physical and Data Link Layers Refer to ISO 14230 for further clarification regarding the use of KWP2000. 6. 2. Connector The OBD Scan Tool must be compliant with SAE J1962 Diagnostic Connector. The OBD Scan Tool must support the Standard Pin Assignments defined in SAE J1962. 6. 3. Messages Appendix 2 or ISO 14230-1,2 describes the request messages to be sent by the OBD Scan Tool to the vehicle and the response messages to be sent by the vehicle to the OBD II Scan Tool in order to perform the required services. 6. 4. Expanded Diagnostic Protocol The OBD Scan Tool must allow the user to enter and send vehicle specific messages defined and supplied in motor vehicle manufacturer documents and ISO CD display XXX6(SAE J2205). response messages, as defined related the in 6. 5. Automatic Hands Off Determination of the Communication Interface Used in a Given Vehicle 6. 5. 1. General While there are four types of communication interfaces that could be used to access the OBD functions in a given vehicle (i. e. ISO 11519-4(SAE J1850) 41. 6 Kbps PWM, ISO 11519-4(SAE J1850) 10. 4 Kbps VPW with CRC, ISO 9141-2, KWP2000 ISO CD 14230-1,2), only one is allowed to be used in any one vehicle to access all supported OBD functions. When connected to a vehicle and/or when the OBD support is selected where such a selection is necessary, the OBD Scan Tool shall automatically attempt to determine which of the possible communication interfaces is being used in the vehicle to support OBD related functions. The tool will continue to try to determine which interface is being used until it is successful in doing so. No user the appropriate interface. required, nor allowed, input will be to determine 188 Indications or messages will be displayed during this process informing the user that initialisation is taking place and, if all interface types have been tested and none is responding properly to the request for OBD services, the OBD Scan Tool must advise the user: - To verify that the ignition is on. - To check the emissions label or vehicle service information to verify that the vehicle is OBD equipped. - To check that the tool is connected to the vehicle correctly. 6. 5. 2. Initialisation Details Only the following steps shall be used by an OBD Scan Tool to attempt to determine the type of communications interface used in a given vehicle to support OBD functions. - Test for ISO 11519-4(SAE J1850) 41. 6 Kbps PWM step 1: enablethelSO 11519-4(SAE J1850) 41. 6 Kbps PWM interface step 2: send a service 1 PID 0 request message step 3: if a service 1 PED 0 response message is received then ISO 11519-4(SAE J1850) 41. 6 Kbps PWM is the type of interface used in a vehicle for OBD support. - Test for ISO 11519-4(SAE J1850) 10. 4 Kbps VPW step 1: enablethelSO 11519-4(SAE J1850) 10. 4Kbps VPW interface step 2: send a service 1 PID 0 request message step 3: if a service 1 PID 0 response message is received then ISO 11519-4(SAE J1850) 10. 4 Kbps VPW with CRC is the type of interface used in a vehicle for OBD support. - Test for ISO 9141-2 step 1: enable the ISO 9141-2 interface step 2: if the initialisation sequence defined completed successfully, interface used in a vehicle for OBD II support. in ISO 9141-2 is then ISO 9141-2 is the- type of - Test for KWP2000 ISO CD 14230-1,2 step 1: enable the ISO 14230-1,2 interface step 2: if the initialisation sequence defined in ISO 14230-1,2 is completed successfully, then ISO 14230-1,2 is the type of interface used in a vehicle for OBD support. The previous tests may be performed in any order and where possible may be performed in parallel. The service 1 PID 0 request and response messages are defined in Appendix 2. 189 If the tester failts to establish communications using and of the initialisations and if the ignition is on and the vehicle emissions label or service information indicates the vehicle is OBD equipped, then the tester should indicate that there is a Data Link fault. 6. 6. On-Board Diagnostic Evaluations 6. 6. 1. Completed On-Board System Readiness Tests Immediately after initial communications are established, the OBD Scan Tool shall obtain the status of the on-board system readiness tests. If any supported tests have not been completed, the OBD Scan Tool shall indicate to the user: "Not all supported on-board system readiness tests have been completed" or equivalent. The OBD Scan Tool shall also allow the user to identify which readiness tests (if any) have not been completed. 6. 6. 2. Supported On-Board System Readiness Tests The OBD Scan Tool must be capable of indicating to the user which of the tests defined by Appendix 2 service 1 PED 1 data bytes 4 and 5 are supported and which are completed. 6. 6. 3. Malfunction Indicator The OBD Scan Tool must be capable of indicating if the MI has been commanded ON and if so, by which module or modules. 6. 7. Use of ISO CD XXX5(SAE J2201) Universal Interface for OBD Scan Tools The OBD Scan Tool shall use the interface described in ISO CD XXX5(SAE J2201), or an equivalent, as the interface to vehicles. 6. 8. Handling of No Response from Vehicle Vehicle modules may not respond to request messages from the OBD II Scan Tool because of incorrect communication of a request message or because the module does not support the request message. If a response is not received within the timeout period prescribed by the protocol, the scan tool shall: - first, retransmit the request message, - second, if still no response is received, transmit a service 1 PID 0 request message, in order to determine if communication with the vehicle is currently possible, and if the data desired is available, - - third, if a service 1 PID 0 response is received, transmit other messages, if available, to determine if the desired data is supported by the vehicle, lastly, if the above steps fail then as appropriate indicate to the user, that communication with the vehicle, the module or for the information the user has selected can not be performed. 6. 9. Connections Diagnostic Connector to the Vehicle in Addition to the SAE J1962 When connections are made between external equipment and the vehicle in addition to connections made between the same external equipment and the vehicle using the SAE J1962 Diagnostic Connector, any ground circuits must conform to the requirements of the Chassis Ground circuit in the SAE J1962 connector. The intent of this requirement is to maintain the isolation between the vehicle ground and the signal ground in external equipment. 190 7. System Interaction Capability 7. 1. Obtain and Display OBD II Emissions Related Diagnostic Trouble Codes The OBD Scan Tool must be capable of obtaining, converting and displaying OBD emissions related diagnostic trouble codes from a vehicle that can be transmitted by a response to a ISO CD XXX1(SAE J1979) request (see Appendix 2). Either the diagnostic trouble code, its descriptive text or both must be displayed. Diagnostic Trouble Codes and their descriptive text are defined in Appendix 4. When diagnostic trouble code data are selected for display, the OBD Scan Tool will continuously request of the vehicle it's DTC data and display the data received in the corresponding response messages. 7. 2. Obtain and Display OBD Emissions Related Current Data, Freeze Frame Data, Test Parameters and Results The OBD Scan Tool must be capable of obtaining, converting and displaying: - OBD emissions related current data; - OBD emissions related freeze frame data; - test parameters and results data as described in Appendix 2. Appendix 2 details the available data, the messages to be used to request the data, the messages to be used to return the data, the conversion values for the data and the format to be used to display the data. When current data items are selected for display, the OBD Scan Tool will continuously request of the vehicle the data to be displayed and display the data received in the corresponding response messages. When freeze frame or test parameters and results are selected for display, the OBD Scan Tool does not need to continuously request and display those items. Where applicable, the OBD II Scan Tool must indicate whether a test limit is a high limit or a low limit. Where applicable, the display of test results must also show the test ID and component ED. Data from the vehicle may indicate which items are supported, in which case this information shall be made available to the user by the OBD scan tool. The OBD Scan Tool shall also allow users to specify requests for services, parameters, test IDs, etc. irrespective of whether the vehicle has indicated support for such items. 7. 3. Responses from Multiple Modules — The OBD Scan Tool must be capable of interfacing with a vehicle in which multiple modules may be used to support OBD requirements. The QBD Scan Tool must inform the user when multiple modules respond to the same request. The OBD Scan Tool must inform the user when multiple modules respond with different values for the same data item. The OBD Scan Tool must provide the user with the ability to select for display, as separate items, the responses received from multiple modules for the same data item. 191 7. 4. Code Clearing The OBD Scan Tool must be capable of sending a request to clear OBD emissions related diagnostic trouble codes, OBD emissions related freeze frame data and OBD emissions related diagnostic tests status information. The OBD Scan Tool must require the user to confirm such a request before transmitting (e. g. are you sure?). 8. General Characteristics 8. 1. Display The OBD Scan Tool must be capable of displaying simultaneously at least 2 (two) items of OBD emissions related data/ A list of the OBD emissions related current data and freeze frame data items, their Parameter IDs, data resolution and data conversion information, units and display formats is provided in Appendix 2. The display units shall be the Standard International (SI) and English units as specified in Appendix 2. A user shall be able to select between English and SI values. The unit conversions specified in Appendix 2 shall be used. The display of each OBD emissions related current data or freeze frame data shall include the following: - Data value; - Data Parameter ID or name; - The module ID of the module that supplied the data. The display of each OBD emissions related diagnostic trouble code shall include the module ID of the module that supplied the code. As a minimum the data values of two data items must be displayed simultaneously. A display of the parameter EDs of the data items and the IDs of the modules that supplied the data items must be easily accessible if not displayed with the data values. The units of measurement associated with the data items must either be: - Displayed with the data values or; - easily accessible on the display or; — - readily available to the user (e. g. on the tester body); - Having this information available in a user's manual separate from the body of tiie tool does not satisfy this requirement. The display must be capable of showing at least alphanumeric characters. 192 8. 2. User Input The OBD Scan Tool must include some form of user input that would allow the user to: - Select between the basic functions required by OBD II, i. e: - display current data - display freeze frame data - display trouble codes - clear emissions related data - display test parameters and results); - select for simultaneous display at least two items of any one of the following: - OBD emissions related current data - OBD emissions related diagnostic trouble codes - OBD emissions related freeze frame data - OBD emissions related test parameters and results. Responses from multiple modules to requests for a current data item or a freeze frame data item are treated as separate data items for selection and display purposes - To verify a request to clear and/or reset OBD emissions related diagnostic information as defined by Appendix 2. - Enter and send Expanded Diagnostic Protocol messages as defined in ISO CD XXX6 (SAE J2205) Power Requirements if Powered by the Vehicle Through the ISO 11519 (SAE J1962) Diagnostic Connector Voltage Must operate normally within a range of 8. 0 to 18. 0 volts D. C. Must survive a steady state voltage of up to 24. 0 volts D. C. for at least 10. 0 minutes. Must survive a steady state reverse voltage of up to 24. 0 Volts D. C. for at least 10 minutes. The tool must withstand cranking in that communications and data shall not be lost during battery voltage reductions to 5. 5V for up to 0. 5s. The display need not function during this period. For Maximum current refer to ISO 11519(SAE J1962). 193 10. Electromagnetic Compatibility (EMC) The tool must not interfere with the normal operation of vehicle modules. The normal operation of the tool must be immune to conducted and radiated emissions present in a service environment and when connected to a vehicle. The tool must be immune to reasonable levels of Electrostatic Discharge (ESD). EMC and ESD measurements and limits will be in accordance to the standards prevailing in the country in which the tester is to be sold. 11. Conformance Testing 11. 1. General The documents relating to confromance testing are still being prepared. When they are completed the tests outlined below will need to be revised accordingly. Conformance testing defines the tests required to be passed in order for tools to be type approved as "ISO CD XXX4 <date to be added> OBD SCAN TOOL COMPATIBLE" or "CONFORMS TO ISO CD XXX4". Tools that do not pass these tests are not to be so labelled. Validation of the conformance test is the responsibility of the Scan Tool manufacturer and the Scan Tool manufacturer may elect to self-certify. The tests in this section must be performed successfully 5 consecutive times in order to be considered passed. Three examples of at least production intent level tools must pass all these tests in order for a given version of tool hardware and software to be considered passed. Any changes to the hardware or software used in a tool for the functions described in this document will require a retest of these tests or an explanation from the tool manufacturer as to why the change should not require a retest. Where an explanation is submitted in lieu of a retest due to a change, the organization originally performing these tests will determine whether the explanation is acceptable or whether a retest is required. Reasonable normal engineering criteria will be used when determining whether to accept an explanation. The Scan Tool manufacturer shall make available to the buying public: - The methods used to make these tests - The results of the tests - Clear indication of the versions of hardware and software that conform (i. e. labeled as conforming to or are compatible with the requirements of ISO CD XXX4 OBD Scan Tool or other labeling to that effect). 194 Both proper and improper response messages will be employed during these tests. Improper responses are those that have incorrect first, second or third bytes of the header, an incorrect mode, an incorrect PED, an incorrect length of the response message, or with an incorrect CRC or CS. The tool must ignore all improper response messages and perform as if no response was received. Situations involving multiple modules responding to a single request, single modules responding with multiple responses to a single request and multiple modules responding with multiple responses to a single request will be tested. The interval between the end of the request message and the beginning of the response message(s) will be varied from 0 ms up to the delay required to show a no response indication on the OBD II Scan Tool. The delay that causes the no response indication will be compared to the value defined in each protocol. The format, content and order of messages transmitted on each of the buses will be observed and reviewed for correctness. The ability to obtain and report the results of the on-board system readiness tests shall be verified. The ability to report which tests the vehicle supports and have been completed shall be verified. The requirements described in 11. 3 through 11. 7 (inclusive) shall be verified on each protocol specified in 6. 1. When performing these tests, observation of the indications and displays provided to the user and the signals on the ISO 11519-4 (SAE J1850) (bus +) and (bus -) lines, the ISO 9141-2 K and L lines and ISO 14230-1,2 K and L lines will be the criteria for proper performance. These tests will be executed in an environment of 25 degrees C +/-3 degrees C and between 30% and 80% relative humidity +/- 5%. The hardware and software used in the OBD II Scan Tool version being tested ' must be identified. 11. 2. Determine OBD II Communication Type Item to be tested: Automatic hands off determination of interface type - - - - - that it is automatic when the SAE J1962 connector is plugged into its mating connector in the vehicle and/or OBD support is selected, where such a selection is necessary. that a test of all OBD communication interfaces is performed at least once per scan. that the scan of all interfaces continues until successful or until terminated by the user. that some indication is provided to the user that the scan of interfaces is being performed. that a failure to successfully find an OBD II interface during a scan of all the possible interfaces is indicated to the user at the completion of each and every scan. 195 - - - - - that when an OBD interface is successfully found, the tool automatically prompts the user for function selection. that the tool provides and uses the facilities and/or messages defined in SAE J2201 (or equivalent), Appendix 2, ISO 9141-2, ISO 11519-4 (SAE J1850), ISO 14230 and Appendix 4. that the tool does not exceed the polling rates specified in Appendix 2. that the tool provides the proper bias for the K and L lines as specified in ISO 9141-2 and ISO 14230-1. that the tool performs the initialisation tests according to 6. 5. 2, and indicates the information according to 6. 5. 1. The interface determination tests will be performed: - with no modules available, - with an ISO 9141-2 module available, - with a KWP2000 (ISO 14230) module available, - with a ISO 11519 (SAE J1850) 41. 6 Kbps PWM module available, - with a ISO 11519 (SAE J1850) 10. 4 Kbps VPW module available. 11. 3. On-Board System Readiness Tests Item to be tested: - that the tool automatically requests and reports the results of the supported on-board system readiness tests. 11. 4. Select Functions Item to be tested: - - that the tool supports the functions described in Section 5. that the user is able to move back and forth between these functions. The criteria for successfully passing this test is to be able to easily move back and forth between all functions and observe the results. - 11. 5. Select and Display Items Item to be tested: - that the user is able to select and display simultaneously at least two items from any one of: - available DTC's, - current data items, - available freeze frame data items, and - test parameters and results. 196 - - - - - - - that the module ID's and the PID's or parameter names associated with either all the (a) simultaneously with the displayed items, or (b) in some alternate method (printed material, etc. ). also be displayed items mentioned above can that the units-of-measurement information associated with all the possible current data items and freeze frame data items is easily available either as a part of the data display, displayed separately, or otherwise available on or with the tool body itself. that the tool is able to handle multiple responses from the same module due to one request. that the tool is able to handle responses from multiple modules due to one request. that the tool is able to handle multiple responses from multiple modules due to one request. that the tool informs the user that responses from multiple modules due to one request were received. Responses for multiple modules to a request are to be made available to the user as separate items for display. that the tool informs the user that different responses from multiple modules due to one request were received. The criteria for successfully passing this test is to easily select back and forth between all the items and observe the results. 11. 6. Verify Requests to Clear Codes Item to be tested: - - that the selection of the Clear Codes function incorporates a request to the user to verification. that both yes and no responses to the request to the user to verify the selection of the Clear Codes function are processed appropriately. This test should involve situations where there are some DTC's to clear and other situations where there are no DTC's to clear. When making this test, the presence of DTC's must be verified both before and after the Clear Codes function is selected. 11. 7. General Diagnostic Communication Tests When performing tests involving diagnostic messages, tests are to be made of the tool's ability to handle an immediate response, a slow response and a response delayed longer than the maximum allowed by each of the protocols. The tool should be able to process all responses that are received within the maximum time allowed by each protocol and indicate a no response condition to the user when the response is delayed longer than the maximum allowed by each protocol. The tool must support the transmission of its node address as an in-frame- response during the transmission of any response messages from modules on a ISO 11519 (SAE J1850) bus and must be able to handle both the presence and the absence of an in-frame-response during the tool's transmission of request messages. 197 11. 8. Expanded Diagnostic Protocol Item to be tested: - that the user is reasonably able to enter Expanded Diagnostic Protocol (EDP) input and that the OBD Scan Tool correctly executes the entered EDP input. 11. 9. Capacitance and Impedance at the SAE J1962 Connector Item to be tested: - that the capacitance and impedance of the OBD Scan Tool, connecting cables and the male SAE J1962 connector, as seen at the connector, are within the limits defined in ISO 11519 (SAE J1850), ISO 9141-2, ISO 14230 and SAE J1962. Note that SAE J1962 details the impedance of both the used and unused pins. Measurement of these parameters will be made by the testing agency at their discretion following generally acceptable engineering practices. 11. 10. Operating Voltage and Current Draw Item to be tested: - - that the OBD Scan Tool will correctly operate throughout the voltage range specified in the Section 9 of this Appendix and will not require more than the maximum current specified in the Section 9 of this Appendix. that the tool will survive the use of supply voltages of up to the maximum survival voltage and survival reverse voltage specified in the Section 9 of this Appendix. During other conformance tests, the voltage supplied to the OBD Scan Tool is to be varied throughout the specified range and check for continuous operation. Also the current draw is to be compared with the limit specified. 11. 11. Protocol Check Item to be tested: - that all the request and response messages defined by each of the protocols, as specified in Section 6 are properly and appropriately used by the OBD Scan Tool. 11. 12. Alphanumeric Display Item to be tested: - that the OBD Scan Tool is able to display alphanumeric characters. The results of the above test will be observed to determine the ability of the OBD Scan Tool to display alphanumeric characters. 11. 13. User Manual and Help Facility Item to be tested: - that a useful user manual and/or HELP facility is available with the OBD Scan Tool. 198 - that the user manual and/or HELP facility at least includes: - Parameter definitions and Test Ids as described in Appendix 2; - DTC definitions as described in Appendix 4; - All abbreviations used by the tool; - how to select the functions; - how to select items for simultaneous display; - how to determine the PED, item name and module ED of data returned for display; - how to verify the selection of the Clear Codes function; - how to obtain and display OBD emissions related test parameters and results as described in related documentation for each protocol; - how multiple responses from one request is indicated; - how different responses to the same request is indicated; - what current and freeze frame data items are available through OBD; - how to enter requests for the Expanded Diagnostic Protocol and interpret the results. The OBD Scan Tool will be tested for a HELP facility and/or the availability and coverage of a user manual. 199 1. Scope Appendix 4 This Appendix provides some recommended uniformity for these numeric codes. It further provides guidance for uniform messages associated with these codes. The document is comprised of several sections addressing format structure, messages, and a few examples applying the recommendations of the document. The actual code assignments and messages for powertrain systems are contained in one part attached to the Appendix (Part A). The recommended Diagnostic Trouble Codes (DTC) consist of a three digit numeric code preceded by an alpha-numeric designator. The code structure itself is partially open ended. A portion of the available numeric sequences (portions of "BO", "CO", "PO, and "UO") are reserved for uniform codes assigned by this or future updates of this document. Because of continued development in OBD systems and the flexibility of the partially open assignment structure, particular attention should be paid to ensure the user has the latest version of this document. This Appendix is based on ISO CD XXX2 and SAE J 2012, "Diagnostic Trouble Code Definitions". 2. 2. 1. Normative References (References) Applicable Documents The following publications form a part of this specification to the extent specified herein. 2. 1. 1. Normative References ISO Documents: ISO 9141-2 - Diagnostic Road vehicles requirements for interchange of digital information. systems - CARB ISO CD 14230 Keyword Protocol 2000 Parts 1/2/3 ISO 11519-4 Road Vehicles Low speed Serial Data Communication Class B -Data Communications Interface (SAE J1850) ISO CD 14229 Diagnostic Services 2. 1. 2. Informative References SAE Documents: J1850 FEB94 Class B Data Communication Network Interface J1930 JUN93 Systems Diagnostic Terms, Definitions, E/E Abbreviations and Acronyms J1962 JUN93 Diagnostic Connector J1978 MAR92 OBD II Scan Tool J2012 MAR92 Recommended Format and Messages for Diagnostic Trouble Codes 200 J2186 SEP91 Diagnostic Data Link Security J2190 JUN93 Enhanced E/E Diagnostic Test Modes 3. Definitions Most circuit, component, or system Diagnostic Trouble Codes are defined by four basic categories: General Circuit Malfunction, Range/Performance Problem, Low or High Circuit Input. Most terms for components and systems contained in this document are included in ISO CD XXX3 (SAE Recommended Practice J1930) referenced above. This section includes additional definitions of terms not included in ISO CD XXX3. 3. 1. General circuit malfunction Fixed value or no response from the system. Manufacturers may choose to use this code in place of the dual High/Low (defined below) "Or use to indicate any other failure mode. 3. 2. Range/performance The circuit is functional but not in the normal operating range. May also be used to indicate stuck, erratic, intermittent, or skewed values indicating poor performance of a circuit, component, or system. 3. 3. Low input Circuit voltage, frequency, or other signal measured at the control module input terminal or pin that is at or near zero. This is measured with the external circuit, component, or system connected. The signal type (voltage, frequency, etc. ) shall be included in the message in place of the word "input". 3. 4. " High input Circuit voltage, frequency, or other signal measured at the control module input terminal or pin that is at or near full scale'for the particular signal being measured. This is measured with the external circuit, component, or system connected. The signal type (voltage, frequency, etc. ) shall be included in the message in place of the word "input". 3. 5. # = number While each manufacturer has the ability to define the specific DTC's to meet their specific controller algorithms all DTC words must meet applicable (SAE Recommended Practice J1930) referenced above. ISO CD XXX3 201 4. 0. 4. 1. Format structure Description The Diagnostic Trouble Code consists of an alpha-numeric designator, BO - - B3 for Body, CO ~ C3 for Chassis, P0 - P3 for Powertrain, and U0 ~ U3 for Network Communication, followed by three digits. The assignment of the proper alpha designator should be determined by the controller into which the particular function being diagnosed is being integrated, or in the case of multiple controllers, the area most appropriate for that function. In most cases, the alpha designator will be implied since diagnostic information will be requested from a particular controller. In the cases where the source of the diagnostic information is not clear, the uppermost nibble of the two-byte code message as defined in Appendix 2 will define the source system as follows: 0000 - P0 - Powertrain codes ISO / SAE controlled 0 0 0 1- PI - Powertrain codes Manufacturer controlled 0010 - P2 0011 - P3 - - Powertrain codes Reserved Powertrain codes Reserved 1100- U0 - Network Communication codes ISO / SAE controlled 1101- UI - Network Communication codes Manufacturer controlled 1110 - U2 - Network Communication codes Manufacturer controlled 1111 - U3 - Network Communication codes Reserved Within each code class, the first of the three digits identifies a particular grouping of codes. These particular groupings each contain a series of 100 sequence numbers for particular code definitions. Codes have been defined to indicate a suspected trouble or problem area and are intended to be used as a directive to the proper service procedure. To minimise service confusion, fault codes should not be used to indicate the absence of problems or the system (e. g. Powertrain System O. K. , or MEL illuminated), but should be confined to indicated areas in need of service attention. Each alpha designator has code subdivisions which are industry controlled or which are manufacturer specific. These are shown in the above Table and described as "Gore" and "Non Uniform" respectively in the following clauses. Codes in the ISO/SAE subdivisions even if not defined in this document are not to be used by manufacturers until they have been approved by SAE and ISO. the status of parts of 4. 2. Core DTCs Core Diagnostic Trouble Codes are those codes where industry uniformity has been achieved. These codes were felt to be common enough across most manufacturers' applications that a common number and fault message could be assigned. AJ1 undefined numbers in each grouping have been reserved for future growth. Although service procedures may differ widely amongst manufacturers, the fault being indicated is common enough to be assigned a particular fault code. 202 4. 3. Non-Uniform DTC the manufacturers due Areas within each alpha designator have been made available for non uniform DTCs. These are fault codes that will not generally be used by a majority of to basic system differences, implementation differences, or diagnostic strategy differences. Each vehicle manufacturer or supplier who designs and specifies diagnostic algorithms, software, and diagnostic trouble codes are strongly encouraged to remain consistent across their product line when assigning codes in the manufacturer controlled area. For Powertrain codes, the same groupings should be used as in the ISO / SAE controlled area, i. e. , 100's and 200's for Fuel and Air Metering, 300's for Ignition System or Misfire, etc. Code groupings for non-Powertrain codes will be defined at a later date. 4. 4. Powertrain System Groupings 4. 4. 1. POXXX ISO / SAE Controlled 4. 4. 1. 1. P01XX Fuel and Air Metering 4. 4. 1. 2. P02XX Fuel and Air Metering 4. 4. 1. 3. P03XX Ignition System or Misfire 4. 4. 1. 4. P04XX Auxiliary Emission Controls 4. 4. 1. 5. P05XX Vehicle Speed, Idle Control, and Auxiliary Inputs 4. 4. 1. 6. P06XX Computer and Auxiliary Outputs 4. 4. 1. 7. P07XX Transmission 4. 4. 1. 8. P08XX Transmission 4. 4. 1. 9. P09XX Reserved for ISO / SAE 4. 4. 1. 10. P00XX Reserved for ISO / SAE 4. 4. 2. P1XXX Manufacturer Controlled 4. 4. 2. 1. P11XX Fuel and Air Metering 4. 4. 2. 2. P12XX Fuel and Air Metering 4. 4. 2. 3. P13XX Ignition System or Misfire 4. 4. 2. 4. P14XX Auxiliary Emission Controls 4. 4. 2. 5. P15XX Vehicle Speed, Idle Control, and Auxiliary Inputs 4. 4. 2. 6. P16XX Computer and Auxiliary Outputs. 4. 4. 2. 7. P17XX Transmission 4. 4. 2. 8. P18XX Transmission 4. 4. 2. 9. P19XX Category to be Determined by ISO / SAE 203 4. 4. 2. 10. P10XX Category to be Determined by ISO / SAE 4. 4. 3. P2XXX ISO / SAE Reserved 4. 4. 4. P3XXX ISO / SAE Reserved 4. 5. Network Communication Groupings 4. 5. 1. UOXXX ISO / SAE Controlled 4. 5. 2. U1XXX Manufacturer Controlled 4. 5. 3. U2XXX Manufacturer Controlled 4. 5. 4. U3XXX Reserved 5. 0. Messages Each defined fault code has been assigned a message to indicate the circuit, component or system area that was determined to be at fault. The messages are organized such that different messages related to a particular sensor or system are grouped together. In cases where there are various fault messages for different types of faults, the group also has a "generic" message as the first Code/Message of the group. A manufacturer has a choice when implementing diagnostics, based on the specific strategy and complexity of the diagnostic, whether to use one "generic" code for any fault of that circuit, component or system or to use the more specific codes for better defining the type of fault that was detected. The manufacturer must determine what codes and messages best fit the diagnostics actually implemented. The intent is to have only one code stored for each fault detected. » Where messages are broken down into more specific fault descriptions for a circuit, component, or system, the manufacturer should choose the code most applicable to their diagnosable fault. The messages are intended to be somewhat general to allow manufacturers to use them as often as possible yet still not conflict with their specific repair procedures. The terms "LOW" and "HIGH" when used in a message, especially those related to input signals, refer to the voltage, frequency, etc. at the pin of the controller. The specific level of "LOW" and "HIGH" must be defined by each manufacturer to best meet their needs. 6. 0. Examples Manufacturers may chose the depth of diagnosis performed by on board systems and that performed by off board equipment and procedures. In the case of a fault detected with the Throttle Position (TP) Sensor a number of fault codes may be used. If the diagnosis is all to be completed off board then use P0120 (TP Sensor Circuit Malfunction). However if the manufacturer chooses to perform more diagnosis on board then the following codes could be used: - System detects that the input signal is stuck near zero use P0122 (TP Sensor Low Input) 204 - System detects that the input signal is stuck near full scale use P0123 (TP Sensor High Input), - System detects that the input signal is not as expected on idle (e. g. is at 1. 5v rather than l. Ov) use P0121 (TP Sensor Range / Performance). - The generic code P0120 (TP Sensor Circuit Malfunction) could be used in place of any of the above. Even with the more detailed information identification of the root cause of the problem remains as an off board task. For example the higher voltage on idle could be caused by corrosion of electrical contacts or by a poor setting of the throttle plate. 205 PART A POWERTRAIN SYSTEM DIAGNOSTIC TROUBLE CODES NOTE These include systems that might be Following are the Recommended Industry Common Trouble Codes for the Powertrain Control System. into an electronic control module that would be used for controlling Engine functions, such as Fuel, Spark, Idle Speed and Vehicle Speed (Cruise Control) as well as those for Transmission as a Common Industry Code does not imply that it is a Required Code (Legislated), an Emission Related Code, or that it indicates a fault that will cause the Malfunction Indicator Light to be illuminated. that a code control. The recommended integrated fact is P01XX Fuel and Air Metering P0100 P0101 P0102 P0103 P0104 P0105 P0106 P0107 P0108 P0109 P0110 P0111 P0112 P0113 P0114 P0115 P0116 P0117 P0118 P0119 P0120 P0121 P0122 P0123 P0124 P0125 P0126 P0130 P0131 P0132 P0133 P0134 PÔ135 Mass or Volume Air Flow Circuit Malfunction Mass or Volume Air Flow Circuit Range/Performance Problem Mass or Volume Air Flow Circuit Low Input Mass or Volume Air Flow Circuit High Input Mass or Volume Air Flow Circuit Intermittent Manifold Absolute Pressure/Barometric Pressure Circuit Malfunction Manifold Absolute Pressure/Barometric Pressure Circuit Range/Performance Problem Manifold Absolute Pressure/Barometric Pressure Circuit Low Input Manifold Absolute Pressure/Barometric Pressure Circuit High Input Manifold Absolute Pressure/Barometric Pressure Circuit Intermittent Intake Air Temperature Circuit Malfunction Intake Air Temperature Circuit Range/Performance Problem Intake Air Temperature Circuit Low Input Intake Air Temperature Circuit High Input Intake Air Temperature Circuit Intermittent Engine Coolant Temperature Circuit Malfunction Engine Coolant Temperature Circuit Range/Performance Problem Engine Coolant Temperature Circuit Low Input Engine Coolant Temperature Circuit High Input Engine Coolant Temperature Circuit Intermittent Throttle/Pedal Position Sensor/Switch "A" Circuit Malfunction Throttle/Pedal Position Sensor/Switch "A" Circuit Range/Performance Problem Throttle/Pedal Position Sensor/Switch "A" Circuit Low Input Throttle/Pedal Position Sensor/Switch "A" Circuit High Input Throttle/Pedal Position Sensor/Switch "A" Circuit Intermittent Insufficient Coolant Temperature for Closed Loop Fuel Control Insufficient Coolant Temperature for Stable Operation (Bank 1* Sensor 1) 02 Sensor Circuit Malfunction (Bank 1* Sensor 1) 02 Sensor Circuit Low Voltage (Bank 1* Sensor 1) 02 Sensor Circuit High Voltage 02 Sensor Circuit Slow Response (Bank 1* Sensor 1) 02 Sensor Circuit No Activity Detected (Bank 1* Sensor 1) (Bank 1* Sensor 1) 02 Sensor Heater Circuit Malfunction * For systems with single 02 sensors, use codes for Bank 1 sensor, contains cylinder #1. Sensor 1 is closest to the engine. Bank 1 206 P0136 P0137 P0138 P0139 P0140 P0141 P0142 P0143 P0144 P0145 P0146 P0147 P0150 P0151 P0152 PO 153 P0154 P0155 P0156 P0157 P0158 PO 159 PO 160 P0161 PO 162 PO 163 PO 164 P0165 P0166 P0167 PO 170 P0171 PO 172 P0173 PO 174 P0175' P0176 PO 177 PO 178 PO 179 P0180 P0181 P0182 P0183 P0184 P0185 PO 186 P0187 P0188 PO 189 PO 190 P0191 P0192 PO 193 PO 194 P0195 (Bank 02 Sensor Circuit Malfunction (Bank 02 Sensor Circuit Low Voltage (Bank 02 Sensor Circuit High Voltage 02 Sensor Circuit Slow Response (Bank 02 Sensor Circuit No Activity Detected (Bank (Bank 02 Sensor Heater Circuit Malfunction (Bank 02 Sensor Circuit Malfunction (Bank 02 Sensor Circuit Low Voltage (Bank 02 Sensor Circuit High Voltage 02 Sensor Circuit Slow Response (Bank 02 Sensor Circuit No Activity Detected (Bank (Bank 02 Sensor Heater Circuit Malfunction (Bank 02 Sensor Circuit Malfunction (Bank 02 Sensor Circuit Low Voltage (Bank 02 Sensor Circuit High Voltage 02 Sensor Circuit Slow Response (Bank 02 Sensor Circuit No Activity Detected (Bank (Bank 02 Sensor Heater Circuit Malfunction (Bank 02 Sensor Circuit Malfunction (Bank 02 Sensor Circuit Low Voltage 02 Sensor Circuit High Voltage (Bank (Bank 02 Sensor Circuit Slow Response 02 Sensor Circuit No Activity Detected (Bank (Bank 02 Sensor Heater Circuit Malfunction (Bank 02 Sensor Circuit Malfunction (Bank 02 Sensor Circuit Low Voltage (Bank 02 Sensor Circuit High Voltage 02 Sensor Circuit Slow Response (Bank 02 Sensor Circuit No Activity Detected (Bank (Bank 02 Sensor Heater Circuit Malfunction (Bank Fuel Trim Malfunction (Bank System too Lean (Bank System too Rich (Bank Fuel Trim Malfunction (Bank System too Lean (Bank System too Rich 1* Sensor 2) 1* Sensor 2) Sensor 2) 1* Sensor 2) 1* Sensor 2) 1* 1* Sensor 2) 1* Sensor 3) 1* Sensor 3) 1* Sensor 3) 1* Sensor 3) 1* Sensor 3) 1* Sensor 3) Sensor Y Sensor Y Sensor Y Sensor 1' Sensor 1] Sensor Y Sensor 2) Sensor 2] Sensor Sensor Sensor Sensor Sensor Sensor Sensor Sensor Sensor Sensor 1*) 1*) 1*) 2) 2) 2) For systems with single 02 sensors, use codes for Bank 1 sensor. Bank 1 contains cylinder #1. Sensor 1 is closest to the engine. Fuel Composition Sensor Circuit Malfunction Fuel Composition Sensor Circuit Range/Performance Fuel Composition Sensor Circuit Low Input Fuel Composition Sensor Circuit High Input Fuel Temperature Sensor "A" Circuit Malfunction Fuel Temperature Sensor "A" Circuit Range/Performance Fuel Temperature Sensor "A" Circuit Low Input Fuel Temperature Sensor "A" Circuit High Input Fuel Temperature Sensor "A" Circuit Intermittent Fuel Temperature Sensor "B" Circuit Malfunction Fuel Temperature Sensor "B" Circuit Range/Performance Fuel Temperature Sensor "B" Circuit Low Input Fuel Temperature Sensor "B" Circuit High Input Fuel Temperature Sensor "B" Circuit Intermittent Fuel Rail Pressure Sensor Circuit Malfunction Fuel Rail Pressure Sensor Circuit Fuel Rail Pressure Sensor Circuit Fuel Rail Pressure Sensor Circuit Fuel Rail Pressure Sensor Circuit Engine Oil Temperature Sensor Malfunction Range/Performance Low Input High Input Intermittent 207 P0196 P0197 P0198 P0199 Engine Oil Temperature Sensor Range/Performance Engine Oil Temperature Sensor Low Engine Oil Temperature Sensor High Engine Oil Temperature Sensor Intermittent P02XX Fuel and Air Metering P0200 P0201 P0202 P0203 P0204 P0205 P0206 P0207 P0208 P0209 P0210 P0211 P0212 P0213 P0214 P0215 P0216 P0217 P0218 P0219 P0220 P0221 P0222 P0223 P0224 P0225 P0226 P0227 P0228 P0229 P0230 P0231 P0232 P0233 P0235 P0236 P0237 P0238 P0239 P0240 P0241 P0242 P0243 P0244 P0245 P0246 P0247 P0248 P0249 P0250 P0251 P0252 P0253 nder 1 - Injector Circuit Malfunction nder 2 - Injector Circuit Malfunction nder 3 - Injector Circuit Malfunction nder 4 - Injector Circuit Malfunction nder 5 - Injector Circuit Malfunction nder 6 - Injector Circuit Malfunction nder 7 - Injector Circuit Malfunction nder 8 - Injector Circuit Malfunction nder 9 - Injector Circuit Malfunction nder 10 - Injector Circuit Malfunction nder 11 - Injector Circuit Malfunction inder 12 - Injector Circuit Malfunction Injector Circuit Malfunction Cyl Cyl Cyl Cyl Cyl Cyl Cyl Cyl Cyl Cyl Cyl Cyl Cold Start Injector 1 Malfunction Cold Start Injector 2 Malfunction Engine Shutoff Solenoid Malfunction Injection Timing Control Circuit Malfunction Engine Overtemp Condition Transmission Over Temperature Condition Engine Overspeed Condition Throttle/Pedal Position Sensor/Switch "B" Circuit Malfunction Throttle/Pedal Position Sensor/Switch "B" Circuit Range/Performance Problem Throttle/Pedal Position Sensor/Switch "B" Circuit Low Input Throttle/Pedal Position Sensor/Switch "B" Circuit High Input Throttle/Pedal Position Sensor/Switch "B" Circuit Intermittent Throttle/Pedal Position Sensor/Switch "C" Circuit Malfunction Throttle/Pedal Position Sensor/Switch "C" Circuit Range/Performance Problem Throttle/Pedal Position Sensor/Switch "C" Circuit Low Input Throttle/Pedal Position Sensor/Switch "C" Circuit High Input Throttle/Pedal Position Sensor/Switch "C" Circuit Intermittent Fuel Pump Primary Circuit Malfunction Fuel Pump Secondary Circuit Low Fuel Pump Secondary Circuit High Fuel Pump Secondary Circuit Intermittent Turbocharger Boost Sensor "A" Circuit Malfunction Turbocharger Boost Sensor "A" Circuit Range/Performance Turbocharger Boost Sensor "A" Circuit Low Turbocharger Boost Sensor "A" Circuit tligh Turbocharger Boost Sensor "B" Circuit Malfunction Turbocharger Boost Sensor "B" Circuit Range/Performance Turbocharger Boost Sensor "B" Circuit Low Turbocharger Boost Sensor "B" Circuit High Turbocharger Wastegate Solenoid "A" Malfunction Turbocharger Wastegate Solenoid "A" Range/Performance Turbocharger Wastegate Solenoid "A" Low Turbocharger Wastegate Solerioid "A" High Turbocharger Wastegate Solenoid "B" Malfunction Turbocharger Wastegate Solenoid "B" Range/Performance Turbocharger Wastegate Solenoid "B" Low Turbocharger Wastegate Solenoid "B" High Injection Pump "A" Rotor/Cam Malfunction Injection Pump "A" Rotor/Cam Range/Performance Injection Pump "A" Rotor/Cam Low 208 P0254 P0255 P0256 P0257 P0258 P0259 P0260 P0261 P0262 P0263 P0264 P0265 P0266 P0267 P0268 P0269 P0270 P0271 P0272 P0273 P0274 P0275 P0276 P0277 P0278 P0279 P0280 P0281 P0282 P0283 P0284 P0285 P0286 P0287 P0288 P0289 P0290 P0291 P0292 P0293 P0294 P0295 P0296 Injection Injection Injection Injection Injection Injection Injection Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Pump "A" Rotor/Cam High Pump "A" Rotor/Cam Intermittent Pump "B" Rotor/Cam Malfunction Pump "B" Rotor/Cam Range/Performance Pump "B" Rotor/Cam Low Pump "B" Rotor/Cam High Pump "B" Rotor/Cam Intermittent 1 Injector Circuit Low 1 Injector Circuit High 1 Contribution/Balance Fault 2 Injector Circuit Low 2 Injector Circuit High 2 Contribution/Balance Fault Injector Circuit Low Injector Circuit High Contribution/Balance Fault Injector Circuit Low 4 Injector Circuit High 4 Contribution/Balance Fault Injector Circuit Low Injector Circuit High Contribution/Balance Fault Injector Circuit Low 6 Injector Circuit High 6 Contribution/Balance Fault 7 Injector Circuit Low 7 Injector Circuit High 7 Contribution/Balance Fault 8 Injector Circuit Low 8 Injector Circuit High 8 Contribution/Balance Fault 9 Injector Circuit Low 9 Injector Circuit High 9 Contribution/Balance Fault 10 Injector Circuit Low 10 Injector Circuit High 10 Contribution/Balance Fault 11 Injector Circuit Low 11 Injector Circuit High 11 Contribution/Balance Fault 12 Injector Circuit Low 12 Injector Circuit High 12 Contribution/Balance Fault P03XX Ignition System or Misfire P0300 P0301 P0302 P0303 P0304 P0305 P0306 P0307 P0308 P0309 P0310 P0311 P0312 Random/Multiple Cylinder Misfire Detected Cylinder 1 Misfire Detected Cylinder 2 Misfire Detected Cylinder 3 Misfire Detected Cylinder 4 Misfire Detected Cylinder 5 Misfire Detected Cylinder 6 Misfire Detected Cylinder 7 Misfire Detected Cylinder 8 Misfire Detected Cylinder 9 Misfire Detected Cylinder 10 Misfire Detected Cylinder 11 Misfire Detected Cylinder 12 Misfire Detected 209 P0320 P0321 P0322 P0323 P0325 P0326 P0327 P0328 P0329 P0330 P0332 P0333 P0334 P0335 P0336 P0337 P0338 P0339 P0340 P0341 P0342 P0343 P0344 P0350 P0351 P0352 P0353 P0354 P0355 P0356 P0357 P0358 P0359 P0360 P0361 P0362 P0370 P0371 P0372 P0373 P0374 P0375 P0376 P0377 P0378 P0379 P0380 P0381 P0385 P0386 P0387 P0388 P0389 or Single Sensor •y or Single Sensor *) or Single Sensor *) or Single Sensor *) or Single Sensor *) *) *) *) (Bank (Bank (Bank (Bank (Bank (Bank 2 (Bank 2 (Bank 2 (Bank 2 Ignition/Distributor Engine Speed Input Circuit Malfunction Ignition/Distributor Engine Speed Input Circuit Range/Performance Ignition/Distributor Engine Speed Input Circuit No Signal Ignition/Distributor Engine Speed Input Circuit Intermittent Knock Sensor 1 Circuit Malfunction Knock Sensor 1 Circuit Range/Performance Knock Sensor 1 Circuit Low Input Knock Sensor 1 Circuit High Input Knock Sensor 1 Circuit Input Intermittent Knock Sensor 2 Circuit Range/Performance Knock Sensor 2 Circuit Low Input Knock Sensor 2 Circuit Eligh Input Knock Sensor 2 Circuit Input Intermittent Crankshaft Position Sensor "A" Circuit Malfunction Crankshaft Position Sensor "A" Circuit Range/Performance Crankshaft Position Sensor "A" Circuit Low Input Crankshaft Position Sensor "A" Circuit High Input Crankshaft Position Sensor "A" Circuit Intermittent Camshaft Position Sensor Circuit Malfunction Camshaft Position Sensor Circuit Range/Performance Camshaft Position Sensor Circuit Low Input Camshaft Position Sensor Circuit High Input Camshaft Position Sensor Circuit Intermittent Ignit Ignit Ignit Ignit Ignit Ignit Ignit Ignit Ignit: Ignit Ignit Ignit Ignit on Coil Primary/Secondary Circuit Malfunction on Coil "A" Primary/Secondary Circuit Malfunction on Coil "B" Primary/Secondary Circuit Malfunction on Coil "C" Primary/Secondary Circuit Malfunction on Coil "D" Primary/Secondary Circuit Malfunction on Coil "E" Primary/Secondary Circuit Malfunction on Coil "F" Primary/Secondary Circuit Malfunction on Coil "G" Primary/Secondary Circuit Malfunction on Coil "H" Primary/Secondary Circuit Malfunction on Coil "I" Primary/Secondary Circuit Malfunction on Coil "J" Primary/Secondary Circuit Malfunction on Coil "K" Primary/Secondary Circuit Malfunction on Coil "L" Primary/Secondary Circuit Malfunction * Bank 1 contains cylinder 1 Timing Reference High Resolution Signal "A" Malfunction Timing Reference High Resolution Signal "A" Too Many Pulses Timing Reference High Resolution Signal "A" Too Few Pulses Timing Reference High Resolution Signal Timing Reference Eligh Resolution Signal Timing Reference High Resolution Signal Timing Reference High Resolution Signal Timing Reference High Resolution Signal Timing Reference EEigh Resolution Signal Timing Reference Eligh Resolution Signal Glow Plug /Heater Circuit Malfunction Glow Plug /Heater Indicator Circuit Malfunction Crankshaft Position Sensor "B" Circuit Malfunction Crankshaft Position Sensor "B" Circuit Range/Performance Crankshaft Position Sensor "B" Circuit Low Input Crankshaft Position Sensor "B" Circuit High Input Crankshaft Position Sensor "B" Circuit Intermittent 'A" Intermittent/Erratic Pulses 'A" No Pulses •B" Malfunction 'B" Too Many Pulses 'B" Too Few Pulses 'B" Intermittent/Erratic Pulses *B" No Pulses 210 P04XX Auxiliary Emission Controls P0400 P0401 P0402 P0403 P0404 P0405 P0406 P0407 P0408 P0410 P0411 P0412 P0413 P0414 P0415 P0416 P0417 P0420 P0421 P0422 P0423 P0424 P0430 P0431 P0432 P0433 P0434 P0440 P0441 P0442 P0443 P0444 P0445 P0446 P0447 P0448 P0450 P0451 P0452 P0453 P0454 P0455 P0460 P0461 P0462 P0463 P0464 P0465 P0466 P0467 P0468 P0469 P0470 P0471 P0472 Exhaust Gas Recirculation Flow Malfunction Exhaust Gas Recirculation Flow Insufficient Detected Exhaust Gas Recirculation Flow Excessive Detected Exhaust Gas Recirculation Circuit Malfunction Exhaust Gas Recirculation Circuit Range/Performance Exhaust Gas Recirculation Sensor "A" Circuit Low Exhaust Gas Recirculation Sensor "A" Circuit EEigh Exhaust Gas Recirculation Sensor "B" Circuit Low Exhaust Gas Recirculation Sensor "B" Circuit High Secondary Air Injection System Malfunction Secondary Air Injection System Incorrect Flow Detected Secondary Air Injection System Switching Valve "A" Circuit Malfunction Secondary Air Injection System Switching Valve "A" Circuit Open Secondary Air Injection System Switching Valve "A" Circuit Shorted Secondary Air Injection System Switching Valve "B" Circuit Malfunction Secondary Air Injection System Switching Valve "B" Circuit Open Secondary Air Injection System Switching Valve "B" Circuit Snorted Catalyst System Efficiency Below Threshold (Bank 1*] Warm Up Catalyst Efficiency Below Threshold (Bank 1*' Main Catalyst Efficiency Below Threshold (Bank 1* (Bank 1* Heated Catalyst Efficiency Below Threshold (Bank 1* Heated Catalyst Temperature Below Threshold (Bank 2) Catalyst System Efficiency Below Threshold (Bank 2) Warm Up Catalyst Efficiency Below Threshold (Bank 2) Main Catalyst Efficiency Below Threshold (Bank 2) Heated Catalyst Efficiency Below Threshold (Bank 2) Heated Catalyst Temperature Below Threshold * Bank 1 contains Cylinder #1 Evaporative Emission Control System Malfunction Evaporative Emission Control System Incorrect Purge Flow Evaporative Emission Control System Small Leak Detected Evaporative Emission Control System Purge Control Valve Circuit Malfunction Evaporative Emission Control System Purge Control Valve Circuit Open Evaporative Emission Control System Purge Control Valve Circuit Snorted Evaporative Emission Control System Vent Control Malfunction Evaporative Emission Control System Vent Control Open Evaporative Emission Control System Vent Control Snorted Evaporative Emission Control System Pressure Sensor Malfunction Evaporative Emission Control System Pressure Sensor Range/Performance Evaporative Emission Control System Pressure Sensor Low Input Evaporative Emission Control System Pressure Sensor High Input Evaporative Emission Control System Pressure Sensor Intermittent Evaporative Emission Control System Gross Leak Detected Fuel Level Sensor Circuit Malfunction Fuel Level Sensor Circuit Range/Performance Fuel Level Sensor Circuit Low Input Fuel Level Sensor Circuit High Input Fuel Level Sensor Circuit Intermittent Purge Flow Sensor Circuit Malfunction Purge Flow Sensor Circuit Range/Performance Purge Flow Sensor Circuit Low Input Purge Flow Sensor Circuit High Input Purge Flow Sensor Circuit Intermittent Exhaust Pressure Sensor Malfunction Exhaust Pressure Sensor Range/Performance Exhaust Pressure Sensor Low 211 P0473 P0474 P0475 P0476 P0477 P0478 P0479 Exhaust Pressure Sensor High Exhaust Pressure Sensor Intermittent Exhaust Pressure Control Valve Malfunction Exhaust Pressure Control Valve Range/Performance Exhaust Pressure Control Valve Low Exhaust Pressure Control Valve High Exhaust Pressure Control Valve Intermittent P05XX Vehicle Speed , Idle Control , and Auxiliary Inputs P0500 P0501 P0502 P0503 P0505 P0506 P0507 P0510 P0530 P0531 P0532 P0533 P0534 P0550 P0551 P0552 P0553 P0554 P0560 P0561 P0562 P0563 P0565 P0556 P0567 P0568 P0569 P0570 P0571 P0572 P0573 P0574 to P0580 Vehicle Speed Sensor Malfunction Vehicle Speed Sensor Range/Performance Vehicle Speed Sensor Circuit Low Input Vehicle Speed Sensor Intermittent / Erratic / High Idle Control System Malfunction Idle Control System RPM Lower Than Expected Idle Control System RPM Higher Than Expected Closed Throttle Position Switch Malfunction A/C Refrigerant Pressure Sensor Circuit Malfunction A/C Refrigerant Pressure Sensor Circuit Range/Performance A/C Refrigerant Pressure Sensor Circuit Low Input A/C Refrigerant Pressure Sensor Circuit High Input Air Conditioner Refrigerant Charge Loss Power Steering Pressure Sensor Circuit Malfunction Power Steering Pressure Sensor Circuit Range/Performance Power Steering Pressure Sensor Circuit Low Input Power Steering Pressure Sensor Circuit High Input Power Steering Pressure Sensor Circuit Intermittent System Voltage Malfunction System Voltage Unstable System Voltage Low System Voltage High Cruise Control On Signal Malfunction Cruise Control Off Signal Malfunction Cruise Control Resume Signal Malfunction Cruise Control Set Signal Malfunction Cruise Control Coast Signal Malfunction Cruise Control Accel Signal Malfunction Cruise Control / Brake Switch "A" Circuit Malfunction Cruise Control / Brake Switch "A" Circuit Low Cruise Control / Brake Switch "A" Circuit Eligh Reserved for Cruise Codes P06XX Computer and Auxiliary Outputs P0600 P0601 P0602 P0603 P0604 P0605 P0606 Serial Communication Link Malfunction Internal Control Module Memory Checksum Error Control Module Programming Error Internal Control Module Keep Alive Memory (KAM) Error Internal Control Module Random Access Memory (RAM) Error Internal Control Module Read Only Memory (ROM) Error (Module Identification Defined by ISO Cdxxxl / SAE J1979) Powertrain Control Module Processor Fault 212 P07XX Transmission P0700 P0701 P0702 P0703 P0704 P0705 P0706 P0707 P0708 P0709 P0710 P0711 P0712 P0713 P0714 P0715 P0716 P0717 P0718 P0719 P0720 P0721 P0722 P0723 P0724 P0725 P0726 P0727 P0728 P0730 P0731 P0732 P0733 P0734' P0735 P0736 P0740 P0741 P0742 P0743 P0744 P0745 P0746 P0747 P0748 P0749 P0750 P0751 P0752 P0753 P0754 P0755 P0756 P0757 P0758 P0758 P0760 P0761 Transmission Control System Malfunction Transmission Control System Range/Performance Transmission Control System Electrical Torque Converter/Brake Switch "B" Circuit Malfunction Clutch Switch Input Circuit Malfunction Transmission Range Sensor Circuit Malfunction (PRNDL Input) Transmission Range Sensor Circuit Range/Performance Transmission Range Sensor Circuit Low Input Transmission Range Sensor Circuit High Input Transmission Range Sensor Circuit Intermittent Transmission Fluid Temperature Sensor Circuit Malfunction Transmission Fluid Temperature Sensor Circuit Range/Performance Transmission Fluid Temperature Sensor Circuit Low Input Transmission Fluid Temperature Sensor Circuit High Input Transmission Fluid Temperature Sensor Circuit Intermittent Input/Turbine Speed Sensor Circuit Malfunction Input/Turbine Speed Sensor Circuit Range/Performance Input/Turbine Speed Sensor Circuit No Signal Input/Turbine Speed Sensor Circuit Intermittent Torque Converter/Brake Switch "B" Circuit Low Output Speed Sensor Circuit Malfunction Output Speed Sensor Circuit Range/Performance Output Speed Sensor Circuit No Signal Output Speed Sensor Circuit Intermittent Torque Converter/Brake Switch "B" Circuit EEigh Engine Speed Input Circuit Malfunction Engine Speed Input Circuit Range/Performance Engine Speed Input Circuit No Signal Engine Speed Input Circuit Intermittent Incorrect Gear Ratio Gear 1 Incorrect Ratio Gear 2 Incorrect Ratio Gear 3 Incorrect Ratio Gear 4 Incorrect Ratio Gear 5 Incorrect Ratio Reverse Incorrect Ratio Torque Converter Clutch Circuit Malfunction Torque Converter Clutch Circuit Performance or Stuck Off Torque Converter Clutch Circuit Stuck On Torque Converter Clutch Circuit Electrical Torque Converter Clutch Circuit Intermittent Pressure Control Solenoid Malfunction Pressure Control Solenoid Performance or Stuck Off Pressure Control Solenoid Stuck On Pressure Control Solenoid Electrical Pressure Control Solenoid Intermittent Shift Solenoid "A" Malfunction Shift Solenoid "A" Performance or Stuck Off Shift Solenoid "A" Stuck On Shift Solenoid "A" Electrical Shift Solenoid "A" Intermittent Shift Solenoid "B" Malfunction Shift Solenoid "B" Performance or Stuck Off Shift Solenoid "B" Stuck On Shift Solenoid "B" Electrical Shift Solenoid "B" Intermittent Shift Solenoid "C" Malfunction Shift Solenoid "C" Performance or Stuck Off 213 P0762 •P0763 P0764 P0765 P0766 P0767 P0768 P0769 P0770 P0771 P0772 P0773 P0774 P0780 P0781 P0782. P0783 P0784 P0785 P0786 P0787 P0788 P0789 P0790 C" Stuck On C" Electrical C" Intermittent Malfunction Performance or Stuck Off Stuck On Electrical Intermittent E" Malfunction E" Performance or Stuck Off E" Stuck On E" Electrical E" Intermittent Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Malfunction 1-2 Shift Malfunction 2-3 Shift Malfunction 3-4 Shift Malfunction 4-5 Shift Malfunction Shift/Timing Solenoid Malfunction Shift/Timing Solenoid Range/Performance Shift/Timing Solenoid Low Shift/Timing Solenoid EEigh Shift/Timing Solenoid Intermittent Normal/Performance Switch Circuit Malfunction 214 Appendix 5 ADDENDUM to the Information Document No in accordance with Annex II of Council Directive 70/156/EEC0 relating to type approval and referring to emission control by on-board diagnostic systems for motor vehicles 3. POWER PLANT (q) 3. 2. 12. 2. 8. On-Board Diagnostic (OBD) System 3. 2. 12. 2. 8. 1. Written description and/or drawing of the MI: 3. 2. 12. 2. 8. 2. List and purpose of all components monitored by the OBD system: 3. 2. 12. 2. 8. 3. Written description (general working principles) for: 3. 2. 12. 2. 8. 3. 1. Positive-ignition engines* }: 3. 2. 12. 2. 8. 3. 1. 1. Catalyst monitoring(1): 3. 2. 12. 2. 8. 3. 1. 2. Misfiredetection(1): 3. 2. 12. 2. 8. 3. 1. 3. Oxygen sensor monitoring* ^: 3. 2. 12. 2. 8. 3. 1. 4. Other components monitored by the OBD system(1): 3. 2. 12. 2. 8. 3. 2. Compression-ignition engines(): 3. 2. 12. 2. 8. 3. 2. 1. Catalyst monitoring11): 3. 2. 12. 2. 8. 3. 2. 2. Particulate trap monitoring(1): 3. 2. 12. 2. 8. 3. 2. 3. Electronic fuelling system monitoring(1): 3. 2. 12. 2. 8. 3. 2. 4. Other components monitored by the OBD system(1): 3. 2. 12. 2. 8. 4. Criteria for MI activation (fixed number of driving cycles or stati sti cal method): 3. 2. 12. 2. 8. 5. List of all OBD output codes and formats used (with explanation of each): 3. 2. 12. 2. 8. 6. - Type of (off-board) interrogation tool: n The item numbers and footnotes used in this Information Document correspond to those set out in Annex I to Directive 70/156/EEC. Items not relevant for the purpose of this Directive are omitted. 215 Appendix 6 ESSENTIAL CHARACTERISTICS OF THE VEfflCLE FAMILY Parameters defining the OBD family The OBD family may be defined by basic design parameters which must be common to vehicles within the family. In some cases there may be interaction of parameters. These effects must also be taken into consideration to ensure that only vehicles with similar exhaust emission characteristics are included within an OBD family. To this end, those vehicle types whose parameters described below are identical are considered to belong to the same engine-emission control-OBD system combination. Engine: - combustion process (i. e. positive-ignition, compression-ignition, two stroke, four stroke); - method of engine fuelling (i. e. carburettor or fuel injection). Emission control system: - - type of catalytic converter (i. e. oxidation, three-way, heated catalyst, other) type of particulate trap - secondary air injection (i. e. with or without) - exhaust gas recirculation (i. e. with or without) OBD parts and functioning: - the methods of OBD functional monitoring, malfunction detection and malfunction indication to the vehicle driver. 216 Appendix 7 ADDENDUM to the EC type-approval certificate No. concerning the type-approval of an on-board diagnostic system (OBD) Directive 70/220/EEC, as last amended by Directive. 1. 1. Written description and/or drawing of the MI: 1. 2. List and purpose of all components monitored by the OBD system: 1. 3. Written description (general working principles) for: 1. 3. 1. Misfire detection* ): 1. 3. 2. Catalyst monitoring* }: 1. 3. 3. Oxygen sensor monitoring* }: 1. 3. 4. Other components monitored by the OBD system* }: 1. 3. 5. Catalyst monitoring* }: 1. 3. 6. Particulate trap monitoring* }: 1. 3. 7. Electronic fuelling system actuator monitoring*2): 1. 3. 8. Other components monitored by the OBD system* }: 1. 4. for MI Criteria statistical method): activation (fixed number of driving cycles or 1. 5. List of all OBD output codes and formats used (with explanation of each): 1. 6. Specification of (off-board) interrogation tool: 2. 4. Comments(ifany): (1) *2) In the case of positive-ignition engines. In the case of compression-ignition engines. 217 FINANCIAL STATEMENT B5-3000 Internal Market 1. TITLE OF OPERATION Proposal for a European Parliament and the Council Directive relating to measures to be taken against air pollution by emissions from motor vehicles and amending Directives 70/220/EEC and 70/156/EEC. 2. BUDGET HEADING INVOLVED B5-3000 Internal Market 3. LEGAL BASIS Article 100a of the EU Treaty 4. DESCRIPTION OF OPERATION 4. 1 General Objectives Measures to be taken against air pollution by emissions from motor vehicles 4. 2 Period covered and arrangements for renewal or extension The proposed Directive requires: From 1 January 2000, Member States may no longer grant EC type-approval for a new type of vehicle on grounds relating to air pollution by emissions if it fails to comply with the provisions of "stage 2000". With effect from 1 January 2001, Member States shall refuse the registration, sale or entry into service of new vehicles which do not comply with the provisions of the Directive. As regards the limit values applicable from 1 January 2005, the Commission shall submit, before 31 December 1999, a report to the Council and Parliament concernint the industrial feasibility of the application of such limits, taking account of the technological progress achieved as well as environmental needs and the availability of improved fuels. In the light of this report, the Commission shall submit a proposal for confirming or revising, if necessary, these limit values. 218 5. CLASSIFICATION OF EXPENDITURE OR REVENUE There are no receipts following this action. 6. TYPE OF EXPENDITURE Technical work directly linked to the assessment of envisaged future vehicle technology (A) Technical work linked to the development of new proposals, in particular those dealing with breakthrough technologies (de NOx catalyser, CNG engineered vehicles, other alternatives: fuelled/propelled vehicles), monitoring of air quality, development of Community assessment criteria for non-technical measures (B) Technical work linked to the preparation of Commission Directives through the Committee procedure (notably improvement of OBD requirements), design of prerequisit conditions for type approving of replacement parts ensuring a control of pollution emission equivalent to the original part while not triggering the OBD (C) Organization of a "Review Conference in 1999" (D) 7. FINANCIAL IMPACT 7. 1 Method of calculating total cost of operation (relation between individual and total costs) The expected cost would globally amount to approximately ECU 600 000 dispatched in 1997/1999, for the following actions, in the form of contract, with the following breakdown: (A) 0. 2 (B) 0. 1 (C) 0. 1 (D) 0. 2 7. 2 Itemized breakdown of costs (in ECU million) Budget 96 PDB 97 PDB 98 PDB 99 Total ' A B C D Total 0. 1 0. 1 0. 1 0. 1 0. 2 219 0. 1 0. 2 0. 3 0. 2 0. 1 0. 1 0. 2 0. 6 7. 3 Operational expenditure of studies, experts, included in Part B of the Budget (in ECU million) Breakdown Budget 96 PDB 97-99 Var. in % - Studies - Meetings of experts - Conferences and congresses - Information and publications 0 Total 0. 4 0. 2 0. 6 New 8. FRAUD PREVENTION MEASURES - It will be explicitly specified in contracts that all work performed is the property of the Commission. - Final payment of contractors will only take place after reception and examination of the reports and services requested. 9. ELEMENTS OF COST-EFFECTIVENESS ANALYSIS 9. 1 Specific and quantified objectives; target population On the basis of the data available on the costs and potential benefits of the various technical measures (engine technology, fuel quality and improved inspection and maintenance of emissions control systems), it has been possible to identify the most cost/effective packages of technical measures necessary to achieve a significant reduction of urban NOx, particulate matters in the most polluted areas and ozone precursors at European level. The present proposal corresponds to the most cost/effective strategy found in the Auto/Oil programme. 9. 2 Grounds for the operation The European Union has a longstanding history in reducing vehicle emissions. However, despite the considerable achievements with regard to the emission reduction of individual vehicles, increased traffic activity (increased number of vehicles, increased kilometers travelled) is likely to counteract these improvements thereby preventing the emission reductions necessary to achieve future air quality objectives. The likelihood of further action to reduce vehicle emissions necessitated a reassessment of the existing policy approach; it being apparent that the emission reduction potential offered by further improvements in vehicle technology was limited and possibly very costly in comparison with other potential solutions. 220 Therefore a new, comprehensive and integrated approach was developed which is set out in Directive 94/12/EC, Article 4. Article 4 stipulates that technical and non- technicla measures to be assessed with regard to their cost-effectiveness shall include improved vehicle technology, the use of alternative fuels (e. g. LPG, CNG, biofuels), more appropriate mechanisms to reduce the in-use deterioration of emission control systems (based on an inspection and maintenance programme) and "improvements in fuel quality as far as vehicle emissions of dangerous substances (in particular benzene) are concerned". The proposal forms part of a global Community strategy which will include strengthened requirements for passenger cars, light commercial vehicles and heavy duty vehicles from year 2000, new minimum standards for motor fuels and enhanced in-use vehicle emission requirements. This combination of measures represents, in view of the Commission, an optimal package of legislative actions which will ensure that the Air Quality targets identified in the course of the implementation of the Auto/Oil programme will be met by year 2010. In addition, the present proposal includes a revision of the framework for emission-related fiscal incentives and emissions values corresponding to the foreseen Stage 2005 car emission standards. 9. 3 Monitoring and evaluation of the operation The Commission, in cooperation with the Member States, will monitor the development of air quality on an urban and regional level in order to verify the air quality predictions which have guided the currently proposed legislative measures. 221 ISSN 0254-1475 COM(96) 248 final DOCUMENTS EN 14 12 15 Catalogue number : CB-CO-96-310-EN-C ISBN 92-78-05787-8 Office for Official Publications of the European Communities L-2985 Luxembourg 222

Proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE on the sale of consumer goods and associated guarantees

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels,18. 06. 1996 COM(95)i 520 final 96/0161 (COD) Proposal for a EUROPEAN PARLIAMENT ANP COUNCIL DIRECTIVE on the sale of consumer goods and associated guarantees (presented by the Commission) EXPLANATORY MEMORANDUM I. General A. Context 1. Since its first preliminary programme for a consumer protection and information policy(l), the various Community institutions have on several occasions requested the Commission to present proposals with a view to improving guarantee arrangements and after-sales services. The progressive completion of the single market gives further cause to address these problems at Community level. Hence, in its proposal for a Council Directive on unfair terms in consumer contracts(2), the Commission finally proposed harmonization of certain aspects of the legal and commercial guarantee for movables and the legal guarantee for services. These proposals were backed by the European Parliament. However, the Council thought it more appropriate to deal with these matters separately and in greater depth and refused to include these provisions in the Directive on unfair terms, inviting the Commission to examine the opportunities of harmonizing guarantee schemes in the Member States relating to consumer contracts and, on this basis, to submit to it, if relevant, a proposal for a Directive on the harmonization of national legislation in this domain(3). In the meantime the Commission has conducted an in-depth analysis of the "usefulness and desirability of approximating guarantee arrangements and improving after-sales services for goods and services in the internal marketH(4). This analysis was conducted in the context of wide-ranging consultations in the wake of the Green Paper on guarantees for consumer goods and after-sales services(5). The impact assessment annexed to this proposal surveys the results of these consultations. This proposal is also a necessary complement to Directive 93/13/EEC concerning unfair contract terms. This Directive assures all consumers a uniform minimal level of protection throughout the European Union with regard to contract terms governing all transactions with professionals. Irrespective of the place of purchase, European consumers have the same protection everywhere with regard to unfair general conditions of sale. However, this Directive only concerns clauses governing the modalities of a transaction and is silent as regards the consumer's rights in the event of bad performance of a contract. Thus, at present, a clause in a sales contract (1) Council Resolution of 14 April 1975, OJ No C 92, 25. 4. 1975, p. 1. (2) Initial proposal - see OJ No C 243, 28. 9. 1990, p. 2; amended proposal - see O J N o C 7 3, 24. 3. 1992, p. 7. (3) Statement in the Council minutes in connection with the adoption of the Directive on unfair terms in consumer contracts of 5 April 1993. (4) As the Council had also requested in its Resolution of 13 July 1992 on future priorities for the development of consumer protection policy, OJ No C 186, 23. 7. 1992, p. 1. (5) COM(93) 509 of 15 November 1993. excluding the vendor's liability for any defects in the good sold is void as against the consumer, while the concrete rights that the consumer can rely on in such a case are somewhat quite different according to the State where the good was purchased. This proposal seeks to guarantee a uniform minimal level of protection for consumers throughout the Union. The need for a directive on this subject was also underlined European Parliament's Opinion on the Commission's Green Paper*6*. The Parliament, in fact, requested the Commission to present, without delay, a proposal for a Directive. in the Studies in the different Member States show that problems concerning the quality of goods and the operation of guarantees and after-sales services are the main source of consumer complaints in connection with the purchase of goods(7). The situation is similar in the case of cross-border transactions. The information provided to the Commission, notably by the European consumer infocentres operating in certain border regions, shows that the bulk of consumer complaints relating to the purchase of movables concern the legal and commercial guarantees. An analysis of the latest 100 cases reported to the Commission by one of the European infocentres concerning disputes associated with the cross-border purchase of goods (France, Luxembourg, Belgium, Germany) shows that approximately 70% of complaints relate to this domain. It goes without saying that in the case of cross-border transactions, the consumer's plight is aggravated because of the nature of the dispute: the problem of the applicable law, divergences between national laws, problems of invoking the commercial guarantee, etc. Against this backdrop, it is not surprising that European consumers are still quite reluctant to shop abroad, although in theory European citizens consider the freedom to buy products and services abroad to be one of the main attractions of the single market. According to a Eurobarometer survey conducted in 1993(8), 52% of consumers mentioned the difficulties they encountered in exchanging goods or having repairs done to products purchased abroad as the main barrier to cross-border purchases. The percentage of consumers who mentioned this barrier is far higher in (6) Resolution of 6 May 1994, OJ No C 205, 25. 7. 1994, p. 562. (7) For example, the statistics published by the Office of Fair Trading on consumer complaints reported to the national authorities in the United Kingdom. These quarterly statistics are published in the review Fair Trading and highlight the preponderance of problems relating to defective goods and the difficulties of getting them repaired in complaints concerning such goods. A calculation based on complaints received during the second quarter of 1994 (Fair Trading No 9, Winter 1994/95) gives the following percentages for different types of goods: furniture (not upholstered) 60. 6% upholstered furniture 75. 6% radio, TV, other electrical goods and hire 66. 4%, major appliances 72. 2%, clothing 61. 3%, footwear 81. 1%, toilet article, perfumery, hairdressing 39. 9%, jewellery, silverware, clocks and watches 66. 6%, new motor cars, 59. 5%, secondhand cars 61. 9%. (8) Eurobarometer No 39, September 1993. some countries than in others (68% in Denmark, 63% in the Netherlands and 61% in Germany for example). The language barrier is mentioned by 40% of consumers and, in third place, the difficulty of settling disputes, mentioned by 34% of consumers. Interestingly, the fourth barrier mentioned is uncertainty with regard to the terms of sale: the percentage of consumers who mention this barrier rose from 24% in 1991 to 31% in 1993. In its general conclusions concerning the Green Paper adopted on 17 May 1994, the Council reaffirmed its conviction that the benefits of the internal market should accrue to all consumers; that consumers must be encouraged to play a more active role in the operation of this market; that measures of this kind are essential if Europe is to be brought closer to the European citizen. Already in its second three-year action plan on consumer policy (1993-1995)(9), the Commission emphasized that "transfrontier shopping can only flourish if the consumer is assured that he can enjoy the same after-sales and guarantee terms no matter where the supplier is domiciled" and that, if the internal market is to work properly, it is necessary to guarantee consumers that, independently of the country of purchase of a good within the single market, they will always be able to benefit from an effective after-sales service and to challenge possible defects in the goods purchased00*. This proposal for a Directive follows from the above and aspires to provide European consumers with a minimum common corpus of rights throughout the European Union. This can only be done by approximating national legislation governing the legal guarantee. In all Member States the legal guarantee is the bedrock of consumer rights as regards the quality and conformity of the goods purchased. Commercial guarantees are add-ons to these basic rights, but generally they cannot waive them. Hence the legal guarantee is the foundation for the development and operation of the commercial guarantees. The notion of the "legal guarantee" includes all legal protection of the purchaser in respect of defects in the goods acquired, resulting directly from the law, as a collateral effect of the contract of sale. The key feature of the legal guarantee is that it is designed to protect purchasers' confidence in the context of the contract of sale - their legitimate expectations concerning the product purchased - and that it operates independently of the will of the contracting parties, its effects being binding in law. On the other hand, the notion of "commercial guarantee" expresses the will of one person, the guarantor, who assumes personal liability for certain defects which may be present in the goods sold. These guarantees take the form of a written promise accompanying the product or delivered at the time of purchase, pursuant to which the guarantor undertakes to repair or replace the product if a defect emerges within a certain time. w COM(93) 378 final of 28 July 1993. (10) COM(93) 509 final of 15 November 1993. Divergences in national legal guarantee regimes concern both how defects are defined and the rights accorded to consumers and how they can exercise them. Divergences are most striking notably as regards the legal guarantee period, which ranges from an indeterminate period (F, B, L, NL, FIN) to a short period of six months (D, E, P, G, A) and, in mid-field, the period of six years (UK, IRL), two years (S) and one year (DK, I). Again, many of the national laws hark back to a time when manufacturing and marketing conditions were very different from what they are today. Traditional civil law rules governing the contract of sale were based on the paradigm of two equal citizens concluding a contract for the transfer of title from one to the other. Hence they are ill adapted to current manufacturing and marketing realities. For example, the traditional effects of the legal guarantee - the right to rescind the contract and to secure a reduction in price - are both overly rigid and inadequate, and so they may suit neither the consumer nor the seller. And we should remember that the traditional remedies associated with the commercial guarantee - replacement or repair of the good - are a statutory requirement only in half the Member States and even then only in certain strictly defined circumstances. 5. Member States also seem to be aware of the need to overhaul domestic law. This trend may be observed in several Member States. Let us mention some of the more recent initiatives: the United Kingdom has just amended its general legislation on the sale of goods with an eye to protecting buyers against minor defects and in product durability. Greece has just promulgated a new shortcomings Consumer Protection Act which contains landmark provisions concerning after-sales services: suppliers are now obliged to provide operating instructions with their products and to inform the consumer of the product's normal lifespan, during which period repair and maintenance services must be made available to consumers. Finland has also reformed its consumer protection law, mainly with an eye to establishing joint and several liability of the manufacturer and seller in the context of the legal guarantee. Germany has not yet got around to reforming its rules but an expert committee which has long been working on a plan to reform the law pertaining to contractual obligations has stated clearly that the existing provisions are obsolete. Notably it has proposed that the legal guarantee be extended to three years as opposed to six months at present. And Austria is already discussing a bill to amend the existing legal guarantee regime, notably with a view to establishing a three-year legal guarantee. In Sweden, the two-year legal guarantee currently in force is felt to be inadequate and a bill currently under debate provides for a mandatory five-year guarantee period. It is likely mat other Member States will also take initiatives in a domain which is so crucial to the protection of consumers in the context of purchasing goods. This proposal for a Directive will also contribute to simplifying existing national rules, by approximating them to the law in force on the international sale of goods between professionals (Vienna Convention of 1980) and by reducing distortions to competition which may result from divergences in national legislation. The proposal for a Directive also takes into consideration the European Parliament's endeavours to encourage approximation of the private law of the Member States at Community level0 *\ 6. An analysis of consumer complaints and commercial practices shows that minimum harmonization of the legal guarantee must be accompanied by certain framework rules governing commercial guarantees. Very often the way commercial guarantees are drafted leads to their being confused with the legal guarantee, with the result that consumers may be misled as to their rights. And far too often commercial guarantees are less than candid as to their scope and content, or lay down unconscionable terms as to the circumstances in which the guarantee may be relied on - hence effectively negativing the very rights they seemingly grant. 7. the terms this Explanatory Memorandum, "legal guarantee" and In "commercial guarantee" are used for reasons of clarity. However in the text of the proposal for a Directive the terminology is somewhat different, so as to avoid difficulties as regards certain legal traditions to which the concept of the "legal guarantee" is foreign. Hence the term "guarantee" will be reserved for commercial guarantees only, and indeed this is generally what the consumer understands by the term. Thus the first four Articles (approximation of sales law) concern the "legal guarantee", although the term is not mentioned, while Article 5 concerns the "commercial guarantee", which is simply referred to as the "guarantee". B. Essential aspects of the proposal The proposal for a Directive has two strands. The first part - the main section - addresses the commercial guarantee. legal guarantee, while second part concerns the the As regards the legal guarantee, the text of this proposal for a Directive is very precise: its purpose is to regulate aspects which are strictly linked to the protection of consumers when they buy goods which are not in conformity with the contract. In no way does it attempt to completely harmonise sales law. For this reason, all questions concerning the formation of the contract between the parties, defects in the contract, the effects of the contract, including those linked to performance or non-performance of the contract, or forms of imperfect performance other than non-conformity of the product with the contract, are not addressed by the text and remain entirely and completely subject to national law. Moreover, the proposal merely specifies that the guarantor must resolve the problem, i. e. through refund or price reduction, replacement of repair of the product. The proposal for a Directive in no way regulates liability for possible direct or indirect damage caused by the lack of conformity. (11) Resolutions of 26 May 1989 and 6 May 1994, OJ No C 158, 26. 6. 1989, p. 400 and OJ No C 205, 25. 7. 1994, p. 518 respectively. If it provides the consumer with a minimum corpus of legal rights throughout the European Union, the text also tries to maintain a certain balance between the obligations of the various parties. Hence it lays down obligations which consumers must fulfil on pain of forfeiting their rights. The second aspect of the proposal for a Directive concerns the commercial guarantee, but it does not endeavour to regulate it in its entirety. It merely lays down certain principles concerning transparency and the relationship with the legal guarantee as well as certain rules designed to furnish a legal framework for commercial guarantees. Any additional features are a matter for commercial policy where competition is of the essence and fall within the competence of the firm. Henpe there is no obligation to provide commercial guarantees in the first place, although certain countries have already adopted this approach. The content of the guarantees, the guarantee period and the procedures for invoking the guarantees are also left to the offerers' discretion. For reasons linked to application of the subsidiarity principle, after-sales services as such, i. e. services relating to the use, maintenance and repair of goods, independently of the implementation of any legal or commercial guarantee, are not covered by this proposal for a Directive. This is a complex domain which is more adequately addressed, at Community level, through voluntary instruments (for example codes of conduct for individual sectors), than in the form of statutory rules. C. Consistency with other Community policies Since consumers and economic operators need to know for certain that they can fully and fairly benefit from the single market, the Council has made a point of stressing its determination to ensure that the single market must work effectively for the good for all Community citizens by assuring respect for the four freedoms(12), hence offering consumers a greater choice of quality goods and services and improving the competitiveness of Community firms(13). These declarations by the Council highlight the interaction between the policy concerning the creation and operation of the single market and the other Community policies and, in general, all the objectives of the European Union. (12) In this context it should be remembered that the Court of Justice has ruled that the free movement of goods also implies that "(. ) consumers resident in one Member State may travel freely to the territory of another Member State to shop under the same conditions as the local population. " GB-INNO-BM judgment of 7 March 1990, Case C 362/88, ECR 1990, p. 667, grounds 8. (13) Council Resolution of 7 December 1992 on making the single market work, OJNoC334, 18. 12. 1992, p. 1. The role of improving consumer protection in this context has already been stressed by the Commission. On the one hand the single market was not created for business alone and cannot function properly without active and genuine consumer participation. Another point is that informed consumers can, by shopping wisely, accelerate the positive economic effects of an integrated market0'0. The Commission considers that this proposal dovetails perfectly with the goals of all Community policies, particularly those concerning quality and competition policy. II. Justification of the proposal in the light of the subsidiarity principle (a) What are the objectives of the proposed measure, and how do they relate to the Community's obligations? Article 129a of the Treaty stipulates that the Community shall contribute to the attainment of a high level of consumer protection through measures adopted pursuant to Article 100a in the context of the completion of the internal market and through specific action which supports and supplements the policy pursued by the Member States to protect the health, safety and economic interests of consumers and to provide adequate information to consumers. The Community measure is designed to approximate the essential features of the domestic legal orders pertaining to the sale of consumer goods, so as to improve the functioning of the single market and to reduce distortions to competition which may be caused by differences in the legislations, by providing European consumers with a minimum standard of protection, no matter where they shop. More specifically, the envisaged measure would have the following benefits: strengthen consumer confidence in the single market; facilitate cross-border shopping and strengthen the role of consumers as active market players; simplify existing national rules; bring Community law closer to European citizens by giving them direct and very tangible benefits. Hence strengthen the Community citizen's support for European integration; have positive effects on competition, business competitiveness and the European economy. <14) "Making the most of the single market: strategic programme", COM(93) 632 of 22 December 1993. In this document, the Commission already pointed out that it considered legal and commercial guarantees a priority area for legislative measures at Community level, with a view to making the Union a genuine single market from the consumer's perspective. 8 (b) Is the measure an area where the Community has sole jurisdiction or where it shares jurisdiction with the Member States? The measure concerns an area where the Community has sole jurisdiction, namely the creation and operation of the single market. (c) What options are available to the Community? The objective pursued can only be achieved by Community Directive laying down minimum rules. Independent measures taken by the Member States can ensure neither a minimum standard of protection for consumers throughout the Union nor adequate protection of consumers in the context of cross-border transactions. The Directive's main objective - the approximation of national rules governing the legal guarantee - is incompatible with solutions based on "soft law" or codes of conduct. Moreover, the sectors under consideration are so heterogeneous that the establishment of pan-European codes of conduct seems to be an unrealistic option. (d) Are uniform rules needed, or is it enough to adopt a Directive setting out general objectives, while leaving implementation to the Member States? Considering the existing differences between national laws, both in respect of issues of principle and legislative techniques, partial harmonization is required. As required by the principle of subsidiarity, the proposal for a Directive is however strictly limited to the essential aspects concerning legal guarantees and commercial guarantees. Hence the proposal concerns only consumers' rights relating to direct "repair" of the deficiency: Member States remain completely free to determine the rules on damages, both direct and indirect, applicable to consumers who have purchased a defective good(15). Likewise, the proposal for a Directive says nothing about the general rules applicable to sales contracts, those relating to the formation of the contract, absent of consent, etc. The proposal does not regulate the substance of commercial guarantees and there is no general requirement to provide guarantees. Moreover, within the strict limits of partial harmonization, the proposal for a Directive provides only for minimum harmonization; hence Member States will be free to adopt or maintain in force more stringent rules with a view to protecting consumers. Thus the national margin of discretion will be very wide. (15) In contrast to the amended proposal for a Directive on unfair terms in consumer contracts (COM(92) 66 of 4 March 1992, OJ No C 73, 24. 3. 1992), where this aspect was expressly included in Article 6. Finally, the very nature of the text - rules applicable in the context of sales of consumer goods - means that practical enforcement of most of the provisions will be a task for the national courts, which will apply these rules on a case-by-case basis. HI. Detailed comments on the Articles Article 1 The definitions in Article 1 broadly outline the scope of the Directive by linking the criterion of the contracting parties (contracts concluded between professionals and consumers) and the criterion of the subject of the contract (consumer goods). Paragraph 2(a) The definition of the consumer is inspired by the classical definitions already contained in other Directives. All sales of consumer goods by a professional seller to a private individual are covered by the proposal provided the latter is not acting in the course of business. Paragraph 2(b) As suggested in the Green Paper, immovables are excluded. However, the definition of consumer goods is not limited to new and durable goods. Most of the replies to the Green Paper argued that such a restriction would be unwise. Moreover, national laws do not distinguish between these types of goods in the context of the legal guarantee. It would also be very difficult to define what exactly is meant by a durable good: should it be defined as one that is destroyed by use (entirely or partly?), as one that can only be used for a determinate (short?) period, etc? Anyhow, the rules provided for in this proposal can quite readily be adapted to accommodate different types of goods. Paragraph 2(c) The proposal covers only sales by professional sellers. Hence, private sales are completely outside its scope and remain fully subject to the applicable national rules. Paragraph 2(d) This paragraph defines what in the Green Paper was called the "commercial guarantee". It covers all commercial guarantees independently of the offerer. It also covers commercial guarantees offered against payment and extended warranties provided against payment over and above free guarantees. This definition is directly linked to Article 5 of this proposal and recalls that guarantees must always place the beneficiary in a more advantageous position than that resulting from the national provisions governing the sale of consumer goods. 10 Article 2 Article 2 lays down the straightforward principle that the goods must be in conformity with the contract. This groundrule will make it possible to cover a whole range of situations, not just the criterion of "conformity with the consumer's legitimate expectations" as suggested in the Green Paper. Although it has been very warmly welcomed by consumer advocates, professional circles take a dim view of this criterion. Paragraph 1 The principle of conformity with the contract may also be considered as common to different national legal traditions. Conformity with the contract is also the criterion enshrined by the Vienna Convention of 1980 on the international sale of goods between professionals. Conformity with the contract derives not only from conformity with the express terms of the contract, but also from conformity with certain criteria laid down in the second paragraph. In continental legal systems the criteria may be considered as imperative rules applicable to contracts governing the sale of consumer goods, while in common law systems they may be seen as part of the notion of "implied terms" of the contract which the parties cannot waive. In conformity with the most modern legal systems (the new Netherlands Civil Code, legislation in the Nordic countries) and the Vienna Convention, the traditional distinction in certain legal orders between the obligation to deliver and the legal guarantee covering hidden defects is abandoned and replaced by the new and shared concept of conformity of the goods with the contract. The theoretical and practical difficulties engendered by this distinction can clearly be seen in French case law which, over the years, has oscillated between conflating and distinguishing these two notions, without coming to any definitive conclusion. Paragraph 2 Different elements, explicating the principle of conformity, have been taken into account in this paragraph in the light of different national traditions. The wording was to a large degree inspired by Article 35(2) of the Vienna Convention. Paragraph 3 The Green Paper discussed the possibility of extending the rules governing the legal guarantee to services associated with goods (installation, repair, maintenance, etc. ) Most of the responses were favourable. However, the Commission considers that the complexity and diversity of services do not lend themselves to a simple extension to services of rules governing the sale of goods. On the other hand, as regards the installation of goods linked to the sale, this extension is unproblematic and even necessary since in practice it is difficult to distinguish between the two and because it is necessary to protect the consumer consistently. 11 Article 3 Paragraph I The first sentence of paragraph 1 stipulates the seller's liability for lack of conformity and also specifies the moment at which conformity of the goods with the contract is to be determined. It is based directly on Article 36(1) of the Vienna Convention but - contrary to this Convention and the law of certain Member States - it provides that conformity be assessed the moment the consumer receives the good and not at the time the contract is concluded. This seems to be the only appropriate solution in transactions involving consumers. The overwhelming majority of replies to the Green Paper were agreed on this point. When the consumer knew of or could not have been unaware of the lack of conformity at the time of purchase (i. e. a patent defect present in the good which the consumer has examined prior to purchase), there is strictly speaking no lack of conformity with the contract because the consumer has accepted the good as such and so it will be "in conformity with the contract". Exclusion of the seller's liability would therefore in these cases already ensue, in principle, simply from applying the concept of conformity with the contract. Nevertheless, it seemed preferably to provide a specific reference to this solution. The period of two years seems to be an adequate compromise between the periods laid down by the different Member States. Paragraph 2 The purpose of paragraph 2 is to restrict the seller's liability for public statements made by third parties, the conformity criterion referred to in Article 2(2)(d). The seller may waive liability for all the cases referred to in each indent. Paragraph 3 Generally, definition of rules governing the burden of proof is a national prerogative. According to the traditional rules governing proof, it will normally be up to the consumer to prove that the non-conformity of the good with the contract already existed, at least in embryonic form, at the time he received the good. However, when the non-conformity arises from the existence of a defect which does not become manifest until later (and sometimes very much later), it is well-nigh impossible for consumers to prove that the defect existed at the time they received the good. Generally, it is far easier for the professional to demonstrate that the lack of conformity was not present at the time of delivery and that it resulted, for example, from improper handling by the consumer. This is why over the years case law in several Member States has tended to reverse the burden of proof in the case of goods purchased by consumers from professionals. Hence this paragraph provides for a partial reversal of the burden of proof as regards the moment of the existence of the lack of conformity in favour of the consumer for a short period of six months after delivery. 12 Paragraph 4 When the lack of conformity is non-trivial, the consumer may choose between the four traditional remedies: reimbursement or reduction of the price, replacement or repair of the good. These four remedies are also provided for in the Vienna Convention and in the most modern national legislations. More traditional systems allow only the first two remedies: to add the latter two would certainly help bring the law more into line with economic realities. The first remedy (cancellation of the contract with return of the good and reimbursement of the price) is normally challenged by professionals who often think that it should be excluded when the good can be repaired or exchanged. This corresponds to economic and social realities: the consumer, unless he has lost confidence in the product or seller, is normally happy to exchange the product or have it repaired. However, the remedy should be retained because: - given the broad notion of lack of conformity, this remedy is the only appropriate one in certain cases; it is a good way for consumers to exercise pressure in order to ensure that the product is repaired or exchanged at the earliest opportunity; - it is the classical remedy found in all legal traditions. There is no reason to fear that consumers will abuse this remedy. First, when a refund is not sought within a short period following sale, the amount reimbursed will normally be reduced so as to take into account the value of the use of the good by the consumer. Secondly, the consumer must purchase a new good to replace the one he has returned to the professional. Finally, the experience of sellers who sell on a "satisfaction or money back" basis show that consumers normally behave reasonably. In this context, it should be remembered that even motor cars have been sold on a "satisfaction or money back" basis within a one-month period. The guarantee period is two years (paragraph 1), as in the Vienna Convention. However consumers may not pursue all the remedies at their disposal throughout this period: the right to rescind the contract and to have the good replaced applies only during the first year following delivery. This differentiated solution is based on the idea that rescission and replacement are remedies which, as time passes, become increasingly inappropriate as the period of use grows longer. Moreover, it is envisaged as a compromise to accommodate the traditions of the common law counties which have quite a long guarantee period (six years) for seeking damages, but where consumers are entitled to replacement and refunds only for quite a short period. Again with an eye to compromise and in order to accommodate different national traditions, Member States are allowed to limit the consumer's options in the case of a minor lack of conformity. 13 Paragraph 5 National provisions governing sales between professionals are normally less strict than those governing sales between a professional and a consumer. Thus, sellers may often include in these contracts clauses disclaiming their liability for the legal guarantee. These clauses will also be valid under Community law, because the scope of Directive 93/13/EEC on unfair terms is limited to contracts concluded between "a seller or supplier and a consumer". This situation may also cfeate an injustice in that the entire liability for defects ultimately resulting from an act of commission or omission on the part of another party falls upon the final sellers. This is notably the case as regards manufacturing defects, defects caused by improper handling on the part of an intermediary or indeed any lack of conformity resulting from the statements referred to in Article 2(2)(b). Although this proposal for a Directive concerns the sale of goods to the final consumer, it is also necessary to include a provision granting the final seller the right to pursue remedies against those responsible so that he can recover the costs caused by defects which can be imputed to them. The procedures for pursuing remedies are to be regulated by national law. Article 4 Article 5 provides for a period which starts to run the moment the lack of conformity is discovered, and compliance with which is a formal condition for exercising the rights granted in the preceding Articles. Paragraph 1 The obligation on the buyer to notify the seller of any lack of conformity within a certain period following discovery of the defect already exists in certain countries (Denmark, Sweden, Finland, Italy, Luxembourg, the Netherlands, Portugal) and is also enshrined in Article 39(1) of the Vienna Convention. This obligation reinforces legal certainty and encourages diligence on the part of the buyer, taking the seller's interests into account. As in the Vienna Convention, the period begins to run from the moment the consumer detects or ought normally to have detected the lack of conformity. The last sentence makes it incumbent on the consumer to take normal care in examining the goods after reception, but does not establish a strict obligation to carry out a detailed inspection of the good or to conduct tests to evaluate its functioning or performance. Paragraph 2 The choice of a single period, at once procedural and substantial, means that the limitation period must bç frozen once the notification provided for in paragraph 1 has been brought. Unless this principle is enshrined, consumers would be forced to bring legal proceedings so as not to forfeit their rights, hence discouraging speedy 14 and amicable settlement between the professional and the consumer. The detailed procedures governing this interruption (notably as regards the moment the limitation period begins to run again) are laid down by national law. Article 5 Paragraph 1 This paragraph establishes the principle, which seems self-evident, that any guarantee legally binds the guarantor in accordance with the conditions laid down in the guarantee document. This does not imply any legal qualification in respect of the guarantee (contract, unilateral promise, etc. ), which could also vary depending on the person of the guarantor and national legal traditions. This paragraph, however, also gives guarantee references in advertising the same status as actual guarantee conditions. In reality, consumers never have access to guarantee documents prior to purchase. Hence, the only contact the consumer has with guarantees is through advertising. It is on the basis of advertising pertaining to guarantees that the consumer's confidence and expectations are built up. Thus, advertising statements must be looked on as an integral part of the guarantee conditions. A similar principle was also established at Community level in the context of Directive 90/314/EEC of 13 June 1990 on package travel, package holidays and package tours, Article 3(2) of which prescribes that "[i]he particulars contained in the brochure are binding on the organiser or retailer. ". This paragraph thus establishes the principle that guarantees must put the consumer in a more advantageous position than that resulting from the arrangements established by the national rules applicable. It is not necessary that all features of the commercial guarantee offered should go beyond the national rules applicable; it is enough that the consumer's position should be improved in some respect. Paragraph 2 To ensure transparency and adequate information of consumers, all guarantees must be in writing and contain certain minimum particulars. However, when a guarantee infringes the rules, just as when it infringes Article 5(1), this should not in any way affect the guarantee's validity: the consumer may still rely on the guarantee and require that it be honoured. But Member States must take effective measures to prevent such guarantees from being offered, to ensure that the objectives are achieved and to reduce sources of potential disputes. In order to ensure absolute transparency, this paragraph also establishes the right that consumers who wish to do so shall be free to consult the guarantee documents before purchasing goods. 15 Article 6 Paragraph 1 Paragraph 1 is a "classical" provision designed to enshrine the imperative nature of the rules contained in this proposal in favour of the consumer. These rules may not be waived, even with the consumer's consent. Paragraph 2 A similar provision already features in Directives 93/13/EEC (unfair terms) and 94/47/EEC (timeshares). Article 7 Paragraph 1 As is clear from the text of the proposal and explained at length in the Explanatory Memorandum, the Commission's intention in presenting this proposal is to cover only a very limited number of the questions raised by the sale of consumer goods. As far as lack of conformity is concerned, the aim of the Commission, fully in keeping with the principle of proportionality, is merely to resolve, by the means established by Article 4, the problems relating to the goods themselves as a result of such lack of conformity. The general (and of course specific) provisions of national law normally go much further and in some cases extend the liability of the seller (or other parties, e. g. the producer) to include other harms done to the consumer as a result of lack of conformity. This may cover a carpet damaged by a faulty cleaner, or the cost of hiring a replacement car, etc. This proposal is, of course, without prejudice to the cumulative application of such national provisions. Paragraph 2 This is a traditional provision in the context of consumer protection directives. Article 8 Since the proposal for a Directive mainly concerns the legal guarantee, and since it is restricted to prescribing a minimum common corpus of consumer rights, a transposition period of two years seems adequate. 16 Proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE on the sale of consumer goods and associated guarantees THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 100a thereof, Having regard to the proposal from the Commission03, Having regard to the opinion of the Economic and Social Committee(2), Acting in accordance with the procedure referred to in Article 189b of the Treaty(3), Whereas the internal market comprises an area without internal frontiers in which the free movement of goods, persons, services and capital is guaranteed; whereas free movement of goods concerns not only persons acting in the course of a business but also private individuals; whereas it implies that consumers resident in one Member State should be free to purchase goods in the territory of another Member State on the basis of a minimum set of fair rules governing the purchase of consumer goods; Whereas the laws of the Member States concerning the sale of consumer goods are quite disparate, with the result that national consumer goods markets differ from one another and that competition between sellers may be distorted; Whereas consumers who are keen to benefit from the large market by purchasing goods in Member States other than their State of residence play a fundamental role in the completion of the internal market by preventing the artificial reconstruction of new frontiers and the compartmentalization of markets; whereas these opportunities have been greatly broadened by new communication technologies which allow ready access to distribution systems in other Member States or at international level; whereas in the absence of minimum harmonization of the rules governing the purchase of consumer goods, the development of the sale of goods through the medium of new distance communication technologies risks being impeded; Whereas the creation of a common minimum corpus of consumer law, valid no matter where goods are purchased within the Community, will further strengthen consumer confidence and enable consumers to make the most of the internal market; ( i) (2) (3) 17 Whereas the main difficulties encountered by consumers and the main source of disputes with sellers concern the non-conformity of goods with the contract; whereas it is therefore appropriate to approximate national legislation governing the sale of consumer goods in this respect, without however impinging on provisions and principles of national law relating to contractual and non-contractual liability; Whereas the goods must, above all, conform with the contractual specifications; whereas the notion of conformity with the contract may be considered as common to the different national legal traditions; whereas the seller should be directly liable to the consumer for the conformity of the goods with the contract; whereas this is the traditional solution enshrined in the legal orders of the Member States; whereas, nevertheless, the seller should be free to pursue remedies against his own seller or the producer when the non-conformity is the result of an act of commission or omission on their part; Whereas, in the case of non-conformity of the product with the contract, consumers should be entitled to request that the product be repaired or replaced, or to a reduction in the price paid by way of damages or cancellation of the contract of sale; whereas, however, exercise of these rights should be limited in time and time-limits laid down during which these rights may be invoked against the seller; Whereas, in the interest of a stable business environment and good faith in the relations between the contracting parties, it should be incumbent on the consumer to notify the seller of any non-conformity he detects within a short period; whereas in order to allow the parties to reach amicable settlements without immediately having to institute legal proceedings to safeguard their rights the limitation period should be interrupted once the consumer draws attention to the lack of conformity of the goods; Whereas it is current practice, for certain categories of goods, for sellers and producers to offer guarantees on their products designed to insure consumers against any defect which becomes manifest within a certain period; whereas this practice can stimulate competition; whereas, however, these guarantees may be a simple publicity ploy and deceive the consumer; whereas to ensure market transparency certain common principles applicable to the guarantees offered by the economic operators should be laid down; Whereas the rights granted to consumers should not be excludable by common consent between the parties since otherwise the legal protection afforded would be vitiated; whereas consumers should always be entitled to rely on the rights resulting from this Directive or any other applicable national provision, even if they accept the implementation of the guarantee; whereas consumer protection resulting from this Directive should not be reduced on the grounds that the law of a non-member country is applicable to the contract; Whereas legislation and case law in this area in the various Member States show that there is growing concern to ensure a high level of consumer protection; whereas in the light of these trends and the experience acquired in implementing this Directive it may be necessary to envisage more far-reaching harmonization, notably by stipulating the producer's direct liability for defects for which he is responsible; 18 Whereas Member States must be allowed to adopt or maintain in force more stringent provisions, in the field covered by this Directive, to ensure a yet higher level of consumer protection, HAVE ADOPTED THIS DIRECTIVE: Article 1 Scope and definitions 1. The purpose of this Directive is the approximation of the laws, regulations and administrative provisions of the Member States on the sale of consumer goods and associated guarantees in order to ensure a uniform minimum level of consumer protection in the context of the internal market. 2. For the purposes of this Directive, (a) "Consumer" means any natural person who, in the contracts covered by this Directive, is acting for purposes which are not directly related to his trade, business or profession; (b) "Consumer goods" means any goods, excluding buildings, normally intended for final use or consumption; (c) "Seller" means any natural or legal person who sells consumer goods in the course of his trade, business or profession; (d) "Guarantee" means any additional undertaking given by a seller or producer, over and above the legal rules governing the sale of consumer goods, to reimburse the price paid, to exchange, repair or handle a product in any way, in the case of non-conformity of the product with the contract. Article 2 Conformity with the contract 1. Consumer goods must be in conformity with the contract of sale. 2. Goods shall be deemed to be in conformity with the contract if, at the moment of delivery to the consumer: (a) they comply with the description given by the seller and possess the qualities of the goods which the seller has held out to the consumer as a sample or model, (b) they are fit for the purposes for which goods of the same type are normally used; (c) they are fit for any particular purpose for which the consumer requires them and which he had made known to the seller at the time of conclusion of the contract, except where the circumstances show that the buyer did not rely on the seller's explanations; 19 (d) their quality and performance are satisfactory given the nature of the goods and the price paid and taking into account the public statements made about them by the seller, the producer or his representative. 3. Any lack of conformity resulting from incorrect installation of the goods shall be considered to be equivalent to lack of conformity of the goods with the contract, if the goods were installed by the seller or under his responsibility. Article 3 Obligations of the seller 1. The seller shall be liable to the consumer for any lack of conformity which exists when the goods are delivered to the consumer and which becomes manifest within a period of two years unless, at the moment of conclusion of the contract of sale, the consumer knew or could not be unaware of the lack of conformity. 2. When the goods are not in conformity with the public statements made by the producer or his representative, the seller shall not be liable if: the seller shows that he did not know and could not reasonably know the statement in question; - the seller shows that at the time of sale he corrected the statement; or the seller shows that the decision to buy the goods could not have been influenced by the statement. 3. Until proof of the contrary any lack of conformity which becomes manifest within six months of delivery shall be presumed to have existed at the time of delivery, unless this presumption is incompatible with the nature of the goods or the nature of the lack of conformity. 4. When a lack of conformity is notified to the seller, pursuant to Article 4, the consumer shall be entitled to ask the seller either to repair the goods free of charge within a reasonable period, or to replace the goods, when this is possible, or to demand an appropriate price reduction or rescission of the contract. Exercise of the right of rescission or replacement of the good is limited to one year. Member States may provide that the scope of the rights referred to in the first subparagraph be limited in the case of a minor lack of conformity. 5. When the final seller is liable to the consumer because of a lack of conformity resulting from an act of commission or omission by the producer, a previous seller in the same chain of contracts or any other intermediary, the final seller shall be entitled to pursue remedies against the responsible person, under the conditions laid down by national law. 20 Article 4 Obligations of the consumer 1. In order to benefit from the rights referred to in Article 3(4) the consumer must notify the seller of any lack of conformity within a period of one month from the date on which he detected the lack of conformity or ought normally have detected it. 2. Notifications made pursuant to paragraph 1 shall interrupt the limitation period provided for in Article 3(4). AûifikJ. Guarantees 1. Any guarantee offered by a seller or producer shall legally bind the offerer under the conditions laid down in the guarantee document and the associated advertising and must place the beneficiary in a more advantageous position than that resulting from the rules governing the sale of consumer goods set out in the national provisions applicable. 2. The guarantee must feature in a written document which must be freely available for consultation before purchase and must clearly set out the essential particulars necessary for making claims under the guarantee, notably the duration and territorial scope of the guarantee, as well as the name and address of the guarantor. Articled Binding nature of the provisions 1. Any contractual terms or agreements concluded with the seller before notification of the lack of conformity which waive or restrict the rights resulting from this Directive shall not be binding on the consumer. 2. Member States shall take the necessary measures to ensure that, irrespective of the law applicable to the contract, and when the contract has a close connection with the territory of the Member States, consumers are not deprived of the protection afforded by this Directive. Article 7 National law and minimum protection 1. The rights resulting from this Directive shall be exercised without prejudice to other rights which the consumer may rely on under the national rules governing contractual or non-contractual liability. 2. Member States may adopt or maintain in force more stringent provisions, compatible with the Treaty, in the field covered by this Directive, to ensure a higher level of consumer protection. 21 Article 8 Transposition 1. Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive not later than [two years after its publication in the Official Journal of the European Communities]. They shall immediately inform the Commission thereof. When Member States adopt these provisions, these shall contain a reference to this Directive, or shall be accompanied by such reference at the time of their official publication. The procedure for such reference shall be adopted by Member States. 2. Member States shall communicate to the Commission the provisions of national law which they adopt in the field covered by this Directive. Article 9 Entry into force This Directive shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Communities. AtiicifiLlû Addressees This Directive is addressed to the Member States. Done at Brussels, For the European Parliament The President For the Council The President 22 IMPACT STATEMENT Proposal for a European Parliament and Council Directive on the sale of consumer goods and associated guarantees 1(a) Taking account of the principle of subsidiarity, why is Community legislation necessary in this area and what are its main aims? The main aims of the proposal are: to improve the functioning of the single market; to strengthen consumer confidence in the single market and enable consumers to benefit fully from the abolition of frontiers and to contribute actively to better integration of the European economy; to secure for European consumers a minimum corpus of rights which will provide them with a high level of protection when purchasing consumer goods, irrespective of the Member State in which the purchase is made. These objectives cannot be realized adequately by the Member States and hence, given the dimensions and effects of the envisaged measure, can better be accomplished at Community level, in the form of a Directive designed to approximate existing national laws and to create a minimum corpus of rights for consumers throughout the Community. 1(b) What other merits or demerits might the proposal have? include global The proposal has additional merits over and above its primary objectives. Advantages the improvement European market, enhanced competitiveness of the European economy and greater product durability, with beneficial effects on the environment (by reducing over-exploitation of natural resources and waste) and unemployment (through the growth of repair and inspection services, which are by definition labour-intensive). in product quality in Moreover, the proposal contributes to simplifying the legal framework relating to the sale of consumer goods and commercial guarantees that currently exist, hence making things easier for firms, notably when planning commercial strategies in the field of guarantees. 1(c) Are other solutions envisaged and what would be the results (for example: codes of conduct, self-regulation at sectoral level)? The Directive's main objective - the approximation of national legislation pertaining to the legal guarantee - is incompatible with a code of conduct type solution. Moreover, the sector concerned is so heterogenous that it would be difficult to establish codes of conduct at European level. The consultations in the 23 context of the Green Paper were proof enough: although the Commission, in the Green Paper, invited the economic operators to submit any self-regulation proposals they found desirable and although it even published, by way of example, a code of conduct for commercial guarantees drawn up by the British retail trade, no concrete proposal or initiative has yet been received by the Commission in this area. to the proposal for a Directive gives enormous Nonetheless, self-regulatory initiatives. Moreover, the provisions concerning commercial guarantees merely lay down certain basic general principles and rules which ideally should be fleshed out in the context of self-regulation. The Commission will do its utmost to encourage initiatives in this regard. latitude 2(a) Who will be affected by the proposal? Which sectors of business? Which sizes of business and what is total employment in the sector? The sector of activity concerned by the proposal is that of the sale of consumer goods. Obviously the size of the affected firms varies greatly - since large firms are to be found side by side with small and medium-sized ones. 2(b) Does this sector have specific characteristics - for example, do a small number of firms enjoy a dominant position? No. 2(c) What will the proposal's impact be on very small firms, skilled trades and the liberal professions? In the case of very small retailers, the proposal will give them the right to seek remedies against their suppliers in the distribution chain. 2(d) Are there particular geographical areas of the Commuhity where these businesses are found? No. 3(a) What obligations will the proposal impose on firms? What are the costs of compliance? Compliance costs are negligible. In so far as the proposal extends the duration of the legal guarantee - by comparison with the laws of certain Member States - and makes it easier for the consumer to seek remedies from the economic agents liable, in the case of defective products, one might expect a small increase in costs associated with handling defective products. Nonetheless, these costs are very limited and can be assessed perfectly in advance on the basis of the product's reliability record. After all, the proposal for a Directive concerns only the defective good itself (repairs, recall, etc. ), to the exclusion of any other direct or indirect injury to the consumer caused by the defective good. 24 To avoid this hypothetical increase in costs, economic agents may be encouraged to improve or adapt global quality control systems so as to identify and rectify internal sources of inefficiency, hence contributing substantially to a progressive reduction in costs. Specialists estimate that the potential reduction in costs associated with introducing appropriate quality management may exceed 10% of turnover. Moreover, the proposal, by clarifying the liability regime, may contribution to reducing the number of disputes and the attendant costs. The approximation of national laws on the sale of consumer goods, guarantees and after-sales services will also simplify the existing legal framework at European level and may thus contribute, in a general manner, to reducing the costs incurred by economic operators in interpreting and applying different national laws. 3(b) Are there other administrative procedures or documents to be filled in? No. 3(c) Are licences or authorizations for placing on the market required? No. Will charges be levied? No. 4(a) What economic effects is the proposal likely to have (costs, advantages, etc. )? on employment? In so far as the proposal for a Directive inter alia provides for the repair of goods and may encourage the production of more durable goods, there will be an increased demand for maintenance and quality control services, which by definition are very labour-intensive. 4(b) on the investment and creation of new businesses For the reason mentioned above, the proposal should encourage the creation of new firms providing repair and maintenance services. 4(c) on the competitive position of businesses, both in the Community market and elsewhere? The proposal will encourage competitiveness. First, it will significantly bolster consumer confidence in the single market and encourage consumers to shop around. The increase in cross-border consumer shopping will contribute to removing barriers to trade and the artificial compartmentalization of markets. There will be greater competition and this will make firms more competitive. 25 Secondly, the proposal will encourage better working relations between economic operators at different levels in regard to marketing, with a view to satisfying the final consumer. Thirdly, the proposal may lead economic operators, in particular producers of consumer goods, to establish appropriate quality control systems, with the attendant growth in competitiveness. Fourthly, the proposal will encourage economic agents to make more accurate representations in regard to their goods and discourage the use of dubious or indeed fraudulent claims concerning goods. This will improve market transparency and consumers will find it easier to compare products, which in turn will also encourage competition. Finally, the Directive will enlighten consumers as to their rights in connection with the purchase of defective products and will make it easier for consumers to exercise these rights. The consumers' obligation to notify any defect discovered within a short period (on pain of forfeiting their rights) makes them the final link in the "quality control" chain, and gives the economic operators the feedback they need in order to identify and eliminate sources of inefficiency. 4(d) on the authorities responsible for implementing the provisions? The proposal will not lead to any particular costs for the national authorities. 4(e) Are there other indirect effects? No. 4(0 What are the costs and benefits of the proposal? • Costs In certain circumstances, particularly in the case of less efficient firms operating in Member States where the legal guarantee is less protective than the one provided for in the proposal, there may be a slight increase in costs associated with the handling of defective goods. • Advantages The stimulus given to quality policy, which may lead ta savings. Greater competitiveness. Greater market transparency. More intensive competition. Greater consumer confidence in the single market; More cross-border purchases. Strengthening of economic integration. Strengthening of competitiveness and competition. 26 Positive effects on employment and the environment. Conclusion: the benefits exceed the costs. 5(a) Impact on SMEs. Does the proposal contain measures to take account of the specific situation of SMEs - if not, why not? Are reduced or different requirements appropriate? There are no particular measures for SMEs in this proposal. Nonetheless, given that one of me weak points of SMEs is their problem in coping with the complexity of the legal environment, the proposal may make life easier because it simplifies this environment. The clarification of the rules governing liability contained in the proposal may also contribute to reducing the number of disputes between SMEs and consumers, because the latter will be in a better position to assess the scope of their rights and will be less likely to submit complaints that have no foundation in law. Moreover, by stimulating the creation of repair and maintenance firms, the proposal will benefit SMEs most of all. It also seems that sellers and even producers will tend increasingly to subcontract after-sales services to independent specialized firms. 5(b) Are higher thresholds, which exclude SMEs without compromising the measures' effectiveness, envisageable? No. Consultation 6(a) When did consultations take place and what was the date of publication of the plan to introduce regulatory measures? In January and February 1993 the Commission organized two hearings, one with the Member States and the other with the business circles concerned. The ongoing work was presented, followed by a debate, at the CCD (Committee on Commerce and Distribution) in April of the same year. These consultations were organized in tandem with bilateral contacts with all the social players who evinced an interest in the subject. In the second three-year action plan on consumer policy (1993-1995), called "Placing the single market at the sen/ice of European consumers" (COM(93) 378 final of 28 July 1993), the Commission officially announced the forthcoming publication of a Green Paper on the subject. On 15 November 1993 the Commission published the Green Paper on guarantees for consumer goods and after-sales services (COM(93) 509). This Green Paper contains an in-depth analysis of the law in force in each of the 12 Member States and at Community level which directly or indirectly governs guarantees and after-sales services, as well as an examination of trade practices concerning the guarantee offered by the economic operators. The Green Paper also recapitulates 27 the main bugbears facing consumers and economic operators in the context of the single market and sets out a range of concrete proposals for Community measures with a view to resolving them. These proposals focus on possible harmonization of the legal guarantee and a full specific regime is proposed in this regard. The deadline for consultations was 30 April 1994. In a communication published in OJ No C 338 of 15 December 1993, the Commission invited all interested parties, notably the social players concerned, to supply all information and data of an economic, social and/or legal nature which they considered relevant, to propose any measure they deemed suitable for improving the functioning of guarantees and after-sales services in the context of the single market and, more specifically, to comment on the solutions aired in the Green Paper. The Commission also stated that anyone who sent in a written submission could be invited to a hearing. also organized conferences were Several subject. The European Commission participated in a study day organized by the University of Utrecht in the Netherlands and a two-day conference at Buxton, organized by the University of Sheffield included representatives of the academic community, consumer advocates, and the economic operators concerned. the United Kingdom. Attendees this on in The hearing on the Green Paper took place on 18 July 1994. Approximately 50 persons, representing the main interest groups, participated. The first European Consumer Forum, held in Brussels on 4 October 1994, had the Green Paper as one of its main discussion topics. A total of 350 persons participated in the European Consumer Forum, representing various professional groups from 19 countries (producers, distributors, representatives of consumer associations and the legal world, academic experts in consumer law, members of the Community institutions, etc. ). 6(b) List the organizations which have been consulted about the proposal, which have communicated their general view in a detailed manner, including any misgivings or objections concerning the final proposal. Why is it not possible - or desirable - to accommodate their demands? There were a total of 77 formal replies, broken down as follows. five replies from the "institutions" (European Parliament, EP-Legal Affairs Committee, Economic and Social Committee, Consumers' Consultative Council, and the Committee on Commerce and Distribution); 36 replies from professional bodies; 13 replies from consumer associations; 12 replies from states or institutions belonging to the States; 28 one reply from a university group (ECLG - European Consumer Lawyers Group); two replies from individual firms; eight replies from individuals (law professors or company lawyers). 6(c) Member States four Member States officially Only their Permanent Representations. However, certain ministries or semi-public agencies in four other Member States replied directly to the Commission. The EFTA countries agreed to submit a common position, with the exception of Sweden which made an independent contribution. in writing via replied As a rule the Member States' replies are quite positive and encouraging. Some have come out clearly in favour of Community measures to harmonise the legal guarantee and to adopt a Community legal framework for commercial guarantees (this is also the position of the EFTA countries). Others are more circumspect but say they will support initiatives in at least one of these domains (legal guarantee and commercial guarantee). 6(d) The European Parliament The two EP committees responsible (Committee on the Environment and Consumer Protection - chef de file; Legal Affairs Committee - for opinion) submitted very positive reports. The European Parliament adopted its resolution on 6 May 1994. This resolution was quite detailed and urged the Commission to prepare by the end of 1994 a proposal for a Directive designed to ensure minimum harmonization of the legal guarantee and to establish a legal the framework Commission to scrutinize the question of after-sales services more closely than it did in the Green Paper. for commercial guarantees. The resolution also invites 6(e) The Economic and Social Committee The ESC delivered its opinion at its plenary session on 1 June 1994. This report is by and large very positive, albeit somewhat general. The ESC welcomes gradual harmonization in regard to the legal guarantee, and also supports framework rules and a European consumer code concerning the commercial guarantee; as regards after-sales services, it favours the establishment of codes of conduct in preference to legally binding rules. 6(f) Consumer associations Consumer associations clearly and vigorously support the Community initiatives. At the hearings the Forum consumer organizations were emphatic in defending their stance. Some of the Commission proposals in the Green Paper were criticized for not being consumer-friendly enough. Generally speaking, consumer 29 associations want the Community to give priority to harmonizng the legal guarantee, while also interested in far-reaching measures in regard to commercial guarantees and after-sales services. 6(g) Professional bodies Reactions from the professional bodies fall into one of three classes: professional bodies that are opposed to any Community initiative; professional bodies that are in favour of minimum harmonization of the legal guarantee and agree that it would be good to adopt codes of conduct so as to improve the situation in regard to commercial guarantees; professional bodies that in principle reject harmonization of the legal guarantee but do not object to Community measures in regard to commercial guarantees, at least in the form of codes of conduct. The main professional bodies opposed to Community initiatives argue that there are no major problems and that no Community action is necessary. However, few concrete criticisms were made regarding specific aspects of the proposed schemes, and sometimes there was even general agreement as to the substance (for example the Green Paper's proposed option of a legal framework governing commercial guarantees). Moreover, the business world has been very divided in its reaction to the Commission proposals. While the large Europe-wide horizontal organizations often came out quite vociferously against harmonization of the legal guarantee (UNICE, Eurocommerce, Committee of Commerce and Distribution, Orgalime), the national bodies - often members of these European federations - have been more positive or have even clearly support harmonization of the legal guarantee - this applies to the CNPF (Confédération Nationale du patronat français), the Chambre de Commerce et de the CGPME (Confédération Générale des Petites et Moyennes Entreprises, France), the British Retail Consortium and AMADEA (Association of Manufacturers of Electrical Appliances - UK). Likewise, the more branch-specific organizations, both national or European, are by no means averse to harmonising the legal guarantee. For example, this holds for the Fédération de l'Horlogerie (France), ACEA (the European carmakers' association) the British Photographic Importers Association, the Software Publishers Association Europe and FEDSA (Federation of European Direct Selling Associations). l'Industrie de Paris, Generally speaking, the professional bodies have been far more open to harmonizing the legal guarantee than to far-reaching Community intervention in the domain of commercial guarantees and after-sales services. 30 6(h) How have the comments and suggestions made been taken into account? Close consideration has been given to the suggestions and comments made by the contributors in the consultation process in drafting the proposal for a Directive. Examples include the definition of the scope of the proposal for a Directive, the notion of lack of conformity, the very fact that the Directive focuses on the legal guarantee, and the abandonment of the idea of creating a Euro-guarantee label. 6(i) Have the professional bodies of the SMEs been formally consulted? If not, why not? The professional bodies of the SMEs were consulted in the general context of the Green Paper. Moreover, before and after adoption of the Green Paper, Commission officials discussed the proposal with SME representatives in the context the of meetings organizations themselves. the Commission organized by or 7. Follow-up and re-examination. Indicate the procedures for following up and re-examining the proposal in regard to the effects and costs associated with its implementation. Will it be easy to amend the proposal once it is adopted? No formal procedure for following up and re-examining the proposal is envisaged. However, the Commission will not fail to conduct studies and surveys necessary to evaluate the proper implementation of the Directive, once adopted. In the absence of a comitology procedure, all amendments to the Directive will be subject to the usual legislative process. 31 Wt^H^:l^'i^*t^'«». #'-'"'mrnmÊaà ISSN 0254-1475 COM(95) 520 final DOCUMENTS EN 10 Catalogue number : CB-CO-95-632-EN-C ISBN 92-77-96654-8 Office for Officiai Publications of the European Communities L-2985 Luxembourg 32

COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL on a future strategy for the control of atmospheric emissions from road transport taking into account the results from the Auto/Oil Programme

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 18. 06. 1996 COM(96) 248 final 96/0163 (COD) 96/0164 (COD) COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL on a future strategy for the control of atmospheric emissions from road transport taking into account the results from the Auto/Oil Programme Proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE relating to the quality of petrol and diesel fuels and amending Council Directive 93/12/EEC Proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE relating to measures to be taken against air pollution by emissions from motor vehicles and amending Council Directives 70/156/EEC and 70/220/EEC (presented by the Commission) COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL on a future strategy for the control of atmospheric emissions from road transport taking into account the results from the Auto/Oil Programme 1. BACKGROUND EU Legislation on vehicle emission standards Directive 70/220/EEC(]) was the first directive to lay down emission limits for passenger cars. Over the past two decades subsequent amendments to Directive 70/220/EEC and the adoption of legislation on emission standards for light commercial^ and heavy duty vehicles(3) have strengthened and extended Community policy in this area. When the emission standards. for passenger cars laid down in Directive 94/12/EC(4) (the latest amendment of the 1970 base directive) comes into effect in 1996/97, emissions of regulated pollutants from new passenger cars will be reduced by over 90% as compared to the standards which prevailed in the early 1970s. These improvements in standards are illustrated below in Figure 1. Figure 1 Evolution of Community Passenger Car Emission Standards •5 O S 3 03 OJ t 0- 100 m % co m % HC & NOx (1) (2) (3) (4) Directive 70/220/EEC; OJ No L 76, 6. 4. 1970, p. 1. Directive 93/59/EEC; OJ No L 186, 28. 7. 1993, p. 21. Directive 91/542/EEC; OJ No L 295, 25. 10. 1991, p. 1 Directive 94/12/EC; OJ No L 100, 19. 4. 1994, p. 42. However, despite these considerable achievements with regard to the emission reduction of individual vehicles, increased traffic activity (increased numbers of vehicles, increased kilometres travelled) are likely to counteract these improvements and to militate against overall emissions being reduced to a level consistent with the attainment of future air quality objectives. Given the reductions already achieved, further action to reduce vehicle emissions necessitated a reassessment of the existing policy approach since the emission reduction potential offered by further improvements in vehicle technology, was limited and possibly very costly in comparison to other potential solutions. The Commission, in October 1992 therefore organized a conference with all relevant interest groups to discuss the» issue of vehicle emission standards for the year 2000 and beyond. The major conclusion from this conference was that future emission standards should be based on an integrated approach and should have as their objective the achievement of air quality targets. In this context it was recognized that further steps would be needed not least because of increased traffic activity (increased numbers of vehicles and increased kilometres travelled). This new approach was outlined in the legislative proposals the Commission submitted to Council and Parliament in 1992. It is reflected in Article 4 of Directive 94/12/EC "which was adopted by Council and Parliament in 1994 under the co-decision procedure. The main elements of Article 4 are outlined below: "In these proposals [future proposals for emission standards to apply from 2000] the Commission shall take the following approach: the measures shall be designed to produce effects to meet the requirements of the Community's air quality criteria and related objectives, an assessment of the cost effectiveness of taking each measure shall be undertaken; in this global assessment full account shall be taken, inter alia, of the contributions that: traffic management, costs appropriately, for example by spreading the environmental enhanced urban public transport, new propulsion technologies (e. g. electric propulsion), • the use of alternative fuels (e. g. biofuels), could make to improving air quality, the measures shall be proportional and reasonable intended objectives. in the light of the The proposals, taking account of the methodology outlined above and aimed at a substantial reduction of pollutant emissions as regards the vehicles covered by this Directive, shall comprise in particular the following elements: 1. Further improvements in the requirements of this Directive: based on the assessment of the potential of the Traditional engine and post-combustion technology, possible improvements in the test procedure, e. g. cold-start, starting in low or wintry tests), evaporative emissions, temperatures, durability conformity (e. g. the in measures at the level of type-approval supporting strengthened inspection and maintenance requirements, including, for example, on-board diagnostic systems, the possibility of checking the conformity of vehicles in circulation, the proportional need for: (i) specific limits for HC and NOx in addition to a cumulative limit value, and (ii) measures to cover pollutants not yet regulated. 2. Complementary technical measures in the framework of specific Directives, including: improvements in fuel quality as far as vehicle emissions of dangerous substances (in particular benzene) are concerned, strengthening of the requirements of the inspection and maintenance programme. The reduced limit values which will be the subject of the new Directive shall not apply before 1 January 2000 for new type-approvals. The Council shall decide on the conditions for granting tax incentives on the basis of these limit values. " While Directive 94/12/EC was only adopted in 1994, Article 4 of that Directive is the formal expression of the framework within which the Commission carried out its preparatory work for the development of future legislative proposals directed at the reduction of emissions from road transport to be effective from the year 2000. 2. THE AUTO/OIL PROGRAMME In recognition of the fact that the future Community policy on the control of vehicle emissions should be based on an integrated and comprehensive approach and taking into account the potential of a wide variety of different measures for bringing about cost-effective solutions, the Commission, in 1992, invited the European oil and automobile industries to participate in a collaborative programme with the intention of developing a solid technical foundation upon which the Commission could build its future strategy: this programme subsequently became known as the Auto/Oil Programme. (A short summary of the technical analysis carried out in the Auto/Oil Programme is included as Annex 1 to this Communication. A more detailed explanation of the programme can be found in a consolidated technical report). The Auto/Oil Programme was a ground-breaking initiative in which the resources and expertise of two major industries were combined in collaboration with the services of the Commission and focused on the challenge of developing a rationale basis for future legislative action. The programme is an example of the principle of partnership identified in the fifth Environmental Action Programme. The Commission would like to record its thanks and appreciation to both industries in demonstrating their commitment to the goal of-sustainable development in such a tangible manner. In particular the extensive research programme known as the European Programme on Engines Fuels and Emissions (EPEFE) has provided a unique insight into the relationship between engine technology/fuel quality and vehicle emissions. The rationale of the Auto/Oil Programme was to quantify both the cost and the emission reduction potential of a variety of different measures which could contribute to reducing vehicle emissions and the attainment of air quality targets. The measures which were included in the analysis included not only advances in vehicle technology and fuel quality but also the benefits of improvements to the regular inspection and maintenance procedures as well the potential contribution of non-technical measures such as road pricing, improved public transport and scrappage schemes. The objective of the auto/oil analysis was to identify cost effective packages of measures sufficient to reduce vehicle emissions to the level compatible with the achievement of rigorous air quality standards throughout the Community. 3. CLEAN AIR: THE MOTIVATION FOR REDUCING VEHICLE EMISSIONS review process as well as Article 4 of Directive 94/12/EC requires that measures to reduce emissions from road traffic shall be designed to meet the requirements of the Community's air quality criteria and related objectives. The existing Community legislation on air quality objectives and dealing inter alia with nitrogen di-oxide, sulphur dioxide and particulate matter, lead and troposheric ozonze are currently being revised. In order to take account of the latest information emerging from that the existing World Health Organization air quality guidelines, the Commission and the two industry partners in the Auto/Oil Programme agreed to explore a number of air quality objectives: these objectives and the way they were used in the Auto/Oil Programme are described in summary form in the Annex to the present Communication and in greater detail in the consolidated air quality report from the Auto/Oil Programme. The critical air quality objectives which were eventually used as the basis for designing the package of measures to reduce road transport emissions are presented in Table 1. the ongoing work revise to Table 1 Air Quality Targets Pollutant: Urban N02 Air Quality Targets: 200 ug/m3 As maximum hourly value Urban Carbon Monoxide 10 mg/m3 As maximum hourly value. Urban Benzene Urban Particulates Tropospheric Ozone 10 ug/m3 As an annual mean 50 ug/m3 As a24 hour rolling average 180 ug/m3 As a one hour 99 percentile value. 4. REDUCING EMISSIONS FROM ROAD TRANSPORT STRATEGIES: SHARED RESPONSIBILITY INTEGRATED The Auto/Oil Programme focused exclusively on the control of emissions from the road transport sector. While for the majority of atmospheric pollutants road transport constitutes the single most important source of emissions other sources such as power stations, Industry and individual households also make a significant contribution. The implementation of the measures arising out of the Auto/Oil Programme will ensure that emissions from road transport are reduced to a level compatible with the attainment of rigorous air quality standards. However, in order that the air quality standards are achieved it will require equally significant and parallel reductions in emissions from other man made sources. In particular the results from the Auto/Oil Programme have demonstrated that reductions of man made emissions of both Volatile Organic Compounds (VOCs) and oxides of nitrogen (NOx) of the order of 70+% as compared to today's levels will be required if air quality iargets for tropospheric (low-level) ozone are to be achieved. ~ The attainment of satisfactory air quality throughout the Community should be based on an integrated, balanced and cost-effective approach to the reduction of emissions. Clearly, there are significant differences in the air quality to be found in the different cities and regions throughout the Community. The most cost-effective solution with regard to transport related emissions, will not be based on the assumption that Community wide technical measures should be expected, on their own, to resolve the pollution problems in the worst affected cities/regions. Air quality standards are laid down in Community legislation and Member States are required as a minimum to ensure that these standards are respected. This basic legal obligation placed upon the Member States constitutes the ultimate legal safeguard that the emission reduction measures taken at Community, national and local level will result in the achievement of the necessary air quality standards. In the Auto/Oil Programme and in the package of measures to be put forward by the Commission the underlying rationale was that technical measures, such as emission standards, fuel quality and improved inspection and maintenance regimes, will be applied at a certain intensity across the Community and will result in a widespread and significant reduction in emissions and consequent improvements in air quality. However, these Community-wide measures will have to be complemented and supplemented, as appropriate, by local and national measures such as road pricing, the expansion of the public transport system, emission related vehicle taxes and scrappage schemes applied to old vehicles. As a minimum, these national and local measures would need to be applied in localities/regions where, in the absence of such targeted actions, the Community-wide technical measures would not, on their own, ensure that the air quality standards required under Community legislation are achieved and respected. In addition, those Member States and localities that wish to achieve air quality standards higher than the minimum standards required under Community legislation, are of course free to introduce whatever national and local measures they see fit in order to reduce emissions from vehicles on condition that such measures are compatible with the Treaty such as the provisions on the free movement of goods and in particular the provisions of the Directives accompanying the present Communication. While decisions with regard to the appropriate choice of geographically restricted-measures aimed at reducing atmospheric pollution should be taken at the national, regional and local level, in the context of shared responsibility, there is a role for the Community to inform, promote and enable in order to ensure that Community policies have a positive influence. To this end the Commission has issued a Green Paper concerning public passenger transport and entitle "The Citizens Network" which suggests ways in which public transport can be made more attractive and usable. The Commission is also involved in a number of other initiatives and collaborative projects including inter alia the Car Free Cities Network which now has over 50 participating cities ,the networks addressing transport, energy efficiency and air quality involved in JOULE-THERMDE projects (the POLIS network on transport telematics applications, the EUROCITEES, TELECITIES and POLIS networks on the European Digital Cities project, city networks in environment telematics projects and the CITELEC). The interdependence of the various elements in the Commission's strategy applies not only to the relationship between actions taken at the Community/national/regional and local levels but also to the various technical measures. The increased severity of the vehicle emission standards applies at the time when a vehicle is type approved for marketing in the. Community; manufacturers are then required to ensure that all examples of that model which are produced conform to these standards and to ensure that the emission performance will not deteriorate significantly during the life of the vehicle; once the vehicle is on the road its emission performance will be influenced by the quality of the fuel and the behaviour of the driver; electronic sensors which monitor the emissions of the vehicle will also inform the driver of any defects and signal the need for repair; finally regular inspection and maintenance tests combined with road side checks and re-call schemes will also ensure that vehicles maintain a high level of emission performance throughout their life. The message which has to be underlined in relation to the control of vehicle emissions is the interdependence of all the elements 'in the systems. The technical components need to be compatible and the administrative systems need to inter-lock and be mutually supportive. In addition vehicle manufacturers and oil companies need to comply with their obligations. Finally and very importantly , individual vehicle owners have a major role to play in reducing vehicle emissions: responsible driving behaviour has a significant effect on fuel consumption and emissions; poorly maintained vehicles contribute a disproportionate amount to the total pollution load from the vehicle fleet. The Auto/Oil Programme and the Commission's future strategy on the control of vehicle emissions is based on the concept of shared responsibility and burden sharing between the Community, national and local governments, Industry and the individual citizen: such an approach is entirely consistent with the principle of sustainable development which requires that all stake-holders have a role to play in the protection of the environment. 5. FROM AUTO/OIL PROGRAMME TO LEGISLATIVE PROPOSALS The Auto/Oil Programme provides the technical foundation upon which the Commission will, build its strategy with regard to the control of vehicle emissions. In developing its proposals for the legislative actions which form a central part of that strategy the Commission took account of a number of considerations over and above the exclusively technical input provided by the programme: Uncertainty In recognition of the uncertainty inherent in any scientific investigation , particularly one a complex as the Auto/Oil Programme, the Commission's proposals are based on a precautionary approach. This means that the severity of the legislative proposals is such that even making conservative assumptions regarding the efficiency of non-technical measures it is confidently to be expected that the necessary air quality objectives will be respected throughout the Community. An integrated package As explained in section 3 the Commission's strategy is based on an integrated approach relying on action at a number of levels and the shared responsibility of all stakeholders. The Commission's legislative proposals must therefore be seen as a package - all the elements in the package are required to be adopted for the strategy to be effective. In addition and in accordance with the underlying premises of the Auto/Oil Programme, the different elements must be implemented concurrently to ensure maximum effectiveness. Feasibility The Commission's proposals also take account of the technological feasibility of introducing the measures according to the specified deadlines. For example in the case of the emission standards for diesel vehicles the proposals are based on the assumption that the de-NOx catalyst will not be in commercial production by the year 2000. The Commission's proposal does, however, take account of the need to provide an incentive for the continued development of this important technology as well as a commitment to guarantee that when vehicles equipped with these technologies arrive on the market, fuels of the a quality sufficent to ensure the effective performance of the new technologies are also available. The integrity of the internal market The economic benefits deriving from the creation of an internal market of over 350 million inhabitants were extremely important considerations for the Commission in developing its legislative proposals. The Commission has endeavoured to achieve an effective balance between one the one hand the need for flexibility in order to respond to the different air quality situations in the Community and on the other hand, the desire to ensure thejntegrity of the internal market. Coherence in legislative policy The Commission's proposals also took into account the history and the balance in the existing legislative regime. For example, in relation to the emission standards applied to different classes of vehicles the Auto/Oil Programme indicated that severe emission limits should be applied to light commercial vehicles and only light to moderate limits on passenger cars. In recognition of the fact that the same engines are often used in both categories of vehicle the Commission will propose that similar and co-ordinated emission limits are applied to each. Expectations of the Member States and the Parliament On the basis of frequent meetings with technical experts and written statements, the Commission has been kept informed of the position of the Member States with regard both to the Auto/Oil Programme and the legislative proposals arising from it. In addition the Parliament has on several occasions expressed itself in favour of environmentally ambitious measures to reduce emissions from road transport. The views of the Member States and the Parliament have been taken into account by the Commission in preparing its legislative proposals. 6. THE LEGISLATIVE PACKAGE ARISING FROM THE AUTO/OIL PROGRAMME In order to facilitate a clearer understanding as to how the Commission's proposals correspond to the framework established under Article 4 of Directive 94/12/EC, a short description of these proposals is given below: 6. 1 Vehicle-related measures 6. 1(a) Passenger Cars (this proposal to Directive 70/220/EEC The emission standards for passenger cars will be tightened by means of a proposed modification the present Communication). A summary of the new emission standards to come into force in 2000 and an indication of the percentage improvement as compared to current standards is given in Table 2 (designated as proposal A in the Table) Also shown in Table 2 are the indicative values which the Commission proposes should come into force in 2005 (designated as proposal B in the Table). These very stringent standards are referred to as the "second step" standards and will be subject to review and confirmation by the Council and Parliament in 1998. The rationale behind the establishment of a second step is provided in section 7 (Table 2 also shows for comparison the LEV and ULEV standards from the U. S. A. ) is attached to The Commission's proposal also contain provisions to ensure that the emission control systems in the car work effectively throughout the life of the vehicle. In particular there is now a requirement for passenger cars to be equipped with technology to monitor the emission performance and to indicate malfunctions to the driver: this technology is known as on board diagnostics (OBD). In addition, the Directive on passenger cars will also introduce arrangements for the in-use testing and eventual re-call of vehicle models after they have been placed on the market. Together with the strengthening of the periodic technical inspections (see below), OBD and re-call provisions should ensure that the emission performance should not deteriorate significantly during the life of the vehicle. As a means to reduce the amount of volatile organic compounds (essentially petrol fumes) which are lost to the atmosphere due to evaporation, a more rigorous test procedure for evaporative losses will be incorporated into the requirements for the type approval of gasoline passenger cars. One of the conclusions from the Auto-oil study was that already existing measures will result in significant reductions in vehicle related emissions of carbon-monoxide (CO) such that CO air quality standards will be respected. It was therefore concluded that the introduction of a cold start test procedure as part of the type approval requirements was not in fact necessary. Finally, in relation to passenger cars, the Commission's proposals (see Table 2) also include separate emission limits for NOx and hydrocarbons as was requested in Article 4 of Directive 94/12/EC. Table 2 Comparison of Passenger Car Limit Values Limit Values Mass of Carbon Mass of Mass of Oxides of Combined mass of Monoxide Hydrocarbons Nitrogen (CO) L, (g/km) (HC) L2 (g/km) (NOx) L3 (g/km) hydrocarbons and oxides of nitrogen (HC+NOx) L2 + L 3 (g/km) Petrol Diesel Petrol Diesel Petrol Diesel Petrol Diesel Mass of particulates (PM) L4 (g/km) Diesel 0. 05 Proposal A (2000) Proposal B* (2005) Current U. S. Federal Standards C. A. R. B. TLEV** C. A. R. B. LEV*** C. A. R. B. ULEV **" 2. 3 0. 64 0. 20 1. 00 0. 50 0. 10 - - 0. 15 0. 50 0. 08 0. 25 2. 1 2. 1 0. 25 0. 25 0. 25 0. 25 2. 1 2. 1 1. 7 2. 1 2. 1 1. 7 0. 08 0. 08 0. 25 0. 05 0. 05 0. 12 0. 02 0. 02 0. 12 0. 25 0. 12 0. 12 - - - _ _ - 0. 56 0. 30 '- 0. 025 -. _ - 0. 05 _ _ - Indicative limit values C. A. R. B. ( Califomian Air Resources Board)standards will be progressively introduced in a number of U. S. States in addition to California over the next ten years. C. A. R. B. Standards are: Transient Low Emission Vehicle Standard Low Emission Vehicle Standard Ultra Low Emission Vehicle Standard These standards specify emissions for Non Metane Organic Gases (NMOG) rather than Hydrocarbons (NMOG being a major fraction of HC). The test cycle used in the USA differs to that used in the EU, and so limit values are not directly comparable. 10 6. 1(b) Light commercial vehicles to Directive 70/220/EEC By the end of 1996, the Commission will come forward with a proposal for a further modification light commercial this vehicles. Indicative emission reductions for pollutant emissions to be incorporated into the type approval procedures for this category of vehicle as from the year 2000 are shown in Table 3: at present the exact values of the emission standards are still to be finalized and the values in Table 3 are therefore expressed as percentage reductions as compared to current standards. in relation time to In addition to the revised emission standards, the Commissions proposal for an amendment to Directive 70/220/EEC with regard to light commercial vehicles will also include many of the additional provisions which are foreseen for passenger cars e. g. OBD, re-call, an improved test procedure for evaporative emissions of volatile hydrocarbons and separate emission limits for NOx and hydrocarbons. Indicative Emission Reductions to Light Commercial Vehicle Emission Standards Table 3 Percentage Reduction from Current Standard Gasoline LCVs Diesel LCVs CO 30% 40% HC 4. 0% 65% NOx 40% 20% PM _ 35% 6. 1(c) Heavy duty vehicles By the beginning of 1997, the Commission will come forward with a proposal to amend Directive 88/77/EEC which concerns diesel engines used principally in heavy duty vehicles. The Commission's proposal will include stricter emission limits for regulated pollutants (see Table 4). As was the case with the light commercial vehicles, the precise values of the emission limits are not yet finalized and therefore the figures given in Table 4 are expressed as approximate percentage improvements as compared to current standards. In addition to the improved emission standards the Commission's proposal may also include the introduction of a new test cycle for measuring emissions as part of the type approval procedure (the effects of the new driving cycle will also need to be reflected in establishing the new emission limits). This new test cycle is intended to represent the real world driving pattern for these type of engines more effectively than the current procedure. Indicative Emission Reductions to Heavy Duty Engine Emission Standards Table 4 ^ 1 Diesel HDVs & Buses | Percentage Reduction from Current Standard NOx - 30% PM - 30% | | 11 6. 1(d) Alternative propulsion systems Although Article 4 of Directive 94/12/EC did require that the potential of alternative, propulsion systems should be evaluated by the Commission this issue was not addressed as part of the Auto/Oil Programme. However, the Commission is convinced that such systems, may achieve a significant role in the 21st century, recognizing that even more stringent emissions targets may have to be introduced as the effects of automotive emissions on health and global warming become better understood, and to meet the growing threat of global competition in the field of clean propulsion technologies. To this end the Commission has established a Task Force The Car of Tomorrow' (see section 8 below) which has as its objective the coordination of research on future technologies with a particular focus on advanced propulsion systems and more rigorous, broad-based comparative assessment of their performance relative to conventional propoulsion. 6. 2 Improved fuel quality The Auto/Oil Programme confirmed that improved fuel quality can have a significant impact upon pollutant emissions from vehicles. The Auto/Oil Programme also identified improved fuel quality standards as being a component part of a cost effective package of Community wide technical measures which would also contribute to the achievement of stringent air quality objectives. At the present time there exist relatively few Community provisions dealing with the quality of fuel used in road transport (lead and benzene in petrol (Directive 85/210/EEC); oxygenate levels in petrol (Directive 85/536/EEC) and sulphur levels in diesel (Directive 93/12/EEC)). These provisions will now be replaced by a comprehensive set of specifications to come into force in 2000 for both petrol and diesel and set out in the new fuel quality Directive. The impact upon the fuel quality on the European market in the year 2000 which will result from the Commission's proposal for a fuel quality Directive are shown in Tables 5 and 6. Predicted Market Average Fuel Quality in 2000 and Effect of Proposal - Petrol Table 5 Parameter Unit Market Average Without proposal Market Average with Proposal __ 58 53 84 11 37 1. 6 1 150 0. 005 RVP Summer E. 100 E. 150 Olefins Aromatics Benzene Oxygen Sulphur Lead kPa % v/v % v/v % v/v % v/v % v/v % m/m ppm ^ 68 53 84 11 40 2. 3 0. 6 300 0. 005 12 Predicted Market Average Fuel Quality in 2000 and Effect of Proposal - Diesel Table 6 Parameter Cetane Number Density Unit - kPa Poly-aromatics % Vol T95 Sulphur °C ppm Market Average without proposal Market Average with Proposal 51 843 9 355 450 53 835 6 350 300 Article 4 of Directive 94/12/EC made specific reference to the need to address the problem of the benzene content of petrol. In the proposal for a framework Directive on fuel quality, the Commission's position is that the maximum content of benzene should be reduced from 5% as is currently the case under Directive 85/210/EEC, to 2%. Article 4 of Directive 94/12/EC also required that the Commission should take into account the potential of alternative fuels in developing its future legislative proposals. Alternative fuels such as compressed natural gas (CNG) and liquid petroleum gas (LPG) were considered in the Auto/Oil Programme as potential alternatives to diesel fuel to be used for buses and other 'captive fleets' - waste disposal lorries, taxis etc - in cities (see below under local measures). The Commission's proposed fuel quality framework directive also includes a commitment to explore further the potential of CNG, LPG, biofuels and other alternative fuels and if appropriate to put forward amendments to the Directive. 6. 3 Inspection and maintenance Periodic - annual or bi-annual - inspection and maintenance checks are effective in ensuring that the emission performance of a vehicle does not deteriorate significantly during its life. The Auto/Oil Programme identified all measures targeted at the improved durability of emission control systems - OBD, recall (see section 6. 1a above) and improved inspection and maintenance - as being highly cost effective in reducing pollutant emissions indeed such measures were estimated as having the potential to contribute over a third of the emission reduction targets for some pollutants. The Community already has basic requirements for inspection and maintenance as laid down in Directive 92/55/EEC. In the light of the conclusions from the Auto/Oil Programme and the results of an extensive study due to be finalized in 1996, the Commission will, during the course of 1997, come forward with proposals to strengthen the requirements laid down in Directive 92/55/EEC. These-proposals to be implemented in 2000, will include improvements to the tests for roadworthiness in order to make these tests more representative of real world conditions and to ensure that the gross polluters in the vehicle fleet( it has been estimated that over 50% of vehicle emissions are produced by 10% of the fleet) are consistently identified. The Commission will also take steps to encorage Member States to implement road-side inspections as a further step towards ensuring that motor vehicles maintain their emission performance throughout their life. Finally, and as explained in section 3, the individual vehicle owner has an important role to play in reducing polluting emissions from road vehicles and the responsibility to keep a vehicle well maintained is a fundamental obligation for all road users. 13 7. THE TWO-STEP APPROACH At the time of adoption of Directive 94/12/EC it was recognized that when the Commission came forward with its proposals for measures to apply after the year 2000, it might also be necessary to put forward target values involving a further substantial reduction in emissions (14th "whereas" clause). In the Commission's proposals relating to the emission standards for passenger cars there are two sets of emission limits. The first set of emission limits will be obligatory and apply as from the year 2000: it is based on the results of the Auto/Oil Programme. The second set of emission limits which is considerably more ambitious than the first, will come into force in 2005. However, these limits will be reviewed by the end of 1998 with regard to their industrial feasibility, taking account of air quality requirements and the availability of improved fuels. The second set of emission limits (the second step) is an essential part of the Commission's policy on reducing vehicle emissions. The Member States will be able to offer fiscal incentives in order to encourage the marketing of vehicles respecting both the first and second set of emission standards (see below for a more detailed discussion on fiscal incentives). This means that manufacturers will have an incentive to continue to invest in the development of pollution abatement technologies. The second step is therefore designed to encourage the early introduction into the market of cleaner vehicle technologies developed by vehicle manufacturers. To illustrate the benefit of the second step it is informative to look at the example of the diesel passenger car. Diesel engines are relatively high emitters of particulate matter and oxides of nitrogen (NOx). At present, considerable resources are being invested in the development of new technologies (particulate traps and de-NOx catalysts) which have the potential to significantly reduce the emissions of these pollutants without negative effects on other emissions. However, it is generally accepted that these technologies will not be in large scale commercial production by 2000 and the Commission's proposal for the emission limits for diesel cars for the year 2000 reflects these expectations. In the absence of a second step, manufacturers would have no incentive to push ahead with the development and introduction into the market place of the new pollution abatement technologies. The Commission also believes that the existence of the second step will provide the Industry with a degree of security concerning the regulatory environment within which it will have to operate over the next 10-15 years. Finally, by establishing challenging standards in the Community with a market of over 350 million people the Commission believes that this will provide the platform for a strong export potential for Community products. In particular the export markets in Asia and North America, will offer opportunities for low emission, fuel efficient vehicles. It is therefore in the Community's economic interest to be at the forefront of technical development: the promulgation of ambitious, technology-challenging standards is an effective instrument to ensure that European Industry remains competitive in the international market place. TZT With regard to fuels, the Commission intends to come forward with proposals to revise the specifications for petrol and diesel fuels and that these improved specifications should come into effect in 2005 at the same time as the "second step" emission standards for vehicles referred to above. , The Commission's proposal will take into account that improvements to fuel quality have a direct and significant impact on emissions of particulate matter, volatile organic compounds and oxides of nitrogen. All of these pollutants either directly, or as a result of their contribution to ozone formation, result in important impacts on human health and the environment. 14 In addition, to the direct benefits that improved fuel quality has on vehicle emissions, there is a clear interaction between fuel quality and vehicle technology. With regard to the development of new pollution abatement technologies, such as the de-NOx catalyst, there is evidence that fuels of a certain quality, particularly low sulphur fuels, may well be required if such technologies are to achieve optimal and long-lasting levels of performance. Accordingly, the Commission foresees that its future proposal to revise the specifications of petrol and diesel fuels should comprise a significant reduction in the content of sulphur for both fuels. Current research and development indicates that a sulphur limit in the order of 50 ppm could be needed for the optimal functioning of the new, vehicle-based pollution abatement technologies as well as contributing to improving emissions from the existing car pare. While for the reasons outlined above, the Commission is persuaded of the need to revise the fuel specifications for petrol and diesel fuels, it nevertheless considers that it would be premature, given the current state of knowledge, to lay down today the fuel specifications which should apply in the Community in the year 2005. The Commission, therefore, intends to bring forward by the end of 1998, a proposal for a revision of the present fuel quality Directive which will include inter alia a revision of specifications for petrol and diesel which are laid down in the Directive. These revised specifications will come into effect in 2005. The Commission's proposals will be based on a comprehensive cost-effectiveness assessment and review (see below). The determination of the precise value of a revised sulphur specification for petrol and diesel fuels will of course be subject to the outcome of this assessment. To take account of the possibility that vehicles equipped with new pollution abatement technologies such as the de-NOx catalyst are developed and introduced into the market before 2005, the Commission has also included in its proposal a commitment to bring forward, if appropriate, proposals to ensure that when vehicles equipped with such technologies are placed on the market, fuels of a quality sufficient to guarantee the necessary level of performance of the technology will be widely available. In bringing forward such proposals the Commission will give due regard to considerations of air quality, cost-effectiveness and proportionality. The Commission will also take into account: (i) (ii) the latest information on the interaction between fuel quality and the performance of the new pollution abatement technologies; the situation with regard to the development and production of these technologies and the forecasts concerning the marketing of vehicles equipped with such technologies; (iii) the need to ensure that the measures proposed will neither disrupt the free movement of persons and goods nor unduly distort competition. The review process The strategy for the control of vehicle emissions which is described in the present Communication, is based on the methodology of the Auto/Oil Programme. The strategy is designed to produce effects to meet the requirements of Community air quality standards and related objectives at least cost. However, in a domain where knowledge is evolving so rapidly, the strategy cannot be static: it must evolve in response to developing knowledge. For this reason, the Commission has also announced its intention to carry out a comprehensive assessment and review of the strategy taking into account the following considerations: trends in air quality; noxious pollutant emissions in Europe from transport and non-transport sources and the contribution that existing, pending and potential measures to control emissions from all sources, could make to improve air quality; 15 technical developments with regard to: * * vehicle technologies as well as new propulsion technologies (e. g. electric propulsion, fuel cells); refinery technology; the potential of alternative fuels such as compressed natural gas (CNG), Liquid Petroleum Gas (LPG), and Dimethyl Ether (DME) and biofuels to reduce vehicle emissions; possible improvements in the test procedures for the type approval of vehicles, in particular the addition of a new test procedure at at low temperatures; the potential of technical, non-technical and local measures to reduce emissions: in this context, the contribution of transport and other policy measures such as traffic management, enhanced urban transport and vehicle scrappage schemes should be evaluated; the contribution that selective and differentiated fiscal measures could make to reducing emissions , whilst not negatively impacting on the functioning of the internal market; the effects of any measures on C02 emissions; the strategies followed by third countries to improve air quality and the emission values applied therein; the situation with regard to the supply and quality of crude oil available to the Community. On the basis of the comprehensive assessment described above the Commission will, not later than 12 months following the adoption of the two proposals accompanying this Communication and in any event not later than 31 December 1998, bring forward: a proposal for a further tightening of the emission standards for passenger cars. This proposal shall establish , inter alia whether the " second step" emission standards for vehicles (see above) and which in the present proposal for the amendment to Directive 70/220/EEC are given as indicative values, should be confirmed as the regulatory limit values to be applied from 1 January 2005; a proposal for a revision of the Directive on the quality of petrol and diesel fuels. This proposal should include further improvements to the specifications for petrol and diesel fuels (in particular, a significant reduction in the sulphur content of both petrol and diesel fuels) and will also come into effect on 1 January 2005. ~ Auto/Oil H Programme In order to carry out the comprehensive assessment upon which it will base its future proposals to be made at the latest by the end of 1998, the Commission considers that it will be necessary to build upon, improve, and extend the concept of the Auto/Oil Programme. With this in mind the Commission will take contact with Industries, Member States and NGOs with a view to setting up the Auto/Oil II Programme. 8. RESEARCH AND DEVELOPMENT, THE CAR OF TOMORROW In 1995 the Commission created a task force dedicated to the theme of the Car of Tomorrow, drawn up after extensive consultation with various stakeholders, including representation from the automotive and oil industries, public authorities, transport operators, and utilities. The 16 aims of this task force include a better focusing of R&D initiatives aimed at the next generation of road vehicles and in particular vehicles which are clean, safe, energy efficient and intelligent. These R&D initiatives will also aim at giving further insights into the development of air quality standards and improving the assessment of risks to health and the environment from vehicle emissions. Arising out of the work of the Task Force the Commission services have developed an Action Plan for the Car of Tomorrow. The Commission considers that the work of the task force and the recent action plan are directed at initiatives which will take the emission performance of road vehicles up to and far beyond the second step identified in the vehicle emission proposals and will lead ultimately to the development of near zero and zero emission vehicles. The task force will aim to achieve these goals through stimulation of RTD and demonstration of promosing clean propulsion technologies, utilising cleaner fuels. These efforts will be integrated with telematics systems and new technologies for reducing vehicle weight and drag. The RTD will be underpinned by a broad based comparative assessment process based on a life cycle approach, to identify more cost effective routes to reducing harmful vehicle emissions and energy consumption. 9. ECONOMIC INSTRUMENTS 9. 1 Fiscal instruments All taxes influence behaviour. This is independent of whether that is their intended purpose, or whether they are simply a means for raising revenues. A purchase tax, for instance, makes new cars more expensive, and will therefore lead consumers to buy fewer or different cars than. otherwise, or may induce them to hold on to their old vehicle for longer. A fuel tax affects a different aspect of transportation. As it increases the fuel costs for each mile driven, people may drive less or use more fuel efficient cars. One can therefore take advantage of this behavioural effect to design the tax system so that is has the effect of reducing vehicle emissions. To various degrees, Member States already apply a variety of taxes and fees as a means of changing transport behaviour in a desired direction. For instance, gasoline taxes are used to decrease fuel consumption. By analogy, fiscal instruments can encourage emission reductions by steering transport behaviour into a desired direction. Transport emissions will decrease when people buy cars with clean technology, keep them well-maintained, scrap old and dirty cars, burn cleaner fuels, drive less, participate in car pools, etc. Regulations concerning vehicle emissions and fuel specifications which are designed to harmonize Member States' legislation at a high level of environmental protection can address only a limited number of these behavioural factors. A policy limited to these technological aspects has little impact on behaviour. Therefore, important leverage points to achieve emission reduction would be left out. Economic instruments, by contrast, can have an influence on these behavioural aspects by making undesired behaviour more expensive than desired behaviour. This could be done either by increasing taxes on polluting activities, or by using tax incentives, i. e. by providing tax rebates to activities that decrease emissions. There are a variety of economic instruments that can be used to do this. 'For example, vehicle purchase or registration taxes can be differentiated in such a way that dirtier cars are taxed higher than cleaner ones. Similarly, one could differentiate annual circulation taxes according to emission characteristics. The impact of this instrument would not only be limited to new vehicles but it would also affect vehicles already in circulation, which contribute to a significant share of the transport emissions. Potentially, therefore, a structured circulation tax could be a cost-effective measure to complement emission standards, as it could reduce emissions from this part of the vehicle fleet. Scrappage subsidies could also help getting old and dirty vehicles off the road. 17 Tax differentiation for leaded and un-leaded gasoline, and for high and low sulphur fuels in some countries has shown the effectiveness of fiscal instruments in the fuel market. Driving behaviour can be influenced by increasing kilometre-dependent charges, for instance, through road taxes. For most of these measures the administrative structure is already in place. What is necessary is only to alter the rate structure to obtain the desired behavioural effect. A number of initiatives in the indirect taxes area are under way or scheduled for the near future where environmental concerns, such as emission levels, may be relevant. These initiatives cover both fuel taxes and vehicle taxes. All motor fuels are subject to excise duty. Within the excise system, a number of Member States have sought and been granted derogations from the normal rules, under a procedure which requires the approval of the Commission and all Member States (Aticle 8(4) of Directive 92/81/EEC). In some instances, the derogations are related to fuel quality. For example, Denmark, Finland, Greece & Sweden have been granted derogations allowing them to apply reduced rates on environmentally friendly diesel. Finland can apply reduced excise duty rates on reformulated unleaded and leaded petrol. Denmark can apply differential rates of duty between petrol distributed from petrol stations equipped with a return system for petrol fumes and petrol distributed from other petrol stations. A number of applications from other Member States are being processed at present. Some of the derogations granted under Article 8(4) of Directive 92/81/EEC expire at the end of this year, and all fall to be reviewed in the course of 1996. This review is necessary to ensure continuity and to deal with the evolving situation whereby various Member States wish to introduce rate differentiation, often on environmental grounds. The review will thus provide an opportunity for this aspect to be considered more fully in the short term. Minimum rates of excise duty are laid down at Community level, with a requirement that they be reviewed every two years in the light of the functioning of the internal market, the real value of the duty rates and the wider aspects of the Treaty. The first review did not make any proposals for change, pending a wide ranging consultation process which was to take account, inter alia, of the wider Treaty aspects. That process is now nearing completion, and the second review is due to be carried out later this year. The Commission's proposal for a framework Directive on fuel will result in a significant improvement in the average quality of fuels sold in the Community. However, it is probable that some Member States, particularly those which have used fiscal measures in the past (see above), may wish to encourage the use of even cleaner fuels as part of their overall strategy to improve air quality. The Commission notes that Directive 92/81/EEC provides a framework within which Member States may apply fiscal incentives. Discussions on a Commission proposal for a carbon/energy tax failed to reach agreement in the Council. In the absence of agreement, the ECOFIN Council of U March 1996 invited the Commission to bring forward new proposals for the taxation of energy products^A large number of Member States have expressed the wish that any such proposals should build on the existing excise structure. Given the obvious link between the requirement to review minimum rates of excise duty and the intention to bring forward new proposals for taxing energy products, it is likely that these two activities will be combined, and it is expected that new proposals will be brought forward by the end of 1996. It is clear that environmental aspects should be an important influence on these proposals. On the question of vehicle taxation, it is important to note that the tax treatment of vehicles varies enormously from one Member State to another, not just in terms of tax burden but also in terms of mix of tax type. Furthermore, the factors which influence fiscal policy for vehicles also vary significantly between Member States, often drawing on traditional, social and cultural elements in addition to the more obvious economic and industrial concerns. 18 The Commission has recently commenced a detailed study of vehicle taxation in the Member States. This study will analyse the Member States. It will also examine vehicle taxation from a Community perspective, with a view to ascertaining what Community measures are necessary, or appropriate, in the interests of improving the functioning of the internal market and advancing other policy objectives, including environmental concerns. the various approaches followed in 9. 2 Fiscal incentives used in relation to vehicle emission limits Article 4 of Directive 94/12/EC does not include any specific reference to fiscal/tax incentives (e. g. tax reductions) among the measures which should be taken into account by the Commission in the preparation of future legislative proposals. It is however stated in Article 4. 2 that the Council will decide upon the conditions for granting tax incentives with regard to the future emission standards on the basis of the emission limits proposed by the Commission. Since the adoption of Directive 89/548/EEC, Community decisions relating to the environmental aspects of motor vehicle emissions have contained a framework for the granting of fiscal incentives to encourage the early application of the new limit values. In these directives a balance has been struck between , on the one hand, the need to encourage the introduction of new technologies as quickly as possible, and, on the other hand, the need to avoid fragmenting the Single Market with diverse fiscal incentive programmes incentivizing different limit values with the consequence that, de facto , there would be simultaneously a multitude of regulatory limit values existing on the market. The principle adopted in the framework set out in Article 3 of Directive 94/12/EC have been to permit fiscal incentives only for vehicles complying with the Directive and provided that they comply with trie provisions of the Treaty and that they are: non-discriminatory; limited in time and that they terminate when the limit values become mandatory; of an amount lower than the additional cost of the technical solutions introduced to ensure compliance with the new limit values and the cost of their installation on the vehicle. its proposals for vehicle emission standards arising out of the In developing Auto/Oil Programme the Commission has declared its intention to explore a more flexible approach to the use of fiscal incentives. Accordingly, the Commission's proposals relating to vehicle emission standards and arising from the Auto/Oil Programme will include two sets of emission standards (see section 6. 1). Member States will be able to use fiscal incentives to encourage the introduction of vehicles conforming to both sets of emission limits. As compared to the present situation, the use of fiscal incentives in the context of artwo-step approach has considerable advantages as the emission limits in the second step will be sufficiently ambitious as to ensure that fiscal incentives applied in relation to this step will constitute a genuine encouragement to innovation. It is possible, despite the two-step approach and the greater freedom allowed in relation to the use of fiscal incentives, that some Member States may object to the principle of Community legislation based on Article 100a, imposing restrictions on their freedom with regard to the use of fiscal/tax incentives. However, the Commission continues to believe that a Community framework for the application of emission related fiscal incentivesis necessary to ensure the integrity of the internal market which could be jeopardized by the proliferation of incentive schemes in the different Member States. Thus, while the Commission is in favour of introducing greater freedom into Community policy on vehicle emissions it would be totally opposed to initiatives which could seriously undermine the principle of the single market and the advantages associated with it. 19 Pollutant, Urban NOx Urban Particulates Urban Benzene Total VOCs Total NOx 10. The emission reduction benefits and the costs associated with the Commission's package of measures on vehicle emissions The package of legislative actions due to come into force in 2000 and described in section 6 will result in considerable reductions in the emissions from road transport over and above those which would be expected from already agreed measures (see Table 7 below). Effect on Road Transport Emissions of Auto Oil Package of Measures Table 7 Emissions in 1990 Emissions in 1995 Emissions in 2010 without Auto Oil 1000 Tonnes/yr Percent of 1990 Level 1000 Tonnes/ yr Percent of 1990 Level 1000 Tonnes/ yr Percent of 1990 Level 1 936. 68 100 1 940. 58 100 1 207. 77 62 Emission in 2010 with' Auto Oil Package 1000 Tonnes/ yr 748. 817 Percent of 1990 Level 38. 7 124. 663 100 137. 029 110 69. 383 Urban CO 25 189. 17 100 100 20 224. 04 13. 88 80 87 1 1961. 25 7. 78 15. 91 56 47 49 42. 324 34 5 980. 625 4. 0456 23. 7 25. 4 4 105. 72 100 3 688. 83 90 1 811. 33 44 996. 232 24 5 864. 84 100 5 581. 33 95 3 053. 25 52 1 984. 613 33. 8 While these Community measures may in some localities need to be complemented by targetted local initiatives (see section 3) the Commission is confident that by 2010 and assuming parallel actions to reduce emissions from other sources, that the air quality targets referred to in Table 1 will be respected thfoughout the Community. While the benefits in terms of human health (mortality, morbidity and quality of life) and the environment (crop production and ecosystem damage) are difficult to quantify, it is clear from the available evidence that these benefits will be considerable. In addition to the significant emission reduction benfits associated with the measures due to come into force in 2000 further reductions will clearly be associated ^with the implementation of the second step for vehicle emissions and the future proposal on fuel quality (see section 7). 20 The Costs(S) of the Commission's package of legislative measures Tnsts to industry Measures to become effective from 2000 Passenger car producers Van /light commercial vehicle producers Heavy duty vehicle producers Refining Industry National governments associated with improved inspection and maintenance ECU 3 094 million per annum ECU 373 million per annum ECU 675 million per annum ECU 765 million per annum ECU 555 million per annum TOTAL ECU 5 461 million per annum. Measures proposed for vehicles for 2005 'the Second Step* Passenger car/light commercial vehicle producers ECU 2 500 million per annum ECU 500 million per annum Heavy duty vehicle producers Cost to the consumer Measures which become effective from 2000 Fuel Additional cost per litre/1 000 litres Petrol: Diesel: ECU 0. 002 per litre: ECU 0. 0018 per litre: ECU 2 per 1 000 litres ECU 1. 8 per 1 000 litres Additional cost on the fuel bill of the average motorist ECU 2. 3 (assuming 12 600 km per year and 8. 61 1/100 km) Petrol Car: Diesel Car: ECU 1. 7 (assuming 12 600 km per year and 7. 61 1/100 km) Increased new vehicle costs Petrol passenger car Diesel passenger car Small Medium Large ECU 200 per new car ECU 225 per new car ECU 290 per new car Medium ECU 380 per new car ECU 520 per new^ear Large Light commercial vehicles: ECU 145-290 per vehicle Heavy duty vehicles: ECU 530-1 620 per vehicle Increased maintenance costs ECU 7. 5 - 10 per annum for passenger cars. Measures proposed for vehicles for 2005 'the Second Step' Between ECU 150 and 200 per new car as an average (5) All costs are in 1995 ECU 21 REPORT ON THE AUTO/OIL PROGRAMME ANNEX 1. THE EUROPEAN AUTO/OEL PROGRAMME 1. 1 Phase I - Establishing the framework In keeping with its commitment to develop a more comprehensive approach to reducing emissions from road transport, the Commission decided at the end of 1992 to initiate a work programme to provide a solid technical foundation upon which to base its future legislative proposals. In accordance with the principle of 'shared responsibility' expressed in the 5th Environmental Action Programme, the Commissioners for Environment, Industry and Energy, invited the European associations of the car (ACEA) and oil (EUROPIA) industries to make available their considerable know-how and expertise and to collaborate in the realization of this work programme. The two industries responded positively to this invitation and together with the Commission designed, planned and executed the programme which subsequently became known as the Auto/Oil Programme. The objective of the Auto/Oil Programme were defined as: to provide policy-makers with an objective assessment of the most cost-effective package of measures including vehicle technology, fuel quality, improved durability and non-technical measures, necessary to reduce emissions from the road transport sector to a level consistent with the attainment of the new air quality standards being developed for adoption across the European Union. 1. 2 Work programme The work programme was divided into a number of inter-related components as follows: (i) (ii) (iii) (iv) the prediction of future air quality in the Community and in the case where future air quality was predicted to fall below an acceptable standard, the identification of appropriate emission reduction targets for road transport; the collation and, where necessary, the generation of data concerning the potential of the various measures inter alia engine technology, fuel quality, increased durability requirements and complementary measures, to reduce emissions from road transport; the collation and, where necessary, the generation of data concerning the cost of introducing the measures identified under ii (above); ^ on the basis of the data generated in steps ii and iii above to identify the most cost effective package of measures necessary to achieve the emission reduction targets identified under step i). 1. 3 Organizational framework (a) Cooperation Commission/industry A management group and a number of technical working groups were established comprised of representatives of the Commission and ACEA and EUROPIA. The management group met on a regular basis and was responsible for the oversight and planning of the work programme with regard to content and time. The technical working groups were established for issues requiring further investigation. 22 At the level of the Commission services a number of Directorates General (principally DGs II, IE, XI and XVII with support from DGs VII and XII) were involved in the implementation of the Auto/Oil Programme. In addition to the involvement in the programme of staff from the Commission and the two industries, external consultants/consultancy companies were commissioned to carry out certain parts of the programme. Their work was specifically related to fuel quality, emissions/air quality and cost-effectiveness issues. (b) Information Provision Auto/Oil Programme to interested parties not directly involved in the (i) European Parliament In 1995 a number of technical briefings with members of various committees of the Parliament were held in order to keep Members of the European Parliament and their staff informed as to the progress of the Auto/Oil Programme. (ii) Member States A national expert group on "environmental fuel specifications" (EFEG) was established early in 1993 to follow and to discuss on a regular basis the progress invited being made with Member States to provide technical advice and support in areas of specific interest to them. the Auto/Oil Programme. The Commission In addition the Motor Vehicle Emissions Group (MVEG) was consulted and informed on various aspects related to vehicle technology and ^ improved durability requirements. In the course of 1995 the Commission held four combined EFEG/MVEG meetings in order to give full account of the progress and results of the programme. EFEG/MVEG meetings also provided a forum for a number of industries and non-government environmental organizations. In this way access to information on the programme was also guaranteed to a range of interest groups likely to be effected by future legislation. 2. ABR QUALITY MODELLING 2. 1 Introduction The following atmospheric pollutants were investigated as part of the Auto/Oil Programme: Carbon Monoxide (CO) - in cities Particulate matter (PM) - in cities Benzene - in cities Nitrogen dioxide (N02) - in cities Tropospheric Ozone (03) - principally at the regional level A short description of each of these pollutants, their effects on human health and the environment as well as the contribution of road transport to total emissions is to be found in Box 1. 23 Pollutants Investigated in the Auto Oil Programme BOX1 Carbon Monoxide (CO) Colourless, odourless, and tasteless gas. It replaces Oxygen in the blood and thus causes asphyxiation in high concentrations. It is transformed to Carbon Dioxide - a "green house" gas - in the Atmosphere. Soared of all CO Emissions In EU in 1990 Road Transport Carbon Monoxide Emission Sourcts Apfcvlton Nat«n 1H Nitrogen Monoxide / Nitric Oxide (NO) (Transforms mainly to N02) Nitrogen Dioxide ( N 02- N 02& NO together are known as NOx) A reddish-brown gas, it causes a variety of respiratory conditions, especially in vulnerable groups (e. g. children & asthmatics). Contributor to the problem of Acid deposition, and decreases plant growth their Effects and Sources Particulate Matter (PM) / Black Smoke (BS) Any fine particle, the effect of which is dependent on the type of particulate, although there is some evidence that the smaller fractions are, in general, carcinogenic. However, black smoke may not contain the smallest size fractions now associated with carcinogenic effects. Furthermore, many components, e. g. heavy metals, are toxic. Ozone ( 03) A secondary pollutant formed by the reactions of mainly NOx and VOCs in the presence of sunlight. A strong oxidising agent it induces eye, nose, and throat irritation, chest discomfort, coughs and headaches. It also damages materials and inhibits plant growth. Hydrocarbons (HC) The complete range of organic compounds - usually gasses - this term includes both VOCs and Benzene. Volatile Organic Compounds (VOCs) Any organic compound sufficiently volatile to cause significant emissions into the air via evaporatioa The complex interaction of many of the VOCs cause the formation of "secondary" pollutants such as Ozone (see below). VOCs also contribute to the problem of acidity and ethylene is a serious plant growth inhibitor. Contains some Carcinogenic compounds -See Benzene Below. Sources of all VOC Emissions in EU In 1990 — Road Transport VOC Emission Sources 'TV V«kklei B «M * * * *" 7H J *. —**- L%k« C M U M K UL VAfclM, 1IH Sourcts of all NOx (as N02) Emissions in EU in 1990 Road Transport NOx Emission Sources B«n« Twa Wheal» BnrMUonA •xilfUh * Otter MrtCa W i rf treatment 13H. __ l**"*t»7 Othar Mai Sivrcea 1 2* Colourless liquid or gas - smells of almonds Benzene is known to be both toxic and a carcinogen. Benzene (CéH«) •Antwx tn Cammunimfirm • The Auto Oil Programme 24/05/1996 page 4 2. 2 Air quality in cities Population density, industrial activity and traffic intensity in urban environments can frequently give rise to acute problems of air pollution. In order to investigate the problem of atmospheric pollution in cities, seven European cities - Athens, the Hague, Cologne, London, Lyon, Madrid and Milan - were chosen for detailed study. These cities were considered as being representative in terms inter alia of their air quality, geographic location and the characteristics of their vehicle fleets(1). On the basis of information on the emissions of pollutants from various sources and the relationships between emissions and air quality, computer models were used to predict the air quality in the seven cities in the year 2010( \ Unfortunately, in the case of particulate matter, the quality of the data was not good enough to permit the prediction of air quality in 2010 in each of the cities. For this reason pollution by particulate matter was dealt with separately (see section 3. 3 below) In order to decide whether the predicted air quality in respect of the three pollutants carbon monoxide, benzene and oxides of nitrogen were satisfactory, air quality standards were defined for each pollutant. In the case of N02 and CO air quality standards already exist, laid down either, in Community legislation (N02: Directive 85/23/EEC) or in WHO guidelines. However, in recognition of the fact that the WHO guidelines for both N02 and GO were in the process of being reviewed and that initial recommendations for revised values from scientific expert groups were already available, it was decided to use two air quality standards for the purposes of the Auto/Oil Programme: a less severe standard based on current air quality standards; a more severe standard based on the initial recommendations of the expert groups currently reviewing the WHO guidelines. In the case of benzene there are no existing Community standards and the WHO does not set limit values for substances such as benzene which are regarded as carcinogenic. In the light of existing scientific evidence and recommended the Member States, the Auto Oil partners agreed upon a less severe and a more severe standard as they had done for CO and N02. However, in recognition of the fact that certain Member States have also expressed aspirations to achieve extremely low 'target values ' in terms of benzene concentrations the Commission also insisted upon the inclusion of a third very severe standard in relation to this pollutant. limit values which exist in A summary of the air quality standards used for CO, N02 and benzene is given in Table 1. A summary of the emission reduction requirements determined to be necessary in each of the seven cities in order to achieve these air quality standards is given in Table 2. (i) (2) To enable the Auto/Oil Programme to base air quality predictions on the most reliable data on the future development of the EU vehicle fleet, the Commission made available the FOREMOVE model. The commission funded this model which contains details of vehicle fleets in each Member State (vehicle categories, age, and distance travelled) and generates information concerning the total and percentage emission of major pollutants by each category of vehicle. FOREMOVE also contains assumptions concerning the development of the vehicle fleet in each country over the next 25 years and the predicted effect of current and agreed new legislation on vehicle emissions. The year 2010 was chosen as reference year because the programme was designed to identify measures which would take effect from 2000. Measures introduced in 2000, such as emission standards for new vehicles, will only have a gradual effect on air quality as the existing vehicle fleet is replaced. By 2010, it will be possible to judge their impact. 25 2. 3 Particulate material As indicated in Section 2. 2 it was not possible to model pollution by particulate material in the same way as the other urban pollutants. There is a lack of basic information concerning the relationship between emissions and air quality and a lack of consistency in the way that particulate matter is measured. However, results are just beginning to emerge which allow some provisional conclusions concerning the likely effects of particulate pollution on human health, tentative air quality standards and the need for emission reductions. There is increasing evidence that particulate material may contribute significantly to patterns of morbidity and mortality on western Europe. There is also an emerging consensus that the particulate material which causes health effects is to be found in the smaller size fractions: these smaller size fractions are now measured using a parameter called PM10 which means those particles with a size of 10 microns or less. With regard to the establishment of an air quality standard sufficient to protect human health, there is as yet no international consensus. However, the UK Government's Expert Panel on Air Quality Standards has recently recommended a value of 50ug/m3 measured as a 24 hour running average and in the absence of alternative standards this figure will be used for the purposes of the present report. 26 Table 1 Air Quality Target Values Used in Air Quality Modelling Pollutant N02 Standard* Less severe standard = 200ug/m3 as 98 percentile** of hourly values More severe standard*** = 93 u g/m3 as a 98 percentile of hourly values. CO Less severe standard = 10mg/m3 as a 98 percentile of 8 hourly values. More severe standard **** = 5 mg/m3 as a 98 percentile of 8 hourly values Benzene Less severe standard = 16 ug/m3 as an annual mean More severe standard = 10 ug/m3 as an annual mean Very severe standard ***** = 2. 5 ug/m3 as an annual mean To Equate values for the different averaging periods used to determine these standards it was necessary to undertake a statistical analysis of European air quality data using the Commission's Air Pollution Information Service (APIS) database enhanced with additional data from Member States obtained by CONCAWE. a 98th percentile value means that only 2% of all values recorded during the year would be above this value. Therefore in the case where measurements are taken on an hourly basis, in any one year there will be a total of 365 x 24 (=8760) separate values. The 98th percentile figure would correspond to the value below which lie 8585 of the hourly readings. Expressed in another manner the 98th percentile value is the value which may be exceeded on 175 hours each year, i. e. a total of 7 days. ***98th percentile value corresponding to a maximum value of 200 ug/m3 (recommended new standard emerging from WHO working groups). The relationship between maximum values and 98 percentiles was obtained from european air quality records. """98th percentile value corresponding to a maximum value of 10 mg/m3 (recommended new standard emerging from WHO working groups). The relationship between maximum values and 98 percentiles was obtained from european air quality records """Benzene is of particular concern in a number of Member States who have reflected-this by setting very low, long term target values. Recognizing the aspirational nature of these target values, it was agreed that the necessary reductions to achieve a value of 2. 5ug/m3 would be investigated. 27 Table 2 Air Quality Modelling - Summary of the Emission Reductions N02*/ NOx CO Benzene CITY Percentage Emissions Reduction necessary to achieve air quality targets: Percentage Emissions Reduction necessary 'to achieve air quality targets: Percentage Emissions Reduction necessary to achieve air quality targets: Less severe standard More severe standard Less severe standard More severe standard Less severe standard More severe standard Very severe standard Athens Cologne The Hague London Lyon Madrid Milan (N/A - Not Available) 0 0 0 0 0 0 0 50 20. 5 0 31. 5 22. 5 39 45 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 50 0 0 0 20 35 15 * Nitrogen di-oxide is a pollutant with demonstrated direct and indirect effects upon human health and the environment. Air quality standards are therefore expressed in terms of concentrations of N02. However, emissions from vehicles and other sources consist of a mixture of nitrogen di oxide and nitrous oxide (NO). For the purposes of establishing emission limits these two gases are combined under one heading - NOx. Therefore, while the air quality concentrations given in Table 2 are expressed in terms of N02 the emission reduction targets are expressed in terms of NOx. 28 Reliable measurements of ambient air concentrations of particulate matter using the PM10 parameter have only recently started to come available. Some data are available from the UK and additional information has been generated from a major research project undertaken in the context of the European Community's Research Programme: results from the UK and the EU programme are presented in Table 3 below. It would appear from the data summarized in Table 3, that maximum daily mean values for PM10 concentrations in many european cities are within the range 100-150 ug/m3. This would imply thai reductions in the range of 50-65% are required in order to meet the air quality standard of 50ug/m3. In trying to convert these estimates into tentative conclusions as to the likely magnitude of emission reductions great care must be exercised as the contribution of different sources to the total particulate load is only poorly understood and shows significant variation between regions. Nevertheless it was decided in the Auto/Oil Programme to use the range of 50-65% of 1995 levels as an emission reduction target for 2010(3). 2. 4. Regional Tropospheric Ozone Tropospheric ozone is referred to as a secondary pollutant, this means that it is formed as a result of the interaction between primary pollutants, principally nitrogen oxides and Volatile Organic Compounds (VOCs). The chemical reactions leading to the formation of-ozone are accelerated in warm conditions and in the presence of sunlight: ozone is therefore often referred to as 'summer smog'. Tropospheric ozone is a regional, transboundary problem: high concentrations of ozone frequently being found considerable distances (100s of kilometres) away from the major urban centres which are the principal source of the precursor pollutants, NOx and VOCs. In order to explore the regional aspects of ozone formation, the Auto Oil partners relied heavily on the EMEP model which has been developed to support the various protocols which have been established in the context of the 1979 Geneva Convention on transboundary air pollution. On the basis of data relating to emissions of primary pollutants, the detailed chemistry of ozone formation and factors such as temperature, wind speed, intensity of solar radiation etc, the EMEP model can be used to predict ozone concentrations throughout Europe. Having taken into account the expected trends in emissions of primary pollutants the predicted air quality values were then compared with the air quality objectives for tropospheric ozone as laid down in Directive 92/72/EC (see Table 4). If one considers the benefits of improvements which could be expected as a result of across the board decreases in emissions from all sources, some of the results generated from the EMEP model are given in Table 5. These results are expressed as the percentage of the Community's land area in compliance with the various air quality objectives. (3) Already agreed measures will reduce particulate emissions across the EU to nearly a half of those in 1995. Therefore the additional emission reductions required in 2010 to achieve the target reduction of 50-65% compared to 1995 levels is equivalent to approximately one-third off the predicted 2010 emissions. 29 Summary of Data from UK and EU Studies on Urban PM Concentrations. Table 3 APHEA Project data: ,1 ». City Measurement Winter (December, January, February) Summer (June, July, August) Athens Black Smoke Barcelona TSP or PMx Helsinki TSP or PMx Cologne TSP or PMx London Black Smoke Lyon Milan Paris PM13 TSP or PMx 187. 9 TSP or PMx Rotterdam Black Smoke Min. * 64. 0 137. 5 33. 4 70. 3 24. 1 48. 6 36. 4 15. 6 Max. ** 141. 4 232. 2 121. 8 83. 8 94. 5 87. 8 199. 7 67. 3 29 Min. * 41. 8 117. 2 41. 9 72. 1 7. 2 29. 8 81. 7 37. 6 9. 4 Max. ** 102. 4 177. 7 91. 7 83. 4 15. 9 55. 7 85. 1 47. 8 20. 4 PEACE Project: Country City Finland Kupio Germany Berlin Germany Zerbst Greece Athens Italy Italy Pisa Torre del Lago NL Amsterdam Sweden Mal mo 1 Max. PM10 Winter (ug/m3) UK data: City Dailv mean PM10 (Mg/m3) 60 117 95 201 131 149 123 59 Belfast BirminghamA BirminghamB Bristol Cardif Edinburgh Hull Leeds Liverpool 191 113 106 83 96 65 84 114 84 * Mean from the station giving the minimum annual measurements levels for each city. **Mean from the station giving the maximum annual measurements levels for each city. (Mean figure from above data is: 112. 6) 30 Table 5 also indicates the predicted impact of 50%, 60%, 70%, and 80% emission reductions in both NOx and VOCs from all anthropogenic sources as compared to 1990 The nature of ozone formation is such that dramatic reductions from all sources for all precursors are required before complete compliance with air quality standards can be expected. Indeed it is only when an 80% emission reduction (compared to 1990) of precursors from all sources is achieved that over 90% of the EU land area is predicted to have a 1 hour maximum ozone concentration below 180ug/m3. With regard to the 99 percentile 1 hour mean 180 ug/m3 standard, across the board reductions in ozone precursor emissions of 60% and to a percentage land area compliance of 95 and 99% respectively. It was 70% correspond decided that for the Auto/Oil Programme an overall emission reduction target for ozone precursors in 2010 would be 70% of 1990 levels(4). Table 4 Comparative Values: reactive pollutant modelling Guidelines Directive 92/72/EEC Directive 92/72/EEC Air Quality Standard 110 ug/m3 8-hour average 180 ug/m3 1-hour average WHO Air Quality Guidelines 1995 120 ug/m3 8 hour average Relevance Health protection threshold Threshold level over which information / warnings have to be issued by the authorities to the general public. Protection of health threshold (4) Already agreed measures will reduce ozone precursor emissions across the EU to nearly a half of those in 1990. Therefore the additional emission reductions required in 2010 to achieve the target of 70% reductions compared to 1990 is equivalent to approximately one-third off the predicted 2010 emissions. 31 Compliance with Ozone Air Quality Standards Table 5 EU Percentage of EU Land Area (measured in EMEP grid squares) in Compliance with Standards 1 h mean 100 percentile % > 180 ug/m3 1 h mean 99 percentile % > 180 ug/m3 37 53 62 73 81 92 73 87 89 95 99 100 8 h mean 100 percentile % > 120 ug/m3 not known 5 8 11 18 26 8 h mean 99 percentile % > 120 ug/m3 10 19 25-_ 28 37 46 Scenario 1990 basecase 2010 Basecase 1990 basecase -50% 1990 basecase - 60% 1990 basecase - 70% 1990 basecase - 80% 32 The following are the conclussions from the Auto Oil Study with respect to each of the pollutants which were investigated: (1) Carbon Monoxide; the impact of already agreed measures (in particular the increasing penetration of the three way catalyst) will already, by 2005 reduce urban background concentrations in all the cities studied to below the level of the most stringent air quality standard. On the basis of these results regulating for further reductions in vehicular emissions of this gas would not be a priority. (2) Benzene; the results indicate that as with carbon monoxide, the impact of the three way catalyst will result in a marked improvement of urban background concentrations over the coming years. Only in the case where an air quality standard of 2. 5 ug/m3 is used as a basis for comparison are emission reductions foreseen to be necessary in a number of the most polluted cities. (3) Oxides of Nitrogen; the air quality modelling results clearly demonstrate lhat if one uses the more stringent air quality standard for nitrogen dioxide as a basis for comparison it will still be necessary in 2010 to make further reductions in emissions of between 0 and 50% dependent upon the city. (4) Particulates; emission reductions of particulate matter from road transport in urban environments in the range 50-65% as compared to todays levels were considered necessary in order to achieve suitable air Quality targets. (5) Regional Ozone Pollution; the most important messages to be taken from this analysis are: - that the emission reductions resulting from already agreed measures will by 2010 bring about a considerable improvement with regard to regional ozone pollution; - that to reduce ozone pollution beyond that achieved by already agreed measures will require significant emission reductions of NOx and VOCs emissions of the order of 70-80% as compared to 1990; - that further emission reduction measures applied to traffic will, in the absence of parallel measures applied to other sources particularly sources of VOCs , have at most a marginal impact. - that for the purpose of the Auto/Oil Programme an emissions reduction target of at least 70% compared to 1990 levels of both total NOx and totai VOCs across the EU would be used. 33 3. THE COSTS AND POTENTIAL BENEFITS OF MEASURES TO REDUCE POLLUTANT EMISSIONS FROM VEHICLES. 3. 1. The European Programme on Environmental Fuels and Engines (EPEFE) One of the first steps taken in the Auto/Oil Programme was to review all available data concerning the relationships between vehicle emissions fuel properties, and engine technologies: this review included the results of the US Auto/Oil Programme. The conclusions from this review were published in 1994 in the report entitled "Effect of Fuel Qualities and Related Vehicle Technologies on European Vehicle Emissions"(5). In reviewing existing information on the relationship between fuel quality, engine technology and exhaust gas emissions it became apparent that gaps existed concerning certain fuel and vehicle interactions. As such knowledge was vital for the completion of the Auto/Oil Programme, the European Oil and Vehicle industries collaborated in the realization of an extensive research initiative designed to generate the missing data. This research programme was known as the "European Programme on Emissions, Fuels and Engine Technologies" (EPEFE) The EPEFE programme was extremely successful and has allowed important insights into the relationships between fuel quality and emissions. These relationships are complex, indeed it was observed that in some cases changing certain fuel parameters would decrease emissions of one pollutant while increasing emissions of another. Such insights are of vital importance when selecting fuels with the object of attacking priority pollutants. The EPEFE programme is one of the most ambitious studies of this type ever carried out. It has assisted in the quantification of the relationship between certain important fuel parameters (e. g sulphur content, aromatics content, distillation characteristics for gasoline; cetane number, density, polyaromatics content, and distillation characteristics in the case of diesel) and pollutant emissions. The EPEFE programme represented a significant investment on the part of the industrial partners in the Auto/Oil Programme and it is unlikely that such an ambitious undertaking would have taken place without the impetus of the Auto/Oil Programme. The results of the EPEFE programme have been published by the Industry(6). The individual test results from the tens of thousands of measurements taken during the EPEFE programme are also available upon request. 3. 2 Fuel quality changes - Costs and potential benefits Combined with already existing data, the EPEFE programme constituted a solid foundation upon which to make reliable estimates of the effects of changing fuel quality upon vehicle emissions. This allowed the Auto Oil partners to design fuels and to be confident in predicting the impact each fuel would have on the emission profiles of different classes of vehicles. In order to cany out a cost analysis it was necessary to combine the information concerning the effects of different fuel qualities on engine emissions (the benefits) with information concerning the additional costs of producing fuels corresponding to new, environmentally driven, specifications. (5) (6) This report - the report of "sub-Group 1" - is available on request from the European Commission. European Programme on Emissions, Fuels and Engine Technologies, Final Report. ACEA/EUROPIA, 9. 10. 1995. 34 On the basis of information provided by the Industry and the evaluation carried out by the independent contractor engaged by the Commission, the cost to the Industry of making changes to the composition of the gasoline and diesel fuels produced by EU refineries was assessed. A summary of some of the data concerning the benefits (emission reductions) and costs of cleaner gasoline and diesel fuels is presented in Tables 6 and 7 below. Complete details of the costs and benefits of fuel reformulations are to be found in the consultants report and the summary report of the Auto/Oil Programme. Table 6 Costs and Emissions Benefits of Cleaner Fuels - Gasoline: Emissions Reduction Potential for vehicles equiped with a 3-way catalyst. Cost to Industry per annum** Cost per litre Cost to the * motorist*** NOx* 7. 12% tl -6. 36% VOCs 18. 62% tl 4. 31% CO 17. 16% t l" 5. 36% ECU 327 - 1 450 million/year ECU 0. 003478/litre - ECU 0. 010964/litre ECU 3. 77 per year - ECU 11. 89 per year Negative emissions reduction for NOx in cases where fuel reformulation would cause an increase in emissions (from catalyst equipped vehicles) compared to current average fuel quality. Costs in Net present value in millions of 1995 ECU, discounted over period 1996 - 2015 at 7% per annum. Average costs assuming fuel use of 8. 611 / 100km and annual travel of 12, 000km. 35 Table 7 Costs and Emissions Benefits of Cleaner Fuels - Diesel in Passenger Cars and LCVs: Emissions Reduction Potential per vehicle Cost to industry per annum* Cost per litre Cost to the motorist** NOx 1. 8% ti 0. 5% VOCs 34. 3% tl 10. 7% CO 36. 1% ti 10. 6% PM 30% tl 10% ECU 260 - 1742 million/year ECU 0. 001761/litre - ECU 0. 01301/litre ECU 1. 69 per year -• ECU 12. 47 per year All costs expressed as Net present value in milhons of 1995 ECU, discounted over die period 1996-2015 at 7% per annum. Average costs assuming fuel use of 7. 611 / 100km and annual travel of 12, 000km. 36 3. 3 Changes to vehicle technology - Costs and potential benefits European vehicle manufactures were asked to provide estimates of the additional costs involved in equipping their vehicles with the technology necessary to achieve progressively more severe emission reductions. The manufacturers were invited to provide this information for a total of 16 different sub-categories e. g Gasoline cars - small, medium and large; heavy duty diesel vehicles - small, medium and large etc. The information provided by the manufacturers was evaluated by the independent contractors engaged by the Commission and was also cross-checked against information obtained from component manufacturers. A summary of some of the data concerning the emissions reduction benefit and associated costs is presented in Tables 8 and 9 below. Complete details of the costs and benefits of improved vehicle technology are to be found in the consultants report and the summary report of the Auto/Oil Programme. With regard to the potential of diesel engines to achieve further emission reductions, the figure used in the analysis are based on the assumption that the de-NOx catalyst will probably not be available for production models by the year 2000. Clearly if such technology were available in a reliable form, the potential for NOx emission reductions would be increased significantly. 37 Table 8 Costs and Emissions Benefits of Improved Vehicle Technology - Gasoline Passenger Cars Emission Reduction Benefits as compared to existing standards: NOx 65% tl 20% HC* 65% tl 20% CO 45% tl 20% Costs: Additional Cost per vehicle Percentage of Purchase Price Annual Cost to Industry Small ECU 43 - 237 Medium ECU 42 - 256 Large ECU 7 2 - 3 41 0. 5 - 2% ECU 574 - 3 262 million - HC = Hydro-Carbons - a high proportion of which will be VOCs Table 9 Costs & Emissions Benefits of Improved Vehicle Technology - Diesel Passenger Cars Emission Reduction Benefits as compared to existing standards: PM Costs: 50% tl 20% NOx 20% tl 20% HC* 65% tl 10% CO Additional Cost per vehicle Percentage of Purchase Price Medium ECU 203 - 367 Large ECU 227 - 402 0. 5 - 2. ! 5% HC = Hydro-Carbons - a proportion of which will be VOCs 50% tl 25% Annual Cost to Industry ECU345 «*605 million 38 3. 4 Improved durability of Emission Control Systems - Costs and potential benefits As a vehicle gets older its performance including that of the emission control system deteriorate. Significant reductions in vehicle emissions can potentially be achieved by reducing the rate of detioration in the emission control systems. There are several mechanisms by which such improvements can be achieved. increased severity and frequency of compulsory inspection and maintenance checks; manufacturers liability for the performance of the emission control systems extended from 80 000 km to 160 000 km; electronic sensors installed on the vehicle to monitor the performance of the emission control systems -referred to commonly as on-board diagnostics; re-call procedures whereby models can be re-called and re-fitted if their emission performance deteriorate beyond an acceptable level; improved mechanisms for the remote-roadside detection of vehicles emitting above acceptable levels. As part of the Auto/Oil Programme data were collected with regard to the cost and the emission's benefit of the various mechanisms designed to reduce the rate of detioration of the emission control systems. A summary of some of the data concerning the emissions reduction benefit and associated costs of improved durability of emission control systems is presented in Table 10 below. Table 10 Costs and Emissions Benefits of Improved Emission Control System Durability Emission Reduction Potential: Total NOx 15. 9% tl 0% Total VOCs 30% tl 0% Urban PM* 10% tl 0% Costs*": ECU 290 million/year -» ECU 1 112 million/year Emission reductions from diesel vehicles assumed to apply only to particulate emissions. Costs expressed as Net Present Value in 1995 ECU, discounted at 7% between 1996 and 2015. 39 4. COMPLEMENTARY LOCAL TECHNICAL AND NON-TECHNICAL MEASURES - COSTS AND POTENTIAL BENEFITS Article 4 of Directive 94/12/EC required that the Commission when developing future proposals should also take into account the potential of complementary non-technical measures such as traffic management and enhanced public transport as well as the use of alternative fuels. Non-technical instruments are geared towards changing the behaviour of transport users. As the analysis carried out by the Commission showed (see below), such behavioural changes are needed especially in cities with severe air quality problems where more stringent vehicle emission control, better fuel quality and improved durability of emission control systems alone are not sufficient to meet air quality targets. Many of these complementary measures would, of course, be applied at the Member State, regional or local level and decided by the corresponding authorities. The Commission has acknowledged the importance of these measures by promoting research, development and demonstration projects relating especially to urban transport through a number of channels (e. g. the THERMIE and SAVE II Programmes) and by fostering the exchange of experience between European cities in order to promote "best practice" in local transport planning (e. g. through the Commission's Urban Environment Expert Group and the Sustainable Cities Campaign). Most recently, the Commission presented two Green Papers on the Citizen's Network and the use-of pricing mechanisms in the transport area to stimulate the discussion on these issues at the European level. The instruments looked at included both local measures (traffic bans, speed regulation, cheaper public transport, alternative fuels), certain non-fiscal economic instruments (road pricing, scrappage subsidies) and the use of fuel taxes, vehicle purchase taxes and annual vehicle circulation taxes to influence transport users. In the final analysis, road pricing, traffic bans, the subsidy of public transport, scrappage subsidies and the conversion of urban buses to alternative fuels (LPG, CNG) were included. Information on the costs and the effectiveness of these instruments were collected, drawing on the experience in their application in different countries. The EUCARS passenger transport model developed by the Commission (Directorate-General II) was used to estimate the behavioural responses associated with the different instruments(7). Besides the investment and operating costs associated with some of the measures, non-monetary costs to society ("welfare costs") were taken into account which arise from the behavioural changes imposed on European citizens (e. g. their loss of freedom to drive by car into the city centre) and changes in tax revenues. Citizens adapt their behaviour in different ways in response to the non-technical measures studied, for example through reduced car usage, the purchase of less polluting vehicles or the better maintenance of vehicles. As compared to the evaluation of technical improvements, the assessment of non-technical measures is compounded by a number of difficulties. The responses of transport users cannot be predicted exactly and are often determined by local factors; the definition of measures is not as precise which makes it more difficult to assess their costs and effectiveness; many of the measures are interdependent and their costs and benefits are affected by-external influences (e. g. economic development). Therefore, the quantification of the costs and benefits of local transport measures and economic instruments entails considerable uncertainties. The analysis done showed that the non-technical measures considered had very different investment, operating and welfare costs. The analysis pointed to the fact that a reform of vehicle-related taxation in line with environmental criteria could make a cost-effective contribution to the reduction of transport-related air pollution. Under certain conditions, road pricing could even yield additional benefits beyond that of emission reduction by increasing (7) European Commission (Directorate-General II), "A Welfare Cost Assessment of Various Measures to Reduce Pollutant Emissions from Passenger Road Vehicles for the Year 2010" (Final Report, 12. 10. 1995) See also the consultants report from the cost effectiveness analysis. 40 the overall efficiency of the transport system. With due consideration to the uncertainty inherent in the assessment of these measures, it was concluded that local technical (LPG/CNG buses) plus non-technical measures (road pricing, cheaper public transport, traffic bans and scrappage subsidies, but excluding taxation instruments) can reduce urban NOx emissions by 10 to 25% beyond the reductions achieved through fuel quality changes, changes to vehicle technology and improved durability of emission control systems. The potential contribution of local technical and non-technical measures to emission reduction of other pollutants was not assessed in the same detail as for urban NOx but is likely to be of a similar magnitude. 5. COST-EFFECTIVE SOLUTIONS TO ACHIEVE AIR QUALITY TARGETS The most important step in the Auto/Oil Programme involved the exploitation of the data compiled on the costs and benefits of the various emission reduction measures (sections 4 and 5) in order to identify the most cost effective solutions to achieve the emission reduction targets identified in section 2 (see Figure 2). In the original concept of the Auto/Oil Programme it was foreseen that emission reduction targets would be generated in a consistent manner for all pollutants and that least cost solutions would be generated simultaneously in order to satisfy these multiple- emission reduction objectives. However, as described in sections 2. 3, it was not possible to determine precise emission reduction targets for particulate matter in each of the seven cities although a tentative objective of a reduction in the range of 50-65% as compared to present levels was identified. Similarly reduction targets for total NOx and total VOCs as precursors of regional ozone were difficult to establish: again tentative reduction targets in the range 70-80% for both pollutants compared to 1990 were identified. In the absence of compatible emission reduction targets for all pollutants, the analysis was conducted in a step wise manner looking first at the three pollutants- NOx, CO and Benzene - for which it had been possible to identify precise emission reduction targets in the 7 cities. Subsequently, strategies for reducing urban particulate emissions were explored. Finally, approaches for reducing emissions of total NOx and total VOCs as contributors to regional ozone were examined. With regard to the attainment of the emission reduction targets for urban pollutants, one important consideration was the achievement of an effective balance between on the one hand EU wide, largely technical, measures such as emission standards, fuel quality and inspection and maintenance and on the other hand local, largely non-technical measures such as road pricing, increased public transport, scrappage schemes and the replacement of diesel buses and trucks with LPG/CNG fuelled vehicles. The objective was to identify the most cost-effective series of interlocking measures such that a certain proportion of the background levels of pollution would be removed by EU wide technical measures and that as and where appropriate these technical measures would be supplemented by national and/or local measures in localities with elevated levels of-pollution - the objective being to achieve the desired emission reductions at the least cost for the Community as a whole. The details of the technical procedures used to identify the least cost combination of measures are described in the^ consultants report on the cost-effectiveness study and the consolidated report of the Auto/Oil Programme. 41 EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE 96/0163 (COD) Proposal for a relating to the quality of petrol and diesel fuels and amending Council Directive 93/12/EEC 42 EXPLANATORY MEMORANDUM 1. BACKGROUND in reducing vehicle emissions. The European Union has a long standing history Directive 94/12/EC(1) is the latest amendment of base Directive 70/220/EEC(2), laying down new emission standards for passenger cars. When the provisions of Directive 94/12/EC come into effect in 1996/97, emissions of regulated pollutants from new passenger cars will be reduced by over 90% as compared to the standards which prevailed in the early 1970s. However, despite these considerable achievements with regard to the emission reduction of individual vehicles, increased traffic activity (increased numbers of vehicles, increased kilometers travelled) are likely to counteract these improvements thereby preventing the emission reductions necessary to achieve future air quality objectives. The likelihood of further action to reduce vehicle emissions necessitated a reassessment of the existing policy approach; it being apparent that the emission reduction potential offered by further improvements in vehicle technology was limited and possibly very costly in comparison to other potential solutions. In the light of the above considerations a new, comprehensive and integrated approach was developed. Directive 94/12/EC, Article 4 outlines the main elements of this new approach: "In these proposals [future proposals designed to reduce emissions from traffic which the Commission is requested to submit] the Commission shall take the following approach: * * the measures shall be designed to produce effects to meet the requirements of the Community's air quality criteria and related objectives; an assessment of the cost-effectiveness of taking each measure shall be undertaken; in this global assessment full account shall be taken, inter alia, of the contributions that: traffic management, for example by spreading the environmental costs appropriately, enhanced urban public transport, new propulsion technologies (e. g. electric transmission), the use of alternative fuels (e. g. biofuels), could make to improving air quality, * the measures shall be proportional and intended objectives. " reasonable in the light^ of the Article 4 of Directive 94/12/EC stipulates that measures to be assessed with regard to their benefits and costs shall include improved vehicle technology, more appropriate mechanisms to reduce the in-use deterioration of emission control systems and "improvements in fuel quality as far as vehicle emissions of dangerous substances (in particular benzene) are concerned". (1) (2) OJ No L 100, 19. 4. 1994, p. 42. O J N oL 76^ 6. 4. 1970, p. l. 43 The importance of fuels with regard to the release of atmospheric pollutants such as lead, benzene and sulphur dioxide from vehicles has been recognized for some time. EU-wide legislation aimed at limiting the detrimental health and environmental effects of these pollutants already exist. The in limit values currently Directive 85/210/EEC(3) concerning the lead and benzene content of petrol and the sulphur content of diesel fuels is regulated under Directive 93/12/EC(4). in place are laid down The use of fuels for transportation purposes is however also linked to the release of other air pollutants such as volatile organic compounds (NOx), carbonmonoxide (CO) and particulate matter (PM) which directly or as precursors of ozone can have detrimental health and environmental effects. (VOCs), nitrogen oxides Therefore, assessment of the cost-effectiveness of fuel quality changes as a measure to reduce vehicle emissions must include a wider range of fuel components than those already legislated for. 2. THE EUROPEAN AUTO/OIL PROGRAMME In keeping with its commitment towards the development of a more comprehensive approach to reducing emissions from road transport and in conformity with the principles set out in Article 4 of Directive 94/12/EEC the Commission, at the end of 1992, decided to initiate a technical work programme for the purpose of providing a solid technical foundation upon which to base its future legislative proposals. In accordance with the principle of 'shared responsibility' expressed in the 5th Environmental Action Programme, the Commissioners for Environment, Industry and Energy, invited the European associations of the car (ACEA) and oil (Europia) industries to make available their considerable know-how and expertise and to collaborate in the realization of this technical programme. The two industries responded positively to this invitation and together with the Commission designed, planned and executed the programme which subsequently became known as the Auto/Oil Programme. The content and the structure of the Auto/Oil Programme is described in the Communication which accompanies this proposal. A short description of the programme and the conclusions derived from it is presented below. The objective of the Auto/Oil Programme was defined as: to provide policy-makers with an objective assessment of the most cost-effective package of measures to reduce emissions from the road transport sector to a level consistent with the attainment of the new air quality standards being developed for adoption across the European Union. The Auto/Oil Programme explored cost-effective combinations of measures sufficient to achieve, by 2010, stringent air quality standards with respect to the following pollutants: ~ZT * * * * * oxides of nitrogen (NOx) in cities benzene in cities carbonmonoxide (CO) in cities particulate matter (PM) in cities tropospheric ozone and thereby emissions of total NOx and Volatile Organic Compounds (VOCs). (3) (4) OJNoL96, 03. 4. 1985, p. 25. OJNoL74, 27. 3. 1993, p. 81. 44 The Auto/Oil Programme demonstrated that in the absence of futher measures to significantly reduce emissions from road transport, concentrations of nitrogen oxides, particulate matter and tropospheric ozone would constitute a continuing threat to human health and the environment into the next millenium. In contrast, the impact of already agreed measures was predicted to reduce concentrations of carbonmonoxide and benzene to acceptable levels. The Auto/Oil Programme explored the cost and the emission reduction potential of a variety of different measures inter alia improved vehicle technology, inspection and maintenance schemes, changes in the quality of fuels and a number of non-technical measures such as scrappage schemes and road pricing. Drawing on the results of the Auto/Oil Programme the Commission has decided upon a package of legislative proposals to be submitted to the European Parliament and the Council. a proposal on a moderate reformulation of petrol and diesel fuels (this proposal); to strengthen a proposal for passenger cars the existing emission (Directive 70/220/EEC, as last amended by Directive 94/12/EC (accompanying this proposal); limits a proposal light duty vehicles (Directive 70/220/EEC as last amended by Common Position No 3/96, [in 1997])(5) ; the emission strengthen limits for to a proposal (Directive 88/77/EEC(6) as last amended by Directive 91/542/EEC7)); the emission strengthen limits to for heavy duty vehicles. a proposal with regard to the strengthening of the current legislation on inspection and maintenance (Directive 92/55/EC^ [in 1997]). The proposals enumerated above foresee the simultaneous entry into force of a series of measures as from 1 January 2000. The Commission estimates that the measures coming into effect in 2000 will, in 2010, reduce emissions from the road transport sector by: urban NOx = urban CO = urban benzene 39% 51% = 48% urban particulates total NOx total VOCs = = = 39% 35% 46% as compared to what the emissions would have been in the absence of the measures. 3. EMISSION REDUCTION FROM OTHER THAN MOBILE SOURCES The package of measures is part of an integrated Commission strategy to reduce atmospheric emissions from all sources and which was developed on the basis of the 5th Environmental Action Programme. While emission reductions from mobile sources are an important contribution to the achievement of future air quality targets they will not be sufficient to solve the problem of ozone pollution and acidification. (5) (6) (7) (8) O J N oC 37, 9. 2. 1996, p. 23. O J N oL 36, 9. 2. 1988, p. 1. O J N oL 295, 25. 10. 1991, p. 1. O J N oL 225, 10. 8. 1992, p. 68. 45 The Commission is therefore pursuing complementary measures aimed at emission reduction from stationary sources such as power plants, industrial installations, households, etc. The revision of the large combustion plant directive*9' and the proposed directive on Integrated Pollution Prevention and Control0* are steps in this direction. Further action, especially with regard to the reduction of volatile organic compounds as a precursor for ozone formation, are needed to complement the beneficial effects gained from traffic related measures. 4. THE EUROPEAN MARKET FOR PETROL AND DIESEL FUELS The Community's total energy demand is covered by several sources of which almost half is supplied by liquid fuels. The annual turnover is approximately ECU 40 billion/year. In 1990, energy demand for transport activities amounted to about 30% of total final energy consumption. More than 83% of the energy needed for transport is consumed by road transport in the form of fuels. The principal fuels are petrol and diesel with other fuels such as Liquified Petroleum Gas (LPG) and Compressed Natural Gas (CNG) only taking up a small share of the market. According to the latest oil industry figures gasoline and diesel consumption in 1995 amount to around 170 000 respect. 120 000 million litres. The consultancy company AD. Little has estimated that over the period 2000-2015, EU consumption of petrol and diesel fuels will amount to 2 540 respectively 2 572 thousand million litres. These forecasts are likely to be overestimated in view of the Commission's aim of bringing forward policy measures to reduce C07 emissions from cars. Market Share of Leaded and Unleaded Gasoj 0Leaded Figure 1 • Unloaded FfetiHtd Qftmany [jjKtmbourg aeijiuni ftwtoo 0% 10% 20% 30% 40% 50% 60%i 70% 80% 80% 100% Percentage Market Share (9) (10) Revision of Directive 88/609/EEC: OJ No L 336, 7. 12. 1988, p. 1 COM 96/C87/02 46 Leaded v unleaded petrol The market for petrol is divided into leaded and unleaded petrol, of which the latter has gained an increasing market share over the last years. In 1995 the average market share of unleaded petrol in the EU reached about 68%». However, this figure does not reflect the wide difference of the use of unleaded petrol in the Member States. While in countries like Austria, Finland and Sweden 100% of the petrol pool consists of unleaded petrol, in Spain, Greece and Portugal the latter only represents 30-40%. An overview of the share of leaded and unleaded petrol in the market in 1995 is provided in Figure 1. With the introduction of the catalytic converter the market share of unleaded petrol will increase further with an estimated growth rate of approx. 8% of the 1995 market share per year. Unleaded petrol is provided in the market as 'unleaded regular1 (91/92 RON [Research Octane Number]), 'unleaded premium/super' (RON 95) and 'unleaded super plus' (RON 98) Table 1 is the oil industry's estimate of the market share of each type calculated as percentage of total unleaded petrol and as percentage of total petrol. Table 1 (Estimate Europia 1995) TYPE unlead. % of total unleaded petrol % of total petrol pool RON 91/92 RON 95 RON 98 Fuel quality 1 3^ 68. 5 18. 0. 9 47 12 The quality of unleaded petrol and diesel fuels in Europe is subject to European standards as laid down by the European Committe for Standardisation (CEN) [see chapter 12, p. 22]. Requirements specified by the CEN standards are set with a view to improved performance of the engine/vehicle. While the establishment of European standards has led to a certain degree of harmonization current data on fuel quality in the market show that there are considerable variations with regard to locations (north, south, central) and seasons (winter/summer). The predicted average fuel quality of petrol and diesel fuels by the year 2000 and in the absence of any legislative action is shown in Tables 2 and 3 below. 47 Table 2: Predicted Average Values for Fuel Parameters of Market Fuel (unleaded petrol) Parameter RVP Summer E. 10Q E. 150 Olefins Aromatics Benzene Oxygen Sulphur Lead Unit kPa % v/v % v/v % v/v % v/v % v/v % m/m gpm g/1 Predicted Market Average in the year 2000 without new measures 68 53 84 U 40 23 (^6 300 0. 005 Table 3: Predicted Average Values for Fuel Parameters of Market Fuels (diesel) Parameter • Cetane Number Density Poly aromatics T95 Sulphur Units : kg/m3 vol% ^Ç ppm Predicted Market Average in the year 2000 without new measures 51 843 9 355 450 48 5. THE EMISSIONS BENEFITS AND COSTS OF CHANGES IN FUEL QUALITY The Auto/Oil Programme demonstrated clearly that changes of fuel components such as sulphur, aromatics and benzene content and vapour pressure for gasoline and sulphur, cetane number, density and polyaromatic content of diesel can have a significant benefit in terms the of reducing emissions of priority pollutants from vehicles. In Auto/Oil Programme the relationship between the benefits in terms of reduced emissions and the costs were explored for unleaded petrol and diesel fuels modified to increasing degrees of severity. the context of The Commission's proposal As described in Chapter 2. the Auto/Oil Programme identified moderate changes in the quality of petrol and diesel fuels as part of a cost-effective integrated package of measures. The fuel specifications proposed by the Commission for petrol and diesel fuel and foreseen to come into force in 2000 are shown in Tables 4 and 5. The specifications are expressed as maximum and minimum for various parameters of environmental relevance. The tolerances of the refinery production process mean that in order to ensure that the product complies with the prescribed specifications the average quality of the fuel placed on the market will be better than the specifications. Tables 4 and 5 also indicate the Commission's estimates of the market average fuel quality which will result from the application of the proposed specifications. A comparison with the predicted average market values for petrol and diesel fuels by the year 2000 in the absence of legislation (see Tables 2 and 3 on pages 6 and 7) shows improvements with regard to Reid Vapour Pressure (RVP), aromatics, benzene and sulphur in petrol and with regard to cetane number, density, poly aromatics, T95 (distillation) and sulphur in diesel fuel. Table 4: Proposed Fuel Specifications for Petrol to Come into Effect in 2000 and the Corresponding Predicted Market Average Values Parameter Unit Average Market Values of Proposed Fuel Package Limit Values of Proposed Fuel Package Minimum Maximum RVP Summer E. 100 E. 150 Olefins Aromatics Benzene Oxygen Sulphur Lead kPa % v/v % v/v % v/v % v/v % v/v % m/m ppm g/1 58 53 84 11 37 1. 6 1 150 0. 005 _ 46 75 - - - _ _ - 60 _ _ Ts* 45 2 2. 3 200 0. 005 [* Except for unleaded petrol regular for which the maximum olefin content shall be 2 1% v/v. ] 49 Table 5: Proposed Fuel Specifications for Diesel to Come into Effect in 2000 and the Corresponding Predicted Market Average Values Parameter Unit Average Market Values of Proposed Fuel Package Limit Values of Proposed Fuel Package Minimum Maximum Cetane Number Density - kPa Poly-aromatics % Vol. T95 Sulphur °C ppm 53 835 6 350 300 51 • _ _ - _ 845 11 360 350 Emission reductions The emission reductions which are achieved by the proposed petrol and diesel specifications foreseen in 2000 are shown in Table 6. Table 6: Emission Reductions Achieved From Different Vehicle Classes by Expected Petrol and Diesel Fuel Quality Changes Pollutant % emission reduction achieved by the proposed change in petrol % emission reduction achieved by the proposed change in die:elfuel (LDVs)* % emission reduction achieved by the proposed change in diesel fuel (HDVs)* NOx VOCs CO PM - 7. 12 - 8. 44 - 8. 89 Benzene -20. 7 - 0. 53 - 10. 68 - 10. 60 - 9. 95 — -2. 15 -2. 20 -0. 39 -3. 22 * The difference in emission reduction between light duty (LDVs) and heavy duty vehicles (HDVs)inrdue to the difference in the test cycle which reflects the different engine technologies of the two vehicle categories and the different loads under which they operate. In addition to the proposed Community-wide measures, supplementary emission reduction measures might be taken by Member States at national, regional or local level in order to achieve established EU or national air quality standards everywhere in the Community (see also 'Fiscal Measures' below). 50 Leaded petrol The Auto/Oil Programme only investigated the cost and emission effects of unleaded petrol, grades. With the increasing number of cars equipped with catalytic converters the share of leaded petrol in the total pool will diminish significantly. While today the share of leaded petrol is around 30% of the total pool the estimated growth rate of the market share of unleaded petrol (see chapter 4, p. 5) suggests that by the year 2000 only a very small amount of leaded petrol (2%) will be in the market. In addition, it is estimated that by the year 2000 the entire car fleet will be able to run on unleaded petrol except the socalled 'Oldtimers'. These cars can be run on unleaded petrol containing a lead substitute which can be added to the petrol tank. These lead substitutes are already available at the petrol station where they can be purchased and added by the consumer. In the light of the above and in recognition of the significant human health risk associated with lead pollution, the Commission has proposed a general ban on the marketing of leaded petrol as from 1. January 2000. However, in recognition of the fact that for certain Member States such a rapid phase- out may result in severe socio-economic problems, the Commission's proposal also provides for a limited, two year derogation. Benzene the benzene content in petrol is 5% as regulated under EC The current limit value of Directive 85/210. With a number of Member States producing petrol containing benzene levels well below this limit, the European average market value today is about 2. 3% (see Chapter 4, p. 6). Air quality modelling results obtained as part of the Auto/Oil Programme have shown that by the year 2010 atmospheric benzene levels will be sufficiently low even without the application of additional measures if this average value is being maintained. However, the Commission is aware that atmospheric benzene pollution is likely to persist in the short to medium term, in areas with high traffic density (inner cities, cross-roads, etc. ). For this reason countries like Austria, Finland, Germany, Italy and Sweden have in an Environment Council meeting in December 1994 demanded that a reduction of the benzene level in petrol to 1% be introduced at European level as the most effective measure to mitigate existing benzene pollution in those problem areas. Directive 94/12/EEC, Article 4 requires the Commission to particularly investigate the emission effects with regard to a change in benzene content. Austria, in the accession negotiations, was allowed to maintain its national benzene limit value of 3% for a transitional period. Sweden and Finland were permitted to continue a tax incentive scheme with which the benzene content of petrol has been redueed to 3% and 1%> respectively. The Commission in its response to Member States' concern on atmospheric benzene levels is taking a positive stance when proposing a considerable reduction of the current benzene limit value from 5%;to 2%. However, in view of the air quality from the Auto/Oil Programme and summarised in chapter 2. , the Commission does not see the need to mandate for a EU-wide benzene limit value of 1%. Review Process Within 12 months of the adoption of the Directive and in any event not later than 31 December 1998 the Commission will bring forward proposals to revise the provisions of the Directive. This proposal will be based on the comprehensive assessment to be carried out in conformity with the requirements of Article 4 of the proposed amendment to Directive 70/220/EEC. The purpose of that assessment is to develop a strategy designed to 51 produce effects to meet the requirements of Community air quality standards and related objectives, at least cost. In developing such a strategy, the Commission will take full account of: trends in air quality; noxious pollutant emissions in Europe from transport and non-transport sources and the contribution that existing, pending and potential measures to control emissions from non-transport sources , could make to improve air quality; technical developments with regard to: * * vehicle technologies as well as new propulsion technologies (e. g. electric propulsion, fuel cells), refinery technologies; the potential of alternative fuels such as compressed natural gas (CNG), Liquid Petroleum Gas (LPG), and Dimethyl Ether (DME) and biofuels to reduce vehicle emissions, possible improvements in the test procedures for the type approval of new vehicles, in particular the addition of a new test procedure at low temperatures; the potential of technical, non-technical and local measures to reduce emissions: in this context, the contribution of transport and other policy measures such as traffic management, enhanced urban public transport and vehicle scrappage schemes should be evaluated; the contribution that selective and differentiated fiscal measures could make to reducing emissions, whilst not negatively the internal market; the functioning of impacting the effects of any measures on C02 emissions; the strategies followed by third countries to improve air quality and the emission values applied therein; the situation with regard to the supply and the quality of crude oil available to the Community. The proposal to revise the provisions of the Directive based on a comprehensive assessment and as an integral part of the strategy described above, will include, inter alia, a revision of this the specifications for petrol and diesel fuels as laid down in Annexes I and frof Directive. These revised specifications would come into effect on January 1, 2005. The Commission's proposal will take into account that improvements to fuel quality have a direct and significant impact on emissions of particulate matter, volatile organic compounds and oxides of nitrogen. All of these pollutants either directly, or as a result of their contribution to ozone formation, result in important impacts on human health and the environment. In addition to the direct benefits that improved fuel quality has on vehicle emissions there is a clear interaction between fuel quality and vehicle technology. With regard to the development of new pollution abatement technologies such as the de-NOx catalyst there is evidence that fuels of a certain quality, particularly low sulphur fuels, may well be required if such technologies are to achieve optimal and long-lasting levels of performance. 52 Accordingly, the Commission foresees that its future proposal to revise the specifications of petrol and diesel fuels should comprise a significant reduction in the content of sulphur for both fuels. Current research and development indicates that a sulphur limit of the order of 50 ppm could be needed for the optimal functioning of the new vehicle-based pollution abatement technologies as well as contributing to improving emissions from the existing car pare. While this proposal does not specify a limit value for the sulphur content in petrol and diesel fuels for 2005 the establishment of these values will of course be based on the outcome of the cost-effectiveness assessment to be carried out prior to the development of the Commission's future proposal. To take account of the possibility that vehicles equipped with new pollution abatement technologies such as the de-NOx catalyst are developed and introduced into the market before 2005, the Commission has also included in its proposal a commitment to bring forward, if appropriate, proposals to ensure that when vehicles equipped with such technologies are placed on the market, fuels of a quality sufficient to guarantee the necessary level of performance of the technology will be widely available. In bringing forward such proposals the Commission will give due regard to considerations of air quality, cost-effectiveness and proportionality. The Commission will also take into account: (i) (ii) the latest information on the interaction between fuel quality and the performance of the new pollution abatement technologies; the situation with regard to the development and production of these technologies and the forecasts concerning the marketing of vehicles equipped with such technologies. (iii) the need to ensure that the measures proposed will neither disrupt the free movement of persons and goods nor unduly distort competition. Fiscal Measures While the Commission's proposal will result in a significant improvement in the average quality of fuels sold throughout the Community, it is likely that some Member States, particularly those in which. fiscal incentives have been applied in the past, may wish to encourage the use of even cleaner fuels as part of their overall strategy to improve air quality. The Commission would not wish to impede national or local initiatives aimed at improving air quality on condition that such initiatives were compatible with the provisions of Directive 92/81/EEC dealing with mineral oil structures. According to Directive 92/81/EEC(11), mineral oils used as a motor fuel shall be taxed at a single rate per product category. The excise duty rate for each product is to be decided by the individual Member States provided they respect the Community minimum rates as outlined in the Mineral Oils Rates Directive 92/82/EEC(12). Should Member States wish to use fiscal incentives and apply differential rates, other than those provided for in article 8(2) of Council Directive 92/81/EEC, they have the-possibility to request a derogation from the general regime according to Article 8(4) of the same Directive. Such requests must be authorized by the Council. For motor fuels, Denmark, Finland, Greece and Sweden have been granted derogations allowing them to apply reduced rates on environmentally friendly diesel. Finland can apply reduced excise duty rates on reformulated unleaded and leaded petrol. Denmark can apply differential rates of duty between petrol. distributed from petrol stations equipped with a return system for petrol fumes and petrol distributed from other petrol stations. A number of applications from other Member States are presently being evaluated. (11) (12) OJ No L 316, 31. 10. 1992, p. 12. OJ No L 316, 31. 10. 1992, p. 19. Derogations - Special Fuels Notwithstanding the possibilities open to Member States to encourage the marketing of cleaner fuels through fiscal measures, there may be specific locations such as large urban areas where atmospheric pollution constitutes or may reasonably be expected to constitute a serious and recurrent problem for human health and/or the environment. In such locations Member States may consider it appropriate to require the marketing of special fuels as part of a strategy to combat air pollution. The Commissions proposal therefore foresees the possibility for Member States to be granted a derogation in order to require the use of such special fuels. The Commission's proposal also foresees that Member States wishing to make use of this derogation will be required to motivate their proposed measures on the basis of air quality measurements and the improvement in air quality that the measures are expected to bring. The Member State should also provide evidence that the proposed measures respect the principle of proportionality with particular attention being given to their impact upon the internal market and competition. 6. THE EUROPEAN REFINING INDUSTRY The European Union (15) has 106 refineries with a total distillation capacity of In the past, refineries have been categorized in three types: 13 212 833 barrels per day. simple, catalytic cracking and full upgrading. However, these categories no longer represent the range of refineries operational in Europe. Over the last three to five years, some refiners have upgraded their installations in response to tighter product specifications such as the reduction of lead in petrol and the lowering of the sulphur content in gas oil and diesel fuel. The currently existing refinery types are best categorised as follows: * * * * * Simple - including thermal operations & some vaccum distillation Fluid Catalytic Cracking (FCC) with or without feed pretreatment with or without C6-Isomerisation Hydrocracking Fluid Catalytic Cracking (FCC) and hydrocracking Others (e. g. lube oil production, etc. ) ~ The latter category is without importance for petrol and diesel production and will therefore be excluded from the further analysis. The refinery type most common in Europe is the fluid catalytic cracking (FCC) type (with or without pretreatment and with or without C6-Isomerisation but not including the combination FCC plus Hydrocracker) accounting for around 61% of total atmospheric distillation capacity in the European Union. Table 7 provides an overview of European refinery types and their percentage share of total European distillation capacity. Figure 3 shows the types of refinery existing in each country and their total distillation capacity. 54 Table 7: European Refinery Types and Their Share of European Distillation Capacity (1994) Refinery Type Simple without thermal or C6 Isomenzation Simple without thermal but with C6 Isomenzation Simple with thermal but without C6 Isomenzation Simple with thermal and C6 Isomenzation Hydrocracker without C6 Isomerisation Hydrocracker with C6 Isomenzation FCC without Pretreatment or C6 Isomenzation FCC without Pretreatment but with C6 Isomerisation FCC with Pretreatment but without C6 Isomerisation FCC with Pretreatment and C6 Isomerization FCC and Hydrocracker without pretreatment or C6 Isomerization FCC and Hydrocracker without Pretreatment but with C6 Isomerization Other Number of Refineries Total Atmospheric Distilliation Capacity (b/cd) % of European Capacity in Each 18 3 10 9 7 3 19 17 8 3 4 2 3 969 030 244 000 737 118 696 700 881 160 494 000 3 218 500 2 793 000 7. 3% 1. 8% 5. 6% 5. 3% 6. 7% 3. 7% 24. 4% 21. 1% 1 454 025 11. 0% 598 300 737 000 390 000 4. 5% 5. 6% 3. 0% 0 0% Total in Europe 106 13 212 833 55 Figure 2 European Refinery Types per Country (1994) H Hydro D FCC and Hydro without Pretreatment m FCC with Pretreatment • FCC Without Pretreatment • Simple It can be seen from Figure 2 that in Austria, Belgium, France, Italy, the Netherlands, the UK and Spain the various types of FCC refineries predominate. Greece's distillation capacity is divided between simple and FCC refineries however, one of the FCC refineries also has some hydrocracking capacity which increases its flexibility with regard to the fuel quality changes required. the biggest hydrocracking capacity of all EU Member States. Finland has a simple and a FCC/hydrocracking refinery. Denmark and Ireland only operate simple refineries. Sweden's distillation capacity is nearly equally divided between the simple and the FCC refinery type. One of the latter however has some hydrocracking capacity. German refineries have — The refinery configuration has a major influence on the oil industry's ability to meet product specifications and is the key indicator as to the technical capacity of an individual refinery to cope with tighter specifications as a consequence of European environmental legislation. In general tighter limit values for diesel specifications and for petrol specifications such as sulphur and olefin content can more easily be met by simple and hydrocracking than by other refinery types. FCC and combined FCC/hydrocracker refineries are better suited to the tightening of certain petrol components such as benzene and aromatics. 56 Projected costs of legislative fuel specifications to the refining industry The financial implications incured by the proposed specifications are presented in Table 8 for the European refining industry (EU 12). They provide an overview of the estimated total costs over 15 years expressed as the net present value, indicate the overall capital investment costs and the yearly incured fixed operating and energy costs. Table 8: Cost Implications* for Proposed Petrol and Diesel Fuel Specifications in 2000 ŒU12) CECXJ) million Net present Value (over 15 years) Total Capital Investment Costs Fixed operating Costs/Year Energy Costs/Year 11 380 7 223 291 146 The costs are based on the value of the ECU in 1995 and a project life of 15 years from 2000 onwards. Not included in this cost analysis are the financial implications for the refinery industries in Austria, Finland and Sweden since they were not members of the European Union at the time when the Auto/Oil Programme began. However, all three new Member States have already undertaken action with regard to a change of certain parameters of pefol and diesel fuels. This is particular so for Sweden and Finland where a number of fuel specifications are much stricter than those proposed in this Directive. It can be expected that costs for the Swedish and Finnish refinery sector will not increase as a result of the forthcoming European legislation. For Austria however, some costs will occur. While the aggregated total costs for EU-12 do not reflect individual refinery and regional variations, these aspects have nevertheless been studied. It can be expected that the results for individual refineries and for regions show a wide difference. However, the variation is not uniform because the impact of the quality parameter changes depends on both feedstock and refinery configuration. Therefore, it is likely that the Mediterranean region with its higher sulphur feedstock will face higher costs than the aggregate for removal of sulphur. North West Europe and the atlantic region on the other hand will have to pay more than the aggregate costs for removal of benzene and aromatics because their feedstock contains a high amount of these compounds. It is expected that the aggregated costs can vary between ± 25% depending on refinery type and region. 7. TRADE IMPLICATIONS In order to produce a range of fuels and satisfy local demand it is often necessary for a refiner to trade in feedstock and/or a certain amount of their refinery products. This enables refiners to balance refinery configuration and design against fuel demand and the nature of, the crude oil supply. trade occurs among Member States and between Member States and This non-European countries. 57 Petrol Over the last ten years the EU trade balance of petrol has been positive with total exports to third countries increasing from 6. 7 to 15. 0 million tonnes. The U. S. A. and Canada are one of the major export markets of the EU for petrol. While in 1992 and 1993 exports were low because additional MTBE production in those countries replaced some of the previously imported petrol, in 1994 exports started to recover and rose to about 6. 8 million tonnes. Figure 3 shows the contribution of individual Member States towards these exports. It is difficult to predict the future development of these exports since they are influenced not only by the forthcoming changes of fuel quality in the EU but also by the evolution of the 'reformulated gasoline' programme in the USA. FigttrrS 1994 Petrol Exports to USA and Canada Source: E T S U/ High and Watt Associates, 1995. Gasoil/diesel fuel The EU- trade balance of gas/diesel oil between 1985 and 1994 has turned from negative to positive with net exports to third countries totalling about 1 million tonnes in 1994. Of the total imports the biggest share of 30% is coming from Russia. Another important supplier of gas/diesel oil is Egypt with 20%. No statistics on the breakdown of imports between diesel and other gas oil are available. However, the diesel share of total gas oil production increases. The rise has been from 49% in 1993 to 50% in 1994. For 1995 the share of diesel is projected to be 53%. Changes in diesel fuel quality as proposed in this Directive will make it more difficult to meet sulphur and density specifications in diesel and are likely to lead to an increasing demand on low sulphur (sweet), crudes. In the mid and long term North West Europe and the Atlantic region will become short on their reserves of low sulphur crude oil. It is therefore reasonable to expect the price differential to widen between low sulphur (sweet) and high sulphur (sour) crudes and imports of low sulphur crudes into the Community to rise. These developments will favour the North African crude oil suppliers while the Russian and most West African crudes are generally higher in sulphur. 58 8. IMPLICATIONS FOR THE CONSUMER The incurred European-wide costs for a change in the quality of fuel as illustrated in Chapter 5. will ultimately be borne by the consumer. For her/him the additional costs per litre at the pump will be around ECU 0. 002 for a petrol or diesel car for measures to be introduced in 2000. For a motorist who drives around 12 600 km/year this amounts to additional costs of around ECU 2/year for a petrol or diesel car. This increase in price is well below price changes which occur on a regular basis for other market reasons (e. g. changes in crude oil and feedstock products). 9. IMPACT ON EU-WIDE CO, EMISSIONS Changes in fuel quality require the use of additional energy which in turn increases C02 emissions. It is estimated that C02 emissions per year will rise by 6 million tonnes across the EU (12) when the proposed fuel quality changes will become mandatory for 2000. These 6 million tonnes represent around 0. 2% of total C02 emissions and 0. 8% of C02 emissions from transport sources in 1993. 10. SUBSIDIARITY 10. 1 What are the Objectives of the Proposed Measure in Relation to the Obligations Placed Upon the Commission? The objectives of the measure are to achieve a basic level of harmonization of the considerable market of transport fuels (about 290. 000 million litres in 1995). Despite the existance of norms laid down by the European Committee for Standardization (CEN) for certain fuel components, the majority of the petrol and diesel fuel marketed is characterized by numerous permissible levels for a number of fuel components (e. g. sulphur, aromatics, benzene). The proposal asserts an increased level of harmonization to replace the existing range, thus ensuring the proper functioning of the internal market. Harmonization will be even more important in the future as environmental concerns may lead many Member States to introduce new restrictions on some of the above mentioned fuel components. Unilateral measures could produce differences in product specifications in the various Member States thereby hindering the free flow of goods. The role of transport fuels with regard to their potential of reducing vehicle emissions has been discussed in Chapter 5. For the purpose of considerable emission reductions necessary to achieve future urban and regional air quality objectives, changes in fuel quality have proven to be a cost-effective means. Only legislative -action on Community level can ensure that the emission reduction potential of fuelsTs used to the extent needed. 10. 2 Does the Proposed Action relate to a Matter of Exclusive Community Competence or Competence Shared with the Member States? The matter concerns harmonization of the internal market and therefore is an issue of exclusive Community competence. 10. 3 What Forms of Action are Available to the Community? The only realistic form of action is legislation based either on a Directive or a Regulation. 59 10. 4 Is a Uniform Regulation Necessary or will a Directive Imposing General Objectives with the Execution being Left to Member States Suffice? A directive imposing general objectives and with the detailed implementation being left to the Member States will achieve the necessary objectives while at the same time allowing the Member States considerable freedom with regard to practical details of implementation. 11. RESULTS OF CONSULTATION WITH AFFECTED PARTIES Consultation with Member States During the course of the Auto/Oil Programme which was to serve as the technical and scientific basis for legislation on car emissions and fuel quality, DG XI and DG HI have conducted a series of meetings with national experts. The purpose of the meetings was to fully inform Member States about all aspects of the programme and to ensure that their comments were taken into consideration. In a meeting on 7 December experts from Member States were consulted on the proposed fuel quality specifications laid down in this directive. The experts in general welcomed the Commission's initiative to put forward legislative proposals on the quality. of petrol and diesel fuels. Experts from Austria, Denmark, Finland, Germany, Sweden and the Netherlands expressed their strong view of most of the petrol and diesel fuel specifications not being strong enough. Especially Finland and Sweden voiced the concern that the high quality fuel specifications currently in place in their countries could be endangered by the Commission's proposal for only moderate changes of fuel quality. Experts from Ireland, France, Spain and Portugal were of the opinion that some fuel parameters in particular the sulphur content of both petrol and diesel fuel would be difficult for their refineries to achieve. Consultation with the European oil and car industries (Europia and ACEA) Both, the European associations of the oil (Europia) and the car (ACEA) industries were partners in the Auto/Oil Programme. The work carried out in the framework of the programme was based on the consensus of all partners involved. At a final technical meeting of the Auto/Oil Programme on 20 March 1996, the database and the methodology used for carrying out the cost-effectiveness ananlysis were approved. The oil industry was also consulted on a number of technical questions which arose in the discussion on transposing the fuel parameter values used in the cost-efectiveness analysis into limit values. With regard to the proposed specifications the oil industy has expressed its strong opposition concerning the intention to already indicate the need to make significant cuts in the sulphur content of petrol and diesel fuels in 2005. Europia considers this as a violation of the cost-effectiveness principle. With regard to the benzene content of petrol. Europia maintains its position that in view of the results of the air quality modelling carried out within the context of the Auto/Oil Programme a reduction of the current EU average market value of about 2. 3% is not justified. 60 The car industry however considers the proposed fuel specifications for the year 2000 as too moderate and would like to see more severe limit values in particular with regard to the sulphur content of diesel fuels. ACEA claims that with the current proposal on fuel quality, which amounts to yearly costs of around ECU 880 million for the oil industry puts the bulk of the total financial burden of ECU 5 326 million/year for the overall package of emission reduction measures on the car industry. 12. DESCRIPTION OF LEGISLATIVE SITUATION IN MEMBER STATES Current European legislation on fuel quality European legislation on fuel quality is currently limited to Directive 85/210/EEC on the lead and benzene content of petrol and EC Directive 93/12/EEC on the sulphur content of diesel fuel. Directive 85/536/EEC sets out the framework for the addition of oxygenates into petrol. Member States have to permit a certain amount of oxygenates in the petrol and can allow those in excess of it. According to the legislation referred to above Member States have to adhere to the following values: Petrol lead content (g/1) in leaded petrol: lead content (g/T in unleaded petrol: benzene content%V/V: > 0. 15 - < 0. 40 < 0. 013 < 5. 0 Diesel sulphur content% m/m 0. 2 0. 05 (1/10/1996) Temporary derogations for new EU Member States at the time of their accession The following countries were given temporary derogations with regard to some fuel components for which national legislation already existed: Austria benzene in petrol sulphur in diesel ban of leaded petrol 3% 500 ppm Sweden/Finland ban of leaded petrol/continuation of currently existing tax incentive scheme for environmentally higher quality fuels. —7 61 Additional national legislation Some Member States have extended the existing European legislation to other fuel parameters and have given legal status to the technical norms set by the European Committee for Standardisation (CEN) for a range of fuel parameters. Tables 9 and 10 give an overview of the countries which enforced CEN-norms as legally binding, the fuel types and the environmentally important fuel components to which they apply. Table 9 Specifications Density (kg/m3) Cetane number I Distillation, T 95% Diesel Fuel Limit values s 860 £ 820 £ 49 (temperate climate) | <L 370 C° (temperate climate) | Countries: Finland, France, Germany, United Kingdom, Italy Table 10 Specifications Limit values Unleaded Petrol (regular/premium) Sulphur content (%m/m) Reid vapour pressure (kPa) Distillation (El00) (%v) <. 0. 05 ^ 35 £ 100 (depending on seasonal and geographical conditions) z 40 ^ 70 (dep. on seasonal and geographical conditions) Countries: Austria, France, Germany, and the United Kingdom. The CEN-norms for unleaded regular and premium petrol have also been applied for the super grade. fuels. Applications from other Member States such as Ireland and Denmark, Finland, Greece and Sweden have under Directive 92/81/EEC been granted derogations with regard to the introduction of reduced excise rates on environmentally friendly the United Kingdom on the same issue are currently being evaluated by the Commission (see Chapter 5 'Fiscal Measures'). Tables 11 and 12 provide a comparison between the different diesel and petrol fuel qualities of some of these countries with the specifications proposed in this Directive. 62 Table 11: Comparison of Gasoline Fuel Parameters Parameter (Units) Sweden Finland Austria Sulphur(max) E. lOO(min) RVPsummer (max) ppm % Kpa Benzene(max) Vol % Aromatics (max) Vol % Olefins(max) Vol % Oxygen(max) % m/m 100 47 70 2 46 _ 2. 0 Lead(maxX g/1 0. 005 100 43 70 1 - _ 2. 7 - 100. 58 3 - _ _ - EU specifications proposed for 2000 200 46 60 2. 0 45 T8* 2. 3 0. 005 [* Except for unleaded petrol regular for which the maximum olefin content shall be 21/v/v. ] Table 12: Comparison of Diesel FUel Parameters Parameter (Units) Sweden {Category 1) Finland {City Diesel) Denmark Ultra light {Bus Fuel) EU Specifica tions proposed for 2000 Cetane Number(min) Density(max) Distillation 95% point (max) Polycyclic-aromatic hydrocarbons Aromatics Sulphur (max) No. kg/m3 °C % m/m Vol % ppm 50 820 285 0. 017 5 10 49 850 20 50 50 855 320. 500 51 845 360 11 — _ 350 63 13. EXPLANATION OF PROVISIONS OF THE PROPOSAL The scope of the Directive (Article 1) The scope of the proposal is to use harmonization of the various national legislation and/or fuel quality norms to ensure, on the one hand, a high level of protection against urban and regional air quality problems caused by vehicles through the use of petrol and diesel fuels and, on the other hand, the functioning of the internal market. The proposed measures will not eliminate the negative environmental impacts, but reduce them to some degree. Definitions (Article 2) The definitions of the various fuels are made as close as possible to the current EU definitions. Petrol (Article 3) 3. 1 3. 2 3. 3- 3. 6 Lead is a harmful air pollutant and a poison for the catalytic converter required to fulfil the latest passenger car emission standards. By 1995 the market share-of leaded petrol throughout the European Union has gone down to about 30% of the total petrol pool and is expected to be down at about 2% by the year 2000. By that time it is also estimated that the entire European car fleet will be able to run on unleaded petrol. The Commission therefore foresees the phasing out of leaded petrol by the year 2000. The European Auto/Oil Programme has identified the potential of certain petrol fuel quality changes for emission reduction and therefore the improvement of air quality. The limit values proposed are in accordance with the fuel quality measures identified by the cost-effectiveness analysis. These paragraphs allow for a temporary, two-year derogation from the 1 January 2000 ban on leaded petrol in those Member States where this may result in severe socio-economic difficulties. Diesel Fuels (Article 4) As for petrol the European Auto/Oil Programme has identified the potential of certain diesel fuel quality changes for emission reduction and therefore the improvement of air quality. The limit values proposed are in accordance with the fuel quality measures identified by the cost-effectiveness analysis. Free circulation (Article 5) This Article is to ensure that Member States do not prohibit, prevent or restrict the marketing of fuels complying with the specifications set out under the Directive. This applies also in the case of Member States making use of the derogations under Article 6 where stricter specifications may be encouraged through the application of tax incentives. Derogations-Special Fuels (Article 6) This Article provides for the situation where, in specific locations which are subject to special air quality conditions, Member States may be granted derogations in order that they may require the use of cleaner "special" fuels 64 Change in supply of crude oils (Article 7) The reformulation capacity required by refineries in each Member State will relate closely to. their supplies of a certain crude oil quality. In order to avoid problems posed by a sudden change in the supply of crude oil petroleum products, the Commission can authorize higher limit values for one or more fuel components for a period not exceeding six months. Monitoring compliance system and reporting (Article 8) Member States are required to establish national compliance monitoring systems to ensure that the fuel quality limit values are respected in the market. For this purpose a uniform system should be developed for which the assistance of the European Committee for Standardisation (CEN) might be requested. From the year 2002 onwards Member States are required to submit a yearly report on the market quality of petrol and diesel fuels. Review of progress achieved (Article 9) Within 12 months of the adoption of the proposed Directive and at the latest by 31 December 1998 the Commission will come forward with proposals for a revision of the Directive. This revison will be based on a comprehensive assessment carried out in accordance with Article 4 of the proposed amendment to Directive 70/220/EEC. The proposal will include a revised set of specifications for petrol and diesel fuels for the year 2005, including a significant reduction in the maximum sulphur content of both fuels. The proposal will also take account of possible action on alternative fuels. Procedure for adaptation to technical progress and Committee procedures (Article 10 and 11) Adaptation to technical progress with regard to the measuring méthodes laid down in annexes I and IT of this directive will be carried out by a Commission Committee established in accordance with Article 12 of Council Directive 96/. /EC(13). Repeal of the existing directives related to the fuel quality of petrol and diesel fuels (Article 12) All relevant regulations in the current directive related to certain petrol and diesel fuel components (85/210/EEC, 93/12, Article 1(b), Article 2(1) and (2) and 85/536/EEC) are transferred to the new proposal. The existing Directive 93/12/EEC will remain valid with respect only to gas oils. Transposition into National Legislation and Entry into Force (Articles 13 and-14) These Aticles contain standard conditions. Article 15 This Article contains standard wording. (13) Proposal submitted by the Commission on Ambient Air Quality Assessment and Management - COM(94) 109 final, 94/0106 (SYN), OJ No C 216, 6. 8. 1994, p. 4. 65 Proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE 96/0163 (COD) relating to the quality of petrol and diesel fuels, and amending Council Directive 93/12/EEC THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 100a thereof,; Having regard to the proposal from the Commission(1), Having regard to the opinion of the Economic and Social Committee(2), Acting in accordance with the procedure referred to in Article 189b of the Treaty, (1) Wliereas disparity between the laws or administrative measures adopted by the Member States on specifications of conventional and alternative fuels used in spark-ignited and diesel vehicles creates barriers to trade in the Community and may thereby have a direct impact on the establishment and functioning of the internal market; whereas in accordance with the provisions of Article 3b of the Treaty, it therefore appears necessary to approximate the laws in this field; (2) Wliereas, Article 100a(3) of the Treaty envisages that Commission proposals aimed at the establishment and functioning of the internal market and concerning environmental protection will take as a base a high level of protection; (3) Whereas primary air pollutants such as nitrogen oxides, unburnt hydrocarbons and particulate matter are emitted in significant amounts through the exhaust and evaporative fumes of motor vehicles thereby posing directly and indirectly through the development of the secondary pollutant ozone, a considerable risk to human health and the environment; (4) Wliereas despite the increasing stringency of vehicle emission limit values laid down by Council Directive 70/220/EEC(3), as last amended by Directive 96/ /EC of the European Parliament and of the Council(4), and by Council Directive 88/77/EEC(5), as last amended by Directive 96/1/EC of the European Parliament and of the Council(6), further measures to reduce atmospheric pollution caused by vehicles and other sources are necessary in order to achieve satisfactory air quality; (5) Whereas Article 4 of Directive 94/12/EC of the European Parliament and of the Council(7) introduced a new approach with regard to emission reduction policies for and beyond the year 2000 and required the Commission to examine inter alia the contribution that improvements in the quality of petrol and diesel and other fuels could make to reducing air pollution; 0) (2) (3) (4) (5) (6) (7) of this Official Journal. OJNoL 76, 64. 1970, p. 1. See p. OJNoL 36, 9. 2. 1988, p. 33. OJNoL 40, 17. 2. 1996, p. 1. OJ No L 100, 19. 4. 1994, p. 42. 66 (6) Whereas the European Auto/Oil Programme, the details of which are outlined in the Commission's Communication^ on a future strategy for the control of atmospheric emissions from road transport, provides the scientific, technical and economic basis for the introduction at Community level of new environmental fuel specifications for petrol and diesel fuels; (7) Whereas the introduction of environmental fuel specifications for petrol and diesel fuels is an important element of the cost-effective package of European-wide and national/regional/local measures identified by the European Auto/Oil Programme; (8) Wliereas the implementation of a combination of European-wide and national/regional/local measures to reduce vehicle emissions is part of the Commission's overall strategy to reduce air emissions from mobile and stationary sources in a cost-effective and balanced way; (9) Whereas this Directive should apply without prejudice to the provisions of Council Directive 92/81/EEC(9), as last amended by Directive 94/74/EC(10), and in particular Article 8(4) thereof; (10) Whereas fuel specifications aiming at the reduction of both exhaust and evaporative emissions are generally lacking; (11) Wliereas, it is to be expected that by 2000 all petrol-driven road vehicles should be able to run on unleaded petrol and whereas, therefore, leaded petrol should, as from that date, no longer be marketed; (12) Whereas the need for vehicle emission reduction and the availability of the necessary refinery technology justify the setting of environmental fuel specifications for the marketing of unleaded petrol and diesel fuels; (13) Wliereas, in order to protect human health and/or the environment in specific locations with special problems of air quality, Member States should be permitted to require the marketing of special fuels; (14) Whereas, in order to ensure compliance with the fuel quality standards required under this Directive, Member States should introduce monitoring systems. Such monitoring systems should be based on common procedures for sampling and testing; (15) Whereas, on the basis of a comprehensive assessment, the Commission should, within 12 months of the adoption of this Directive, but in any case no later than 31 December 1998, come forward with a proposal to amend the provisions of this Directive; (16) Whereas further developments with regard to reference methods for measuring the specifications set out in this Directive may be desirable in the light of scientific and technical progress; whereas to this end, provision should be made in order to adapt the Annexes to this Directive to technical progress; (8) (9) (10) OJNoC OJNoL 316, 31. 10. 1992, p. 12. OJ No L 365, 31. 12. 1994, p. 46. 67 (17) Whereas Council Directive 85/210/EEC of 20 March 1985 on the approximation of the laws of the Member States concerning the lead content of petrol(H), as last and Sweden, the Act of Accession of Austria, Finland amended by Council Directive 85/536/EEC of 5 December 1985 relating to crude-oil savings through the use of substitute fuel components in petrol(12), as amended by Commission Directive 87/441/EEC(13), and Article l(l)(b) and Article 2(1) of Council Directive 93/12/EEC of 23 March 1993 relating to the sulphur content of certain liquid fuels(14), should be repealed accordingly, HAVE ADOPTED THIS DIRECTIVE: Article 1 Scope This Directive sets technical specifications on health and environmental grounds for all fuels - conventional and alternative - to be used in spark-ignition and diesel vehicles. Article 2 Definitions For the purpose of this Directive: 1. 2. 1. 2. ( i i) (12) (13) (14) (15) (16) "petrol" means any volatile mineral oil intended for the operation of internal combustion spark-ignited engines used for the propulsion of vehicles and falling within CN Codes 2710 00 27, 2710 00 29, 2710 00 32, 2710 00 34 and 2710 00 36. "diesel fuels" means gas oils falling within CN Code 2710 00 69 and used for self-propelling vehicles as referred to in Directive 70/220/EEC, Directive 88/77/EEC and Council Directive 74/150/EEC(l5) and those used for engines in non-road mobile machinery(I6), which means any machine or vehicle with or without body work, powered by a compression ignition engine, with the exception of those vehicles intended for the use of passenger - or goods - transport on the road and agricultural tractors as defined in Article 1 of Directive 74/150/EEC, having a power output of not more than 560 kW2. Article 3 Petrol As from 1 January 2000 Member States shall prohibit the marketing of all leaded petrol within their territory. ~z Member States shall ensure that within their territory petrol can be marketed only if, with regard to certain parameters of environmental relevance, they comply with the specifications set out in Annex I. O J N oL 96, 3. 4. 1985, p' 25. O J N oL 334, 12. 12. 1985, p. 20. O J N oL 238, 21. 8. 1987, p. 40. O J N oL 74, 27. 3. 1993, p. 81. O J N oL 84, 28. 3. 1974, p. 10. O J N oC 328, 7. 12. 1995, p. 1. 68 3. By way of derogation from the provisions of paragraph 1, Member States may continue to permit the marketing of leaded petrol in their territory until three years after the adoption of this Directive, but in any case not later than 1 January 2002, if it can be demonstrated that the introduction of a total ban on the marketing of leaded petrol as from 1 January 2000 would result in severe socio-economic difficulties. Member States wishing to make use of the derogation, must inform the Commission before 1 January 1999. The Member State shall also provide the Commission with a justification of the need for such a derogation. The Commission may authorize the derogation for the marketing of leaded petrol. The Commission shall notify its decision. the Member States and inform the Council of Article 4 Diesel fuels Member States shall ensure that within their territory diesel fuel can be marketed only if, with regard to certain parameters of environmental relevance, they comply with the specifications set out in Annex II. Article 5 Free circulation No Member States may prohibit, restrict or prevent the placing on the market of fuels which comply with the requirements of this Directive as from the date of application laid down in Article 13(1). Article 6 Special fuels 1. 2. By derogation from the provisions of Articles 3, 4 and 5, Member States may in specific areas in which atmospheric pollution constitutes or may reasonably be expected to constitute a serious and recurrent problem for human health and/or the environment, require the marketing of fuels of a higher quality than those foreseen in this Directive. Member States wishing to make use of the derogation provided for in paragraph 1 must inform the Commission in advance, of the measures it intends to take. The Member State shall also provide the Commission with data on ambient air-quality for the area in question as well as the predicted effects on air quality of thelneasures proposed. In addition, the Member State shall also provide the Commission with evidence that the proposed measures respect the principle of proportionality and that they will neither disrupt the free movement of persons and goods nor unduly distort competition. ^ The Commission, after informing the other Member States of the information received, may authorize the specific measures for the marketing of cleaner fuels as proposed by the Member State in question. The Commission shall notify the Member States and the Council of its decision. Any Member State may refer the Commission's decision to the Council within one month of its notification. 69 The Council, acting by a qualified majority, may take a different decision within one month of the matter being referred to it. Article 7 Change in supply of crude oils If a sudden change in the supply of crude oils or petroleum products renders it difficult for the refineries in a Member State to respect the fuel specification requirements of Articles 3 and 4, that Member State shall inform the Commission thereof. The Commission after informing the Member States, may authorize higher limit values in that Member State for one or more fuel components for a period not exceeding six months. The Commission shall notify the Member States and the Council of its decision. Any Member State may refer the Commission's decision to the Council within one month of its notification. The Council, acting by a qualified majority, may take a different decision within one month of the matter being referred to it. 1. 2. 3. 4. 5. 1. Article 8 Monitoring compliance system and reporting Member States will establish programmes requirements of Article 3(2) and Article 4. to monitor compliance with the The analytical methods used the concentration/level of a to determine substance/parameter in the fuel will be the standard methods specified in Annexes I and II. The Commission will promote the development of a uniform' system for compliance monitoring programmes. The Commission may for the purposes of developing such a system request the assistance of CEN. Within 12 months after the date of entry into force of this Directive, Member States will submit their national the Commission a detailed description of compliance programme. to As from the year 2002, Member States will submit to the Commission by 30 June each year a summary of the results from the national compliance monitoring programme from the previous calendar year. The Commission will establish a common format for the submission of such summary results. — Article 9 Review process The Commission will, periodically and for the first time not later than 12 months from the date of adoption of this Directive but in any event not later than 31 December 1998, and in the light of the assessment carried out in conformity with the requirements of Article 5 of Directive 96/ /EC, submit to the European Parliament and the Council a proposal for a revision of this Directive. This proposal will include further, cost effective, improvements to the specifications for petrol and diesel fuels with regard to the parameters laid down in Annexes I and II to this Directive and should comprise, in particular, a significant reduction in the sulphur content of both petrol and diesel fuels, to come into effect on 1 January 2005. This action will form 70 an integral part of a strategy designed to produce effects to meet the requirements of the Community air quality standards and other related objectives at least cost. 2. In addition to the provisions of paragraph 1, the Commission may bring forward proposals to ensure the necessary availability and sufficient distribution throughout the Community before 2005, of fuels of a quality compatible with the effective functioning of the new pollution abatement technologies. In preparing such proposals the Commission shall have regard in particular, to considerations of air quality, cost-effectiveness and proportionality, and shall also take into account: the latest information with regard to the interaction between fuel quality and the performance of new pollution abatement the de-NOx catalyst; technologies such as the situation with regard to the development and production of the new pollution abatement technologies and the forecasts with regard to the marketing of vehicles equipped with such technologies; the need to ensure that the measures proposed will neither disrupt the free movement of persons and goods nor unduly distort competition. 3. The proposal referred to in paragraph 1 shall be submitted to the European Parliament and the Council at the same time as the proposal referred to in Article 5 of Directive 96/ /EC; the measures shall enter into effect at the same time as the measures provided for in the proposal to be submitted in accordance with Article 5 of Directive 96/ /EC. Article 10 Procedure for adaptation to technical progress Any amendments which are necessary in order to adapt the measuring methods as laid down in Annexes I and II to this Directive, to take account of technical progress, shall be adopted by the Commission assisted by the Committee established in accordance with Article 12 of Directive 96/. /EC(17) and in accordance with the procedure laid down in Article 11 of this Directive. Article 11 Committee procedure The representative of the Commission shall submit to the committee a draft of the measures to be taken. The committee shall deliver its opinion on the draft, within a time limit which the chairman may lay down according to the urgency of the matter, if necessary-fey taking a vote. The opinion shall be recorded in the minutes; in addition, each Member State shall have the right to ask to have its position recorded in the minutes. The Commission shall take the utmost account of the opinion delivered by the committee. It shall inform the committee of the manner in which its opinion has been taken into account. <17) Proposal submitted by the Commission on Ambient Air Quality Assessment and Management - COM(94) 109 final, 94/0106 (SYN), OJ No C 216, 6. 8. 1994, p. 4. 71 1. 2. 1. Article 12 Repeal and amendment of the existing directives related to the fuel quality of petrol and diesel fuels Directive 85/210/EEC and Directive 85/536/EEC are repealed as from the date of application laid down in Article 13(1). Directive 93/12/EEC is amended by deleting Article l(l)(b) and Article 2(1) as from the date of application laid down in Article 13(1). Article 13 Transposition into national legislation Member States shall adopt and publish the laws, regulations and administrative provisions necessary to comply with this Directive not later than 1 July 1999. They shall immediately inform the Commission thereof. Member States shall apply these provisions from 1 January 2000. Wlien Member States adopt these provisions, these shall contain a reference to this Directive or shall be accompanied by such reference at the time of their official publication. The procedure for such reference shall be adopted by Member States. 2. Member States shall communicate to the Commission the texts of the provisions of national legislation which they adopt in the field covered by this Directive. Article 14 Entry into force of the Directive This Directive shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Communities. Article 15 Addressees This Directive is addressed to the Member States. Done at Brussels, For the European Parliament The President For the Council The President 72 ANNEX I ENVIRONMENTAL SPECIFICATIONS FOR MARKET FUELS TO BE USED FOR VEHICLES EQUIPPED WITH POSITIVE IGNITION ENGINES Type: Petrol Parameter Unit Limits(1) Minimum Maximum Reid vapour pressure,. summer period(3) kPa Distillation(4): evaporated at 100 *C evaporated at 150 *C Hydrocarbon analysis:. olefins. aromatics. benzene 46. 0 75. 0 % v/v % v/v Oxygen content %m/m Sulphur content Lead content ppm g/l 60. 0 18. 0* 45. 0 2. 0 2. 3 200 0. 005 Test Method(2) EN 12 ISO~3405 ASTMD1319 EN 238 prEN 1601 ISO 8754 EN 237 (1) (2) (3) (4) I* The values quoted in the specification are "true values". In establishment of their limit values the terms of ISO 4259 "Petroleum products - Determination and application of precision data in relation to methods of test" have been applied and in fixing a minimum value, a minimum difference of 2R above zero has been taken into account (R - reproducibility). Should it be necessary to clarify the question as to whether a fuel meets the requirements of the specification, the terms of ISO 4259 should be applied. Equivalent ISO methods will be adopted when issued for all properties listed above. The summer period extends from 1 April to 30 September of each year and relates to all volatility classes as specified under EN228. The figures quoted show the evaporated quantities (percentage recovered + percentage loss). Except for unleaded petrol regular (minimum motor octane number (MON) of 81 ancLa minimum research octane number (RON) of 91) for which the maximum olefin content shall be 21% v/v]. 73 ANNEX n ENVIRONMENTAL SPECIFICATIONS FOR MARKET FUELS TO BE USED FOR VEHICLES AND NON-ROAD MOBILE MACHINERY EQUIPPED WITH COMPRESSION IGNITION ENGINES Type: Diesel fuel Parameter Unit Limits(1) Cetane number Density at 15 °C Distillation(3): 95% point kg/m3 °C Polycyclic aromatic hydrocarbons %m/m Sulphur content ppm Minimum Maximum 51. 0 845 360 11 350 Test Method(2) ISO 5165 ISO 3675 ISO 3405 prIP391 ISO 8754 The values quoted in the specification are "true values". In establishment of their limit values the terms of ISO 4259 "Petroleum products - Determination and application of precision data in relation to methods of test" have been applied and in fixing a minimum value, a minimum difference of 2R above zero has been taken into account (R - reproducibility). Should it be necessary to clarify the question as to whether a fuel meets the requirements of the specification, the terms of ISO 4259 should be applied. Equivalent ISO methods will be adopted when issued for all properties listed avove. The figures quoted relate to the evaporated quantities (percentage recovered + percentage loss). (2) (3) 74 FINANCIAL STATEMENT SECTION I - FINANCIAL CONSEQUENCES (PART B OF THE BUDGET). 1. TITLE OF OPERATION Proposal for a European Parliament and Council Directive relating to the quality of petrol and diesel fuels and amending Council Directive 93/12/EEC. 2. BimCTT HEADING INVOLVED B4-304 Environmental Legislation and other general actions based on the 5th Action Programme relating to the environment [Projects (XI. D. 3]. 3. LEGAL BASIS EU Treaty Article 100a, Resolution of the Council and the Representatives of the Governments of the Member States meeting within the Council of 1 February 1993 on a Community programme of policy and action in relation to the environment and sustainable development (OJ No C 138, 17. 5. 1993, p. 1). 4. DESCRIPTION OF OPERATION 4. 1 General objectives The European Union has a longstanding history in reducing vehicle emissions. However, despite the considerable achievements with regard to the emission reduction of individual vehicles, increased traffic activity (increased number of these travelled) vehicles, improvements thereby preventing the emission reductions necessary to achieve future air quality objectives. increased kilometers to counteract likely is The likelihood of further action to reduce vehicle emissions necessitated a reassessment of the existing policy approach; it being apparent that the emission reduction potential offered by further improvements in vehicle technology was limited and possibly very costly in comparison with other potential solutions. Therefore a new, comprehensive and integrated approach was developed which is set out in Directive 94/12/EC, Article 4. Article 4 stipulates that measures to be assessed with regard to their benefits and costs shall include improved vehicle technology, more appropriate mechanisms to reduce the in-use deterioration of emission control systems and "improvements in fuel quality as far as vehicle emissions of dangerous substances (in particular benzene) are concerned". The changes in the quality of both, petrol and diesel fuels, legislated for in this proposal will" considerably reduce emissions of pollutants such as benzene, volatile organic compounds (VOCs), nitrogen oxides (NOx), carbon monoxide (CO) and particulate matter (PM). With these emission reductions a significant contribution will be made to the achievement of future air quality objectives. 75 4. 2 Period covered and arrangements for renewal or extension The proposed Directive requires: * that Member States: will ensure that as from 1st January 2000 only fuels which correspond to the specifications laid down in the Directive can be marketed within their territory; will establish programmes to monitor compliance with the Directive; as from the year 2002 the Member States will submit to the Commission a summary of the results from the national compliance monitoring programme; * that the Commission: will promote the development of a uniform system for compliance monitoring programmes. For the purpose of developing such a system the assistance of the European Committee for Standardization might be requested; submits a report to Council and Parliament assessing the need for further action in the field of fuel quality, including possible action on alternative fuels; prepares a revised proposal on the sulphur content of diesel fuel which will be necessary at a time when new vehicle technologies such as the de-NOx catalyst are on the market; convenes technical progress. the meeting of the Committtee for Adaptation to 5. CLASSIFICATION OF EXPENDITURE OR REVENUE DNO and CD 6. TYPE OF EXPENDITURE Technical work directly linked to the development of a uniform system for compliance monitoring programmes; Technical work linked to the development of new proposals, in particular those dealing with alternative fuels and the relationship between new vehicle technologies and fuel quality; Technical work linked to the preparation of Commission Directives through the Committee procedure. 76 7. FINANCIAL IMPACT 7. 1 Method of calculating total cost of operation (definition of unit costs) Technical assistance with the development of a uniform fuel quality monitoring system to ECU 250 000. through CEN. Total costs would amount Technical assistance with regard to the development of new proposals, in particular those dealing with alternative fuels and the relationship between new vehicle technologies and fuel quality. The costs would amount to ECU100 000/year between 1998 and 2000. 7. 2 Itemized breakdown of cost (in ECU) Breakdown Year n - Technical assistance uniform fuel quality monetary system - CEM - Technical assistance development new proposals Total ECU million (money of the day) n+4 n+5 and subseq. Total n+1 0. 11 n+2 0. 11 n+3 0. 03 0. 1 0. 1 0. 1 0. 11 0. 21 0. 13 0. 1 0. 55 7. 3. Indicative schedule of appropriations Comitment appropriations Payment appropriations n n+1 n+2 n+3 n+4 n+5 and subseq. Total Year n n+1 0. 11 n+2 0. 21 n+3 0. 13 n+4 0. 1 n+5 and subseq. Total — 0. 55 0. 077 0. 033 0. 147 0. 063 0. 091 0. 039 0. 11 0. 21 0. 13 0. 07 0. 03 0. 1 0. 55 77 8. ANTI-FRAUD DISPOSITIONS It will be explicitly specified in contracts that all work performed is the property of the Commission. Final payment of contractors will only take place after reception and examination of the reports and services requested. SECTION H - ELEMENTS OF COST-EFFECTIVENESS ANALYSIS 9. 1 Specific and quantifiable objectives: target population The general objective of the operation is to increase the protection of: human health, ecosystems, vegetation and material against the impact of various air pollutants such as nitrogen oxides, hydrocarbons and ozone; human health additionally against the impact of particulate matter; ecosystems additionally against the impact of nitrogen oxides deposition ("acid rain") on land and water. According to the results of the European Auto/Oil Programme which provided the technical basis for the present directive, changes in the quality of both petrol and diesel fuels can make a significant contribution to the reduction of exhaust and evaporative fumes of motor vehicles. This Directive foms part of a package of measures derived from the Auto/Oil Programme. The package of measures is designed to deliver reductions in the emissions from road transport compatabile with the attainment of rigorous air quality standards for carbonmonoxide (5 ug/m3 as a 98 percentile of 8 hourly values), nitrogen dioxide (93 ug/m3 as a 98 percentile of hourly values), benzene (10 ug/m3 as an annual mean), particulate matter (50ug/m3 as a 24-hour running average) and regional ozone (180ug/m3 as a 1-hour average). This proposal will contribute to emission reductions across Europe in the range of 70% for oxides of nitrogen and volatile organic compounds, 65% for urban particulates and 75% for urban carbon monoxide. 9. 2 Grounds for the operation While some fuel components such as lead and benzene in petrol and sulphur in diesel have been subject to Community legislation, fuel quality as a whole as covered by this Directive has not. According to the considerations-that are described above and in Chapter 4 of the Explanatory Memorandum changes in the quality of both petrol and diesel fuels contribute significantly to improved air quality with regard to nitrogen oxides, particulate matter, benzene and ozone. Thus it would be unreasonable to neglect this source of pollutants which can be reduced in a cost-effective way as the results of the Auto/Oil Programme have shown. 78 9. 3 Monitoring and evaluation of the operation Monitoring compliance system In order to ensure compliance with this Directive, Member States are required to establish national compliance monitoring systems. The Commission will promote the development of a uniform system as a common basis for Member States to carry out these programmes and to be in a position to forward to the Commission this information on a comparable base. For this purpose the Commission is likely to seek the assistance of the European Committee for Standardization (CEN). The Member States are required to submit 12 months after the date of entry into force of the Directive a detailed description of their national compliance programme and as from the year 2002, by 30 June of each year, a summary of the results from these programmes for the previous calendar year. Air quality The Commission, in cooperation with the Member States, will monitor the development of air quality on an urban and regional level in order to verify the air quality predictions which have guided the currently proposed legislative measures. The results of this monitoring exercise will be one of the main elements of a report the Commission is required to bring forward at the latest by 30 June 2002 and inter alia will be the basis for deciding whether proposals for amendments and/or extensions to this Ddirective will be necessary. SECTION HI - ADMINISTRATIVE EXPENSES (PART A OF THE BUDGET) 10. ADMINISTRATIVE EXPENDITURE (Part A of section HI of the Budget) 10. 1 Increase in staff Type Human Resources Human Resources Length Permanent jobs Temporary jobs Existing human resources in the DG or service Additional human resources — Civil servants or temporary' agents A B C Other Total 0 0 0 0 79 10. 2 Financial global impact of additional human resources ^ Amounts Mode of computation Civil servants Temporary agents Other resources 0 0 0 Total (ECU) 0 10. 3 Increase of other operative expenses Budget item A-2510 (Travel for the Committee foreseen under Article 11 of the proposal Amounts 20 850 Total (ECU) 20 850 Mode of computation 15 x ECU 695imeeting x 2 meetings/year 80 IMPACT ASSESSMENT FORM The Impact of the proposal on business with special reference to small and medium- sized enterprises (SMEs) TTTLE OF THE PROPOSAL Proposal for a European Parliament and Council Directive on environmental specifications with regard to gasoline and diesel. fuel Reference Number (Repertoire): 1. TAKING INTO ACCOUNT THE PRINCIPLE OF SUBSIDIARITY. WHY IS COMMUNITY LEGISLATION NECESSARY IN THIS AREA AND WHAT ARE ITS MAIN ALMS? The matter concerns harmonization of the internal market and therefore is an issue of exclusive Community competence. The market in transport fuels is considerable (about 290 00 million litres in 1995) and despite the existence of norms laid down by the European Committee for Standarization (CEN) for certain fuel components, the majority of the petrol and diesel fuel market is characterised by numerous permissible levels for a number of fuel components (e. g. sulphur, aromatics, benzene). The proposal asserts an increased level of harmonization to replace the existing range, thus ensuring the proper functioning of the market. The main aim of the Directive is to reduce vehicle emissions in order to achieve future EU-wide air quality objectives and is part of a legislative package which the Commission intends to put forward for this purpose. The directive is part of the outcome of the European Auto/Oil Programme which explored cost-effective combinations of measures sufficient to achieve, by 2010, stringent air quality standards with respect to the most important urban and regional pollutants such as nitrogen oxides, particulate matter and ozone. The programme investigated the cost and the potential of a variety of different measures inter alia improved vehicle technology, inspection and maintenance schemes, changes in the quality of fuels and a number of non-technical measures such as scrappage schemes and road pricing. Drawing on the results of the Auto/Oil Programme, the Commission has decided upon a package of legislative proposals to be submitted to Council and Parliament: a proposal on a mild reformulation of petrol and diesel fuels (this proposal); a proposal to strengthen the emission limits for passenger cars (a proposal accompanying this proposal); proposals to strengthen the emission limits for light and heavy duty vehicles (1996/ 1997); a proposal with regard to the strengthening of the current legislation on inspection and maintenance (in 1997). With this legislative package the Commission estimates that by 2010, the above pollutants will be reduced considerably as compared to what the emissions would have been in the absence of these measures. 2. WHO WILL BE AFFECTED BY THE PROPOSAL? Which sectors of business? Changes in the quality of gasoline and diesel fuels affect refiners and therefore oil companies, the petrochemical industry and individual consumers driving a gasoline or diesel vehicle. There may also be effects for traders' organization who import petrol and/or diesel fuels from regions with less strict environmental fuel specifications. Which sizes of businesses? All oil and petrochemical companies can be considered to be large. Traders' organizations are small/medium enterprises. Are there particular geographical areas of the Community where these businesses are found? Refineries, petrochemical companies and traders' organizations are found in all regions of the Community. 3. WHAT WELL BUSINESS HAVE TO DO TO COMPLY WITH THE PROPOSAL? Refineries will have to change their refinery processes, install new process units and/or have to undertake blending operations in order to achieve the changes in gasoline and/or diesel fuel quality as required by the directive. The mechanisms used to control each of the fuel parameters are all currently available and proven technologies. Some changes can also be met by changes in crude oil diet e. g. to low sulphur crude types, such as North Sea, which tend to be high in benzene and aromatics content, or to low benzene/aromatics crude types such as Middle East (which tend to be high in sulphur). There are no obligations posed on petrochemical companies and individual fuel users associated with the proposed Directive. 4. WHICH ECONOMIC EFFECTS IS THE PROPOSAL LIKELY TO HAVE? On employment? The proposal will require significant investment for the refining industry (see below). Given the current over-capacity and narrow operating margins for the industry it is possible that the proposal may have a negative efffect on employment in the refining industry. However, in the area of feed-stock production (such as oxygenates) and of research and development a positive employment effect is likely to be seen. Production of oxygenates needs to be improved considerably in order to meet the required blending capacity. Some of this additional production capacity will be installed in Europe. In the area of research and development it can be expected that the search for more competitive, less costly refinery processes will stimulate the engineering/construction business which might have some positive effects on employment. 82 industry estimations with regard to employment For the petrochemical development are difficult to make. An oversupply in benzene through fuel reformulation is likely to have a negative effect on Europe's main benzene source for aromatic production of pygas. Ethylene producers might therefore loose some of their competitiveness. However, ethylene producers are in most cases also producers of aromatics and with the cheaper feedstock of benzene might be able to increase the aromatics production. The effect on employment is uncertain. There are unlikely to be any significant employment effects for the traders' organizations. On investment and creation of new business? According to cost estimations carried out under the Auto/Oil Programme, the achievement of the presently proposed fuel specifications requires refineries to invest a total of about ECU 8 442 million. The costs are based on the value of the ECU in 1995 and a project life of 15 years from 2000 onwards. Investments are envisaged to take place over 4 years between 1996 and 1999 with 15% being invested in 1996 and 1999 and 35% in each of the years 1997/98. In addition to the capital investment costs, fixed operating costs of ECU 342 million and energy costs of ECU 171 million will have to be borne by the European refining industry. All costs are aggregated costs which do not reflect individual refinery and regional variations. The variations in costs due to these individual and regional differences are not estimated to be uniform because the impact of the quality parameter changes depends on both feedstock and refinery configuration. The size of the refinery with regard to cost variations is likely to play a relatively influence of feedstock availability and role compared small refinery configuration. the to New business can be expected with regard to the production of oxygenates as a feedstock product. As shown earlier, the need for this product in order to compensate for octane loss through reduction of benzene and aromatics will increase considerably. Refineries themselves might expand their production of oxygenates (new catalysts) and/or new production units. through better technologies For petrochemical companies it is difficult to predict whether a loss of feedstock production (pygas) can be compensated by higher aromatic production and what consequences these developments would have for the employment situation. On the competitiveness of businesses? ~z The impact of the proposal on individual refineries will vary considerably as a function of the current technical configuration. While in the case of some refineries only minimal investment will be required others will need extensive upgrading dependent upon their technical configuration. 83 On the petrochemical side, increased availability of benzene from gasoline reformulation could adversely affect the production of an important feedstock product - pygas. Pygas is the biggest source of benzene for the aromatics market in Europe and if the value of pygas were to fall in view of over supply of benzene from other sources, the European ethylene producers would be at a competititve disadvantage. The competitiveness of traders' organizations might be affected if their import of petrol and diesel fuels mainly comes from sources with less strict or no environmental regain competitiveness if they ensure sufficient diversity of import sources. specifications. Traders can maintain or fuel 5. DOES THE PROPOSAL CONTAIN MEASURES TO TAKE INTO ACCOUNT THE SPECIFIC SITUATION OF SMALL AND MEDIUM-SIZE FIRMS (REDUCED OR DIFFERENT REQUIREMENTS, etci ? All refineries and petrochemical companies in Europe can be considered to be large enterprises. Traders' organizations have sufficient means to maintain their position in the market e. g. by diversification of import sources. The users of reformulated fuels will be insignificantly affected by negligibly increased prices for these fuels. Thus particular measures in favour of small and medium-sized companies appear to be unnecessary. 6. CONSULTATION List of organizations which have been consulted with regard to the proposal and outline of their main views: - Europia (European Petroleum Industry Association); - ACEA (European Automobile Manufacturers Association); - APA, a sector group of CEFIC (Aromatics Producer Association). Europia'ACEA Both, the European associations of the oil (Europia) and car (ACEA) industries were partners of the Auto/Oil Programme. The work carried out in the framework of the programme was based on the consensus of all partners involved. At a final-technical meeting of the Auto/Oil Programme on 20 March 1996, the database- and the methodology used for carrying out the cost-effectiveness analysis were approved. The oil industry was also consulted on a number of technical questions which arose the in cost-effectiveness analysis into limit values. the fuel parameter values used the discussion on transposing in 84 With regard to the proposed specifications the oil industy has expressed its in reservations concerning the limit values for the sulphur content of both fuels particular those for petrol claiming that the emission benefits are not in proportion to the costs incured. Another area of concern for the oil industry is the benzene content of petrol. Europia maintains its position that in view of the results of the air quality modelling carried out within the context of the Auto/Oil Programme a reduction of the current EU average market value of about 2. 3% is not justified. The car industry on the other hand considers the proposed fuel specifications as too moderate and would like to see more severe limit values in particular with regard to the sulphur content of diesel fuels. ACEA claims that with the current proposal on fuel quality which amounts to yearly costs of around 880 million ECU for the oil industry puts the bulk of the total financial burden of ECU 5 326 million/year for the overall package of emission eduction measures on the car industry. However, this argument of burden sharing between the two industries is not in line with the request for a cost-effective solution to future air quality problems which is required by Directive 94/12/EC, Article 4. APA APA's concern is that with increasing amounts of benzene from gasoline reformulation in Europe and the U. S. Pygas production, as a major benzene source for aromatics production in Europe, would be significantly reduced. In addition, while aromatics production could be increased in principle due to cheaper benzene feedstock prices, APA fears that developments of the aromatic markets in other parts of the world will prevent Europe from finding an adequate export market. 85 EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE 96/0164 (COD) Proposal for a relating to measures to be taken against air pollution by emissions from motor vehicles and amending Council Directives 70/156/EEC and 70/220/EEC 86 EXPLANATORY MEMORANDUM A. Objective of the proposal The objective of this proposal is to strengthen Community requirements aimed at limiting new passenger car polluting emissions. These are governed by Directive 70/220/EEC, as last amended by Directive 94/12/EC. The proposal forms part of a global Community strategy which will include strengthened requirements for passenger cars, light commercial vehicles and heavy duty vehicle?0 from year 2000, new minimum standards for motor fuels and enhanced in-use vehicle emission requirements. This set of measures, in combination with additional measures taken at local level, represents, in view of the Commission, an optimal package of legislative actions which will ensure that the Air Quality targets identified in the course of the implementation of the Auto/Oil Programme will be met by year 2010. In addition, this proposal includes a revision of the framework for emission-related fiscal incentives and emissions values corresponding to the foreseen Stage 2005 car emission standards. The Auto/Oil Programme itself is described in a separate auto/oil Communication. B. Legal basis The measures are proposed on the basis of Article 100a of the Treaty of the Union. They are consistent with the Council recommendation on the 5th Environmental Action Programme, which announced the need for a further improvement of car emission standards from the year 2000. The measures form part of the European Type-Approval system for cars and compliance with them will be mandatory for new approvals to be issued by national authorities. The measures reflect the traditional legislative approach followed in this sector namely total harmonization of all relevant technological prescriptions. The measures set the performance standards, leaving to the producers themselves, the design and manufacture of equipment necessary to ensure that these are met. This legislative approach is fully supported by the operators in the market. The text is relevant for the EEA Treaty. C. Background Much progress has been achieved in improving air quality in Europe through the successive tightening of emission standards. Since the first emission directive of 1970, the overall reduction of emissions from new passenger cars has been in the order of 90%, depending on the pollutant concerned (carbon monoxide emissions (CO), unburned hydrocarbons and nitrogen oxides emissions (HC + NOx)). The Auto/Oil Programme was set up, because it was recognized that, since additional reductions of emissions from new vehicles from the year 2000 would be increasingly difficult to achieve technologically and would be costly, future standards would have to be established on a more scientific basis which would allow for full account to be taken of the potential advantages and disadvantages of all possible measures to reduce emissions. (1) Directive 88/77/EEC, as last amended by Directive 96/1/EC. 87 1. Article 4 of Directive 94/12/EC: the multi-faceted approach Directive 94/12/EC adopted by the European Parliament and the Council on 23 March 1994, which set new emission limit values for new types of passenger cars from 1996, stipulated in Article 4 that the Commission should propose new measures to be implemented in the year 2000, according to a new multi-faceted approach, based on a comprehensive assessment of costs and effectiveness of all measures aimed at reducing road transport pollution. The Article stated that the proposal should include, besides tightened car emission standards, complementary measures, such as improvements in fuel quality and a strengthening of inspection and maintenance programmes for the car fleet. Article 4 of Directive 94/12/EC requires that the Commission base its proposals on two pillars. the establishment of air quality criteria and associated emission reduction objectives; an evaluation of the cost/efficiency of each proposed measure, taking into account the potential contribution of other measures such as: traffic management; enhancement of urban public transport; new propulsion technologies; the use of alternative fuels. Thus, Article 4 requires that the cost/effectiveness assessment should be carried out not only for the measures which will be proposed by the Commission (improvement of new vehicle technology, of fuels, technical inspection), but also encompassing all measures permitting the reduction of pollution by road traffic, regardless whether they are of the responsibility of Member States or of local authorities. This multi-faceted cost/effectiveness approach differs from the usual approach based on the assessment of the Best Available Technology. However, Article 4 also stipulated to the Commission that the Stage 2000 proposal would need to achieve a "substantial" reduction in emissions. The next stage will also continue to be founded on Article 100a of the Treaty, i. e. the proposal should be based on a "high level" of environmental protection. There is thus, to some degree, a need to reconcile these two different concepts. However, application of the Best Available Technology principle independently for each separate measure would lead in all likelihood to a sub-optimal set of measures, economically as well as environmentally. The multi-faceted approach therefore aims at determining the best cost/effective package of measures with a view to achieving a high level of protection. 2. The Auto/Oil Programme In accordance with the principle of shared responsibility expressed in the 5th Environmental Action Programme, the Commissioners for Energy, Environment and Industry, at the end of 1992, decided to initiate a technical scientific work programme for the purpose of providing a solid technical foundation upon which to base its future legislative proposals. The Commission invited the European Automobile manufacturers and Oil industry trade associations (ACEA and EUROPIA) to make available their considerable know-how and expertise. The two industries responded positively to this invitation and together with the Commission services designed, planned and executed the programme which subsequently became known as the Auto/Oil Programme. 88 The objective of the Auto/Oil Programme was to provide policy-makers with an objective assessment of the most cost-effective package of measures including vehicle technology, fuel quality, inspection and maintenance measures and non-technical measures, necessary to reduce emissions from the road transport sector to a level consistent with the attainment of the new air quality standards being developed for adoption across the European Union. The work organization, assumptions and outcomes of the Auto/Oil Programme are described in the accompanying Commission Communication on the Auto/Oil Programme and Future Strategies to Reduce Emissions(2). 3. Changes to vehicle technology Within the framework of the Auto/Oil Programme, European vehicle manufacturers were asked to provide estimates of the additional costs which would be required in order to equip their vehicles with the technology necessary to achieve a series of progressively more stringent emission scenarios. The main findings of the cost analysis of vehicle technologies are that: significant vehicle technology; reductions in pollutant emissions are possible through improved applying the most stringent reduction scenario to all vehicle categories would represent an annual cost of ECU 5. 5 billion (in 1995 ECU) to the Union; when expressed as a cost per vehicle, the most stringent packages for which cost data increase of 3-5% on current purchase price were provided equate (excluding taxation). to an In addition, as part of the Auto/Oil Programme, data were collected with regard to cost and to the efficiency of the various mechanisms designed to reduce the rate of deterioration of the emission control systems. Two technical devices by which such improvements can be achieved have been studied: electronic sensors installed on the vehicle to monitor the performance of the emission control systems - referred to commonly as on-board diagnostics (OBD); "In-use compliance testing" procedures whereby vehicles can be recalled by authorities and if necessary repaired if their emission performance deteriorates beyond an acceptable level; Inspection and maintenance requirements have also been shown to be particularly cost-effective. — 4. Cost effectiveness optimization On the basis of the data available on the costs and potential benefits of the various technical measures (engine technology, fuel quality and improved inspection and maintenance of emissions control systems), it has been possible to identify the most cost/effective packages of technical measures necessary to achieve a significant reduction of urban NOx, particulate matters in the most polluted areas and ozone precursors at European level. (2) COM(96) of June 1996. 89 D. 1. Consultations of interested parties Position of industry throughout industries were associated and were consulted The motor and oil the Auto/Oil Programme. These industries accepted the methodology as well as the majority of the results. The car manufacturers would have liked a method of calculation from the emissions giving more weight to measures with an immediate effect, by the taking into account of an emission carry over method or "emission discounting". However, the Commission considers that a sustainable policy of improvement of the air quality shall be based on balanced mix of immediate and long-term measures which is the objective with the overall 2000 Stage strategy. The car manufacturers consider that the main cost burden falls on it and that a certain rebalancing of the measures should be carried out. The Commission considers nevertheless that the proposed measures have to fulfil cost/effectiveness criteria. In this respect, the optimisation made during the programme shows that, in general, the measures affecting the vehicles are the most effective ones. 2. Position of the Member States Member States were informed and were consulted regularly throughout the programme. They considered that the orientations described by the Commission, in particular at an informal meeting on 7 December 1995, were in general acceptable. Half of the Member States could support of stricter measures than those envisaged at the time, in particular for the petrol cars. The principle of a later "Stage 2005" serving as a basis for granting tax incentives was not disputed. A majority of the Member States experts were in favour of an ambitious regulatory stage with a review clause. 3. Position of the European Parliament Four specific meetings were organized to inform the Members of the European Parliament of the work carried out. While the members of the European Parliament expressed their sympathy with the principles underlying the programme, they expressed some regret that certain interested parties had been less consulted, notably equipment suppliers, the fuel additive producers and non governmental organizations. Members also regretted the delay in presenting of the proposals. They are awaiting the specific proposals before to take formally taking a position with the expectation that proposals will take into account of the precautionary principle of as well as the need to harmonize on the basis of the best available technology. E. 1. Content of the proposal Passenger car emission standards - modification of Directive 70/220/EEC In accordance with the results of the Auto/Oil Programme, the Commission proposes that emissions standards for passenger cars are tightened and improved by the adding of new requirements. It is proposed that these measures (discussed below in detail) should apply from the year 2000 for new vehicle types and from 2001 for all new vehicles. A second regulatory stage should also be envisaged to be applied from 2005 for new vehicle types and from 2006 for all new vehicles. This should however be confirmed (see below). 90 1. 1 Test of the tailpipe emissions after a cold start ("type I test") The Type I test constitutes the main element of the Directive. It aims at the effective limitation of the air-polluting emissions of motor vehicles with a total mass up to 3 500 kg driven in typical urban and extra-urban traffic conditions. The driving cycle which simulates such traffic conditions for the purpose of carrying out this test in the laboratory will be modified in order to better represent a typical vehicle cold start. As suggested by the Commission's Motor Vehicle Emission Group, the 40 second warm up period before the sampling of the exhaust gases permitted in the current test will be deleted. This change will result for gasoline vehicles in a considerable increase of the emissions of carbon monoxide (up to 40%) and hydrocarbons measured during the test. Notwithstanding changes of the limit values, this measure by itself constitutes a significant severisation of the requirements of the Type I test. 1. 2 Limit values in the year 2000 The proposed new limit values to be applied from the year 2000 represent reductions, against Stage 1996 emissions standards, of: 40% nitrogen oxides, 40% hydrocarbons, 30% carbon monoxide for petrol engined passenger cars; 20% nitrogen oxides, 20% for the combined value for hydrocarbons plus nitrogen oxides, 40% carbon monoxide, 35% particulate matter for diesel passenger cars equipped with indirect injection engine; 40% nitrogen oxides, 40% for the combined value for hydrocarbons plus nitrogen oxides, 40% carbon monoxide, 50% particulate matter for diesel passenger cars equipped with direct injection engines which presently comply with less stringent limit values. These reductions correspond to scenarios evaluated in the Auto/Oil Programme, as described in the Auto/Oil Communication. The new limit values for diesel vehicles no longer make a distinction between indirect and direct injection engines, since direct injection technology will be mature by year 2000 and will therefore be able to comply with the general requirements for diesel vehicles. In applying these reductions to the present limit values of Directive 94/12/EC the combined limit value for hydrocarbons and nitrogen oxides has to be broken down. In the past it has been assumed that the ratio of these pollutants in the exhaust emissions was 55 to 45 for petrol cars and 20 to 80 for diesel cars. These ratios were established when the limit values for hydrocarbons and nitrogen oxides were combined in Directive 83/351 /EEC. Recent data shows, however, that for modern diesel engines, in particular when equipped with oxidation catalysts, a ratio of 10 to 90 is more representative. time first the for For petrol cars separate limit values are now proposed for hydrocarbon and nitrogen oxide emissions, in order to achieve specific emission reductions for both pollutants. However, a combined limit value for these pollutants is still maintained for diesel cars for which the Stage 2000 standards are particularly demanding, in order to assure the flexibility necessary for the engineering of future diesel engines and associated emissions reduction technologies. In addition diesel cars emit unburned hydrocarbons at a very low level. However, in accordance with the emphasis which the Commission attributes to the control of nitrogen oxide emissions, the combined value is completed by a separate limit value for nitrogen oxides emissions. 91 The incremental costs of the proposed Stage 2000 standards have been assessed in the Auto-oil cost/effectiveness study, as has the technology require to fulfil these standards. The mean calculated costs are from ECU 113 for a small gasoline car to ECU 402 for diesel cars. The standards will require technologies like close coupled catalyst, improved injection, dual oxygen sensor for gasoline vehicles, and fully electronic pump and electronically-controlled exhaust gas recirculation for diesel vehicles. The Auto/Oil Programme has shown that they will be available by the year 2000. The proposed Stage 2000 limit values are therefore. Stage: Directive 94/12/EC CO HC+NOx HC NOx (limit values in g/km ) 2. 2 0. 5 Petrol cars Directive 94/12/EC Corrected values(3) 2. 7 0. 341 0. 252 Stage 2000 2. 3 0. 20 0. 15 _ Stage: Directive 94/12/EC Diesel cars Directive 94/12/EC Corrected values Stage 2000 CO HC + NOx NOx PM (limit values in g/km ) 1. 0 0. 7/0. 9w 0. 08/0. 10(4) 1. 06 0. 71/0. 91 0. 63/0. 81w 0. 08/0. 10(4) 0. 64 0. 56 0. 50 0. 05 1. 3 Test of evaporative emissions ("type TV test") This test became part of the European emission standards in 1991 in order to control the losses of hydrocarbons by evaporation from the fuel system of a petrol car. For this purpose the test simulates the conditions of a car which is parked after use under hot weather conditions. Following the recommendation of the Commission's Motor Vehicle Emission Group, the test will be improved to better represent the real conditions which determine the evaporative emissions as well as the state of the art of the relevant laboratory techniques. Based on the review of available emission and meteorological data, it is proposed to up-grade the test with more severe specifications for pre-conditioning the test vehicles, and with a new 24-hour diurnal test after soaking for an extended period at hot temperatures. (3) (4) Corrected to take account of change in test cycle caused by elimination of the 40 second idling period. For vehicles equipped with direct injection engine. 92 1. 4. Measures for ensuring the durability of the emission control systems There are three important ways in which the durability of emission control systems can be assured, relevant to the proposed directive: 1. 4. 1 Onboard Diagnostic Systems (OBD) OBD systems have been identified by the Auto/Oil Programme as a cost-effective means of assuring that the emissions of a car are effectively controlled during its useful life. OBD systems have a double purpose. They detect failures of the anti-pollution equipment of the car and indicate these to the driver so that he can have the vehicle fixed in a repair shop. In addition, they record the detected failures allowing stations carrying out the annual roadworthiness inspections to verify that the relevant repairs have been carried out. A new Annex XI in the directive incorporates the technical provisions necessary for the approval of OBD systems. The proposed OBD specifications do not require the direct measurement of emissions, but aim at ensuring a monitoring, through electronic computing and sensing, of the performance of related component or systems. While the technology has already been proven for gasoline powered vehicles, OBD technologies are at ^ far less developed stage for diesel vehicles. The Directive stipulates, therefore, that requirements for these vehicles are, in a first stage, optional. The proposal takes into account the most recent technological developments for both categories of vehicles. OBD requirements shall necessarily include anti-tampering provisions. A clause has been added to avoid that anti-tampering features preclude the use of aftermarket parts which give an equivalent level of emission control. 1. 4. 2 Control of compliance of vehicles in service The Auto/Oil Programme has highlighted the favourable cost/effectiveness potential of systems for verifying the compliance of vehicles in service with the regulatory requirements in force when these vehicles are approved. Such systems exist in the United States, in Sweden and, on a voluntary basis, in the Netherlands. The EC type-approval procedure contains, at present, only provisions allowing the control of conformity of production. The Commission is therefore proposing to introduce in the EC type-approval procedure for motor vehicles, provisions which will verify the compliance of manufacturer's vehicles with the durability requirements of the present directive with the help of surveys carried out on vehicles in service which have accumulated up to 80 000 km and/or an age of five years. In order to assure the application of such provisions at EU level, they must be closely linked to existing provisions relating to the responsibilities of the national authorities with respect to the control of conformity of production. The introduction of the proposed new system necessitates not only amendments of the present directive but also amendments of the framework directive relating to EC type-approval (70/156/EEC). The amendments to the latter directive and the detailed provisions relating to the statistical aspects of the surveys of vehicles in service and the remedial measures that should apply in case of non-compliance (e. g. "recall") will be subject of the new Annex X of this Directive. 1. 4. 3 Test for verifying the durability of anti-pollution devices ("type V test") This test was introduced in Directive 91/441/EEC in order to verify the requirement that the emission control measures taken by the manufacturers remain effective throughout the normal life of the vehicles and under normal conditions of use. The test is intended to simulate the ageing of anti-pollution devices during an operation of 80 000 km in accordance with a specified driving pattern. 93 The experience made by industry and the national approval authorities with this test has, however, shown a considerable lack of representativity in the way that emission control The devices deteriorate of the concerned devices under actual driving conditions. Commission has decided therefore to refrain from proposing an extension of this test to 160 000 km which would merely increase the costs of emission approvals of cars without noticeable environmental benefits. Hence, the present provisions of the Directive relating to the type V test remain unchanged. 1. 5 Reference fuels The characteristics of the reference fuels used for emission testing are also modified to reflect evolution of the specifications of the commercial fuels in year 2000. 1. 6 Low temperature testing The Commission does not propose that specific requirements relating to the emission performances of vehicles at low temperatures be introduced, because the typical conditions simulated by this test were not covered in the Auto/Oil Programme. Nevertheless, in the light of the interest shown by some Member States for such a new test, the Commission ^will study its potential costs and effectiveness at a later stage, and will, if necessary, bring forward proposals. 2. Second stage 2005 The proposal also sets out indicative limit values to be applied for a second Stage to reduce vehicle emissions in the year 2005. The purpose of the second stage is twofold. Firstly by setting indicative, but realistic limit values which could be applied from the year 2005, the Commission is giving advance notice to the automobile industry as to the measures it anticipates will need to be applied from that date. Secondly, the year 2005 values are proposed in order to provide uniform targets to Member States which would like to stimulate the improvement of environmental technologies through the granting of fiscal incentives. In view of the anticipatory nature of the second stage, the Commission proposes that the limit values proposed should be confirmed by decision of the European Parliament and the Council. To this end, the Commission will bring forward proposals to the Council and the Parliament within twelve months of the adoption of this Directive, but not later than 31 December 1999, as required in Article 4 of this proposal. Contemporaneously with the new proposals on vehicles, the Commission will also propose new fuels quality specification for application also in year 2005. The proposals on fuels and vehicles to reduce emissions for the year 2005, will be based on a further analysis of trends in air quality, technical developments in vehicle and refinery technologies, the-potential for alternative fuels to reduce vehicle emissions and the relative cost/effectiveness of the measures concerned. The indicative limit values are based on the most stringent packages of measures examined in the Auto/Oil Programme but not selected for the year 2000. The costs of the technologies necessary to meet these second stage standards are not precisely known at the present time. Stage 2005 proposed standards will require, especially for diesel vehicles, the development of technologies like deNOx catalytic converters which are not yet industrially proven. These will require the availability of improved fuels (for instance, low sulphur diesel fuel). This is another reason why the second stage on vehicles needs to be accompanied by a second stage on fuels. * 94 The proposed Stage 2005 limit values are therefore: Stage: CO HC NOx (limit values in g/km ) Directive 94/12/EC Corrected values 2. 7 0. 341 0. 252 Stage: CO H C + N Ox NOx PM Directive 94/12/EC Corrected values 1. 06 0. 71/0. 91(i) 0. 63/0. 81(4) 0. 08/0. 10w 3. Emission based fiscal incentives Petrol cars Stage 2000 Regulatory values 2. 3 0. 20 0. 15 Diesel cars Stage 2000 Regulatory values 0. 64 0. 56 0. 50 0. 05 Stage 2005 Indicative values 1. 00 0. 10 0. 08 Stage 2005 Indicative values 0. 50 0. 30 0. 25 0. 025 Since the adoption of Directive 89/458/EEC, Community decisions relating to the environmental aspects of motor vehicle emissions have contained a framework for the granting of fiscal incentives to encourage the early application of the new limit values. In these directives a balance has been struck between, on the one hand, the need to encourage the introduction of new technologies as quickly as possible, and, on the other hand, the need to avoid fragmenting the Single Market with diverse fiscal incentive programmes incentivising different limit values with the consequence that, de facto, there would be simultaneously a multitude of emission standards existing in the market. The principles adopted in the framework set out in Article 3 of Directive 94/12/EC have been to permit fiscal incentives only for vehicles complying with the Directive and provided that they comply with the provisions of the Treaty and that they are: non-discriminatory; limited in time and that they terminate when the limit values become mandatory; of an amount lower than the additional cost of the technical solutions introduced to ensure compliance with the new limit values and the cost of their installation on the vehicle. — (5) For vehicle equipped with direct injection engine. 95 It should be noted that this fiscal framework has been established within the context of a directive based on Article 100a of the Treaty a point which has been contested by a number of Member States. Legally speaking however this is perfectly justified since the main subject matter of the directive concerns questions of the internal market (harmonization of legislation). The fiscal incentive framework does not aim at harmonizing taxes but rather at preventing obstacles to the functioning of the Internal Market in this sector. Without a Community framework there would be nothing to prevent Member States, within the limits of the Treaty, from incentivising a wide range of emission limit values. This would be damaging for the proper functioning of the internal market. It is for this reason that Member States have agreed to establishing a framework within which fiscal incentives could be given. The Commission believes that it is essential that this policy continues in the future. The Commission has however re-examined the modalities of the framework with a view to ascertaining if any additional flexibility could be introduced into it without prejudicing the objectives outlined above. The Commission notes in this context that in the course of the discussions on Directive 94/12/EC it stated that with regard to the inclusion of pollutant emissions in the basis for calculating the annual road tax, any adjustment should be progressive and be based upon the actual performance of each vehicle. Fiscal incentives should not be given to incentivjse limit values not agreed at Community level (e. g. US standards) but can be given in the context of annual road taxes to incentivise actual emission standards. In the last whereas clause of Directive 94/12/EC the Council and the Parliament requested the Commission, when putting forward measures to apply after the year 2000, to put forward, if necessary, target values involving a further substantial reduction of emissions. Such target values clearly would be used for purposes of fiscal incentivisation. In examining the relative merits of such an approach the Commission notes that for some time a number of Member States - notably Germany and Sweden - have advocated the establishment of target limit values for incentivisation purposes. Sweden indeed has applied such a system (by means of environmental Classes I/n/ffi) despite the fact that it is in contradiction with current Community legislation. The European Parliament has also been in favour of a second stage. Against this a number of Member States have made clear their preference for the maintenance of a single stage of incentivised limit values, which has been the approach followed up to now. This issue was discussed by the Commission in 1991 during which time the responsible Commissioners agreed that there was a case for providing a second stage target limit value for fiscal incentive purposes which would be based upon the most advanced technologies. The Auto/Oil Programme has provided data on the most advanced technologies and the information therefore exists on which to base a second stage for incentivisation purposes. In addition this information has been gathered on a European wide basis and hence is likely to provide a sounder basis for a second stage than figures put forward in the past by Member States individually which would reflect their own national industries' capabilities. On balance therefore the Commission considers that there are strong grounds for liberalising the current framework and providing for a second stage of incentivisation. It has to be acknowledged that allowing a second level of incentivisation contains certain risks in terms of internal market. Jiowever since, given the legislative timetable, this proposal is unlikely to be applied before 1998 by Member States on an optional basis for vehicle types approved to Stage 2000 standards. This is only a short time before vehicles will mandatorily have to conform to emission performances corresponding to Stage 2000 standards. As a practical matter therefore, there will be only a very short period when, theoretically, there are three simultaneous standards existing in the market (actual, Stage 2000, indicative Stage 2005). This has to be seen in the light of the far greater danger 'in terms of negative effects on the internal market which would result from a failure to agree to any framework at all. This later scenario would have the consequence that unbridled fiscal incentives measures would be permitted leading to the risk of a proliferation of standards in the market and a threat to the functioning of the internal market. 96 towards The two-stage approach the clear understanding that these and only these limit values will be permitted to be incentivised and not others such as US standards or variants thereof. Article 4 of the draft Directive provides, that the regime governing fiscal incentives for the year 2005 will, if necessary, be revised, in the course of the proposals conforming or revising the limit values to be applied in 2005. incentivisation should be permitted on With regard to fiscal incentive measures given in the context of annual road taxes the Commission proposes that the policy it outlined in the course of the adoption of Directive 94/12/EC should be maintained. F. New measures for other categories of vehicles A proposal will be submitted in 1996 to modify the light commercial vehicles (LCV) standards included in Directive 70/220/EEC. In order to ensure parallelism and coherence between light commercial vehicles and passenger cars, limit values for these vehicles will be an extrapolation of limit values in this proposal. The Commission will examine closely the issue of whether limit values for Class I and II LCV should be the same. A proposal aimed at achieving a 30% NOx and particulate reduction will also be-proposed in 1996, for heavy duty diesel engines approved according Directive 88/77/EEC. Limit values will take into account the on-going discussions on revising the heavy vehicle test procedure. The implementation dates will be the same as those for passenger cars. As for passenger cars and light commercial vehicles, it is also foreseen to propose target values for 2005 for heavy duty vehicles. Provisions for LPG/CNG technologies in buses and city vehicles will also be developed. G. 1. Subsidiarity Objective of the proposed measures in relation to the obligations placed upon the Commission The objective of the measures is to adapt existing measures to the technical progress as well as to new knowledge in the field of environment. These existing measures have largely contributed to achieving the harmonization of the Community vehicle market since 1970. Their adaptation is explicitly requested by Directive 94/12/EC and is an element of a global consensus which had permitted the adoption of the last directive. 2. Compared competence of the Community and of the Member States With the Council Directive 89/458/EEC, the Community has decided to harmonize all emission related requirements for new vehicle type-approval on the base of total harmonization. The matter is therefore an issue of exclusive Community competence. 3. Forms of actions available for the Community — The only realistic form of action is legislation based either on a directive or a regulation. As a separate directive permitting the application of the EU type-approval put in place by Directive 70/156/EEC, the proposal adopts the legal forms of all requirements in this field. 97 4. Availability of an approach with general objectives leaving execution to Member States A uniform detailed regulation is necessary to be coherent with the requirements of the framework Directive 70/156/EEC. H. Conclusions With this present proposal for a European Parliament and Council Directive, the highest degree of environmental protection, consistent with a economically sound global approach, will be ensured. The proposals will contribute to the improved protection of public health within the Community by setting ambitious but realistic objectives, whilst giving a sufficient lead time to the automobile and components industries to develop the relevant technologies. The Commission has moreover taken care of the need to provide a stable framework for operators in the market, and the proposals have been made with this objective in mind. The ambitiousness of the changes will put the Community squarely at the head of the global effort to reduce emissions. Nevertheless, alongside measures taken out at the level of the European Union, cost effective measures implemented at local level will be necessary to achieve air quality objectives. 98 Proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE 96/0164 (COD) relating to measures to be taken against air pollution by emissions from motor vehicles and amending Council Directives 70/156/EEC and 70/220/EEC THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 100 thereof, Having regard to the proposal from the Commission(1), Having regard to the opinion of the Economic and Social Committee(2), Acting in accordance with the procedure referred to in Article 189b of the Treaty(3), Whereas measures should be adopted within the framework of the internal market; Whereas the first programme of action of the European Community on protection of the environment^, approved by the Council on 22 November 1973, called for account to be taken of the latest scientific advances in combating atmospheric pollution caused by gases emitted from motor vehicles and for directives adopted previously to be amended accordingly; whereas the fifth programme of action, which in its general approach was approved by the Council in its resolution of 1 February 1993 ((5)), provides for additional effort to be made for a considerable reduction in the present level of emissions of pollutants from motor vehicles; whereas this fifth programme also set targets in terms of emission reduction for various pollutants in the understanding that emissions from both mobile and stationary sources would have to be reduced; Whereas Council Directive 70/220/EEC(6) lays down the limit values for carbon monoxide and unburnt hydrocarbon emissions from the engines of such vehicles; whereas these limit values were first reduced by Council Directive 74/290/EEC(7) and supplemented, in accordance with Commission Directive 77/102/EEC(8), by limit values for permissible nitrogen oxides; whereas the limit values for these three types of pollution were successively reduced by Commission Directives 78/665/EEC(9), 83/351/EEC(10) and 88/76/EEC(U); whereas limit values for particulate pollutant emissions from diesel engines were introduced by Council Directive 88/436/EEC(12); whereas more stringent European standards for the emissions of gaseous pollutants of motor vehicles below 1 400 cm were introduced by Council Directive 89/458/EEC(l3); whereas these standards have been extended to all passenger (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) OJ No C OJ No C Opinion of the European Parliament of — , Common Position of the Council of , and Decision of the European Parliament of OJNoC 112, 20. 12. 1973, p. 1. OJNoC 138, 17. 5. 1993, p. 1. OJNoL 76, 6. 4. 1970, p. 1. OJNoL 159, 15. 6. 1974, p. 61. OJNoL 32, 3. 2. 1977, p. 32. OJ No L 223, 14. 8. 1978, p. 48. OJNoL 197, 20. 7. 1983, p. 1. OJNoL 36, 9. 2. 1988, p. 1. OJNoL 214, 6. 8. 1988, p. 1. OJNoL 226, 3. 8. 1989, p. 1. 99 cars independently of their engine capacity on the basis of an improved European test procedure comprising an extra-urban driving cycle and, whereas requirements relating to evaporative emissions and to the durability of emissions-related vehicle components as well as more stringent particulate pollutant standards for motor vehicles equipped with diesel introduced by Council Directive 91/441/EEC(U); whereas engines which were Directive 94/12/EC of the European Parliament and of the Council(15) introduced more stringent limit values for all pollutants and a modification of the control of conformity of the production; whereas passenger cars designed to carry more than six passengers and having a maximum mass of more than 2 500 kg, light commercial vehicles, and off-road vehicles, covered by Directive 70/220/EEC, which benefited until then from less stringent standards, have been submitted by Council Directive 93/59/EEC(16) and Directive 96/. /EC of the European Parliament and of the Council(17), to standards as severe as the respective standards for passengers cars, taking into account the specific conditions of these vehicles; Whereas Article 4 of Directive 94/12/EC requires that the Commission proposes standards which will be enforced after the year 2000, according to a new multi-faceted approach, based on a comprehensive assessment of costs and efficiency of all measures aimed at reducing road transport pollution; whereas the proposal should include, besides car emission standard tightening, complementary measures, like an improvement in fuel quality and a strengthening of the car fleet inspection and maintenance programme; whereas the proposal should be based on the establishment of air quality criteria and associated emission reduction objectives and an evaluation of the cost/effectiveness of each package of measures, taking into account the potential contribution of other measures such as, inter alia, traffi z management, enhancement of urban public transport, new propulsion technologies, or the use of alternative fuels; Whereas the Commission has implemented a European programme on air quality, road traffic emissions, fuels and engines technologies (the Auto/Oil Programme08') with a view to fulfilling the requirements of Article 4 of Directive 94/12/EC; whereas the European car and oil industries have carried out the European Programme on Engines Fuels and Emissions (EPEFE) to determine the contribution which can be made both by future vehicles and the fuels which propels them; whereas the auto/oil and EPEFE programmes strove for ensuring that proposals for directives on polluting emissions seek the best solutions for both the citizen and for the economy; whereas a cost/effectiveness study within the Auto/Oil Programme has shown that a further improvement of car emission technology was necessary with a view to achieving air quality in year 2010 as described in the Communication by the Commission on the Auto/Oil Programme; Whereas improvement of requirements for new passenger cars in Directive 70/220/EEC constitute a part of a consistent global Community strategy which will also include a revision of standards for light commercial vehicles and heavy duty vehicles from year 2000, an improvement of motor fuels and more accurate assessment of in-use vehicle emission performances; whereas alongside these measures, additional cost/effective local measures will nevertheless be needed to achieve the air quality criteria in the most polluting areas; Whereas Directive 70/220/EEC is one of the separate directives under the type-approval procedure laid down by Council Directive 70/156/EEC of 6 February 1970 on the approximation of the laws of the Member States relating to the type-approval of motor vehicles and their trailers(l9), as last amended by Directive 96/27/EC of the European Parliament and of the Council(20); whereas the objective of reducing the level of (14) (15) (16) (,7) (18) (19) (20) OJNoL 242, 30. 8. 1991, p. 1. OJ No L 100, 19. 4. 1994, p. 42. OJNoL 186, 28. 7. 1993, p. 21. OJ No L Commission Communication. OJNoL 42, 23. 2. 1970, p. 1. OJNoL 169, 8. 7. 1996, p. 1. 100 pollutant emissions from motor vehicles cannot be sufficiently achieved by individual Member States and can therefore be better achieved by the approximation of the law of the Member States relating to measures to be taken against air pollution by motor vehicles; Whereas reductions of the Type I test limits applicable from year 2000 corresponding to abatements of 40% nitrogen oxides, 40% total hydrocarbons, 30% carbon monoxide for gasoline passenger cars, 20% nitrogen oxides, 20% for the combined value for hydrocarbons plus nitrogen oxides, 40% carbon monoxide, 35% particulate matters for indirect injection diesel passenger cars and 40% nitrogen oxides, 40% for the combined value for hydrocarbons plus nitrogen oxides, 40% carbon monoxides and 50% particulate matters have, for direct injection diesel passenger cars, been identified as key measures to achieve sufficient medium-term air quality; whereas these reductions have been applied to hydrocarbons and nitrogen oxides with the assumption that nitrogen oxides represent respectively 45% and 80% of the weight of the combined value measured for gasoline/diesel light duty vehicles complying with Directive 94/12/EC; whereas separate limit values are now normally fixed for gasoline vehicles in order to monitor the emissions of both pollutants; whereas a combined limit value is maintained for diesel vehicles for which the Stage 2000 standards are the most demanding, with a view to facilitating engineering of future engines; whereas these reductions will take into account the effect on real emissions of a modification also adopted for the test cycle with a view to better representing emissions after a cold start ("deletion of 40 s"); Whereas new provisions for on-board diagnostics (OBD) should be introduced with a view to permitting an immediate detection of failure of anti-pollution vehicle equipment and thus allowing a significant up-grading of the maintenance of initial emissions performances on in-use vehicles through periodical or kerbside control; whereas, however, OBD are at a less developed stage for diesel vehicles and can be fitted on such vehicles only as an option; Whereas the Type IV test which makes it possible to determinate the evaporative emissions of spark-ignition engines can be improved to better represent real evaporative emissions as well as the status of measuring techniques; Whereas the characteristics of the reference fuels used for emission testing should reflect the evolution of the market fuel specifications to be available in year 2000, following legislation on the quality of petrol and diesel fuels; Whereas a new method for conformity of production checking on in-use vehicles has been identified as a cost/effective accompanying measure; and is included in the emission directive with the objective of implementation in year 2001; whereas Directive 70/156/EEC should be amended accordingly; Whereas Member States should be allowed to encourage, by means of tax incentives, the introduction of vehicles which satisfy the improved requirements of this Directive; Whereas, it is necessary to establish indicative limit values to be applied from 2£05 which can also be used for the purposes of, inter alia, encouraging the early introduction of vehicles containing the most advanced anti-pollution equipment; these indicative limit values should be confirmed by a directive of the Whereas European Parliament and of the Council on the basis of a proposal to be made by the Commission not later than 31 December 1998; whereas the Commission will simultaneously propose measures to improve the quality of fuels for the year 2005; whereas both directives should enter into force together in 2005; Whereas Directive 70/220/EEC should be amended accordingly, 101 HAVE ADOPTED THIS DIRECTIVE: Article 1 Directive 70/156/EEC is amended as follows: 1. Article 10 is amended as follows: Article 10 (a) the heading is replaced by the following: "Conformity of production and in-service compliance arrangements" (b) the following paragraph 3 is added: "3. A Member State granting type-approval in relation to separate directives which contain quantified provisions for in-service durability of the systems, components or technical units, covered by these directives, shall make the necessary arrangements for verification to ensure compliance with these provisions by survey on vehicles in service in accordance with the procedures laid down in the directives concerned. " 2. Article 11 is amended as follows: (a) the heading is replaced by the following: "Non-conformity and non-compliance" (b) the following paragraph 4a is inserted: "4a. There shall be failure to comply with quantified durability provisions of a separate directive where a survey on vehicles in service, carried out in accordance with the relevant specifications of the directive, establish that a vehicle type concerned does not meet these durability requirements. If a Member State which has granted type-approval finds that vehicles in service accompanied by a certificate of conformity do not comply with the quantified durability provisions of a separate directive pursuant to which they have been type-approved, it shall decide on measures to be taken in order to ensure that vehicles in service will again comply with these provisions. The approval authorities of the Member State shall advise those of the other Member States of the measures planned. The relevant authorities in each Member State are competent to decide on the advisability of implementation in their territory of the planned measures. If a Member State demonstrates that vehicles in service accompanied by a certificate of conformity do not comply with the quantified durability provisions of a separate directive pursuant to which they have been type-approved, it shall request the Member State which granted the type-approval to verify that by survey on vehicles in use, if necessary in cooperation with the competent authorities of the other Member States vehicles in service comply with these provisions. Such action shall be taken as soon as possible and in any case within the six months of the date of the request. When non-compliance for a vehicle in service is established in accordance with the third subparagraph, the vehicle approval authority takes the measures referred to in the second subparagraph. " 102 (c) paragraphs 5 and 6 are replaced by the following: "5. The approval authorities of the Member States shall inform each other within one month of any withdrawal of type-approval and of the reasons for such a measure. In case of in-service survey under Article 10(2), the approval authorities of the Member State shall inform each other of the decisions taken on the basis of the results of the survey. 6. If the Member State which granted type-approval disputes the failure to conform or to comply demonstrated to it, the Member States concerned shall endeavour to settle the dispute. The Commission shall be kept informed and shall, where necessary, hold appropriate consultations for the purpose of reaching a settlement. " 3. In Article 12, the following subparagraph is added: "All decisions taken pursuant to the provisions adopted in implementation of this Directive and adopting planned measures to restore the conformity of vehicles in service, shall state in detail the reasons on which they are based. The competent authorities of each Member State which decide to initiate the planned measures shall notify the party concerned who shall, at the same time, be informed of the remedies available to him under the laws in force in the Member States and of the time limits allowed for the exercise of such remedies. " Article 2 The Annexes to Directive 70/220/EEC are amended in accordance with the Annex hereto. Article 3 1. Subject to the provisions of Article 6, with effect from 1 January 1998, no Member State may, on grounds relating to air pollution by their emissions: refuse to grant EC Directive 70/156/EEC, or type-approval pursuant to Article 4(1) of refuse to grant national type-approval, or prohibit the registration, sale or entry into service of vehicles, if the vehicles comply with the requirements of Directive 70/220/EEC, as amended by this Directive. 2. Subject Member States: to the provisions of Article 6, with effect from 1 January 2000, may no Directive 70/156/EEC, and longer grant EC type-approval pursuant to Article 4(1) of shall refuse national type-approval, for a new type of vehicle on grounds relating to air pollution by emissions if it fails to comply with the provisions of Directive 70/220/EEC, as amended by this Directive. For the Type I test the limit values set out in row A of the Table in Section 5. 3. 1. 4 of Annex I to Directive 70/220/EEC are to be used. 103 3. With effect from 1 January 2001, Member States shall: consider certificates of conformity which accompany new vehicles pursuant to Directive 70/156/EEC as no longer valid for the purpose of Article 7(1) of that Directive, and refuse the registration, sale or entry into service of new vehicles which are not accompanied by accordance with of a Directive 70/156/EEC, conformity certificate in on grounds relating to air pollution by emissions, if the vehicles fail to comply with the provisions of Directive 70/220/EEC, as amended by this Directive. For the Type I test the limit values set out in row A of the Table in Section 5. 3. 1. 4 of Annex I to Directive 70/220/EEC are to be used. Article 4 Member States may make provision for tax incentives only in respect of motor vehicles which comply with Directive 70/220/EEC, as amended by this Directive. Such incentives shall comply with the provisions of the Treaty and satisfy the following conditions: they shall apply to all new vehicles offered for sale on the market of a Member State which comply in advance with either the mandatory limit values set out in row A of the Table in Section 5. 3. 1. 4 of Annex I to Directive 70/220/EEC, as amended by this Directive, or, the indicative limit values set out in row B of the same Table; they shall be terminated with effect from the mandatory application of the emission limit values laid in Article 3(3) for new motor vehicles, or by 1 January 2005 in the case of the indicative limit values set out in row B of the Table in Section 5. 3. 1. 4 of Annex I to Directive 70/220/EEC, as amended by this Directive; for each type of motor vehicle, they shall be for an amount lower than the additional cost of the technical solutions introduced to ensure compliance with the values set in Article 3(3), or the indicative limit values set out in row B of the Table in Section 5. 3. 1. 4 of Annex I to Directive 70/220/EEC, as amended by this Directive, and of their installation on the vehicle. The Commission shall be informed in sufficient time of plans to institute or change the tax incentives referred to in the first paragraph, so that it can submit its observations. Article 5 The Commission will propose to the European Parliament and the Council a further-tightening of the emission standards of vehicles falling within the scope of this Directive no later than 12 months from the date of adoption of this Directive but in any event not later than 31 December 1998. It shall be based on a revised and enhanced version of the methodology used to prepare measures for this Directive. The strategy put forward in the proposal shall be designed to produce effects to meet the requirements of the Community air quality standards and related objectives at least cost and shall take account of: trends in air quality; noxious* pollutant emissions in Europe from transport and non-transport sources and the contribution that existing, pending and potential emission reduction measures from all sources could make to improve air quality; 104 technical developments with regard to vehicle technologies as well as new propulsion technologies (e. g. electric propulsion, fuel cells); and refinery technologies; the potential of alternative fuels such as compressed natural gas (CNG), Liquid Petroleum Gas (LPG), Dimethyl Ether (DME) and biofuels to reduce vehicle emissions; possible improvements in the test procedures, in particular the addition of a new test procedure at low temperatures; the potential of technical, non-technical and local measures to reduce emissions; in this context the contribution of transport and other policy measures such as traffic management, enhanced urban public transport and vehicles scrappage schemes should be evaluated; the contribution that selective and differentiated fiscal measures could make to reducing emissions, whilst not negatively the internal market; the functioning of impacting the effects of any measures on C02 emissions; the strategies followed by non-member countries to improve air quality and the emission limit values applied therein; the supply situation and qualities of crude oil available to Europe. The proposal shall contain, inter alia, mandatory emission limit values to be applied from 1 January 2005 confirming or modifying in Section 5. 3. 1. 4, row B of Annex 1 to Directive 70/220/EEC, as amended by this Directive. In addition, the proposal shall establish whether the framework under which Member States can make provision for tax incentives established in Directive 70/220/EEC, as amended by this Directive, should be revised. limit values stipulated indicative the p The proposal shall be submitted to the European Parliament and the Council at the same time /EC of the European Parliament and as the proposALreferred to in Article 9 of Directive 96/ of the Coun<pfc*/on the quality of petrol and diesel fuels]; the measures shall enter into effect at the same time as the measures foreseen in the proposal to be submitted in accordance with Article 9 of that Directive. Article 6 The provisions of this Directive will enter into force simultaneously with and in accordance with the same timetable for the introduction of measures specified in the Directive for a European Parliament and Council Directive related to the quality of petrol and dresel fuels. Article 7 1. Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive before 31 December 1997. They shall immediately inform the Commission thereof. When Member States adopt these provisions, these shall contain a reference to this Directive or shall be accompanied by such reference at the time of their official publication. The procedure for such reference shall be adopted by Member States. f«l) See p. of this Official Journal. 105 2. Member States shall communicate to the Commission the texts of the main provisions of national law which they adopt in the field covered by this Directive. Article 8 This Directive shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Communities. This Directive is addressed to the Member States. Article 9 Done at Brussels, For the European Parliament The President For the Council The President 106 ANNEX AMENDMENTS TO THE ANNEXES TO DIRECTIVE 70/220/EEC AS AMENDED BY DIRECTIVE. List of Annexes 1. The list of Annexes is amended as follows: The indication to Annex VI reads as follows: 'Annex VI: Type IV test (Determination of evaporative emissions from vehicles with spark-ignition engines) Appendix 1 : Calibration frequency and methods Appendix 2: Diurnal ambient temperature profile for the diurnal emission test' Annex VIII: The title reads as follows: 'Specifications of reference fuels' The following items are added: 'Annex X: Control of compliance of vehicles in service Annex XI: On-board diagnostics (OBD) for motor vehicles Appendix 1 : Functional aspects of OBD systems Appendix 2: Diagnostic services (Test Modes) Appendix 3: OBD tools Appendix 4: Numeric codes Appendix 5: Addendum to the Information Document Appendix 6: Essential characteristics of the vehicle family- Appendix 7: Addendum to the EC type-approval certificate' 107 Annex I 2. The heading reads as follows: 'SCOPE, DEFINITIONS, APPLICATION FOR EC-TYPE APPROVAL, EC TYPE APPROVAL, REQUIREMENTS AND TESTS, EXTENSION OF EC TYPE- APPROVAL, CONFORMITY OF PRODUCTION, COMPLIANCE IN SERVICE, ON BOARD DIAGNOSTIC (OBD) SYSTEMS' 3. Section 1: The first sentence reads as follows. 'This Directive applies to - the tailpipe emissions, evaporative emissions, emissions of crankcase gases, the durability of anti-pollution devices and on-board diagnostic (OBD) systems for all motor vehicles equipped with positive-ignition engines and the tailpipe emissions, the durability of anti-pollution devices and on-board diagnostic (OBD) systems from vehicles of category Mj and Nj(1), equipped with compression-ignition engines covered by Article 1 of Directive 70/220/EEC in the version of Directive 83/351/EEC(2), with the exception of those vehicles of categ with the exception of those vehicles of categories Nj for which type-approval has been granted pursuant to Directive 88/77/EEC( V 4. A new Section 2. 13 is added to read as follows '2. 13. 'OBD' means an on-board diagnostics system for emission control which shall have the capability of identifying the likely area of malfunction by means of fault codes stored in computer memory. ' Sections 3 to 3. 2. 1 read as follows: '3. APPLICATION FOR EC TYPE-APPRO VAL 3. 1. for EC The application to Article 3(4) of Directive 70/156/EEC of a vehicle type with regard to its tailpipe emissions, evaporative emissions, durability of antipollution devices as well as to its the diagnostic on-board vehicle manufacturer. type-approval pursuant submitted (OBD) system shall — by be As far as the application concerns an on-board diagnostic (OBD) system the procedure described in Annex XI, Section 3 has to be followed. 3. 2. A model for the information document relating to tailpipe emissions, evaporative emissions and durability is given in Annex II; concerning an on-board diagnostic (ODB) system a model is given in Annex XI, Appendix 5. 3. 2. 1. Where appropriate, copies of other type-approvals with the relevant data to enable extension of approvals and establishment of deterioration factors shall be submitted. ' 108 6. Sections 4 to 4. 2 read as follows: •4. GRANTING OF EC TYPE-APPROVAL 4. 1. If the relevant requirements are satisfied, EC type-approval shall be granted to Article 4 (3) of Directive 70/156/EEC. 4. 2. A model for the EC type-approval certificate relating to tailpipe emissions, evaporative emissions and durability is given in Annex DC, concerning an on board diagnostic (OBD) system a model is given in Annex XI, Appendix 7. ' 7. Section 5: The note is deleted. 8. Section 5. 1. 1: The second paragraph reads as follows: ' The technical measures taken by the manufacturer must be such as to ensure that the tailpipe and evaporative emissions are effectively limited, pursuant to this Directive, throughout the normal life of the vehicle and under normal conditions of use. This will include the security of those hoses, their joints and connections, used within the emission control systems, which must be so constructed as to conform with the original design intent. For tailpipe emissions, these provisions are deemed to be met if the provisions of Section 5. 3. 1. 4 (type-approval), Section 7 (conformity of production) and Section 8 (compliance of vehicles in service) are respectively complied with. For evaporative emissions, these provisions are deemed to be met if the provisions of Section 5. 3. 4 (type-approval), Section 7 of Annex VI (conformity of production) and Section 8 (compliance of vehicles in service) are respectively complied with. ' 9. A new Section 5. 1. 3 is added to read as follows: T '5. 1. 3. Provision must be made to prevent excess evaporative emissions caused by a missing fuel filler cap. This may be achieved by using: - an automatically opening and closing, non-removable fuel filler cap; - design features which avoid excess evaporative emissions in the case of a missing fuel filler cap; - a malfunction indicator different from the OBD malfunction indicator to signal a missing fuel filler cap; or any other provision which has the same effect. ' 109 10. Figure 1. 5. 2 is replaced by the following new figure: Figure 1. 5. 2 Different routes for type-approval and extensions Type approval test Type I Type II Type III Type IV Type V In Service Compliance (Section 8) On Board Diagnostics (Section 9) Extension conditions Positive-ignition engined vehicles of categories M and N Yes (mass £ 3,5 t) Yes (mass <> 3,5 t) Yes Yes (mass £ 3,5 t) Yes (mass £ 3,5 t) Yes (mass <. 3,5 t) Yes (Capacity <, 6 occupants) (mass £ 2,5 t) Section 6 Compression ignition engined vehicles of categories Mt and N, Yes (mass <> 3,5 t) -. Yes (mass <. 3,5 t) Yes (mass <; 3,5 t) Optional - Section 6 - M2 and N2 with reference mass not more than 2 840 kg' I 110 11. Section 5. 3. 1. 4: - After the first paragraph a new Table is inserted to read as follows: Limit values. Category of vehicle Reference Mass of carbon Mass of Mass of oxides Combined mass Mass of mass monoxide hydrocarbons of nitrogen of hydrocarbons particulates (CO) (HC) (NO. ) (HC + NO,) (PM) and oxides of nitrogen RW 0<g) (g/km) (g/km) L3 (g/km) (g/km) (g/km) Category Class Petrol Diesel Petrol Diesel Petrol Diesel Petrol Diesel Diesel A(2000) B (2005)* M(2) MO - - all all 2,3 1,00 0,64 0,50 0,20 0,10 - - 0,15 0,08 0,50 0,25 - - 0,56 0,30 0,05 0,025 (*) Indicative limit values to be applied to new types of vehicles from 1 January 2005 which are subject to confirmation by the Council and the European Parliament. These limit values can be the subject of tax incentives referred to in Article 3 of Directive [number of current amending directive]. - The first line of the present Table relating to vehicles of category M is deleted. 12. A new Section 7. 1. 4 is added to read as follows: 7. 1. 4. If a verification of the performance of the OBD system is to be carried out, it must be conducted in accordance with Section 7 of Annex XI. ' 13. Section 8 is deleted. 14. A new Section 8 and 9 are added to read as follows: •8. CONTROL OF COMPLIANCE OF VEHICLES IN SERVICE 8. 1 In order to satisfy the provisions of Section 5. 1. 1, vehicles in service-properly used and maintained shall comply with the provisions of Sections 5. 3. 1. 4 (tailpipe emissions) and 5. 3. 4 (evaporative emissions) for up to 5 years of age or 80 000 km, which occurs first. Compliance with these provisions will be verified in accordance with the provisions of Article 11 of Directive 70/156/EEC by the authorities which have approved the vehicle type concerned with the help of surveys on vehicles in service belonging to this vehicle type. The procedure to be followed for such in service survey is laid down in Annex X. Any vehicle being accompanied by a valid certificate of conformity in accordance with Directive 70/156/EEC may be subject of an in-service survey. I ll Where non-compliance is established in accordance with the provisions of Annex X, the manufacturers of the vehicle type concerned shall carry out the measures notified to him by the authorities of the Member States in accordance with the provisions of Article 11(2) and 12(2) of Directive 70/156/EEC. 9. ON-BOARD DIAGNOSTIC (OBD) SYSTEM FOR MOTOR VEHICLES 9. 1. Vehicles of category M°} equipped with positive-ignition engines, except - vehicles designed to carry more than six occupants including the driver, - vehicles whose maximum mass exceeds 2 500 kg, shail be fitted with an on-board diagnostic (OBD) system for the emission control in accordance with Annex XI. If other vehicles of category M are fitted with an on-board diagnostic (OBD) system, the OBD system must meet the requirements of Annex XI. ' (1) As defined in Annex II Section A to Directive 70/156/EEC. 112 Annex III 15. Section 2. 3. 1: - Paragraph 2 and 3 are deleted. - Paragraph 2 (former paragraph 4) reads as follows: 'Vehicles which do not attain the acceleration. ' (rest unchanged). 16. Section 6. 1. 3: The first sentence reads as follows: 'A current of air of variable speed shall be blown over the vehicle. ' 17. Section 6. 2. 2 is deleted. Appendix 1 18. Section 1. 1: - Figure III. 1. 1 is replaced by the following new figure: Figure III. 1. 1 Operating cycle for the Type I test Speed (km/h) 1 20 1 00 + BS BS: Beginning of sampling, engine start ES: End of sampling 113 - In the English version in column 5 of Table III. 1. 2 (entitled: 'Speed (km/h)'); operation 23 reads as follows: '35 - 10' 19. Sections 4 to 4. 3 including Table III. 1. 4 and Figure III. 1A are deleted. Appendix 3 20. Section 5. 1. 1. 2. 7: In the English version, the formula reads as follows: • p _ M V AV ' 500T 114 Annex VI 21. Sections 1 to 6 read as follows: '1. INTRODUCTION This Annex describes the procedure of the Type IV test according to Section 5. 3. 4 of Annex 1. This procedure describes a method for the determination of the loss of hydrocarbons by evaporation from the fuel systems of vehicles with spark ignition engines. 2. DESCRIPTION OF TEST The evaporative emission test (Figure VI. 1) is designed to determine HC evaporative emissions as a consequence of diurnal temperatures fluctuation, hot soaks during parking, and urban driving. The test consists of these phases: - test preparation including an urban (Part One) and extra-urban (Part Two) driving cycle, - hot soak loss determination, - diurnal loss determination. Mass. emissions of hydrocarbons from the hot soak and the diurnal loss phases are summed up to provide an overall result for the test. 3. VEHICLE AND FUEL 3 1 Vehicle 3. 1. 1. The vehicle must be in good mechanical condition and have been ran in and driven at least 3 000 km before the test. The evaporative emission control system must be connected and have been functioning correctly over this period and the carbon canister(s) shall have been subject to normal use, neither undergoing abnormal purging nor abnormal loading. 32 Fuel 3. 2. 1. The appropriate reference fuel must be used, as defined in Annex VIII to this Directive. 4. TEST EQUIPMENT FOR EVAPORATIVE TEST 4. 1. Chassis dynamometer The chassis dynamometer must meet the requirements of Annex III. 115 4. 2. Evaporative emission measurement enclosure The evaporative emission measurement enclosure must be a gas-tight rectangular measuring chamber able to contain the vehicle under test. The vehicle must be accessible from all sides and the enclosure when sealed must be gas tight in accordance with Appendix 1. The inner surface of the enclosure must be impermeable and non-reactive to hydrocarbons. The temperature conditioning system shall be capable of controlling the internal enclosure air temperature to follow the prescribed temperature versus time profile throughout the test, and an average tolerance of ± 1 K over the duration of the test. The control system shall be tuned to provide a smooth temperature pattern that has a minimum of overshoot, hunting, and instability about the desired long- term ambient temperature profile. Interior surface temperatures shall not be less than 278 K (5 °C) nor more than 328 K (55 "Q at any time during the diurnal emission test. Wall design must be such as to promote good dissipation of heat. Interior surface temperatures shall not be below 293 K (20 °C), nor above 325 K (52 °C) for the duration of the hot soak test. To accommodate the volume changes due to enclosure temperature changes, either a variable-volume or fixed-volume enclosure may be used. 4. 2. 1. Variable-volume enclosure The variable-volume enclosure expands and contracts in response to the temperature change of the air mass in the enclosure. Two potential means of accommodating the internal volume changes are movable panel(s), or a bellows design, in which impermeable bag(s) inside the enclosure expand and contract in response to internal pressure changes by exchanging air from outside the enclosure. Any design for volume accommodation must maintain the integrity of specified temperature range. the enclosure as specified in Appendix 1 over the Any method of volume accommodation shall limit the differential between the enclosure internal pressure and the barometric pressure to a maximum value of± 5 hPa. The enclosure shall be capable of latching to a fixed volume. A variable volume enclosure must be capable of accommodating a ± 7 percent change from its "nominal volume" (see Appendix 1 Section 2. 1. 1), accounting for temperature and barometric pressure variation during testing. 4. 2. 2. Fixed-volume enclosure The fixed-volume enclosure shall be constructed with rigid panels that maintain a fixed enclosure volume, and meet the following requirements. 116 4. 2. 2. 1. The enclosure shall be equipped with an outlet flow stream that withdraws air at a low, constant rate from the enclosure throughout the test. An inlet flow stream may provide make-up air to balance the outgoing flow with incoming ambient air. Inlet air must be filtered with activated carbon to provide a relatively constant hydrocarbon level. Any method of volume accommodation shall maintain the differential between the enclosure internal pressure and the barometric pressure between 0 and -5 hPa. 4. 2. 2. 2. The equipment shall be capable of measuring the mass of hydrocarbon in the inlet and outlet flow streams with a resolution of 0,01 gram. A bag sampling system may be used to collect a proportional sample of the air withdrawn from and admitted to the enclosure. Alternatively, the inlet and outlet flow streams may be continuously analyzed using an on-line FID analyzer and integrated with the flow measurements to provide a continuous record of the mass hydrocarbon removal. 117 r Fuel drain and refill max 1 h Canister load to breakthrough (gasoline) u Repeated diurnal heat builds to 2-gram breakthrough Tflm= 293 K (20 °C) A T= 15 K Figure VIA Evaporative emission determination 3000 km run-in period (no excessive purge/load) Ageing of canister(s) verified Steam clean of vehicle (if necessary) Start ' ' Fuel T: 283 to 287 K (10-14 'C). 40% ± 2% of nominal tank capacity Ambient T: 293 to 303 K (20-30 C). Canister load to breakthrough (butane) Butane/nitrogen loading to 2-grams breakthrough max 1 h Fuel drain and refill _L | 12 to 36 h max 5 min max 2 min max 7 min and max 2 min from engine shut-off Hot soak test 6 to 36 h JL FuelT: 291 ±8 K (18 8 °C) 40% _ 2% of nominal tank capacity Ambient T: 293 to 303 K (20-30 °C) Type I: one Part 1 + two Parts 2. = 293 to 303 K (20-30 'C). Ambient T = 293 to 303 K (20-30 C). Type I: one Part 1 + one Part 2. T^ = 293 to 303 K (20-30 'C). Type I: Part 1. Tmin = 296 K (23 'C). T^ = 304 K (31 C). 60 min ± 0,5 min T = 293 ± 2 K (20 ± 2 CC) last 6 hours. T ,^ = 293 K (20 °C) T„„ = 3 0 8 K; AT = 15 K 24 hours, No. l of diumals = 1 Note: 1. Evaporative emission control families - details clariiled. • 2. Tailpipe emissions may be measured during type I test drive, but these are not used for legislative purposes. Exhaust emission legislative test remains separate. 118 4. 3. Analytical systems 4. 3. 1. Hydrocarbon analyzer 4. 3. 1. 1. The atmosphere within the chamber is monitored using a hydrocarbon detector of the flame ionization detector (FID) type. Sample gas must be drawn from the mid-point of one side wall or roof of the chamber and any bypass flow must be returned to the enclosure, preferably to a point immediately downstream of the mixing fan. 4. 3. 1. 2. The hydrocarbon analyzer must have a response time to 90% of final reading of less than 1,5 seconds. Its stability shall be better than 2% of full scale at zero and at 80 ± 20% of full scale over a 15-minute period for all operational ranges. 4. 3. 1. 3. The repeatability of the analyzer expressed as one standard deviation shall be better than 1% of full scale deflection at zero and at 80 ± 20% of full scale on all ranges used. 4. 3. 1. 4. The operational ranges of the analyzer must be chosen to give best resolution over the measurement, calibration and leak checking procedures. 4. 3. 2. Hydrocarbon analyzer data recording system 4. 3. 2. 1. The hydrocarbon analyzer must be fitted with a device to record electrical signal output either by strip chart recorder or other data processing system at a frequency of at least once per minute The recording system must have operating characteristics at least equivalent to the signal being recorded and must provide a permanent record of results. The record shall show a positive indication of the beginning and end of the hot soak or diurnal emission test (including beginning and end of sampling periods along with the time elapsed between start and completion of each test). 4. 4. Fuel tank heating (only applicable for gasoline canister load option) 4. 4. 1. The fuel in the vehicle tank(s) must be heated by a controllable source of heat, for example a heating pad of 2 000 W capacity is suitable. The heating system must apply heat evenly to the tank walls beneath the level of the fuel so as not to cause local overheating of the fuel. Heat must not be applied to the vapour in the tank above the fuel. 4. 4. 2. The tank heating device must make it possible to evenly heat the fuel in the tank by 14 K from 289 K (16 °C) within 60 minutes, with the temperature sensor position as in Section 5. 1. 1. The heating system must be capable of controlling the fuel temperature to ± 1,5 K of the required temperature during the tank heating process. 119 4. 5. Temperature recording 4. 5. 1. The temperature in the chamber is recorded at two points by temperature sensors which are connected so as to show a mean value. The measuring points are extended approximately 0,1 m into the enclosure from the vertical centre line of each side wall at a height of 0,9 ± 0,2 m. 4. 5. 2. The temperatures of the fuel tank(s) shall be recorded by means of the sensor positioned in the fuel tank as in Section 5. 1. 1 in the case of use of the gasoline canister load option (Section 5. 1. 5). 4. 5. 3. Temperatures must, throughout the evaporative emission measurements, be recorded or entered into a data processing system at a frequency of at least once per minute. 4. 5. 4. The accuracy of the temperature recording system must be within ± 1,0 K and the temperature must be capable of being resolved to 0,4 K. 4. 5. 5. The recording or data processing system must be capable of resolving time to ± 15 seconds. 4. 6. Pressure recording 4. 6. 1. The difference Ap between barometric pressure within the test area and the enclosure internal pressure must, throughout the evaporative emission measurements, be recorded or entered into a data processing system at a frequency of at least once per minute. 4. 6. 2. The accuracy of the pressure recording system must be within ± 2 hPa and the pressure must be capable of being resolved to 0,2 ± hPa. 4. 6. 3. The recording or data processing system must be capable of resolving time to ± 15 seconds. 4. 7. Fans 4. 7. 1. By the use of one or more fans or blowers with the SHED door(s) open it must be possible to reduce the hydrocarbons concentration in the chamber to the ambient hydrocarbon level. 4. 7. 2. The chamber must have one or more fans or blowers of likely capacity 0,1 to 0,5 mV1 with which to thoroughly mix the atmosphere in the enclosure. It must be possible to attain an even temperature and hydrocarbon concentration in the chamber during measurements. The vehicle in the enclosure must not be subjected to a direct stream of air from the fans or blowers. 120 4. 8. v Gases 4. 8. 1. The following pure gases must be available for calibration and operation: - purified synthetic air (purity: < 1 ppm Cj equivalent £ 1 ppm CO, £ 400 ppm C02, £ 0,1 ppm NO); oxygen content between 18 and 21% by volume. - hydrocarbon analyzer fuel gas (40 ± 2% hydrogen, and balance helium with less than 1 ppm CY equivalent hydrocarbon, less than 400 ppm C02), - propane (C3H8), 99,5% minimum purity; - butane (C4H10), 98% minimum purity; - nitrogen (N2), 98% minimum purity. 4. 8. 2. Calibration and span gases shall be available containing mixtures of propane (C3H8) and purified synthetic air. The true concentrations of a calibration gas must be within ± 2% of stated figures. The accuracy of the diluted gases obtained when using a gas divider must be to within ± 2% of the true value. The concentrations specified in Appendix 1 may also be obtained by the use of a gas divider using synthetic air as the diluent gas. 4. 9. Additional equipment 4. 9. 1. The absolute humidity in the tests area must be measurable to within ± 5%. 5. TEST PROCEDURE 5. 1. Test preparation 5. 1. 1. The vehicle is mechanically prepared before the test as follows: - the exhaust system of the vehicle must not exhibit any leaks, - - the vehicle may be steam cleaned before the test, in the case of use of the gasoline canister load option (Section 5. 1. 5) the fuel tank of the vehicle must be equipped with a temperature sensor to enable the temperature to be measured at the mid-point of the fuel in the fuel tank when filled to 40% of its capacity, - additional fittings, adapters of devices must be fitted to the fuel system in order to allow a complete draining of the fuel tank. For this purpose it is not necessary to modify the shell of the tank. 5. 1. 2. The vehicle is taken into the test area where the ambient temperature is between 293 and 303 K (20 and 30 °C). 5. 1. 3. The ageing of the canister(s) has to be verified. This may be done by demonstrating that it has accumulated a minimum of 3 000 km. If this demonstration is not given, the following procedure is used. In the case of a multiple canister system each canister shall undergo the procedure separately. 5. 1. 3. 1. The canister shall be removed from the vehicle. Special care shall be taken during this step to avoid damage to components and the integrity of the fuel system. 121 5. 1. 3. 2. Check the weight of the canister. 5. 1. 3. 3. Connect the canister to a fuel tank, possibly an external one, filled with reference fuel, to 40% volume of the fuel tank(s). 5. 1. 3. 4. The fuel temperature in the fuel tank should be between 283 K (10 °C) and 287 K (14 °C). 5. 1. 3. 5. Heat the (external) fuel tank from 288 to 318 K (15 to 45 °C) (1 °C increase every 9 minutes). 5. 1. 3. 6. If the canister reaches breakthrough before the temperature reaches 318 K (45 *C), the heat source shall be turned off. Then weigh the canister. If the canister did not reach breakthrough during the heating to 318 K (45 °C), the procedure shall be repeated from Section 5. 1. 3. 3 until breakthrough occurs. 5. 1. 3. 7. Breakthrough may be checked as is described in Sections 5. 1. 6. 1 and 5. 1. 6. 2 of this Annex, or with the use of another sampling and analytical arrangement capable of detecting the emission of hydrocarbons "from the canister at breakthrough. 5. 1. 3. 8. Purge the canister with 25 _ 5 liters per liter of charcoal and per minute laboratory air until 300 bed volume exchanges the emission using are reached. 5. 1. 3. 9. Check the weight of the canister. 5. 1. 3. 10 Repeat nine times the steps of the procedure in Sections 5. 1. 3. 4 to 5. 1. 3. 9. The test may be terminated prior to that, after not less than three ageing cycles, if the weight of the canister after the last cycles has stabilized. 5. 1. 3. 11 Reconnect the evaporative emission canister and restore the vehicle to its normal operation condition. 5. 1. 4. One of the methods specified in Sections 5. 1. 5 and 5. 1. 6 shall be used to precondition the evaporative canister. For vehicles with multiple canisters, each canister shall be preconditioned separately. 5. 1. 4. 1. Canister emissions are measured to determine breakthrough. Breakthrough is here defined as the point at which the cumulative quantity of hydrocarbons emitted is equal to 2 grams. 5. 1. 4. 2. Breakthrough may be verified using the evaporative emission enclosure as described in Sections 5. 1. 5 and 5. 1. 6 respectively. Alternatively, breakthrough may be determined using an auxiliary evaporative canister connected downstream of the vehicle's canister. The auxiliary canister shall be well purged with dry air prior to loading. 122 5. 1. 4. 3. The measuring camber shall be purged for several minutes immediately before the test until a stable background is obtained. The chamber air mixing fan(s) must be switched on at this time. The hydrocarbon analyzer must be zeroed and spanned immediately before the test. 5. 1. 5. Canister loading with repeated heat builds to breakthrough 5. 1. 5. 1. The fuel tank(s) of the vehicle(s) is (are) emptied using the fuel tank drain(s). This must be done so as not to either abnormally purge nor abnormally load the evaporative control devices fitted to the vehicle. Removal of the fuel cap will normally be sufficient to achieve this. 5. 1. 5. 2. The fuel tank(s) is (are) refilled with test fuel at a temperature of between 283 and 287 K (10 and 14 °C) to 40 ± 2% of the tank's normal volumetric capacity. The fuel cap(s) of the vehicle must be fitted at this point. 5. 1. 5. 3. Within one hour of being refuelled the vehicle shall be placed,"with the engine shut off, in the evaporative emission enclosure. The fuel tank temperature sensor shall be connected to the temperature recording system. A heat source shall be properly positioned with respect to the fuel tank(s) and connected to the temperature controller. The heat source is specified in Section 4. 4. In the case of vehicles fitted with more than one fuel tank, all the tanks must be heated in the same way as described below. The temperatures of the tanks must be identical to within ± 1,5 K. 5. 1. 5. 4. The fuel may be artificially heated to the starting diurnal temperature of 293 K (20 °C) ± 1 K. 5. 1. 5. 5. When the fuel temperature reaches at least 292 K (19 °C), immediately: turn initiate the purge blower; close and seal enclosure doors; and off measurement of the hydrocarbon level in the enclosure. 5. 1. 5. 6. When the fuel temperature of the fuel tank reaches 293 K (20 °C) a linear ' heat build of 15 K (15 °C) begins. The fuel shall be heated in such a way that the temperature of the fuel during the heating shall conform to the function below to within i 1,5 K. The elapsed time of the heat build and temperature rise is recorded. where: Tr = T0 + 0,2333 - t Tr = required temperature (K), T0 = initial temperature (K); t = time from start of the tank heat build in minutes. — 123 5. 1. 5. 7. As soon as breakthrough occurs or when the fuel temperature reaches 308 K (35 °C), whichever occurs first, the heat source shall be turned off, the enclosure doors shall be unsealed and opened, and the vehicle fuel tank cap(s) shall be removed. If breakthrough has not occurred by the time the fuel temperature reaches 308 K (35 °C), the heat source shall be removed from the vehicle, the vehicle shall be removed from the evaporative emission enclosure and the entire procedure outlined in Section 5. 1. 7. shall be repeated until breakthrough occurs. 5. 1. 6. Butane loading to breakthrough 5. 1. 6. 1. If the enclosure is used for the determination of the breakthrough (see Section 5. 1. 4. 2) the vehicle shall be placed, with the engine shut off, in the evaporative emission enclosure. 5. 1. 6. 2 Prepare the evaporative emission canister for the canister loading operation. The canister shall not be removed from the vehicle, unless access to the canister in its normal location is so restricted that loading can only reasonably be accomplished by removing the canister from the-vehicle. Special care shall be taken during this step to avoid damage to the components and the integrity of the fuel system. 5. 1. 6. 3. Load the canister with a mixture composed of 50 percent butane and 50 percent nitrogen by volume at a rate of 40 grams butane per hour. 5. 1. 6. 4. As soon as the canister reaches breakthrough, the vapour source shall be shut off. 5. 1. 6. 5. Reconnect the evaporative emission canister and restore the vehicle to its normal operation condition. 5. 1. 7. Fuel drain and refill 5. 1. 7. 1. The fuel tank(s) of the vehicle(s) is (are) emptied using the fuel tank drain(s). This must be done so as not to either abnormally purge nor abnormally load the evaporative control devices fitted to the vehicle. Removal of the fuel cap will normally be sufficient to achieve this. 5. 1. 7. 2. The fuel tank(s) is (are) refilled with test fuel at a temperature of between 291 ± 8 K (18 ± 8 °C) to 40 ± 2% of the tank's normal volumetric capacity. The fuel cap(s) of the vehicle must be fitted at this point. 5. 2. Preconditioning drive 5. 2. 1. Within one hour from the completing of canister loading in Section 5. 1. 5. or 5. 1. 6 the vehicle is placed on the chassis dynamometer and is driven through one Part One and two Part Two driving cycles of Type I test as specified in Annex III. Exhaust emissions are not sampled during this operation. 124 5. 3. Soak 5. 3. 1. Within five minutes of completing the preconditioning operation specified in Section 5. 2. 1 the engine bonnet must be completely closed and the vehicle driven off the chassis dynamometer and parked in the soak area. The vehicle is parked for a minimum of 12 hours and a maximum of 36 hours. The engine oil and coolant temperatures must have reached the temperature of the area of within ± 3 K at the end of the period. 5. 4. Dynamometer test 5. 4. 1. After conclusion of the soak period the vehicle is driven through a complete Type I test drive as described in Annex III (cold start urban and extra urban test). Then the engine is shut off. Exhaust emissions may be sampled during this operation and the results are not used for the purpose of exhaust emission type approval. 5. 4. 2. Within two minutes of completing the Type I test drive specified in Section 5. 4. 1 the vehicle is driven a further conditioning drive consisting of one urban test cycle (hot start) of a Type I test. Then the engine is shut off again. Exhaust emissions need not to be sampled during this operation. 5. 5. Hot soak evaporative emissions test 5. 5. 1. Before the completion of the conditioning drive the measuring chamber must be purged for several minutes until a stable hydrocarbon background is obtained. The enclosure mixing fan(s) must also be turned on at this time. 5. 5. 2. The hydrocarbon analyzer must be zeroed and spanned immediately prior to the test. 5. 5. 3. At the end of the conditioning drive the engine bonnet must be completely closed and all connections between the vehicle and the test stand disconnected. The vehicle is then driven to the measuring chamber with a minimum use of the accelerator pedal. The engine must be turned off before any part of the vehicle enters the measuring chamber. The time at which the engine is switched off is recorded on the evaporative emission measurement data recording system and temperature recording begins. The vehicle's windows and luggage compartments must be opened at this stage, if not already opened. 5. 5. 4. The vehicle must be pushed or otherwise moved into the measuring chamber with the engines switched off. 5. 5. 5. The enclosure doors are closed and sealed gas-tight within two minutes of the engine being switched off and within seven minutes of the end of the conditioning drive. 5. 5. 6. The. start of a 60 ± 0,5 minute hot soak period begins when the chamber is sealed. The hydrocarbon concentration, temperature and barometric pressure are measured to give the initial readings CHçi5 Pj and T} for the hot soak test. These figures are used in the evaporative emission calculation, Section 6. The ambient SHED temperature T must not be less than 296 K and no more than 304 K during the 60-minute hot soak period. 125 5. 5. 7. The hydrocarbon analyzer must be zeroed and spanned immediately before the end of the 60 ± 0,5 minute test period. 5. 5. 8. At the end of the 60 ± 0,5 minute test period measure the hydrocarbon concentration in the chamber. The temperature and the barometric pressure are also measured. These are the final readings CHCf, Pf and Tf for the hot soak test used for the calculation in Section 6. 5. 6. Soak 5. 6. 1. The test vehicle shall be pushed or otherwise moved to the soak area without use of the engine and shall be soaked for not less than 6 hours and not more than 36 hours between the end of the hot soak test and the start of the diurnal emission test. For at least 6 hours of this period; the vehicle shall be soaked at 293 K ± 2 K (20 °C ± 2 °C). 5. 7. Diurnal test 5. 7. 1. The test vehicle shall be exposed to one cycle of ambient temperature according to the profile specified in Appendix 2 with a maximum deviation of ± 2 K at any time. The average temperature deviation from the profile, calculated using the absolute value of each measured deviation, shall not exceed 1 K. Ambient temperatures shall be measured at least every minute. Temperature cycling shall begin when time tstart = 0, as specified in Section 5. 7. 6. 5. 7. 2. The measuring chamber shall be purged for several minutes immediately before the test until a stable background is obtainable. The chamber mixing fan(s) must also be switched on at this time. 5. 7. 3. The test vehicle, with the engine shut off and the test vehicle windows and luggage compartment(s) opened shall be moved into the measuring chamber. The mixing fan(s) shall be adjusted in such a way that it (they) maintain a minimum air circulation of 8 km/h under the fuel tank of the test vehicle. 5. 7. 4. The hydrocarbon analyser must be zeroed and spanned immediately before the test. 5. 7. 5. The enclosure doors are closed and gas-tight sealed. 5. 7. 6. Within 10 minutes of closing and sealing the doors, the hydrocarbon concentration, temperature and barometric pressure are measured to give the initial readings CHci, Pj and T{ for the diurnal test. This is the point where time tstart = 0. ' 126 5. 7. 7. The hydrocarbon analyser must be zeroed and spanned immediately before the end of the test. 5. 7. 8. The end of the emission sampling period shall occur 24 hours ± 6 minutes after the beginning of the initial sampling, as specified in Section 5. 7. 6. The time elapsed is recorded. The hydrocarbon concentration, temperature and barometric pressure are measured to give the final readings CHCf, Pf and Tf for the diurnal test used for the calculation in Section 6. This completes the evaporative emission test procedure. 6. CALCULATION The evaporative emission tests described in Section 5 allow the hydrocarbon emissions from the diurnal and hot soak phases to be calculated. Evaporative losses from each of theses phases is calculated using the initial and final hydrocarbon concentrations, temperatures and pressures in the enclosure, ' together with the net enclosure volume. The formula below is used: MHC-k V 10"4 ( ^ | - 5- <*£!-?)+ M H * « I- MHC,. Tf Ti where: MHC MHc CHC V T P = mass of hydrocarbon exiting the enclosure, in the case of fixed-volume enclosures for diurnal emission testing (grams). ,i= m a ss °f hydrocarbon entering the enclosure, in the case of fixed-volume enclosures for diurnal emission testing (grams). = measured hydrocarbon concentration in the enclosure (ppm (volume) C, equivalent), = net enclosure volume in cubic metres corrected for the volume of. the vehicle, with the windows and the luggage compartment open. If the volume of the vehicle is not determined a v o l u me of 1,42 m3 is subtracted. = ambient chamber temperature, K, = barometric pressure in kPA, - H/C = hydrogen to carbon ration, k = 1,2 • (12 + H/C); when: i f H /C H /C is the initial reading is the final reading is taken to be 2,33 for diurnal test losses, is taken to be 2,20 for hot soak losses. 127 6. 2. Overall results of test The overall hydrocarbon mass emission for the vehicle is taken to be: Houi = MDI + MHS where: Houi MDI MHs overall mass emissions of the vehicle (grams), = = hydrocarbon mass emission for diurnal test (grams). = hydrocarbon mass emission for the hot soak (grams). ' 128 Appendix 1 22. Sections 1 and 2 read as follows: • 1. 1. 1. 1. 2. CALIBRATION FREQUENCY AND METHODS All equipment must be calibrated before its initial use and then calibrated as often as necessary and in any case in the month before type-approval testing. The calibration methods to be used are described in this Appendix. Normally the series of temperatures which are mentioned firstly should be used. The series of temperatures within square brackets can alternatively be used. 2. CALIBRATION OF THE ENCLOSURE 2. 1. Initial determination of enclosure internal volume 2. 1. 1. Before its initial use, the internal volume of the chamber must be determined as follows. The internal dimensions of the chamber are carefully measured, allowing for any irregularities such as bracing struts. The internal volume of the chamber is determined from these measurements. For variable-volume enclosures, latch the enclosure to a fixed volume when the enclosure is held at an ambient temperature of 303 K (30 °C) [302 K (29 °C)]. This nominal volume shall be repeatable within ± 0,5 percent of the reported value. 2. 1. 2. The net internal volume is determined by subtracting 1,42 m3 from the internal volume of the chamber. Alternatively the volume of the test vehicle with the luggage compartment and windows open may be used instead of the 1,42 m\ 2. 1. 3. The chamber must be checked as in Section 2. 3. If the propane mass does not agree with the injected mass to within ± 2% then corrective action is required. 2 2 Determination of chamber background emissions This operation determines that the chamber does not contain any materials that emit significant amounts of hydrocarbons. The check must be carried out at the enclosure's introduction to service, after any operations in the enclosure which may affect background emissions and at a frequency of a least once per year. - 2. 2. 1. Variable-volume enclosures may be operated in either latched or unlatched volume configuration, as described in Section 2. 1. 1. Ambient temperatures shall be maintained at 308 ±2 K (35 ± 2 °C) [309 ± 2 K (36 ±2 °C)], throughout the 4-hour period mentioned below. 129 2. 2. 2. Fixed volume enclosures shall be operated with inlet and outlet flow streams closed. Ambient temperatures shall be maintained at 308 ± 2 K (35 ± 2 °C) [309 ± 2 K (36 ± 2 °C)] throughout the 4-hour period mentioned below. 2. 2. 3. The enclosure may be sealed and the mixing fan operated for a period of up to 12 hours before the 4-hour background sampling period begins. 2. 2. 4. Calibrate the analyzer (if required), then zero and span. 2. 2. 5. 2. 2. 6. 2. 2. 7. 2. 2. 8. 2. 2. 9. Purge the enclosure until a stable hydrocarbon reading is obtained. The mixing fan is turned on if not already on. Seal the chamber and measure the background hydrocarbon concentration, temperature and barometric pressure. These are the initial readings CHCi, Pj and ^ used in the enclosure background calculation. The enclosure is allowed to stand undisturbed with the mixing fan on for a period of four hours. At the end of this time use the same analyzer to measure the hydrocarbon concentration in the chamber. The temperature and the barometric pressure are also measured. These are the final readings CHCf, Pf and Tf. Calculate the change in mass of hydrocarbons in the enclosure over the time of the test according to Section 2. 4. The background emission of the enclosure must not exceed 0,05 g. 2. 3. Calibration and hydrocarbon retention test of the chamber The calibration and hydrocarbon retention test in the chamber provides a check on the calculated volume in Section 2. 1 and also measures any leak rate. The enclosure leak rate shall be determined at the enclosure's introduction to service, after any operations in the enclosure which may effect the integrity of the enclosure, and at least monthly thereafter. If six consecutive monthly retention checks are successfully completed without corrective action, the enclosure leak rate may be determined quarterly thereafter as long as no corrective action is required. 2. 3. 1. 2. 3. 2. 2. 3. 3. Purge the enclosure until a stable hydrocarbon concentration is reached. Turn on the mixing fan, if not already switched on. The hydrocarbon analyzer is zeroed, calibrated if required, and spanned. On variable-volume enclosures latch the enclosure to the nominal volume position. On fixed-volume enclosures close the outlet and inlet flow streams. Turn on the ambient temperature control system (if not already on) and adjust it for an initial temperature of 308 K (35 °C) [309 K (36 °C)]. 130 2. 3. 4. When the enclosure stabilizes at 308 ± 2 K (35 ± 2 "C) [309 ± 2 K (36 ± 2 °C)], seal the enclosure and measure the background concentration, temperature and barometric pressure. These are the initial readings CHCi, P{ and Tj used in the enclosure calibration. 2. 3. 5. Inject a quantity of approximately 4 grams of propane into the enclosure. The mass of propane must be measured to an accuracy and precision of ± 0,2% of the measured value. 2. 3. 6. Allow the contents of the chamber to mix for five minutes and then measure the hydrocarbon concentration, temperature and barometric pressure. These are the final readings CHCft Tf and Pf for the calibration of the enclosure as well as the initial readings CHCi, T} and P} for the retention check. 2. 3. 7. Using the readings taken in Sections 2. 3. 4 and 2. 3. 6 and the formula in Section 2. 4, calculate the mass of propane in the enclosure. This must be within ± 2% of the mass of propane measured in Section 2. 3. 5. 2. 3. 8. 2. 3. 9. For variable-volume enclosures unlatch the enclosure from the" nominal volume configuration. For fixed-volume enclosures, open the outlet and inlet flow streams. Start cycling the ambient temperature from 308 K (35 °C) to 293 K (20 °C) and back to 308 K (35 °C) [308,6 K (35,6 °C) to 295,2 K (22,2 °C) and back to 308,6 K (35,6 °C)] over a 24-hour period according to the profile [alternative profile] specified in Appendix 2 within 15 minutes of sealing the enclosure. (Tolerances as specified in Section 5. 7. 1 of Annex VI) 2. 3. 10. At the completion of the 24-hour cycling period, measure and record the final hydrocarbon concentration, temperature and barometric pressure. These are the final readings CHCf, Tf and Pf for the hydrocarbon retention check. 2. 3. 11. Calculate using the formula in Section 2. 4, the hydrocarbon mass from the readings taken in Sections 2. 3. 10 and 2. 3. 6. The mass may not differ by more than 3% from the hydrocarbon mass given by Section 2. 3. 7. 131 2. 4. Calculations The calculation of net hydrocarbon mass change within the enclosure is used to determine the chamber's hydrocarbon background and leak rate. Initial and final readings of hydrocarbon concentration, temperature and barometric pressure are used in the following formula to calculate the mass change. Mnc-k V 10"4 {9^L- Ç ^J + MHC. M-MHC,. where: MHc = hydrocarbon mass in grams MHCou1 = mass of hydrocarbon exiting the enclosure, in the case of fixed-volume enclosures for diurnal emission testing (grams) MHc,i = m a ss °f hydrocarbon entering the enclosure, in the case of fixed volume enclosures for diurnal emission testing (grams) hydrocarbon concentration (NB: ppm carbon = ppm propane x 3)) in the enclosure (ppm carbon = enclosure volume in cubic mêtrbslas measured in Section = ambient temperature in the enclosure, K, = barometric pressure, kPa, = 17,6; 'HC V T P k when: i f is the initial reading. is the final reading' 132 Appendix 2 23. The following new Appendix 2 is added: 'Appendix 2 Diurnal Ambient Temperature Profile for the Calibration of the Enclosure and the Diurnal Emission Test Alternative Diurnal Ambient Temperature Profile for the Calibration of the Enclosure in Accordance with Annex I Section 1. 2 , Time (hours) Temperature (°Q) calibratio test Time (hours) Temperature (°C. ) 16 17 18 19 20 21 22 23 24 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 20 20,2 20,5 21,2 23,1 25,1 27,2 29,8 31,8 33,3 34,4 35 34,7 33,8 32 30 28,4 26,9 25,2 24 23 22 20,8 20,2 20 Ô 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 35^1 35,3 34,5 33,2 31,4 29,7 28,2 27,2 26,1 25,1 24,3 23,7 23,3 22,9 22,6 22,2 22,5 24,2 26,8 29,6 31,9 33,9 35,1 35,4 35,6 133 Annex VIII 24. Annex VIII reads as follows: •ANNEX VIII SPECIFICATIONS OF REFERENCE FUELS 1 TECHNICAL DATA OF THE REFERENCE FUEL TO BE USED FOR TESTING VEHICLES EQUIPPED WITH POSITIVE-IGNITION ENGINES Type: petrol, unleaded (regular, premium, super) Parameter Unit Limits(1) Test Method(2) Minimum Maximum Research octane number, RON Motor octane number, MON Density at 15 °C Reid vapour pressure, - summer period*} Distillation(4): - initial boiling point - evaporated at 100 °C - evaporated at 150 °C - final boiling point Residue Hydrocarbon analysis: - olefins - aromatics - benzene - saturates Carbon/hydrogen ratio Oxidation staf3ility(} Oxygen content Existent gum Sulphur content Copper corrosion at 50 °C Lead content Phosphorous content 95,0 85,0 0,748 56,0 24 49,0 81,0 190 8 29,0 balance r a 480 ISO 5164 ISO 5163 0,762 ASTM D 1298 60,0 40 57,0 87,0 215 2 14 41,0 2,0 t i o 2Ï3 0,04 150 1 0,005 0,0013 EN 12 ASTM D 86 ISO 3405 ISO 3405 ASTM D 86 ASTM D 86 ASTMD1319 ASTMD1319 EN 238 ASTMD 1319 ASTM D 525 pr EN 1601 ASTMD 381 ISO 8754 ASTMD 130 EN 237 ASTMD 3231 kg/l kPa °C % v/v % v/v °C % , % v/v % v/v % v/v min % m/m mg/ml % ppm g/l (1) (2) (3) (4) (5) The values quoted in the specification are 'true values'. In establishment of their limit values the terms of ISO 4259 'Petroleum products - Determination and application of precision data in relation to methods of test' have been appliea and in fixing a minimum value, a minimum difference of_2R above zero has been taken into account; in fixing a maximum and minimum value, the minimum difference is 4R (R = reproducibility). Notwithstanding this measure which is necessary for statistical reasons, the manufacturer or fuels should nevertheless aim at a zero value where the stipulated maximum value is 2R and at the mean value in the case of quotations of maximum and minimum limits. Should it be necessary to clarify the question as to whether a fuel meets the requirements of the specifications, the terms of ISO 4259 should be applied. Equivalent ISO methods will be adopted when issued for all properties listed above. The summer period extends from 1 April to 30 September of each year. The figures quoted shows the evaporated quantities (percentage recovered + percentage loss). The fuel may contain exidation inhibitors and metal deactivators normally used to stabilize refinery gasoline streams, but détergent/dispersant additives and solvent oils must not oe added. 134 TECHNICAL DATA OF THE REFERENCE FUEL TO BE USED FOR TESTING VEHICLES EQUIPPED WITH A DIESEL ENGINE Type: Diesel fuel Parameter Unit Limits(1) Test Method(2) Minimum Maximum 52,0 833 245 345 55 2,5 3 Cetane number1^ Density at 15 °C Distillation(4): - 50% point - 95% point - final boiling point Flash point CFPP Viscosity at 40 °C Polycyclic aromatic hydrocarbons Sulphur content Copper corrosion Conradson carbon residue (10% DR) Ash content Water content Neutralization (strong acid) number Oxidation stability(6) kg/m3 °C °C °c °c °c mm2/s % m/m % m/m % mass % mass % mass mg KOH/g mg/ml 54 837 350 370 -5 3,5 6,0 0,03 1 0,2 0,01 0,05 0,02 2,5 ISO 5163 ISO 3675 ISO 3405 ISO 3405 ISO 3405 ASTM D 93 EN 116 ASTM D 445 prIP 391 ISO 8754 ASTMD 130 ASTMD 189 ASTM D 482 ASTM D95/D 1744 ASTM 2274 (1) (2) (3) (4) (5) (6) The values quoted in the specification are 'true values'. In establishment of. their limit values the terms of ISO 4259 'Petroleum products - Determination and application of precision data in relation to methods of test' have been applied and in fixing a minimum value, a minimum difference of 2R above zero has been taken into account; in fixing a maximum and minimum value, the minimum difference is 4R (R = reproducibility). Notwithstanding this measure, which is necessary for statistical reasons, the manufacturer of fuels should nevertheless aim at a zero value where the stipulated maximum value is 2R and at the mean value in the case of quotations of maximum and minimum limits. Should it be necessary jto clarify the question as to whether a fuel meets the requirements of the specifications, the terms of ISO 4259 should be applied. Equivalent ISO methods will be adopted when issued for all properties listed above. The range for cetane number is not in accordance with the requirement of a minimum range of 4R. However, in the case of dispute between fuel supplier and fuel user, the terms in ISO 4259 can be used to resolve such disputes provided replicate measurements of sufficient number to archive the necessary precision, are made in preference to single determinations. The figures quoted shows the evaporated quantities (percentage recovered + percentage loss). As from 1 January 2005. Even though oxidation stability is controlled, it is likely that self life will be limited. Advice should be sought from the supplier as to storage conditions and life. 135 Annex X 25. A new Annex X is added to read as follows: Annex X CONTROL OF COMPLIANCE OF VEHICLES IN SERVICE 1. INTRODUCTION 1. 1. This Annex describes the procedure referred to in Section 8 of Annex I for the control of compliance of vehicles in service. The procedure describes the selection and handling of test vehicles, in service survey testing and evaluation, the plan of remedial measures and its implementation. 2. IN SERVICE SURVEY 2. 1. 2. 2. 2. 3. The in service survey will be performed by the approval authority which granted the original type-approval according to this Directive, according to procedures laid down in Section 5. The manufacturer shall be notified whenever the approval authority in a Member State, which granted the original type-approval in accordance with this directive, has determined that a vehicle type produced by that manufacturer, although properly maintained and used, does not conform to these provisions. When a manufacturer is notified that a vehicle type is in non-compliance with applicable requirements (including emission limit values) of this Directive, the manufacturer shall submit a plan of measures to the approval authority to remedy such non-compliance. 2. 4. Any vehicle approved according to the requirements of this Directive is subject to the provisions in this Annex. 3. DEFINITIONS For the purpose of this Annex the following definitions apply. 3. 1. 3. 2. 3. 3. The terms used in this Annex X and not specifically defined shall have the meaning assigned to such terms in Annex I to this Directive, or if not defined in Annex I to this Directive, the meaning assigned to such terms in Directive 70/156/EEC. Tn Service Survey' means tests and evaluations of compliance conducted according to this Annex. 'Properly maintained and used' means for the purpose of a test vehicle that such a vehicle satisfies the criteria for acceptance of a selected vehicle of Section 5. 4. SURVEY SCHEDULE 4. 1. 4. 2. The manufacturer will be notified 45 working days before the initiation of the in service survey of a vehicle type. * The manufacturer may submit a voluntary plan of remedial measures, drafted according to Section 6 at any time prior to completion of an in service survey. 136 5. SELECTION CRITERIA, MAINTENANCE, AND SURVEY TEST 5. 1. 5. 2 Emission tests and evaluations to determine whether a vehicle type conforms to the requirements shall be performed in accordance with the procedures of Section 5. The manufacturer shall have an opportunity to observe all the selection and testing and to inspect all vehicles tested under Section 5. In service survey testing of the on-board diagnostic system shall be performed in accordance with Section 5. 5. Sections 5. 2, 5. 3 and 5. 4 do not apply under OBD survey. The approval authority shall select vehicles for in service survey on a random base chosen in accordance with Appendix 1 to this Annex from vehicles within the selected vehicle type. The approval authority determines the vehicle selection. The vehicles for testing shall be representative of the vehicle type which they belong to and available for sale or sold in the EU. Selection criteria 5. 3. The criteria for acceptance of a selected vehicle follows from Sections 5. 3. 1 - 5. 3. 8. Information will be gathered through vehicle examination and a interview with the owner which may include a written survey by the manufacturer. 5. 3. 1. The vehicle belongs to a vehicle type that is type-approved under this Directive and is accompanied with a Certificate of Conformity according to Directive 70/156/EEC. It shall be registered and privately used in the EU. 5. 3. 2. The vehicle has been in service for less than 80 000 km or 5 years which ever occurs first. 5. 3. 3. There is a maintenance record to show that the vehicle has been properly maintained, e. g. has been serviced in accordance with the manufacturer's recommendations. 5. 3. 4. There is no indication of abuse (e. g. , racing, overloading, misfuelling, or other misuse), or other factors (e. g. , tampering) that would affect emissions performance. In the case of vehicles fitted with an OBD system, the information stored in its memory shall be taken into account. 5. 3. 5 There has been no unauthorized major repair to the engine or major repair of the vehicle. 5. 3. 6. Lead content and sulphur content of fuel sample from the vehicle tank meets applicable standards and there is no other evidence of misfuelling. Checks may be done in the exhaust pipe, etc. 5. 3. 7. There is no indication of any problem that might jeopardize the safety of laboratory personnel. 5. 3. 8. All emission control system components on the vehicle shall be in conformity with applicable type approval. 137 Diagnosis and restorative maintenance 5. 4. Diagnosis and restorative maintenance will be performed on vehicles accepted for testing, prior to in service survey testing, according to Sections 5. 4. 1-5. 4. 8. 5. 4. 1. Check air filter, all drive belts, all fluid levels, radiator cap, all vacuum hoses and electrical wiring related to emissions control for integrity; check ignition, fuel metering and emission control system components for maladjustments and/or tampering. Record all discrepancies. 5. 4. 2. Check the integrity of the OBD system; record all malfunction information stored in the OBD memory; make all repairs necessary for extinguishing all malfunction indications. 5. 4. 3. If the OBD malfunction indicator registers a malfunction during a preconditioning cycle or emission test cycle, the fault may be identified and repaired. The test may be rerun, and the results from that repaired vehicle may be used. 5. 4. 4. Check ignition system and replace defective components; i. e. , spark plugs, wires, etc. 5. 4. 5. Check compression. 5. 4. 6. Check and adjust engine parameters to manufacturer's specifications. 5. 4. 7. If the vehicle is [before]within 800 km of a scheduled maintenance service, that maintenance will be performed according to the manufacturer's service instructions. Regardless of odometer reading, change of oil and air filter may be performed at the request of the manufacturer. 5. 4. 8. Upon acceptance of the vehicle the fuel shall be replaced with appropriate emission test reference fuel, unless the manufacturer accepts1 the use of market fuel. 5. 5. 5. 6. In service survey testing and evaluation of results Applicable emission tests in accordance with this Directive will be performed on vehicles selected in accordance with the requirements of Sections 5. 3 and 5. 4 and after being pre-conditioned. Vehicles equipped with an OBD system will be checked for proper durability indication, etc. , in relation to levels of -emissions of the malfunction (e. g. malfunction the indication type-approved specification. in Annex XI) limits defined for 5. 6. 1. The OBD system may be tested for, e. g. , levels of emissions above applicable limit values with no malfunction indication, systematic erroneous activation of faulty or deteriorated components in the OBD system. the malfunction indication, and identified 5. 6. 2. If a component or system that operates outside of the particulars in the type- approval certificate and/or information package for such vehicle type and such deviation has not been authorized under Article 5 (3) or 5 (4) of Directive 70/156/EEC with no malfunction indication by the OBD, the component or system shall not be replaced prior to emission testing, unless it is determined that the component or system has been tampered with or abused in such a manner that the OBD does not detect the resulting malfunction. 138 5. 7. 5. 8. 5. 9. The test results are submitted to the evaluation procedure in accordance with Appendix 1 of this Directive. Within 10 working days after concluding the test, the results of the test and of the evaluation referred to in Section 5. 7 shall be submitted to the manufacturer. The manufacturer shall have, as far as possible, the opportunity to make such inspections and investigations of vehicles whose test results do not comply with the limit value for any pollutant applicable under this Directive to determine the existence of any improper maintenance, misuse, misfuelling, tampering or abuse that was not reasonably discoverable prior to the commencement of testing. 5. 10. Within 25 working days from receiving the test results, the manufacturer may submit a statement based on additional investigation on sample vehicles to the authority concerning the performance of the testing or the determination of a non-compliance. The statement, if any, will be enclosed in the test report. The authority shall give due regard to the manufacturer's statement in determing whether a non-compliance exists. 5. 11. Within 10 working days after the time limit of Section 5. 10 has elapsed, the authority shall finalize the test report and take a decision on compliance and non-compliance. Non-compliance shall be declared when for any single pollutant the result of the evaluation referred in Section 5. 7 exceed the limit values given in Section 5. 3. 1. 4 of Annex I to this Directive. Test results shall not be multiplied by deterioration factors. 6. PLAN OF REMEDIAL MEASURES 6. 1. 6. 2. When the manufacturer is notified that a vehicle type is in non-compliance according to the requirements of these provisions, the manufacturer shall submit to the approval authority a plan of remedial measures to remedy the non-compliance. These plan of remedial measures can address vehicles in service, vehicles under production as well as amendements to the type- approval, if appropriate. The plan of remedial measures shall be filed with the approval authority not later than 45 working days from the date of the notification issued according to Section 5. 10. The approval authority shall within 20 working days declare the approval or disapproval of the plan of remedial measures. 6. 2. 1. The accaptence of the plan of remedial measures may be subject to conditions required by the approval authority. - 6. 2. 2. The approval authority may specify an extended time limit for submitting a plan of remedial measures by up to 60 working days if the manufacturer in writing showed good cause for such extension. 6. 2. 3. When the approval authority cannot approve the plan of remedial measures it may take other measures in accordance with Article 11 (2) (a) to Directive 70/156/EEC. 6. 3. The approval authority shall notify all Member States of its decision concerning the plan of remedial measures and supply all Member States with the plan of remedial measures. 139 The plan of remedial measures 6. 4. The plan of remedial measures shall have the content specified in Sections 6. 4. 1 - 6. 4. 11. The manufacturer shall give the plan of remedial measures a unique identifying name or number. 6. 4. 1. A description of each vehicle type included in the plan of remedial measures. 6. 4. 2. A description of the specific modifications, alterations, repairs, corrections, adjustments, or other changes to be made to bring the vehicles into conformity including a brief summary of the data and technical studies which support the manufacturer's decision as to the particular remedial changes to be used in correcting the non-compliance. 6. 4. 3. A description of the method by which the manufacturer will inform the vehicle owners. 6. 4. 4. A description of the proper maintenance or use, if any, upon which the manufacturer conditions eligibility for repair under the plan of "remedial measures, and an explanation of the manufacturer's reasons for imposing any such condition. No maintenance or use conditions may be imposed unless it is demonstrably related to the non-compliance and the remedial measures. 6. 4. 5. A description of the procedure to be followed by vehicle owner to obtain correction of the non-compliance. This shall include a date after which when the non-compliance may be remedied, the estimated time for the workshop to perform the remedy, and where the remedy can be done. The repair shall be done expediently, within a reasonable time after delivery of the vehicle. 6. 4. 6. A copy of the information transmitted to the vehicle owner. 6. 4. 7. A brief description of the system which the manufacturer will use to assure an adequate supply of component or system, for fulfilling the remedial action. It shall be indicated when there will be an adequate supply of component or system to initiate the campaign. 6. 4. 8. A copy of all instructions to be sent to those persons who are to perform the repair. 6. 4. 9. A description of the impact of the proposed remedy on the emissions, fuel consumption, driveabiliry, and safety of each vehicle type, included the plan of remedial measures with data, technical studies etc. which supports these conclusions. 6. 4. 10. Any other information, reports or data the approval authority reasonably may determine is necessary to evaluate the plan of remedial measures. 6. 4. 11. In the case the plan of remedial measures includes a recall, a description of the méthode for recording the repair shall be submitted to the type approval authority. In the case a label is used an exemple of it shall be submitted. 6. 5. 6. 6. The manufacturer may be required to conduct tests on components and vehicles incorporating a proposed change, repair, or modification reasonably designed and necessary to demonstrate the effectiveness of the change, repair, or modification. The manufacturer is responsible for keeping a record of every vehicle recalled and repaired and the workshop which performed the repair. The approval authority shall have access to the record after request for a period of 5 years from the implementation of the plan of remedial measures. 140 7. 7. 1. IMPLEMENTATION OF THE PLAN OF REMEDIAL MEASURES A recall campaign is commencing after decision by the Member State, based on the approved plan of remedial measures. The manufacturer, or his/her representative, is responsible for conducting the campaign according to the approved plan of remedial measures. 7. 1. 1. If theplan of remedial measures is not carried in the approved time limits fixed in the remedial plan and the manifacturer cannot justify the exceed of the time limits, the approval authority can take measures in accordance with Article ll(2)(a) to Directive 70/156/EEC. 7. 2. 7. 3. The notification of the vehicle owner shall be done expeditiously. This notification shall include all relevant information relating the necessary repair of the vehicle. The manufacturer shall provide a copy of all communication related to the plan of remedial measures. He/she shall also maintain a record onlhe recall campaign, and supply regularly status reports to the approval authority. 141 Annex XI 26. A new Annex XI is added to read as follows: Annex XI ONBOARD DIAGNOSTICS (OBD) FOR MOTOR VEHICLES 1. SCOPE This Annex applies to the functional aspects of on-board diagnostic (OBD) systems for the emission control of all motor vehicles of category M,(1)) equipped with positive-ignition engines and all motor vehicles of categories Mi equipped with compression-ignition engines covered by Article 1 of this Directive. 2. DEFINITIONS For the purposes of this Annex: 2. 1. 2. 2. 2. 3. 2. 4. 2. 5. 2. 6. 2. 7. 'OBD' means an on-board diagnostics system for emission control which shall have the capability of identifying the likely area of malfunction by means of fault codes stored in computer memory. 'Vehicle type' means a category of power driven vehicles which do not differ in such essential engine and OBD system characteristics as defined in Appendix 5. 'Vehicle family' means a manufacturer's grouping of vehicles which, through their design, are expected to have similar exhaust emission and OBD system characteristics. Each engine of this family must have complied with the requirements of this Directive. 'Emission control system' means the electronic engine management controller and any emission related component in the exhaust or evaporative system which supplies an input to or receives an output from this controller. 'Malfunction indicator (MI)' means a visible or audible indicator that clearly informs the driver of the vehicle in the event of a malfunction of any emission related component connected to the OBD system, or the OBD system itself. 'Malfunction' means the failure of an emission related component or system that would result in emissions exceeding the limits in Section 5. 3. 2 of this Annex. 'Secondary air' refers to air introduced into the exhaust system by means of a pump or aspirator valve or other means that is intended to aid in the oxidation of HC and CO contained in the exhaust gas stream. (1) As defined in Annex II Section A of Directive 70/156/EEC. 142 2. 8. 2. 9. 2. 10. 2. 11. 2. 12. 2. 13. 'Engine misfire' means lack of combustion in the cylinder of a positive ignition engine due to absence of spark, poor fuel metering, poor compression or any other cause. In terms of OBD monitoring it is that percentage of misfires out of a total number of firing events (as declared by the manufacturer) that would result in emissions exceeding the limits given in Section 5. 3. 2 or that percentage that could lead to an exhaust catalyst, or catalysts, overheating causing irreversible damage. 'Type I test' means the driving cycle (Parts One and Two) used for emission approvals, as detailed in Annex III, Appendix 1. 'A driving cycle' consists of engine start-up, a driving mode where a malfunction would be detected if present, and engine shut-off. 'A warm-up cycle1 means sufficient vehicle operation such that the coolant temperature has risen by at least 22 K from engine starting and reaches a minimum temperature of 343 K (70 °C). 'Fuel trim' refers to feedback adjustments to the base fuel schedule. Short-term fuel trim refers to dynamic or instantaneous adjustments. Long-term fuel trim refers to much more gradual adjustments to the fuel calibration schedule than short-term trim adjustments. These long-term adjustments compensate for vehicle differences and gradual changes that occur over time. 'Calculated load value' refers to an indication of the current airflow divided by peak airflow, where peak airflow is corrected for altitude, if available. This definition provides a dimensionless number that is not engine specific and provides the service technician with an indication of the percent engine capacity that is being used (with wide open throttle as 100%); CLV - Current airflow Peak aIrflow(al sea lev$l , Atm. pressure(at sea levfl Barometric pressure 2. 14. 'Permanent emission default mode' refers to a case where the engine management controller permanently switches to a setting that does not require an input from a failed component or system where such a failed component or system would result in an increase in emissions from the vehicle to a level above the limits given in Section 5. 3. 2 of this Annex. 2. 15. 'Power Take-Off unit' means an engine driven output provision for the purposes of powering auxiliary, vehicle mounted, equipment. 143 3. 3. 1. APPLICATION FOR EC TYPE-APPRO VAL The application conforming to Annex I, Section 3 is accompanied by the additional information required in Appendix 5 together with: 3. 1. 1. a declaration by the manufacturer of: 3. 1. 1. 1. in the case of vehicles equipped with positive-ignition engines, the percentage of misfires out of a total number of firing events that would result in emissions exceeding the limits given in Section 5. 3. 2 of this Annex if that percentage of misfire had been presem from the start of a Type I test as described in Section 5. 3. 1 of Annex III; 3. 1. 1. 2. in the case of vehicles equipped with positive-ignition engines, the percentage of misfires out of a total number of firing events that could lead to an exhaust catalyst, or catalysts, overheating prior to causing irreversible damage; 3. 1. 2. 3. 1. 3. 3. 1. 4. 3. 1. 5. detailed written information fully describing the functional "operation characteristics of the OBD system, including a listing of all relevant parts of the vehicle's emission control system, i. e. sensors, actuators and components, that are monitored by the OBD system; a description of the MI used by the OBD system to signal the presence of a fault to the driver of the vehicle; the manufacturer shall describe provisions taken to prevent tampering and modification of the emission control computer; when appropriate, copies of other type-approvals with the relevant data to enable extensions of approvals; 3. 1. 5. 1. if applicable, the particulars of the vehicle family as referred to in Appendix 6. 3. 2. 4. 4. 1. 5. 5. 1. For the tests described in Section 5 of this Annex, a vehicle representative of the vehicle types or vehicle family fitted with the OBD system to be approved must be submitted to the technical service responsible for the type-approval test. If the technical service determines that the submitted vehicle does not fully represent the vehicle type or vehicle family described in Appendix 6, an alternative, and if necessary, an additional vehicle shall be submitted for test according to Section 5 of this Annex. GRANTING OF EC TYPE-APPROVAL The certificate conforming to Annex I, Section 4, is accompanied by the Addendum for which a model is given in Appendix 7. REQUIREMENTS AND TESTS All vehicles shall be equipped with an OBD system so designed, constructed and installed in a vehicle to enable it to identify types of deterioration or malfunction over the entire life of the vehicle. In achieving this objective the approval authority shall accept that vehicles which have travelled distances in excess of the Type V durability distance, referred to in Section 5. 3. 1, may show some deterioration in OBD systeih performance such that the emission limits given in Section 5. 3. 2 may be exceeded before the OBD system signals a failure to the driver of the vehicle. 144 5. 2. The OBD system must be so designed, constructed and installed in a vehicle to enable it to comply with the requirements of this Annex during conditions of normal use. 5. 2. 1. Temporary disablement of the OBD system. 5. 2. 1. 1. A manufacturer may disable the OBD system if its ability to monitor is affected by low fuel levels. Disablement shall not occur when the fuel tank level is above 15 percent of the nominal capacity of the fuel tank. level provided 5. 2. 1. 2. A manufacturer may disable the OBD system at ambient engine starting temperatures below 266 K (-7 °C) or at elevations over 2 500 metres above sea an engineering evaluation which adequately demonstrate that monitoring would be unreliable when such conditions exist. A manufacturer may also request disablement engine system starting temperatures if he demonstrates to the authority with data and/or an engineering evaluation that mis-diagnosis would occur under such conditions. the manufacturer submits data the OBD ambient and/or other of at 5. 2. 1. 3. For vehicles designed to accommodate the installation of Power Take-Off units, disablement of affected monitoring systems is permitted provided disablement occurs only when the Power Take-Off unit is active. 5. 2. 2. Engine Misfire - vehicles equipped with positive-ignition engines. 5. 2. 2. 1. Manufacturers may adopt higher misfire percentage malfunction criteria, than that declared to the authority, under specific engine speed and load conditions where it can be demonstrated to the authority that the detection of lower levels of misfire wouH be unreliable. 5. 2. 2. 2. Manufacturers who can demonstrate to the authority that the adoption of higher misfire percentages would still lead to unreliable detection may disable the monitoring system when such conditions exist. 5. 3. Description of tests. 5. 3. 1. The tests are carried out on the vehicle used for the Type V durability test, given in Annex VII, and using the test procedure in Appendix I to this Annex. Tests are carried out at the conclusion of the Type V durability testing. When no Type V durability testing is carried out, or at the request of the manufacturer, a suitably aged and representative vehicle may be used for these OBD demonstration tests. 5. 3. 2. The OBD system shall indicate the failure of an emissions related component or system when that failure results in an increase in emissions above the limits given below: Engine Type Positive-ignition Compression-ignition CO (g/km) 3,2 3,2 HC (g/km) 0,4 0,4 NOx (g/km) 0,6 1,2 PM°> (g/km) 0,18 (1) for compression-ignition engines only 145 5. 3. 3. Monitoring requirements for vehicles equipped with positive-ignition engines In satisfying the requirements of Section 5. 3. 2 the OBD system shall, at a minimum, monitor for: 5. 3. 3. 1. Reduction in the efficiency of the catalytic converter with respect to the emissions of HC only; 5. 3. 3. 2. The presence of engine misfire in the engine operating region bounded by the following lines: (a) A maximum speed of 4 500 min"1 or 1 000 min"1 greater than the highest speed occurring during a Type I test cycle, whichever is the lower; (b) The positive torque line (i. e. engine load with the transmission in neutral); (c) A line joining the following engine operating points: the positive torque line at 3 000 min"1 and a point on the maximum speed line defined in (a) above with the engine's manifold vacuum at 13,33 kPa lower than that at the positive torque line. 5. 3. 3. 3. Oxygen sensor deterioration 5. 3. 3. 4. Other emission control system components or systems, or emission-related powertrain components or systems which are connected to a computer, the failure of which may result in tailpipe emissions exceeding the limits given in Section 5. 3. 2; 5. 3. 3. 5. Any other emission-related powertrain component connected to a computer shall be monitored for circuit continuity; 5. 3. 3. 6. The electronic evaporative emission purge control shall, at a minimum, be monitored for circuit continuity. 5. 3. 4. Monitoring requirements for vehicles equipped with compression-ignition engines. In satisfying shall monitor: the requirements of Section 5. 3. 2 the OBD system 5. 3. 4. 1. Where fitted, reduction in the efficiency of the catalytic converter; 5. 3. 4. 2. Where fitted, the functionality and integrity of the particulate trap; 5. 3. 4. 3. The fuel injection system electronic fuel quantity and timing actuator(s) will be. monitored for circuit continuity and total functional failure; 5. 3. 4. 4. Other emission control system components or systems, or emission-related powertrain components or systems, which are connected to a computer, the failure of which may result in tailpipe emissions exceeding the limits given in Section 5. 3. 2. Examples of such systems or components are those for monitoring and control of air mass-flow, air volumetric flow (and temperature), boost pressure and inlet manifold pressure (and relevant sensors to enable these functions to be carried out). 5. 3. 4. 5. Any other emission-related powertrain component connected to a computer shall be monitored for circuit continuity. 146 5. 3. 5. Manufacturers may demonstrate to the approval authority that certain components or systems need not be monitored if, in the event of their total failure or removal, emissions do not exceed the emission limits given in Section 5. 3. 2 of this Annex. 5. 4. A sequence of diagnostic checks will be initiated at each engine start and completed at least once provided that the correct test conditions are met. The test conditions shall be selected in such a way that they all occur under normal driving as represented by the Type I test. 5. 5. Activation of malfunction indicator. 5. 5. 1. 5. 5. 2. The OBD system shall incorporate a malfunction indicator (MI) readily perceivable to the vehicle operator. The MI shall not be used for any other purpose except to indicate emergency start-up or limp-home routines to the driver. The MI shall be in all reasonable lighting conditions. When activated, it shall display a symbol in conformance with ISO 2575(2)). A vehicle shall not be equipped with more than one general purpose MI for emission-elated problems. Separate specific purpose warning lights (e. g. brake system, fasten seat belt, oil pressure, etc. ) are permitted. The use of red for a MI is prohibited. For strategies requiring on average between three and ten driving cycles for MI activation, the manufacturer shall provide data and/or an engineering evaluation which adequately demonstrates that the monitoring system is equally effective and timely in detecting component deterioration. Strategies requiring on average more than ten driving cycles for MI activation shall not be accepted. The MI shall also activate whenever the engine control enters a permanent emission default mode of operation if the emission limits given in Section 5. 3. 2 are exceeded. The MI shall operate in a distinct warning mode, e. g. a flashing light, under any period during which engine misfire occurs at a level likely to cause catalyst damage, as specified by the manufacturer. The MI shall also activate when the vehicle's ignition is in the "key-on" position before engine starting or cranking and de activate after engine starting if no malfunction has previously been detected. 5. 6. Fault code storage. The OBD system shall record code(s) indicating the status of the emission control system. Separate status codes shall be used to identify correctly functioning emission control systems and those emission control systems which need further vehicle operation to be fully evaluated. Fault codes that cause MI activation due to deterioration or malfunction or permanent emission default modes of operation shall be stored and that fault code shall identify the type of malfunction. 5. 6. 1. In the case of vehicles equipped with positive-ignition engines, misfiring cylinders need not be uniquely identified if a distinct single or multiple cylinder misfire fault code is stored. (2) International Standard ISO 2575-1982 (E), entitled "Road vehicles - Symbols for controls, indicators and tell-tales", Symbol Number 4. 36. 147 5. 7. Extinguishing the MI. 5. 7. 1. 5. 7. 2. For misfire malfunctions at levels likely to cause catalyst damage (as specified by the manufacturer), the MI may be switched to the normal mode of activation if the misfire is not present any more, or if the engine is operated after changes to speed and load conditions where the level of misfire will not cause catalyst damage. For all other malfunctions, the MI may be de-activated after three subsequent sequential driving cycles during which the monitoring system responsible for activating the MI ceases to detect the malfunction and if no other malfunction has been identified that would independently activate the MI. 5. 8. Erasing a fault code. 5. 8. 1. The OBD system may erase a fault code and freeze-frame information if the same fault is not re-registered in at least 40 engine warm-up cycles. 5. 9. Provisions for system security. 5. 9. 1. 5. 9. 2. 5. 9. 3. 5. 9. 4. Any vehicle with an emission control computer shall include features to deter modification, except as authorized by the manufacturer. Any reprogrammable computer codes or operating parameters must be resistant to tampering and the computer and any related maintenance instructions must conform to the provisions in SAE J2186 "E/E Data Link Security" (ISO XXX-8). Any removable calibration memory chips shall be potted, encased in a sealed container or protected by electronic algorithms and shall not be changeable without the use of specialised tools and procedures. Computer-coded engine operating parameters shall not be changeable without the use of specialised tools and procedures (e. g. soldered or potted computer components or sealed (or soldered) computer enclosures). In the case of mechanical fuel injection pumps fitted to compression- ignition engines, manufacturers shall take adequate steps to protect the maximum fuel delivery setting from tampering while the vehicle is in service. Manufacturers may apply to the approval authority for an exemption to this requirement for those vehicles which are unlikely to require protection. The criteria that the approval authority will evaluate in considering an exemption will include, but are not limited to, the current availability of performance chips, the high performance capability of the vehicle and the probable sales volume of the vehicle. 5. 9. 5. Manufacturers using programmable computer code systems (e. g. Electrical Erasable Programmable Read-Only Memory, EEPROM) shall employ proven methods to deter unauthorized reprogramming. Manufacturers shall include enhanced tamper protection strategies including data encryption using methods to secure the encryption algorithm and write protect features requiring electronic access to an off-site computer maintained by the manufacturer. Equivalent methods may be considered by the authority. 5. 9. 6. Anti-tampering features should not preclude the use of replacement parts which give the equivalent level of emission control. 148 6. 6. 1. EXTENSION OF EC TYPE-APPROVAL Approval granted to a vehicle type with respect to the OBD system may be extended to different vehicle types belonging to the same vehicle-OBD family as described in Appendix 6. The engine emission control system must be identical to that or the vehicle already approved and comply with the description of the OBD engine family given in Appendix 6, regardless of the following vehicle characteristics: - combustion process - engine accessories - method of engine fuelling - tyres - equivalent inertia - cooling system - overall gear ratio - transmission type - type of bodywork 7. 7. 1. 7. 2. 7. 3. 8. 8. 1. 8. 1. 1. 8. 1. 2. CONFORMITY OF PRODUCTION OF A VEHICLE EQUIPPED WITH AN OBD SYSTEM When the approval authority determines that the quality of production seems unsatisfactory a vehicle is randomly taken from the series and subjected to the tests described in Appendix 1. If the vehicle taken from the series does not satisfy the requirements of Section 7. 1. 5. 2 a further random sample of three vehicles shall be taken from the series and subjected to the tests described in Appendix 1. The tests may be carried out on vehicles which have been run-in a minimum of 3 000 km. The production is deemed to conform if at least 3 vehicles meet the requirements of the tests described in Appendix 1. ALTERNATIVE REQUIREMENTS Manufacturers may obtain type-approval on the basis of the alternative technical requirements given in Section 8. 1. 1 and 8. 1. 2, subject to the additional requirements of Sections 8. 1. 3, 8. 1. 4 and 8. 1. 5: Federal Register 40 CFR Part 86 Subpart A, entitled "Control of Air Pollution From New Motor Vehicles and New Motor Vehicle Engines; Regulations Requiring On-Board Diagnostic Systems on 1994 and Later Model Year Light-Duty Vehicles and Light-Duty Trucks", published by the US Government Printing Office, Washington, DC 20402. Section 1968. 1 of Title 13, California Code of Regulations (CCR), entitled "Malfunction and Diagnostic Systems Requirements - 1994 and Subsequent Model Year Passenger Cars, Light-Duty Trucks and Medium-Duty Vehicles and Engines". 149 8. 1. 3. The application for approval shall include a written statement that the vehicle family conforms to this Annex. The application for approval to this Annex shall include the complete documentation to meet the requirements of either Section 8. 1. 1 or 8. 1. 2 and the documentation required in Appendix 5 of this Annex. 8. 1. 4. The MI shall comply with the requirements of Section 5. 5 of this Annex. 8. 1. 5. If type-approval is granted according to the requirements of this Section, Section 7 of this Annex shall continue to apply for conformity of production checking. 150 Appendix 1 FUNCTIONAL ASPECTS OF ON-BOARD DIAGNOSTIC (OBD) SYSTEMS 1. INTRODUCTION This Appendix describes the procedure of the test according to Section 5 of this Annex. The procedure describes a method for checking the function of the on-board diagnostic (OBD) system installed on the vehicle by failure simulation of relevant systems in the engine management or emission control system. It also sets procedures for determining the durability of OBD systems. The manufacturer shall make available the defective components and/or electrical devices which would be used to simulate failures. Having simulated a failure the OBD system is approved if the MI is activated when the vehicle emissions exceed die limits of Section 5. 3. 2 by less than [20%]. DESCRIPTION OF TEST The testing of OBD systems consists of the following phases: - simulation of malfunction of a component of the engine management or emission control system; - preconditioning of the vehicle with a simulated malfunction over at least one Type I test or specific preconditioning cycle specified by the manufacturer; - driving the vehicle with a simulated malfunction over the Type I test cycle and measuring the emissions of the vehicle; - determining whether the OBD system reacts to the simulated malfunction and indicates malfunction in an appropriate manner to the vehicle driver. Alternatively, at the request of the manufacturer, malfunction of one or more components may be electronically simulated according to the requirements of Section 6 of this Appendix. Manufacturers may request that monitoring take place outside the Type I test cycle if it can be demonstrated to the authority that monitoring during conditions encountered during the Type I test cycle would impose restrictive monitoring conditions when the vehicle is used in service. TEST VEHICLE AND FUEL Vehicle 2. 2. 1. 2. 2. 2. 3. 3. 3. 1. The test vehicle must meet the requirements of Section 3. 1 of Annex III. 3. 2. Fuel The appropriate reference fuel as described in Annex IX must be used for testing. 151 4. 4. 1. 5. 5. 1. 6. 6. 1. TEST TEMPERATURE AND PRESSURE The test temperature and pressure must meet the requirements of the Type I test as described in Annex III. TEST EQUIPMENT Chassis dynamometer The chassis dynamometer must meet the requirements of Annex III. OBD TEST PROCEDURE The operating cycle on requirements of Annex III. the chassis dynamometer shall meet the 6. 2. Vehicle preconditioning 6. 2. 1. According to the engine type and after introduction of one of the failure modes given in Section 6. 3, the vehicle shall be preconditioned by driving at least two consecutive Type I tests (Parts One and Two). For compression ignition engined vehicles an additional preconditioning of two Part Two cycles is permitted. At the request of the manufacturer, alternative preconditioning methods may be used. 6. 3. Failure modes to be tested. 6. 3. 1. Positive-ignition engined vehicles. 6. 3. 1. 1. Replacement of the catalyst with a deteriorated or defective catalyst or electronic simulation of such a failure. 6. 3. 1. 2. Engine misfire conditions according to the conditions for misfire monitoring given in Section 5. 3. 3. 2 of this Annex. 6. 3. 1. 3. Replacement of the oxygen sensor with a deteriorated or defective oxygen sensor or electronic simulation of such a failure. 6. 3. 1. 4. Electrical disconnection of any other emission-related powertrain component connected to a computer. 6. 3. 1. 5. Electrical disconnection of the electronic evaporative purge control device (if equipped). 6. 3. 2. Compression-ignition engined vehicles. 6. 3. 2. 1. Where fitted, replacement of the catalyst with a deteriorated or defective catalyst or electronic simulation of such a failure. 6. 3. 2. 2. Where fitted, total removal of the particulate trap or, where sensors are an integral part of the trap, a defective trap assembly. 6. 3. 2. 3. Electrical disconnection of any fuelling system electronic fuel quantity and timing actuator. 6. 3. 2. 4. #Electrical disconnection of any other emission-related powertrain component connected to a computer. 152 6. 3. 2. 5. In meeting the requirements of Sections 6. 3. 2. 3 and 6. 3. 2A, and with the agreement of the approval authority, the manufacturer shall take appropriate steps to demonstrate that the OBD system will indicate a fault when disconnection occurs. 6. 4. OBD system test. 6. 4. 1. Vehicles fitted with positive-ignition engines. 6. 4. 1. 1. After vehicle preconditioning according to Section 6. 2 above, the test vehicle shall be driven over a Type I test (Parts One and Two). The MI must activate before the end of this test under any of the conditions given in Sections 6. 4. 1. 2 to 6. 4. 1. 5 of this Appendix. The technical service may substitute those conditions by others in accordance with Section 6. 4. 1. 6. However, the total number of failures simulated shall not exceed 4 for the purpose of type-approval. 6. 4. 1. 2. Replacement of a catalyst with a deteriorated or defective catalyst or electronic simulation of a deteriorated or defective catalyst that "results in emissions exceeding the HC limit given in Section 5. 3. 2 of this Annex. 6. 4. 1. 3. An induced misfire condition according to the conditions for misfire monitoring given in Section 5. 3. 3. 2 of this Annex that results in emissions exceeding any of the limits given in Section 5. 3. 2 of this Annex. 6. 4. 1. 4. Replacement of an oxygen sensor with a deteriorated or defective oxygen sensor or electronic simulation of a deteriorated or defective oxygen sensor that results in emissions exceeding any of the limits given in Section 5. 3. 2 of this Annex. 6. 4. 1. 5. Electrical disconnection of the electronic evaporative purge control device (if equipped). 6. 4. 1. 6. Electrical disconnection of any other emission-related powertrain component connected to a computer that results in emissions exceeding any of the limits given in Section 5. 3. 2 of this Annex. 6. 4. 2. Vehicles fitted with compression-ignition engines. 6. 4. 2. 1. After vehicle preconditioning according to Section 6. 2 above, the test vehicle shall be driven over a Type I test (Parts One and Two). The MI must activate before the end of this test under any of the conditions given in Sections 6. 4. 2. 2 to 6. 4. 2. 5 of this Appendix. 6. 4. 2. 2. Where fitted, replacement of a catalyst with a deteriorated or defective catalyst or electronic simulation of a deteriorated or defective catalyst that results in emissions exceeding limits given in Section 5. 3. 2 of this Annex. 6. 4. 2. 3. Where fitted, total removal of the particulate trap or replacement of the particulate trap with a defective particulate trap meeting the conditions of Section 6. 3. 2. 2 of this Appendix that results in emissions exceeding the limits given in Section 5. 3. 2 of this Annex. 6. 4. 2. 4. With reference to Section 6. 3. 2. 5 of this Appendix, disconnection of any fuelling system electronic fuel quantity and timing actuator that results in emissions exceeding any of the limits given in Section 5. 3. 2 of this Annex. 153 6. 4. 2. 5. With reference to Section 6. 3. 2. 5 of this Appendix, disconnection of any other emission-related powertrain component connected to a computer that results in emissions exceeding any of the limits given in Section 5. 3. 2 of this Annex. 6. 5. Diagnostic Signals 6. 5. 1. 1. Upon determination of the first malfunction of any component or system, "freeze frame" engine conditions present at the time shall be stored in computer memory. Should a subsequent fuel system or misfire malfunction occur, any previously stored freeze frame conditions shall be replaced by the fuel system or misfire conditions (whichever occurs first). Stored engine conditions shall include, but are not limited to calculated load value, engine speed, fuel trim value(s) (if available), fuel pressure (if available), vehicle speed (if available), coolant temperature, intake manifold pressure (if available), closed- or open-loop operation (if available) and the fault code which caused the data to be stored. The manufacturer shall choose the most appropriate set of conditions facilitating effective repairs for freeze frame storage. Only one frame of data is required. Manufacturers may "choose to store additional frames provided that at least the required frame can be read by a generic scan tool meeting the specifications of Sections 6. 5. 3. 2 and 6. 5. 3. 3. If the fault code causing the conditions to be stored is erased in accordance with Section 5. 7 of this Annex, the stored engine conditions may also be erased. 6. 5. 1. 2. If available, the following signals in addition to the required freeze frame information shall be made available on demand through the serial port on the standardised data link connector, if the information is available to the on-board computer or can be determined using information available to the on-board computer: diagnostic trouble codes, engine coolant temperature, fuel control system status (closed loop, open loop, other), fuel trim, ignition timing advance, intake air temperature, manifold air pressure, air flow rate, engine speed, throttle position sensor output value, secondary air status (upstream, downstream or atmosphere), calculated load value, vehicle speed and fuel pressure. The signals shall be provided in standard units based on the specifications given in Section 6. 5. 3 of this Appendix. Actual signals shall be clearly identified separately from default value or limp home signals. In addition, the capability to perform bi-directional diagnostic control based on the specifications given in Section 6. 5. 3 of this Appendix shall be made available on demand through the serial port on the standardised data link connector according to the specifications given in Section 6. 5. 3 of this Appendix. 6. 5. 1. 3. For all emission control systems for which specific on-board evaluation tests are conducted (catalyst, oxygen sensor, etc. ), except misfire detection, fuel system monitoring and comprehensive component monitoring, the results of the most recent test performed by the vehicle and the limits to which the system is compared shall be made available through the serial data port on the standardised data link connector according to the specifications given in Section 6. 5. 3 of this Appendix. For the monitored components and systems excepted above, a pass/fail indication for the most recent test results shall be available through the data link connector. 154 6. 5. 1. 4. The OBD requirements to which the vehicle is certified (i. e. this Annex or the alternative requirements specified in Section 8 of this Annex) and the major emission control systems monitored by the OBD system consistent with Section 6. 5. 3. 3 of this Appendix shall be available through the serial data port on the standardised data link connector according to the specifications given in Section 6. 5. 3 of this Annex. 6. 5. 2. 6. 5. 3. The emission control diagnostic system is not required to evaluate components during malfunction if such evaluation would result in a risk to safety or component failure. The emission control diagnostic system shall provide for standardised access and conform with the following ISO and/or SAE standards. Some of the ISO standards have been derived from Society of Automotive Engineers standards and Recommended Practices. Where this is the case the appropriate SAE reference appears in parenthesis. 6. 5. 3. 1. One of the following standards with the restrictions as described shall be used as the on-board to off-board communications link: ISO 9 1 4 1 -2 "Road Vehicles - Diagnostic Systems - CARB Requirements for the Interchange of Digital Information"; ISO 11519-4 "Road Vehicles - Low Speed Serial Data Communication - Part 4: Class B Data Communication Interface (SAE J1850)". Emission related messages shall use the cyclic redundancy check and the three byte header and shall not use inter-byte separation or checksums. ISO DIS 14230 - Parts 1, 2 and 3 "Road Vehicles - Diagnostic Systems - Keyword Protocol 2000". Either the CARB mode shall be used (directly equivalent to ISO 9141-2) or with fast initialisation at the address specified in Appendix 2 and with the format specified by using keybytes with the decimal value of 2025 (three byte header with normal timing). 6. 5. 3. 2. Test equipment and diagnostic tools needed to communicate with OBD systems shall meet or exceed the functional specification given in Appendix 3. 6. 5. 3. 3. Basic diagnostic data, (as specified in Section 6. 5. 1 of this Appendix) and bi-directional control information shall be provided using the format and units described in Appendix 2 and shall be available using a diagnostic tool meeting the requirements of Appendix 3. 6. 5. 3. 4. Fault codes selected by the manufacturer shall be consistent with those given in Appendix 4. 6. 5. 3. 5. The connection interface between the vehicle and the diagnostic tester shall meet the all requirements of SAE J1962 "Diagnostic Connector, June 1992" (ISO XXX-A "Road vehicles - Diagnostic systems - On-board connector"). The installation position shall be subject to agreement of the approval. authority such that it is readily accessible by service personnel but protected from tampering by non-qualified personnel. 155 Appendix 2 1. Scope This Apppendix defines diagnostic services and functionally addressed request- response messages required to be supported by vehicles and test tools for diagnostic purposes which pertain to vehicle emission-related data. These messages are intended to be used by any service tool meeting the requirements of Appendix 3. Seven Diagnostic Services (Test Modes) are defined and these are detailed in Section four. This Appendix is based on draft ISO CD XXXI and SAE J1979, "E/E Diagnostic Test Modes". 2. References 2. 1. Applicable Documents The following publications form a part of this specification to the extent specified herein. 2. 1. 1. Normative References ISO Documents: ISO 9141-2 Road vehicles - Diagnostic requirements for interchange of digital information systems - CARB ISO CD 14230 Keyword Protocol 2000, Parts 1/2/3 ISO 11519-4 Road Vehicles Low speed Serial Data Communication Class B - Data Communications Interface (SAE J1850) ISO CD 14229 Diagnostic Services 2. 1. 2. Informative References J1850 FEB94 Class B Data Communication Network Interface J1930 JUN93 Systems Diagnostic Terms, Definitions, E/E Abbreviations and Acronyms J1962 JUN93 Diagnostic Connector J1978 MAR92 OBD II Scan Tool J2012 MAR92 Recommended Format and Messages for Diagnostic Trouble Codes J2186 SEP91 Diagnostic Data Link Security J2190 JUN93 Enhanced E/E Diagnostic Test Modes 156 3. Definitions Most terms for components and systems contained in this document are included in ISO CD XXX3 (SAE J1930) - Terms, Definitions, and Acronyms. This section includes additional definitions of terms used in this document, not included in ISO CD XXX3. 3. 1. # = number 3. 2. "Service" in ISO diagnostic communication documents is the equivalent of "Test Mode" or "Mode" in the SAE documents. 3. 3. No further definitions. 4. Technical Requirements 4. 1. Diagnostic Service General Conditions These guidelines are necessary to ensure proper operation of both the test equipment and the vehicle during diagnostic procedures. Test equipment, when using messages defined in this document, should not affect normal operation of the emission control system. 4. 1. 1. Multiple Responses to a Single Data Request The messages contained in this Appendix are functional messages, which means the off-board test equipment will request data without knowledge of which module on the vehicle will respond. In some vehicles, multiple modules may respond with the information requested. In addition, a single module may send multiple responses to a single request. Any test device requesting information must, therefore, have provisions for receiving multiple responses. 4. 1. 2. Response Time For ISO 9141-2 and ISO 14230-2 interfaces, response time requirements are specified in these documents. For ISO CD 11519-4(SAE J1850) network interfaces, the on-board systems should respond to a request within 100 milliseconds of a request or a previous response. With multiple responses possible from a single request, this allows as much time as is necessary for all modules to access the data link and transmit their response(s). If there is no response within this time period, the tool can either assume no response will be received, or if a response has already been received, that no more responses will be received. 4. 1. 3. Minimum Time Between Requests from Scan Tool For ISO 9141-2 interfaces, the required times between requests are specified in the^ISO 9141-2 document. For SAE 11850 network interfaces, a tool should always wait for a response from the previous request, or "no response" timeout before sending another request. In no case should a request be sent less than 100 msec, after the previous request. 157 4. 1. 4. Data not Available There are two conditions for which data is not available. One condition is that the Service is not supported, and the other is that the Service is supported but data is not currently available. There will be no reject message to a functional request if the request is not supported by the module. This prevents responses from all modules that do not support a Service or a specific data value. Some Services are supported by a vehicle, but data may not always be available when requested. For Services $05 and $06, if the test has not been run since test results were cleared, or for Service $02 if freeze frame data has not been stored, valid data will not be available. For these conditions, the manufacturer has the option either to not respond or to respond with data that is invalid. The functional description for these Services discuss the method to determine if the data is valid. 4. 1. 5 Maximum Values If the data value exceeds the maximum value possible to be sent, the on-board system should send the maximum value possible ($FF or $FFFF). The tool should display the maximum value or an indication of data too high. This is not normally critical for real time diagnostics, but in the case of a misfire at 260 km/h with resulting freeze frame data stored, this will be very valuable diagnostic information. 4. 2. Diagnostic Message Format 4. 2. 1. Addressing method Functional addressing will be used for all generic Diagnostic Service messages because the test tool does not know which system on the vehicle has the information that is needed. 4. 2. 2. Maximum message length Is defined in Figure 1 below. 158 4. 2. 3. Diagnostic Message Format Is defined in Figure 1 below. Header Bytes Data Bytes Priority - Type Target Address Source Address #1 #2 #3 #4 #5 #6 #7 ERR RSP Diagnostic Request at 10. 4 Kbps (ISO 11519-4 [J1850] and ISO 9141-2) 68 48 61 41 61 41 6A Tester Address Fx Maximum 7 data bytes Yes No Diagnostic Response at 10. 4 \ Kbps (ISO 11519-4 [J1850] and ISO 9 L41-2) 6B ECU Addr Maximum 7 data bytes Yes No Diagnostic Response at 41. 6 Kbps (ISO 11519-4 [J1850]) 6A Fx Maximum 7 data bytes Yes No Diagnostic Response at 41. 6 Kbps (ISO 11519-4 [J1850]) 6B ECU Addr Maximum 7 data bytes Yes No Diagnostic Request at 41. 6 Kbps (ISO 14230) 6A Fx Maximum 7 data bytes Diagnostic Request at 41. 6 Kbps (ISO 14230) 6B ECU Addr Maximum 7 data bytes Figure 1 - Diagnostic Message Format 4. 2. 4. 'Header bytes The first three bytes of all diagnostic messages are the header bytes. The value of the first header byte is dependent on the bit rate of the data link and the type of message. The second byte has a value that depends on the type of message, either a request or a response. The third header byte is the physical address of the device sending the message. OBD Scan Tools have the address $F1. Other service tools should use addresses in the range from $F0 to $FD. The response to all request messages in this document will be independent of the address of the test equipment requesting the information. Vehicle manufacturers should not use the ISO CD XXX1(J1979) header bytes for any purpose other than diagnostic messages. When they are used, they must conform to this specification. 159 4. 2. 5. Data bytes The maximum number of data bytes available to be specified in this Appendix is 7. The first data byte following the header is the Diagnostic Service Type, and the remaining 6 bytes vary depending on the specific Diagnostic Service. For services $01 and $02, message length is determined by Parameter Identification (PID). For Service $05, message length is determined by Test ID. For other services, the message length is determined by the service. This enables the tools to check for proper message length, and to recognize the end of the message without waiting for possible additional data bytes. 4. 2. 6. Non-data bytes included in diagnostic messages with ISO 11519-4 (J1850) All diagnostic messages will use a Cyclic Redundancy Check (CRC), as defined in ISO 11519-4 (J185Ô), as the error detection (ERR) byte. In-frame response (RSP) is defined as optional in ISO 11519-4 (J1850). For messages defined in this document, the RSP byte is required in all request and response messages at 41. 6Kbps, and is not allowed for messages at 1X3. 4 Kbps. ISO 11519-4 (SAE J1850) defines additional message elements that may be included in Diagnostic Messages. Use of these message elements is beyond the scope of this specification, but needs to be considered when defining total diagnostic messages. 4. 2. 7. Non-data bytes included in diagnostic messages with ISO 9141-2 and ISO 14230 (Keyword Protocol 2000) Messages will include a checksum, defined in those documents, after the data bytes as the Error Detection Byte (ERR). There is no provision for an in-frame response. 4. 2. 8. Bit position convention Some data byte values in this document include descriptions that are based on bit positions within the byte. The convention used in this document is that the Most Significant Bit (MSB) is referred to as "bit 7", and the Least Significant Bit (LSB) is referred to as "bit 0," as shown below: MSB LSB 7 | 6 | 5 | 4 | 3 | 2 | 1 |0 Figure 2 - Bit position within a data byte 4. 3. Allowance for Expansion and Enhanced Diagnostic Services This Appendix allows for the addition of Diagnostic Services both as industry standards and manufacturer specific services. The Diagnostic Services $00 through $0F are reserved to be defined in ISO CD XXXI (J1979). 160 4. 4. Format of Data to be Displayed The format of data to be displayed to the user of the data obtained with these test needs to be standardised so that vehicle manufacturers can write generic service information. Data is transmitted from the vehicle in metric units. The following Table indicates the type of data and minimum requirements for format of the data. See Figure 3. Data Device ID - source address of response Parameter ID (PIP) Frame number Data values Diagnostic Trouble Codes Test ID | Services all $01 & $02 $02 "" $01 & $02 $03 & $07 Display Format Hexadecimal (00 to FF) __ Hexadecimal (00 to FF) description (see Table in Section 5. 3) Decimal (0 to 255) see Table in Section 5. 3 "P", "B", "C" or "U", plus 4 digits and/or DTC definition - see ISO CD XXX2 (SAE J2012) I Test value and test limits Test value and test limits Component ID Optional Data Bytes I $05, $06 & ~T " Hexadecimal (00 to FF) $08 $05 $06 Engineering units for Test IDs icss than $80 (see Section 5. 6. 2) - Decimal (0 ':o 255) for Test IDs grgater than $80 Decimal (0 to 65535) $06 (part of data byte #3) $08 J Hexadecimal (00 to 7F) 4 bytes, each decimal (0 to 255) Figure 3 - Format of Data to be Displayed 5. Services 5. 0. Diagnostic Services included in this document are: Service $01 - Request Current Powertrain Diagnostic Data Analogue inputs and outputs Digital inputs and outputs System status information Calculated values Service $02 - Request Powertrain Freeze Frame Data Analogue inputs and outputs Digital inputs and outputs System status information Calculated values 161 Service $03 Request Emission-Related Powertrain Diagnostic Trouble Codes Service $04 Clear/Reset Emission-Related Diagnostic Information Service $05 Request Oxygen Sensor Monitoring Test Results Service $06 Service $07 Request On-Board Monitoring Test Results for Non- continuously Monitored Systems Request On-Board Monitoring Test Results Continuously Monitored Systems for Service $08 - Request Control of on-board system, test or component For each Service this definition includes: Functional descriptions of service Request and response message formats For some of the more complex services, an example of messages and an explanation of the interpretation of those messages is included. 5. 1. Service $01 - Request Current Powertrain Diagnostic Data 5. 1. 1. Functional Description The purpose of this service is to allow access to current emission related data values, including analogue inputs and outputs, digital inputs and outputs, and system status information. The request fcr information includes a Parameter Identification (PDD) value that indicates to the on-board system the specific information requested. PED definitions, scaling information, and display formats are included in this document. The on-board module will respond to this message by transmitting the requested data value last determined by the system. All data values returned for sensor readings will be actual readings, not default or substitute values used by the system because of a fault with that sensor. Not all PIDs are applicable or supported by all systems. PID $00 is a bit- encoded PID that indicates, for each module, which PIDs that module supports. PID $00 must be supported by all modules that respond to a service $01 request as defined in this document, because diagnostic tools that conform to Appendix 3 use the presence of a response by the vehicle to this request to determine which protocol is supported for diagnostic communications. 162 5. 1. 2. Message Data Bytes Data Bytes (Hex) #1 #2 #3 | #4 | #5 | #6 #7 Request Current Powertrain Diagnostic Data Request Powertrain Diagnostic Data 01 PID Report Current Powertrain Diagnostic Data Report Powertrain Diagnostic Data 41 PID data A data B (*) data C (*) data D (*) Figure 4 - Message data Bytes (*) conditional - number of bytes depends on PID - see Figure 6 5. 2. Service $02 - Request Powertrain Freeze Frame Data 5. 2. 1. Functional Description The purpose of this service is to allow access to emission related data values in a freeze frame. This allows expansion to meet manufacturer specific requirements not necessarily related to the required freeze frame, and not necessarily containing the same data values as the required freeze frame. The request for information includes a Parameter Identification (PID) value that indicates to the on-board system the specific information requested. PID definitions, scaling information, and display formats for the freeze frame are included in this document. The on-board module will respond to this message by transmitting the requested data value stored by the system. All data values returned for sensor readings will be actual stored readings, not default or substitute values used by the system because of a fault with that sensor. Not all PIDs are applicable or supported by all systems. PID $00 is a bit-encoded PID that indicates, for each module, which PIDs that module supports. Therefore, PID $00 must be supported by all modules that respond to a Service $02 request as defined in this document. -- PDD $02 indicates the DTC that caused the freeze frame data to be stored. If freeze frame data is not stored in the module, the system should report $00 00 as the DTC. Any data reported when the stored DTC is $00 00 may not be valid. The frame number byte will indicate $00 for the freeze frame data. Manufacturers may optionally save additional freeze frames and use this service to obtain that data by specifying the freeze frame number in the request. If a manufacturer uses these additional freeze frames, they will be stored under conditions defined by the manufacturer, and contain data specified by the manufacturer. 163 5. 2. 2. Message Data Bytes #1 #2 Data Bytes (Hex) #5 #4 #3 #6 #7 Request Powertrain Freeze Frame Data Request Powertrain Freeze Frame Data 02 PID frame no. Report Powertrain Freeze Frame Data (only valid if Service $02 PID $02 DTC is not $00 00) Report Powertrain Freeze Frame Data 42 PID frame no. data A data B. (*) data C (*) data D (*) Figure 5 - Message Data Bytes (*) conditional - number of bytes depends on PID - see Figure 6 164 5. 3. PIDs for Services $01 and $02 - see Figure 6 Service ID (see note 1) PID (Hex) Description Min ($00) or ($0000) Max ($FF) or ($FFFF) $01 A $02 A 00 PIDs supported ($01 - $20): A 01 Module responds with a message that contains 4 bytes ojf bit-cncodcd information, each bit indicating support or non-support of a PID where: 0 = PID not supported by this module 1 = PID supported by this module Data A - Number of emission-related powertrain trouble codes and MI status: bits 0-6: Number of codes stored in this module bit 7: 0 = MI not commanded ON by this module 1 = MI commanded ON by this module Data B (bits 0 to 3) and Data C - Each bit indicates support or non- support of an on-board diagnostic evaluation: Data B: covers continuous monitoring tests Data C: covers tests run at least once per trip where: 0 = test not supported by this module 1 = test supported by this module Data B (bits 4 to 7) and Data D - Each bit indicates status of on-board diagnostic evaluation for this module, corresponding to tests included in Data B (bits 0 to 3) and Data C: 0 = test complete, or not applicable 1 = test not complete Note: Data B. bits 4 to 7, are required only for vehicles that do not support any non-continuous tests. Figure 6 PIDs for Services $01and $02 165 English display SI (Metric) Scaling/bit and display Byte bit PID Data A 7 $01 Data A 6 $02 DataB 7 $09 Data D 0 $20 Data B: bit Evaluation supported / status 0 Misfire monitoring supported 1 Fuel system monitoring supported 2 Comprehensive component monitoring supported 3 reserved (report as 0) 4 misfire monitoring status 5 fuel system monitoring status 6 Comprehensive component monitoring status 7 reserved (report as 0) Data C and Data D: bit Evaluation supported / status 0 Catalyst monitoring 1 Heated catalyst monitoring 2 Evaporative system monitoring 3 Secondary air system monitoring 4 A/C system refrigerant monitoring 5 Oxygen sensor monitoring 6 Oxygen sensor heater monitoring 7 EGR system monitoring i Service ID (see note 1) PID (Hex) Description Min ($00) or ($0000) Max ($FF) or ($FFFF) SI (Metric) Scaling/bit and display English display $01 $02 A 02 A A 03 DTC that caused required freeze frame data storage (2 byte value - $0000 indicates no freeze frame data) Data A: Fuel system 1 status Data B: Fuel system 2 status ($00 if not used) 00 00 09 99 Pxxxx, Cxxx, Bxxx or Uxxx Pxxxx, Cxxx, Bxxx or Uxxx For each data byte, no more than one bit at a time can be set to a 1 to indicate the status of that bank, where: bit 0 = Open loop - lias not yet satisfied conditions to go closed loop bit 1 = Closed loop - using oxygen sensor(s) as feedback for fuel control bit 2 = Open loop due to driving conditions (e. g. power enrichment, deceleration enleanment) bit 3 = Open loop due to detected system fault bit 4 = Closed loop, but fault with at least one oxygen sensor - may be using single oxygen sensor for fuel control bits 5-7 = reserved (report as 0) 04 05 06 07 08 09 0A Calculated load value Engine coolant temperature Short term fuel trim - Bank 1 (use if only 1 fuel trim value) Long term fuel trim - Bank 1 Short term fuel trim - Bank 2 Long term fuel trim - Bank 2 Fuel pressure gauge A A A A A A A A A A A A A A A A A A 0% -40°C 100% +215°C -100. 00% (lean) +99. 22% (rich) x » n 0 kPaG(gauge) n »» n 765 kPaG (gauge) 255 kPaA 100/255% xxx. x% xxx°F 100/128% (0% at 128) xxx. x% xx. x psig(gaugc) xx. x in. Hg 100/255% XXX. x% 1°C with -40°C offset xxx°C 100/128% (0% at 128) XXX. x% II II II 3 kPaG(gauge) xxx kPaG(gauge) 1 kPaA xxx kPaA 1/4 rpm xxxxx rpm OB Intake manifold absolute pressure OkPaA j Engine R1. PM (2 byte value - high byte/low byte) OC 0 rpm 16,383. 75 rpm Figure 6 PIDs for Services $01 and $02 (continued) 166 A A A A A A A X or PID $1D 10 11 12 13 Service ID (sec note 1) PID (Hex) Description $01 $02 Min ($00) or ($0000) Max ($FF) or ($FFFF) SI (Metric) Scaling / bit and display English display A 0D Vehicle speed 0 km/h 255 km/h 0E Ignition timing advance for #1 cylinder (not including mechanical advance) -64° +63,5° OF Intake air temperature -40°C +215°C Air flow rate from MAF sensor (2 byte value - high byte/low byte) Absolute throttle position 0 gm/scc 0% 655. 35 gm/scc 100% xxx mph xxx°F xxxx. x lb/min 1 km/h xxx km/h l/2°with 0° at 128 xx. x° 1°C with -40°C offset xxx°C. 01 gm/sec xxx. xx grh/sec 100/255% xxx. x% Commanded secondary air status (if supported, one, and only one bit at a time can be set to a 1) bit 0 bit 1 bit 2 bits 3 -7 = reserved (report as 0) I = upstream of first catalytic converter 1 = downstream of first catalytic converter inlet 1 = atmosphere / off Location of oxygen sensors, where sensor 1 is closest to the engine. Each bit indicates the presence or absence of an oxygen sensor at the following location: bit Sensor location 0 Bank 1 - Sensor 1 1 Bank 1 - Sensor 2 2 Bank 1 - Sensor 3 3 Bank 1 - Sensor 4 4 Bank 2 - Sensor 1 5 Bank 2 - Sensor 2 6 Bank 2 - Sensor 3 7 Bank 2 - Sensor 4 where: I 1 = sensor present at that location 0 = sensor not present at that location ' Figure 6 PIDs for Services $01 and $02 (continued) 167 Service ID (see note 1) PID (Hex) Description Min ($00) or($0000) Max ($FF) or ($FFFF) SI (Metric) Scaling/bit and display English display J $01 $02 A % 14 15 16 17 18' 19 1A IB Bank 1 - Sensor 1 Bank 1 - Sensor 2 Bank 1 - Sensor 3 Bank 1 - Sensor 4 Bank 2 - Sensor 1 Bank 2 - Sensor 2 Bank 2 - Sensor 3 Bank 2 - Sensor 4 for each sensor: Data A - Oxygen sensor output 0 volt 1. 275 volt B 1C voltage Data B - short term fuel trim associated with this sensor ($FF if this sensor is not used in the calculation) OBD requirements to which vehicle is designed, where: $ 01 - OBD II (California ARB) $ 02 - OBD (Federal EPA) $ 03 - OBD and OBD II $ 04 - OBD I $ 05 - Not intended to meet any OBD requirements Figure 6 PIDs for Services $01 and $02 (continued) -100. 00% (lean) 99. 22% (rich) This scaling assumes a nominal 1 volt full scale oxygen sensor; any sensor with a different full scale value should be normalised to provide nominal full scale at $C8 (200 decimal). 005 volt x. xxx volt 100/128% (0% at 128) xxx. x% 68 Service ID (sec note 1) PID (Hex) Description Min ($00) or ($0000) Max ($FF) or ($FFFF) SI (Metric) Scaling/bit and display English display $01 $02 A or PID S13 ID Location of oxygen sensors, where 1 is closest to the engine. Each bit indicates the presence or absence of an oxygen sensor at the following location: bit Alternate sensor location 0 Bank 1 - Sensor 1 1 Bank 1 - Sensor 2 2 Bank 2 - Sensor 1 3 Bank 2 - Sensor 2 4 Bank 3 - Sensor 1 5 Bank 3 - Sensor 2 6 Bank 4 - Sensor 1 7 Bank 4 - Sensor 2 Where 1 = sensor present at that location 0 = sensor not present at that location A IE Auxiliary Input Status bit 0:Powcr Take Off (PTO) Status where 0 =PTO not active 1 = PTO active bits 1 to 7 reserved for future expansion report as 0 Waive continuous monitoring tests during PTO Unused - reserved for future expansion. IF i Figure 6 PIDs for Services $01 and $02 (continued) 169 Service ID (see note 1) PID (Hex) Description $01 $02 A 20 PIDs supported ($21 - $40): Min ($00) or($0000) Max ($FF) or ($FFFF) SI (Metric) Scaling / bit and display English display Bvte bit PID Data A 7 $21 Data A 6 $22 Data B 7 $29 DataD 0 $40 21-3F 40 41-FF Reserved - to be specified in ISO 14230 - 3 (SAE J2190). if needed PIDs supported ($41 - $60): Reserved for future expansion A A Figure 6 PIDs for Services $01 and $02 (continued) NOTE 1 : Letters in the column under Service $01 or $02 indicate that this value is included in OBD legislation as indicated below. This information is for guidance only and may be out of date. Refer to the latest appropriate regulations to determine if each value is required to be supported on a given vehicle, or only required if available. 170 5. 4. Service $03 - Request Emission-Related Powertrain Diagnostic Trouble Codes 5. 4. 1. Service $03 Functional Description The purpose of this service is to enable the off-board test device to obtain stored emission-related powertrain trouble codes. This shall be a two step process for the test equipment but a module may respond to a Service $03 request without a Service PID $01 request. If a tester establishes that the Service $01, PID $01 is not supported by all of the modules on the vehicle it may send only Service $03 requests on all subsequent DTC requests. Step 1 - Send a Service $01, PID $01 request to get the number of stored emission-related powertrain trouble codes from all modules that have this available. Each on-board module that has codes stored will respond with a message that includes the number of stored codes to be reported. If a module capable of storing powertrain codes does not have stored codes, then that module shall respond with a message indicating zero codes are stored. Step 2 - Send a Service $03 request for all stored emission-related powertrain codes. Each module that has codes stored will respond with one or more messages, each containing up to 3 codes. If no codes are stored in the module, then the module may not respond to this request. If additional trouble codes are set between the time that the number of codes are reported by a module, and the stored codes are reported by a module, then the number of codes reported could exceed the number expected by the tool. In this case, the tool should repeat this cycle until the number of codes reported equals the number expected based on the Service 1 response. Diagnostic trouble codes are transmitted in two bytes of information for each code. The first two bits (high order) of the first byte for each code will be zeros to indicate a powertrain code (refer to Appendix 3 for additional interpretation of this structure). The second two bits will indicate the first digit of the diagnostic code (0 through 3). The second nibble of the first byte and the entire second byte are the next three digits of the actual code reported as * Binary Coded Decimal (BCD). A powertrain trouble code transmitted as $0143 should be displayed as P0143. See Figure 7 0 | 0 | 0 | 0 | 0 | 0 | 0 | 1 — 0 1 1 | 0 | 0 | 0 | 0 | 1 |1 P 0 1 I 4 i Figure 7 - Diagnostic Trouble Code Encoding Example If less than 3 trouble codes are reported, the response messages used to report diagnostic trouble codes should have their unused bits set to zero to maintain the required fixed message length for all messages. If there are no diagnostic trouble codes to report, no response is required. 171 5. 4. 2. Message Data Bytes Data Bytes (Hex) #1 | #2 J #3 #6 Request number of codes from all modules | #4 | #5 #7 Request number of Powertrain DTC 01 01 1 Report number of codes (each module] Report number of stored powertrain DTC 41 Request Request powertrain DTC 03 01 #DTC & MI codes from all modules Eval. Supp. #1 Eval. Supp. #2 Eval. Status - Report codes (each module) Report powertrain DTC 43 Code #1 or 00 00 Code #2 or 00 00 Code #3 or 00 00 Figure 8 - Message Data Bytes NOTE: Refer to Appendix 2 (ISO CD XXX2 - SAE J2012, Recommended Format and Messages for Diagnostic Trouble Codes), the encoding method for trouble codes. 172 5. 4. 3. Powertrain Diagnostic Trouble Code Example (assume 10. 4 Kbps) Header Bytes (Hex) Data Bytes (Hex) Pty/ Type Tgt Addr Src Addr #1 #2 #3 M #5 #6 #7 Request Powertrain DTC 68 6A FI 01 01 Report Number of Powertrain DTC 48 48 48 48 6B 6B 6B 6B 06 41 01 C3 41 01 2B 41 01 ^F 41 01 06 01 00 82 00 00 00 00 00 00 00 00 00 00 00 00 Request All Stored Powertrain DTC Request number of Powertrain DTC Module 06 has 6 stored DTC Module C3 has 1 stored DTC Module 2B has 0 stored DTC Module 3E has 2 stored DTC and MI ON Request powertrain DTC 1 68 | 6A FI | 03 1 Report All Stored Powertrain DTC Module 06 send codes P0143,P0196, & P0234 Module C3 send code P0443 Module 06 send codes P0357,P0531, & P0661 Module 3E send codes P0112 & P0445 48 6B 06 43 Code #1 Code #2 Code #3 01 43 01 96 02 34 48 6B C3 43 Code #1 48 6B 06 43 04 43 Code #4 Code #5 Code #6 00 00 00 00 48 6B 3E 43 03 57 Code #1 -3-1 05 Code #2 06 61 01 12 04 45 00 00 Figure 9 Powertrain Diagnostic Trouble Code Example 173 5. 5. Service $04 - Clear/Reset Emission-Related Diagnostic Information 5. 5. 1. Functional Description The purpose of this service is to provide a means for the external test device to command on-board modules to clear all emission-related diagnostic information. This includes: Clear number of diagnostic trouble codes (Service $01, PID $01) Clear diagnostic trouble codes (Service $03) Clear trouble code for freeze frame data (Service $01, PED $02) Clear freeze frame data (Service $02) Clear oxygen sensor test data (Service $05) Reset status of system monitoring tests (Service $01, PID $01) Clear on-board monitoring test results (Services $06 and $07) Other manufacturer specific "clearing/resetting" actions may also occur in response to this request. For safety and/or technical design reasons, some modules may not respond to this test service under all conditions. All modules must respond to this test service request with the ignition ON and with the engine not running. Modules that cannot perform this operation under other conditions, such as with the engine running, will ignore the request. 5. 5. 2. Message Data Bytes #6 Request to Clear/Reset Emission-Related Diagnostic Information #5 #2 #1 Data Bytes (Hex) #4 #3 #7 Clear Powertrain DTC 04 Report when Emission-Related Diagnostic Information is Reset Powertrain -DTC- cleared 44 Figure 10 Message Data Bytes 174 5. 6. Service $05 - Request Oxygen Sensor Monitoring Test Results 5. 6. 1. Functional Description The purpose of this service is to allow access to the on-board oxygen sensor monitoring test results. The same information may be obtained by the use of Service $06 The request for test results includes a Test ID value that indicates the information requested. Test value definitions, scaling information, and display formats are included in this document. Many methods may be used by different manufacturers to comply with this requirement. If data values are to be reported using these messages that are different from those predefined in this document, ranges of test values have been assigned that can be used which have standard units of measure. The tool can convert these values and display them in the standard units. The on-board module will respond to this message by transmitting the requested test data last determined by the system. The operation of this diagnostic service in the on-board module is different from Service $01. Service $01 reports data value(s) that are stored internally at a single, or multiple contiguous, locations in memory. Service $05 can report data values that are stored in non-contiguous memory locations. As an example, test results may be stored in RAM, and test limits, (if the value is a calculated value), would normally be stored in ROM. Therefore, the on-board software has additional requirements to respond to this request than it does for Service $01 requests. Not all test values are applicable or supported by all vehicles. An optional feature of this test service is for the on-board module to indicate which test IDs are supported. Test ID $00 is a bit-encoded value that indicates support for test IDs from $01 to $20. Test ID $20 indicates support for test IDs $21 through $40, etc. This is the same concept as used for PID support in test services $01 and $02. If Test ID $00 is not supported, then the module does not use this feature to indicate test ID support. 175 5. 6. 2. Message Data Bytes #1 #2 Data Bytes (Hex) #4 #3 #5 #6 #7 Request Oxygen Sensor Test Results 05 Test ID 02S Sens# Request Oxygen Sensor Test Results Report Oxygen Sensor Test ID Support - Optional (Test IDs $00, $20, $40, $60, $80, $A0, $C0, $E0) Report Oxygen Sensor Test ID Support 45 Test ID 02S Sens# Support for the next 32 test IDs following the requested ID is indicated in data bytes #4 through #7 Report Oxygen Sensor Test Results (All Test IDs That Do Not Indicate Test ID Support) Data is only valid if Service $01 PID $01 indicates Oxygen Sensor monitoring is supported and the test is complete. Report Oxygen Sensor Test Results 45 Test ID 0 2 S# test value min limit * max limit * Figure 11 - Message data Bytes * NOTE: report limits if value is a test result - not required for test constants, such as ID $01 to $04 Results of latest mandated on-board oxygen sensor monitoring test Oxygen Sensor Output Figure 12 - Test ID Value Example - Note: Numbers refer to Test ID 176 Data Description Byte 2 Which Test ID: ' ~ $00 - Test ID's supported - optional ($01 to $20) $01 - Rich to lean sensor threshold voltage (constant) $02 - Lean to rich sensor threshold voltage (constant) $03 - Low sensor voltage for switch time calculation (constant) $04 - High sensor voltage for switch time calculation (constant) $05 - Rich to lean sensor switch time (calculated) $06 - Lean to rich sensor switch time (calculated) $07 - Minimum sensor voltage for test cycle (calculated) $08 - Maximum sensor voltage for test cycle (calculated) $09 - Time between sensor transitions (calculated) $0A-$1F - reserved $20 - Test ID's supported - optional ($21 to $40) $21-$2F - values with units of time less than 1. 02 seconds $30-$3F - values with units of time less than 10. 2 seconds $40 - Test ID's supported - optional ($41 to $60) $41-$4F - values with units of voltage less than 1. 275 volts $50-$5F - values with units of voltage less than 12. 75 volts $60 - Test ID's supported - optional ($61 to $80) $61-$6F - values with units of Frequency less than 25. 5 Hz $70-$7F - values with units of counts less than 255 counts $80 - Test ID's supported - optional ($81 to $A0) $81-$9F - manufacturer specific values / units $A0 - Test ID's supported - optional ($A1 to $C0) $A1-$BF - manufacturer specific values ! units $C0 - Test ID's supported - optional ($C1 to $E0) $C1-$DF - manufacturer specific values / units $E0 - Test ID's supported - optional ($E1 to $FF) $E1-$FF - manufacturer specific values / units 3 Oxygen sensor location (one, and only one bit can be set to a 1): bit Sensor location * Alternative sensor location + 0 Bank 1 - Sensor 1 Bank 1 - Sensor 1 1 Bank 1 - Sensor 2 Bank 1 - Sensor 2 2 Bank 1 - Sensor 3 Bank 2 - Sensor 1 3 Bank 1 - Sensor 4 Bank 2 - Sensor 2 4 Bank 2 - Sensor 1 Bank 3 - Sensor 1 5 Bank 2 - Sensor 2 Bank 3 - Sensor 2 6 Bank 2 - Sensor 3 Bank 4 - Sensor 1 7 Bank 2 - Sensor 4 Bank 4 - Sensor 2 * If Service $01 PID $13 supported +If Service $01 PID $ ID supported ~~ The following 4 bytes define data bytes for Test IDs that indicate support of other Test IDs - optional ($00, $20, $40, $60, $80, $A0, $C0, and $E0) 4 Support for Test ID, where l=support, 0=non-support: bit 7 - support for Test ID request + $01 bit 6 - support for Test ID request + $02 bit 0 - support for Test ID request + $08 177 Support for Test ED, where l=support, O=non-support: bit 7 - support for Test ID request + $09 bit 6 - support for Test ID request + $0A bit 0 - support for Test ID request + $10 Support for Test ID, where l=support, 0=non-support: bit 7 - support for Test ID request + $11 bit 6 - support for Test ID request + $12 bit 0 - support for Test ID request + $18 Support for Test ID, where l=support, 0=non-support: bit 7 - support for Test ID request + $19 bit 6 - support for Test ID request + $1A bit 0 - support for Test ID request + $20 The following 3 bytes define data bytes for Test IDs that report data values Test ID: Test ID $01 Test ID $02 Test ID $03 Test ID $04 Test ID $05 Test ID $06 Test ID $07 Test ID $08 Test ID $09 Test ID $21-$2F Test ID $30-$3F Test ID $41-$4F Test ID $50-$5F Test ID $61-$6F Test ED $70-$7F Min ($00): 0 volt 0 volt Ovolt 0 volt 0 sec. 0 sec. Ovolt Ovolt 0 sec. 0 sec. 0 sec. Ovolt 0 volt 0 Hz 0 counts Max ($FF): 1. 275 v. 1. 275 v. 1. 275 v. 1. 275 v. 1. 02 sec. 1. 02 sec. 1. 275 v. 1. 275 v. 10. 2 sec. 1. 02 sec. 10. 2 sec. 1. 275 v. Scaling/bit. 005 v. 005 v. 005 v. 005 v. 004 sec. 004 sec. 005 v. 005 v. 04 sec. 004 sec. 04 sec. 005 volt. 05 volt. 1 Hz 12. 75 v. 25. 5 Hz 255 counts Minimum test limit (only for calculated test result) see Data Byte #4 for minimum value, maximum value, and scaling Maximum test limit (only for calculated test result) see Data Byte #4 for minimum value, maximum value, and scaling 1 count *NOTE: Current oxygen sensors are nominally 1 volt full scale. If an oxygen sensor is used with a different nominal output, the output voltage should be normalised to 1 volt. Full scale should be reported as $C8 (decimal 200), which allows for reporting an overvoltage condition. Figure 13 - Message Data Byte Description 178 5. 7. Service continuously Monitored Systems $06 - Request On-Board Monitoring Test Results for Non- 5. 7. 1. Functional Description The purpose of this test service is to allow access to the results for on-board diagnostic monitoring tests of specific components/systems that are not continuously monitored. Examples are catalyst monitoring and the evaporative system monitoring. The vehicle manufacturer is responsible for assigning test IDs and component IDs for tests of different systems and components. Test results are requested by test ID. Only one test limit is included in a response message, but that limit could be either a minimum or a maximum limit. If both a minimum and maximum test limit are to be reported, then two response messages will be transmitted, in any order. The most significant bit of the "test limit type / component ED" byte will be used to indicate the test limit type. This test service can be used as an alternative to Service oxygen sensor test results. $05 no report 5. 7. 2. Message Data Bytes Request Test Results #1 06 #2 Data Bytes (Hex) #3 | #4 | #5 #6 #7 Request Test Results Test ID Report Test ID Support (Test IDs $00, $20, $40, $60, $80, $A0, $C0, $E0) Report Test ED Support 46 Test ID FF Support for the next 32 test IDs following the requested ID for any component is indicated in data bytes #4 through #7 Report 1 Multiple Response (Test IDs other than $00, $20 Data is only valid if Service $01 P supported and t Test ID Report Test Results 46 rest Results s may be Transmitted , $40, $60, $80, $A0„$C0, $E0) ID $01 indicates the monitoring test is le test is complete. Test Limit Type & Component ID test value test limit MSB LSB MSB LSB 179 Data Byte 2 Description Test ID: $00 - Test ID's supported ($01 to $20) $01-$ IF - values defined by manufacturer $20 - Test ED's supported ($21 to $40) $21-$3F - values defined by manufacturer $40 - Test ID's supported ($41 to $60) $41-$5F - values defined by manufacturer $60 - Test ID's supported ($61 to $80) $61-$7F - values defined by manufacturer $80 - Test ID's supported ($81 to $A0) $81-$9F - values defined by manufacturer $A0 - Test ID's supported ($A1 to $C0) $A1-$BF - values defined by manufacturer $C0 - Test ID's supported ($C1 to $E0) $C1-$DF - values defined by manufacturer $E0 - Test ID's supported ($E1 to $FF) $E1-$FF - values defined by manufacturer bit 7: Most significant bit indicates type of test limit, where: 0 - test limit is maximum value - test fails if test value is greater than this value 1 - test limit is minimum value - test fails if test value is less than this value If the test result should be within a range of values, two messages will be returned, one with the maximum value and one with the minimum value bit 6 - bit 0: Component ID - manufacturer defined - necessary when multiple components or systems are present on the vehicle and have the same definition of test ID 180 The following 4 bytes define data bytes for Test IDs that indicate support of other Test IDs (Services $00, $20, $40, $60, $80, $A0, $C0, and $E0) Support for Test ID, where l=support, 0=non-support: bit 7 - support for Test ID request + $01 bit 6 - support for Test ID request + $02 bit 0 - support for Test ID request + $08 Support for Test ID, where l=support, 0=non-support: bit 7 - support for Test ID request + $09 bit 6 - support for Test ED request + $0A bit 0 - support for Test ID request + $10 Support for Test ID, where l=support, 0=non-support: bit 7 - support for Test ID request + $11 bit 6 - support for Test ID request + $12 bit 0 - support for Test ID request + $18 Support for Test ID, where l=support, 0=non-support: bit 7 - support for Test ID request + $19 bit 6 - support for Test ID request + $1A bit 0 - support for Test ID request + $20 The following 4 bytes define data bytes for Test EDs that report data values (multiple response messages will be received if there are multiple components that support the same test ID and $FF is included as data byte #3 in the request ) m g e a e s s 4-5 Test result (two byte value) - this value should be less than or equal to the test limit if most significant bit of data byte #3 is '0', and should be greater than or equal to the test limit if most significant bit of data byte #3 is '1' [Integer values] 6-7 Test limit (two byte value) [Integer values] Figure 14 - Message Data Bytes 181 5. 7. 3. Message Example #1 06 46 06 46 06 46 06 46 06 46 06 46 Request Test ID Support - ID in Hex Report Support for Test IDs 06, 10, IE and 20 Request Test ID Support Report Support for Test ID 40 Request Test ID Support Report Support for Test ID 60 Request Test ED Support Report Support for Test ID 80 Request Test ID Support Report Support for Test ID A0 Request Test ID Support Report Support for Test ID Al - no additional test IDs supported #2 #3 Determine Test ID Support #4 Data Bytes (Hex) #5 #6 #7 00 00 20 20 40 40 60 60 80 80 A0 A0 FF FF FF FF FF FF 00000100 =04 00000001 =01 00000000 =00 00000000 =00 00000000 =00 00000000 =00 00000000 =00 00000000 =00 00000000 =00 00000000 =00 10000000 =10 00000000 =00 0000000 0 =00 0000010 1 =05 0000000 0 =00 0000000 1 =01 0000000 0 - =00 0000000 1 =01 0000000 0 =00 0000000 1 =01 0000000 0 =00 0000000 1 =01 0000000 0 =00 0000000 0 =00 Following messages indicate test results for component 01 greater than the minimum Request Results for Test ID 06 Repou Results for component 01 - test value exceeds minimum - passed 06 46 06 06 81 test value minimum test limit 32 C4 16 00 cate test results greater than the maximum for component ID 01 less than the maximum for component 02 Following messages indi anc Request Results for Test ED 10 Report Results for component 01 - test value greater tfian maximum - failed Report Results for component 02 - test value less than maximum - passed 06 46 10 10 01 test value maximum test limit 46 10 02 • 92 36 test value 7F FF maximum test limit 06 61 58 43 182 Following messages indicate test results for component 31 between the minimum and maximum limits Request Results for Test ID Al Report Results for component 31 - test value greater than minimum - passed 06 46 Al Al Bl test value 46 Al 31 35 95 test value Report Results for component 31 - test value less than maximum - passed minimum test limit 14 00 maximum test limit 35 95 66 53 Figure 15 - Message Example 5. 8. Service $07 - Request On-Board Monitoring Test Results for Continuously Monitored Systems 5. 8. 1. Functional Description for emission-related powertrain components/systems The purpose of this service is to enable the off-board test device to obtain test results that are continuously monitored during normal driving conditions. The intended use of this data is to assist the service technician after a vehicle repair, and after clearing diagnostic information, by reporting test results after a single driving cycle. If the test failed during the driving cycle, the DTC associated with that test will be reported. Test results reported by this service do not necessarily indicate a faulty component/system. If test results indicate a failure after additional driving, then the MI will be illuminated and a DTC will be set and reported with Service $03, indicating a faulty component/system. Test results for these components/systems are reported in the same format as •the diagnostic trouble codes in Test Service $03 - refer to the functional description for Service $03. If less than 3 DTC values are reported for failed tests, the response messages used to report the test results should be padded with $00 to fill 7 data bytes. This maintains the required fixed message length for all messages. If there are no test failures to report, no response is required. 5. 8. 2. Message Data Bytes Data Bytes (Hex) #1 #2 #3 | #4 | #5 #6 #7 Request test results for continuously monitored systems Request test results | Report test results for continuously monitored systems | 07 | Report test results 47 Code #1 or 00 00 Code #2 or 00 00 Code #3 or 00 00 Figure 16 - Message Data Bytes 183 5. 9. Service $08 - Request Control of on-board system, test or component 5. 9. 1. Functional Description The purpose of this service is to enable the off-board test device to control the operation of an on-board system, test or component. The data bytes will be defined, if necessary, for each Test ED, and will be unique for each Test ID. If any data bytes are unused for any test, they should be filled with $00 to maintain a fixed message length. Possible uses for these data bytes in the request message are: Turn device ON Turn device OFF Cycle device for nn seconds. Possible uses for these data bytes in the response message are: Data Bytes (Hex) #4 #3 #5 #6 #7 Data C or $00 DataD or $00 DataE or $00 DataC or $00 DataD or $00 DataE or $00 - Report system status - Report test results 5. 9. 2. Message Data Bytes #1 #2 Request control of on board device 08 Test ID Request control o ? on-board device DataB Data A or or $00 $00 Report control of on board device 48 Report control of on-board device DataB or $00 Data A or $00 Test ID Figure 17 - Message Data Bytes 184 5. 9. : Test ID and Data Byte Description Test ID (Hex) 00 I Test ID and Data Byte Description Test IDs supported ($01 to $20) Request: Data bytes A to E should be set to $00 Response: Data A - $00 Data B - Same as Data Byte #4 in Service $06 Data C - Same as Data Byte #4 in Service $06 Data D - Same as Data Byte #4 in Service $06 Data E - Same as Data Byte #4 in Service $06 01 Evaporative system leak test Data bytes A to E should be set to $00 for request and response. If the conditions are not proper to run the test, the vehicle may either not respond to the request, or may respond with a manufacturer defined value as Data A which corresponds to the reason the test cannot be run. This test mode enables the conditions required to conduct an evaporative system leak test, but does not actually run the test. An example is to close a purge solenoid, preventing leakage if the system is pressurised. The vehicle manufacturer is responsible to determine the criteria to automatically stop the test (open the solenoid in the example), such as engine running, vehicle speed greater than zero, or exceeding a specified time period. 02-FF J Reserved - to be defined by ISO / SAE Figure 18 Test ED and Data Byte Description 185 Appendix 3 Scope This Appendix defines the requirements of OBD tools, i. e. test equipment that will interface with vehicle modules in support of the OBD diagnostic requirements. It covers the required capabilities of and conformance criteria for OBD Scan Tools. This Appendix is based on ISO CD XXX4 and SAE J1978, "OBD II Scan Tool". 2. References 2. 1. Applicable Documents: The following publications form a part of this Appendix to the extent specified herein. 2. 1. 1. Normative References ISO Documents: ISO 9141-2: 1994 (E) 2. 1. 2. Informative References SAE Documents: "Road Vehicles - Diagnostic Systems - CARB Requirements of Digital Information" Interchange for SAE J1850 SAE J1930 SAE J1962 SAE J1979 SAE J2012 SAE J2201 SAE J2205 Class B Data Communication Network Interface Electrical / Electronic Systems Diagnostic Terms, Acronyms, and Definitions Diagnostic Connector E/E Diagnostic Test Modes Recommended Diagnostic Trouble Codes Format and Messages for Universal Interface for OBD II Scan Tools DRAFT - Expanded Diagnostic Protocol California Code of Regulations, Section 1968. 1 Title 13 - "Malfunction and Diagnostic System Requirements 1994 and Subsequent Model Year Passenger Cars, Light Duty Trucks, and Medium Duty Vehicles With Feedback Control Systems" Environmental Protection Agency 40 CFR Part 86 Control of Air Pollution From New Motor Vehicles and New Motor Vehicle engines; Regulations Requiring On-Board Diagnostic Systems on 1994 and later Model Year Light- Duty Vehicles and Light-Duty trucks 186 4. Most terms for components and systems, contained in this document are included in ISO CD XXX3 (SAE J1930) - Terms, Definitions, and Acronyms. This Section includes additional definitions of terms used in this document, not included in ISO CD XXX3. 4. 1. Service = Test Mode 4. 2. No further definitions 5. Required Functions The following are the basic functions that the OBD Scan Tool is required to support or provide: - Automatic hands-off determination of the communication interface used, - Obtaining and displaying the status and results of vehicle on-board emission related diagnostic evaluations, - Obtaining and displaying OBD emissions related diagnostic trouble codes (DTCs), - Obtaining and displaying OBD emissions related current data, - Obtaining and displaying OBD emissions related freeze frame data, - Clearing the storage of OBD emissions related diagnostic trouble codes, OBD emissions related freeze frame data storage and OBD emissions related diagnostic tests status, - Ability to perform Expanded Diagnostic Protocol functions as described in ISO CD XXX6 (SAE J2205), - Obtaining and displaying OBD II emissions related test parameters and results as described in Appendix 2, - Provide a user manual and/or help facility. 6. Vehicle Interface The following specifies the minimum vehicle interfaces to be supported by an OBD Scan Tool. 6. 1. Communication Data Link and Physical Layers — The OBD Scan Tool must be able to communicate with vehicle control modules using the communication interfaces described as follows. ISO CD XXX6(SAE J2205) describes a set of functions and communication criteria. 6. 1. 1. ISO 11519-4 Recommended Practice Class B Data Communication Network Interface ISO 11519-4 describes two sets of data link and physical layers for class B vehicle serial multiplex bus networks. The OBD Scan Tool must support both ISO 11519-4 protocols in a manner that is transparent to the user. 187 6. 1. 2. ISO 9141-2: 1994 (E) Road Vehicles - Diagnostic Systems - CARB Requirements for Interchange of Digital Information ISO 9141-2 describes the physical and data link layers of a vehicle serial diagnostic bus. Refer to ISO CD XXX9 for further clarification regarding the use of ISO 9141-2. 6. 1. 3. ISO CD 14230-1,2 Road Vehicles - Diagnostic Sytems - Keyword Protocol 200 - Physical and Data Link Layers Refer to ISO 14230 for further clarification regarding the use of KWP2000. 6. 2. Connector The OBD Scan Tool must be compliant with SAE J1962 Diagnostic Connector. The OBD Scan Tool must support the Standard Pin Assignments defined in SAE J1962. 6. 3. Messages Appendix 2 or ISO 14230-1,2 describes the request messages to be sent by the OBD Scan Tool to the vehicle and the response messages to be sent by the vehicle to the OBD II Scan Tool in order to perform the required services. 6. 4. Expanded Diagnostic Protocol The OBD Scan Tool must allow the user to enter and send vehicle specific messages defined and supplied in motor vehicle manufacturer documents and ISO CD display XXX6(SAE J2205). response messages, as defined related the in 6. 5. Automatic Hands Off Determination of the Communication Interface Used in a Given Vehicle 6. 5. 1. General While there are four types of communication interfaces that could be used to access the OBD functions in a given vehicle (i. e. ISO 11519-4(SAE J1850) 41. 6 Kbps PWM, ISO 11519-4(SAE J1850) 10. 4 Kbps VPW with CRC, ISO 9141-2, KWP2000 ISO CD 14230-1,2), only one is allowed to be used in any one vehicle to access all supported OBD functions. When connected to a vehicle and/or when the OBD support is selected where such a selection is necessary, the OBD Scan Tool shall automatically attempt to determine which of the possible communication interfaces is being used in the vehicle to support OBD related functions. The tool will continue to try to determine which interface is being used until it is successful in doing so. No user the appropriate interface. required, nor allowed, input will be to determine 188 Indications or messages will be displayed during this process informing the user that initialisation is taking place and, if all interface types have been tested and none is responding properly to the request for OBD services, the OBD Scan Tool must advise the user: - To verify that the ignition is on. - To check the emissions label or vehicle service information to verify that the vehicle is OBD equipped. - To check that the tool is connected to the vehicle correctly. 6. 5. 2. Initialisation Details Only the following steps shall be used by an OBD Scan Tool to attempt to determine the type of communications interface used in a given vehicle to support OBD functions. - Test for ISO 11519-4(SAE J1850) 41. 6 Kbps PWM step 1: enablethelSO 11519-4(SAE J1850) 41. 6 Kbps PWM interface step 2: send a service 1 PID 0 request message step 3: if a service 1 PED 0 response message is received then ISO 11519-4(SAE J1850) 41. 6 Kbps PWM is the type of interface used in a vehicle for OBD support. - Test for ISO 11519-4(SAE J1850) 10. 4 Kbps VPW step 1: enablethelSO 11519-4(SAE J1850) 10. 4Kbps VPW interface step 2: send a service 1 PID 0 request message step 3: if a service 1 PID 0 response message is received then ISO 11519-4(SAE J1850) 10. 4 Kbps VPW with CRC is the type of interface used in a vehicle for OBD support. - Test for ISO 9141-2 step 1: enable the ISO 9141-2 interface step 2: if the initialisation sequence defined completed successfully, interface used in a vehicle for OBD II support. in ISO 9141-2 is then ISO 9141-2 is the- type of - Test for KWP2000 ISO CD 14230-1,2 step 1: enable the ISO 14230-1,2 interface step 2: if the initialisation sequence defined in ISO 14230-1,2 is completed successfully, then ISO 14230-1,2 is the type of interface used in a vehicle for OBD support. The previous tests may be performed in any order and where possible may be performed in parallel. The service 1 PID 0 request and response messages are defined in Appendix 2. 189 If the tester failts to establish communications using and of the initialisations and if the ignition is on and the vehicle emissions label or service information indicates the vehicle is OBD equipped, then the tester should indicate that there is a Data Link fault. 6. 6. On-Board Diagnostic Evaluations 6. 6. 1. Completed On-Board System Readiness Tests Immediately after initial communications are established, the OBD Scan Tool shall obtain the status of the on-board system readiness tests. If any supported tests have not been completed, the OBD Scan Tool shall indicate to the user: "Not all supported on-board system readiness tests have been completed" or equivalent. The OBD Scan Tool shall also allow the user to identify which readiness tests (if any) have not been completed. 6. 6. 2. Supported On-Board System Readiness Tests The OBD Scan Tool must be capable of indicating to the user which of the tests defined by Appendix 2 service 1 PED 1 data bytes 4 and 5 are supported and which are completed. 6. 6. 3. Malfunction Indicator The OBD Scan Tool must be capable of indicating if the MI has been commanded ON and if so, by which module or modules. 6. 7. Use of ISO CD XXX5(SAE J2201) Universal Interface for OBD Scan Tools The OBD Scan Tool shall use the interface described in ISO CD XXX5(SAE J2201), or an equivalent, as the interface to vehicles. 6. 8. Handling of No Response from Vehicle Vehicle modules may not respond to request messages from the OBD II Scan Tool because of incorrect communication of a request message or because the module does not support the request message. If a response is not received within the timeout period prescribed by the protocol, the scan tool shall: - first, retransmit the request message, - second, if still no response is received, transmit a service 1 PID 0 request message, in order to determine if communication with the vehicle is currently possible, and if the data desired is available, - - third, if a service 1 PID 0 response is received, transmit other messages, if available, to determine if the desired data is supported by the vehicle, lastly, if the above steps fail then as appropriate indicate to the user, that communication with the vehicle, the module or for the information the user has selected can not be performed. 6. 9. Connections Diagnostic Connector to the Vehicle in Addition to the SAE J1962 When connections are made between external equipment and the vehicle in addition to connections made between the same external equipment and the vehicle using the SAE J1962 Diagnostic Connector, any ground circuits must conform to the requirements of the Chassis Ground circuit in the SAE J1962 connector. The intent of this requirement is to maintain the isolation between the vehicle ground and the signal ground in external equipment. 190 7. System Interaction Capability 7. 1. Obtain and Display OBD II Emissions Related Diagnostic Trouble Codes The OBD Scan Tool must be capable of obtaining, converting and displaying OBD emissions related diagnostic trouble codes from a vehicle that can be transmitted by a response to a ISO CD XXX1(SAE J1979) request (see Appendix 2). Either the diagnostic trouble code, its descriptive text or both must be displayed. Diagnostic Trouble Codes and their descriptive text are defined in Appendix 4. When diagnostic trouble code data are selected for display, the OBD Scan Tool will continuously request of the vehicle it's DTC data and display the data received in the corresponding response messages. 7. 2. Obtain and Display OBD Emissions Related Current Data, Freeze Frame Data, Test Parameters and Results The OBD Scan Tool must be capable of obtaining, converting and displaying: - OBD emissions related current data; - OBD emissions related freeze frame data; - test parameters and results data as described in Appendix 2. Appendix 2 details the available data, the messages to be used to request the data, the messages to be used to return the data, the conversion values for the data and the format to be used to display the data. When current data items are selected for display, the OBD Scan Tool will continuously request of the vehicle the data to be displayed and display the data received in the corresponding response messages. When freeze frame or test parameters and results are selected for display, the OBD Scan Tool does not need to continuously request and display those items. Where applicable, the OBD II Scan Tool must indicate whether a test limit is a high limit or a low limit. Where applicable, the display of test results must also show the test ID and component ED. Data from the vehicle may indicate which items are supported, in which case this information shall be made available to the user by the OBD scan tool. The OBD Scan Tool shall also allow users to specify requests for services, parameters, test IDs, etc. irrespective of whether the vehicle has indicated support for such items. 7. 3. Responses from Multiple Modules — The OBD Scan Tool must be capable of interfacing with a vehicle in which multiple modules may be used to support OBD requirements. The QBD Scan Tool must inform the user when multiple modules respond to the same request. The OBD Scan Tool must inform the user when multiple modules respond with different values for the same data item. The OBD Scan Tool must provide the user with the ability to select for display, as separate items, the responses received from multiple modules for the same data item. 191 7. 4. Code Clearing The OBD Scan Tool must be capable of sending a request to clear OBD emissions related diagnostic trouble codes, OBD emissions related freeze frame data and OBD emissions related diagnostic tests status information. The OBD Scan Tool must require the user to confirm such a request before transmitting (e. g. are you sure?). 8. General Characteristics 8. 1. Display The OBD Scan Tool must be capable of displaying simultaneously at least 2 (two) items of OBD emissions related data/ A list of the OBD emissions related current data and freeze frame data items, their Parameter IDs, data resolution and data conversion information, units and display formats is provided in Appendix 2. The display units shall be the Standard International (SI) and English units as specified in Appendix 2. A user shall be able to select between English and SI values. The unit conversions specified in Appendix 2 shall be used. The display of each OBD emissions related current data or freeze frame data shall include the following: - Data value; - Data Parameter ID or name; - The module ID of the module that supplied the data. The display of each OBD emissions related diagnostic trouble code shall include the module ID of the module that supplied the code. As a minimum the data values of two data items must be displayed simultaneously. A display of the parameter EDs of the data items and the IDs of the modules that supplied the data items must be easily accessible if not displayed with the data values. The units of measurement associated with the data items must either be: - Displayed with the data values or; - easily accessible on the display or; — - readily available to the user (e. g. on the tester body); - Having this information available in a user's manual separate from the body of tiie tool does not satisfy this requirement. The display must be capable of showing at least alphanumeric characters. 192 8. 2. User Input The OBD Scan Tool must include some form of user input that would allow the user to: - Select between the basic functions required by OBD II, i. e: - display current data - display freeze frame data - display trouble codes - clear emissions related data - display test parameters and results); - select for simultaneous display at least two items of any one of the following: - OBD emissions related current data - OBD emissions related diagnostic trouble codes - OBD emissions related freeze frame data - OBD emissions related test parameters and results. Responses from multiple modules to requests for a current data item or a freeze frame data item are treated as separate data items for selection and display purposes - To verify a request to clear and/or reset OBD emissions related diagnostic information as defined by Appendix 2. - Enter and send Expanded Diagnostic Protocol messages as defined in ISO CD XXX6 (SAE J2205) Power Requirements if Powered by the Vehicle Through the ISO 11519 (SAE J1962) Diagnostic Connector Voltage Must operate normally within a range of 8. 0 to 18. 0 volts D. C. Must survive a steady state voltage of up to 24. 0 volts D. C. for at least 10. 0 minutes. Must survive a steady state reverse voltage of up to 24. 0 Volts D. C. for at least 10 minutes. The tool must withstand cranking in that communications and data shall not be lost during battery voltage reductions to 5. 5V for up to 0. 5s. The display need not function during this period. For Maximum current refer to ISO 11519(SAE J1962). 193 10. Electromagnetic Compatibility (EMC) The tool must not interfere with the normal operation of vehicle modules. The normal operation of the tool must be immune to conducted and radiated emissions present in a service environment and when connected to a vehicle. The tool must be immune to reasonable levels of Electrostatic Discharge (ESD). EMC and ESD measurements and limits will be in accordance to the standards prevailing in the country in which the tester is to be sold. 11. Conformance Testing 11. 1. General The documents relating to confromance testing are still being prepared. When they are completed the tests outlined below will need to be revised accordingly. Conformance testing defines the tests required to be passed in order for tools to be type approved as "ISO CD XXX4 <date to be added> OBD SCAN TOOL COMPATIBLE" or "CONFORMS TO ISO CD XXX4". Tools that do not pass these tests are not to be so labelled. Validation of the conformance test is the responsibility of the Scan Tool manufacturer and the Scan Tool manufacturer may elect to self-certify. The tests in this section must be performed successfully 5 consecutive times in order to be considered passed. Three examples of at least production intent level tools must pass all these tests in order for a given version of tool hardware and software to be considered passed. Any changes to the hardware or software used in a tool for the functions described in this document will require a retest of these tests or an explanation from the tool manufacturer as to why the change should not require a retest. Where an explanation is submitted in lieu of a retest due to a change, the organization originally performing these tests will determine whether the explanation is acceptable or whether a retest is required. Reasonable normal engineering criteria will be used when determining whether to accept an explanation. The Scan Tool manufacturer shall make available to the buying public: - The methods used to make these tests - The results of the tests - Clear indication of the versions of hardware and software that conform (i. e. labeled as conforming to or are compatible with the requirements of ISO CD XXX4 OBD Scan Tool or other labeling to that effect). 194 Both proper and improper response messages will be employed during these tests. Improper responses are those that have incorrect first, second or third bytes of the header, an incorrect mode, an incorrect PED, an incorrect length of the response message, or with an incorrect CRC or CS. The tool must ignore all improper response messages and perform as if no response was received. Situations involving multiple modules responding to a single request, single modules responding with multiple responses to a single request and multiple modules responding with multiple responses to a single request will be tested. The interval between the end of the request message and the beginning of the response message(s) will be varied from 0 ms up to the delay required to show a no response indication on the OBD II Scan Tool. The delay that causes the no response indication will be compared to the value defined in each protocol. The format, content and order of messages transmitted on each of the buses will be observed and reviewed for correctness. The ability to obtain and report the results of the on-board system readiness tests shall be verified. The ability to report which tests the vehicle supports and have been completed shall be verified. The requirements described in 11. 3 through 11. 7 (inclusive) shall be verified on each protocol specified in 6. 1. When performing these tests, observation of the indications and displays provided to the user and the signals on the ISO 11519-4 (SAE J1850) (bus +) and (bus -) lines, the ISO 9141-2 K and L lines and ISO 14230-1,2 K and L lines will be the criteria for proper performance. These tests will be executed in an environment of 25 degrees C +/-3 degrees C and between 30% and 80% relative humidity +/- 5%. The hardware and software used in the OBD II Scan Tool version being tested ' must be identified. 11. 2. Determine OBD II Communication Type Item to be tested: Automatic hands off determination of interface type - - - - - that it is automatic when the SAE J1962 connector is plugged into its mating connector in the vehicle and/or OBD support is selected, where such a selection is necessary. that a test of all OBD communication interfaces is performed at least once per scan. that the scan of all interfaces continues until successful or until terminated by the user. that some indication is provided to the user that the scan of interfaces is being performed. that a failure to successfully find an OBD II interface during a scan of all the possible interfaces is indicated to the user at the completion of each and every scan. 195 - - - - - that when an OBD interface is successfully found, the tool automatically prompts the user for function selection. that the tool provides and uses the facilities and/or messages defined in SAE J2201 (or equivalent), Appendix 2, ISO 9141-2, ISO 11519-4 (SAE J1850), ISO 14230 and Appendix 4. that the tool does not exceed the polling rates specified in Appendix 2. that the tool provides the proper bias for the K and L lines as specified in ISO 9141-2 and ISO 14230-1. that the tool performs the initialisation tests according to 6. 5. 2, and indicates the information according to 6. 5. 1. The interface determination tests will be performed: - with no modules available, - with an ISO 9141-2 module available, - with a KWP2000 (ISO 14230) module available, - with a ISO 11519 (SAE J1850) 41. 6 Kbps PWM module available, - with a ISO 11519 (SAE J1850) 10. 4 Kbps VPW module available. 11. 3. On-Board System Readiness Tests Item to be tested: - that the tool automatically requests and reports the results of the supported on-board system readiness tests. 11. 4. Select Functions Item to be tested: - - that the tool supports the functions described in Section 5. that the user is able to move back and forth between these functions. The criteria for successfully passing this test is to be able to easily move back and forth between all functions and observe the results. - 11. 5. Select and Display Items Item to be tested: - that the user is able to select and display simultaneously at least two items from any one of: - available DTC's, - current data items, - available freeze frame data items, and - test parameters and results. 196 - - - - - - - that the module ID's and the PID's or parameter names associated with either all the (a) simultaneously with the displayed items, or (b) in some alternate method (printed material, etc. ). also be displayed items mentioned above can that the units-of-measurement information associated with all the possible current data items and freeze frame data items is easily available either as a part of the data display, displayed separately, or otherwise available on or with the tool body itself. that the tool is able to handle multiple responses from the same module due to one request. that the tool is able to handle responses from multiple modules due to one request. that the tool is able to handle multiple responses from multiple modules due to one request. that the tool informs the user that responses from multiple modules due to one request were received. Responses for multiple modules to a request are to be made available to the user as separate items for display. that the tool informs the user that different responses from multiple modules due to one request were received. The criteria for successfully passing this test is to easily select back and forth between all the items and observe the results. 11. 6. Verify Requests to Clear Codes Item to be tested: - - that the selection of the Clear Codes function incorporates a request to the user to verification. that both yes and no responses to the request to the user to verify the selection of the Clear Codes function are processed appropriately. This test should involve situations where there are some DTC's to clear and other situations where there are no DTC's to clear. When making this test, the presence of DTC's must be verified both before and after the Clear Codes function is selected. 11. 7. General Diagnostic Communication Tests When performing tests involving diagnostic messages, tests are to be made of the tool's ability to handle an immediate response, a slow response and a response delayed longer than the maximum allowed by each of the protocols. The tool should be able to process all responses that are received within the maximum time allowed by each protocol and indicate a no response condition to the user when the response is delayed longer than the maximum allowed by each protocol. The tool must support the transmission of its node address as an in-frame- response during the transmission of any response messages from modules on a ISO 11519 (SAE J1850) bus and must be able to handle both the presence and the absence of an in-frame-response during the tool's transmission of request messages. 197 11. 8. Expanded Diagnostic Protocol Item to be tested: - that the user is reasonably able to enter Expanded Diagnostic Protocol (EDP) input and that the OBD Scan Tool correctly executes the entered EDP input. 11. 9. Capacitance and Impedance at the SAE J1962 Connector Item to be tested: - that the capacitance and impedance of the OBD Scan Tool, connecting cables and the male SAE J1962 connector, as seen at the connector, are within the limits defined in ISO 11519 (SAE J1850), ISO 9141-2, ISO 14230 and SAE J1962. Note that SAE J1962 details the impedance of both the used and unused pins. Measurement of these parameters will be made by the testing agency at their discretion following generally acceptable engineering practices. 11. 10. Operating Voltage and Current Draw Item to be tested: - - that the OBD Scan Tool will correctly operate throughout the voltage range specified in the Section 9 of this Appendix and will not require more than the maximum current specified in the Section 9 of this Appendix. that the tool will survive the use of supply voltages of up to the maximum survival voltage and survival reverse voltage specified in the Section 9 of this Appendix. During other conformance tests, the voltage supplied to the OBD Scan Tool is to be varied throughout the specified range and check for continuous operation. Also the current draw is to be compared with the limit specified. 11. 11. Protocol Check Item to be tested: - that all the request and response messages defined by each of the protocols, as specified in Section 6 are properly and appropriately used by the OBD Scan Tool. 11. 12. Alphanumeric Display Item to be tested: - that the OBD Scan Tool is able to display alphanumeric characters. The results of the above test will be observed to determine the ability of the OBD Scan Tool to display alphanumeric characters. 11. 13. User Manual and Help Facility Item to be tested: - that a useful user manual and/or HELP facility is available with the OBD Scan Tool. 198 - that the user manual and/or HELP facility at least includes: - Parameter definitions and Test Ids as described in Appendix 2; - DTC definitions as described in Appendix 4; - All abbreviations used by the tool; - how to select the functions; - how to select items for simultaneous display; - how to determine the PED, item name and module ED of data returned for display; - how to verify the selection of the Clear Codes function; - how to obtain and display OBD emissions related test parameters and results as described in related documentation for each protocol; - how multiple responses from one request is indicated; - how different responses to the same request is indicated; - what current and freeze frame data items are available through OBD; - how to enter requests for the Expanded Diagnostic Protocol and interpret the results. The OBD Scan Tool will be tested for a HELP facility and/or the availability and coverage of a user manual. 199 1. Scope Appendix 4 This Appendix provides some recommended uniformity for these numeric codes. It further provides guidance for uniform messages associated with these codes. The document is comprised of several sections addressing format structure, messages, and a few examples applying the recommendations of the document. The actual code assignments and messages for powertrain systems are contained in one part attached to the Appendix (Part A). The recommended Diagnostic Trouble Codes (DTC) consist of a three digit numeric code preceded by an alpha-numeric designator. The code structure itself is partially open ended. A portion of the available numeric sequences (portions of "BO", "CO", "PO, and "UO") are reserved for uniform codes assigned by this or future updates of this document. Because of continued development in OBD systems and the flexibility of the partially open assignment structure, particular attention should be paid to ensure the user has the latest version of this document. This Appendix is based on ISO CD XXX2 and SAE J 2012, "Diagnostic Trouble Code Definitions". 2. 2. 1. Normative References (References) Applicable Documents The following publications form a part of this specification to the extent specified herein. 2. 1. 1. Normative References ISO Documents: ISO 9141-2 - Diagnostic Road vehicles requirements for interchange of digital information. systems - CARB ISO CD 14230 Keyword Protocol 2000 Parts 1/2/3 ISO 11519-4 Road Vehicles Low speed Serial Data Communication Class B -Data Communications Interface (SAE J1850) ISO CD 14229 Diagnostic Services 2. 1. 2. Informative References SAE Documents: J1850 FEB94 Class B Data Communication Network Interface J1930 JUN93 Systems Diagnostic Terms, Definitions, E/E Abbreviations and Acronyms J1962 JUN93 Diagnostic Connector J1978 MAR92 OBD II Scan Tool J2012 MAR92 Recommended Format and Messages for Diagnostic Trouble Codes 200 J2186 SEP91 Diagnostic Data Link Security J2190 JUN93 Enhanced E/E Diagnostic Test Modes 3. Definitions Most circuit, component, or system Diagnostic Trouble Codes are defined by four basic categories: General Circuit Malfunction, Range/Performance Problem, Low or High Circuit Input. Most terms for components and systems contained in this document are included in ISO CD XXX3 (SAE Recommended Practice J1930) referenced above. This section includes additional definitions of terms not included in ISO CD XXX3. 3. 1. General circuit malfunction Fixed value or no response from the system. Manufacturers may choose to use this code in place of the dual High/Low (defined below) "Or use to indicate any other failure mode. 3. 2. Range/performance The circuit is functional but not in the normal operating range. May also be used to indicate stuck, erratic, intermittent, or skewed values indicating poor performance of a circuit, component, or system. 3. 3. Low input Circuit voltage, frequency, or other signal measured at the control module input terminal or pin that is at or near zero. This is measured with the external circuit, component, or system connected. The signal type (voltage, frequency, etc. ) shall be included in the message in place of the word "input". 3. 4. " High input Circuit voltage, frequency, or other signal measured at the control module input terminal or pin that is at or near full scale'for the particular signal being measured. This is measured with the external circuit, component, or system connected. The signal type (voltage, frequency, etc. ) shall be included in the message in place of the word "input". 3. 5. # = number While each manufacturer has the ability to define the specific DTC's to meet their specific controller algorithms all DTC words must meet applicable (SAE Recommended Practice J1930) referenced above. ISO CD XXX3 201 4. 0. 4. 1. Format structure Description The Diagnostic Trouble Code consists of an alpha-numeric designator, BO - - B3 for Body, CO ~ C3 for Chassis, P0 - P3 for Powertrain, and U0 ~ U3 for Network Communication, followed by three digits. The assignment of the proper alpha designator should be determined by the controller into which the particular function being diagnosed is being integrated, or in the case of multiple controllers, the area most appropriate for that function. In most cases, the alpha designator will be implied since diagnostic information will be requested from a particular controller. In the cases where the source of the diagnostic information is not clear, the uppermost nibble of the two-byte code message as defined in Appendix 2 will define the source system as follows: 0000 - P0 - Powertrain codes ISO / SAE controlled 0 0 0 1- PI - Powertrain codes Manufacturer controlled 0010 - P2 0011 - P3 - - Powertrain codes Reserved Powertrain codes Reserved 1100- U0 - Network Communication codes ISO / SAE controlled 1101- UI - Network Communication codes Manufacturer controlled 1110 - U2 - Network Communication codes Manufacturer controlled 1111 - U3 - Network Communication codes Reserved Within each code class, the first of the three digits identifies a particular grouping of codes. These particular groupings each contain a series of 100 sequence numbers for particular code definitions. Codes have been defined to indicate a suspected trouble or problem area and are intended to be used as a directive to the proper service procedure. To minimise service confusion, fault codes should not be used to indicate the absence of problems or the system (e. g. Powertrain System O. K. , or MEL illuminated), but should be confined to indicated areas in need of service attention. Each alpha designator has code subdivisions which are industry controlled or which are manufacturer specific. These are shown in the above Table and described as "Gore" and "Non Uniform" respectively in the following clauses. Codes in the ISO/SAE subdivisions even if not defined in this document are not to be used by manufacturers until they have been approved by SAE and ISO. the status of parts of 4. 2. Core DTCs Core Diagnostic Trouble Codes are those codes where industry uniformity has been achieved. These codes were felt to be common enough across most manufacturers' applications that a common number and fault message could be assigned. AJ1 undefined numbers in each grouping have been reserved for future growth. Although service procedures may differ widely amongst manufacturers, the fault being indicated is common enough to be assigned a particular fault code. 202 4. 3. Non-Uniform DTC the manufacturers due Areas within each alpha designator have been made available for non uniform DTCs. These are fault codes that will not generally be used by a majority of to basic system differences, implementation differences, or diagnostic strategy differences. Each vehicle manufacturer or supplier who designs and specifies diagnostic algorithms, software, and diagnostic trouble codes are strongly encouraged to remain consistent across their product line when assigning codes in the manufacturer controlled area. For Powertrain codes, the same groupings should be used as in the ISO / SAE controlled area, i. e. , 100's and 200's for Fuel and Air Metering, 300's for Ignition System or Misfire, etc. Code groupings for non-Powertrain codes will be defined at a later date. 4. 4. Powertrain System Groupings 4. 4. 1. POXXX ISO / SAE Controlled 4. 4. 1. 1. P01XX Fuel and Air Metering 4. 4. 1. 2. P02XX Fuel and Air Metering 4. 4. 1. 3. P03XX Ignition System or Misfire 4. 4. 1. 4. P04XX Auxiliary Emission Controls 4. 4. 1. 5. P05XX Vehicle Speed, Idle Control, and Auxiliary Inputs 4. 4. 1. 6. P06XX Computer and Auxiliary Outputs 4. 4. 1. 7. P07XX Transmission 4. 4. 1. 8. P08XX Transmission 4. 4. 1. 9. P09XX Reserved for ISO / SAE 4. 4. 1. 10. P00XX Reserved for ISO / SAE 4. 4. 2. P1XXX Manufacturer Controlled 4. 4. 2. 1. P11XX Fuel and Air Metering 4. 4. 2. 2. P12XX Fuel and Air Metering 4. 4. 2. 3. P13XX Ignition System or Misfire 4. 4. 2. 4. P14XX Auxiliary Emission Controls 4. 4. 2. 5. P15XX Vehicle Speed, Idle Control, and Auxiliary Inputs 4. 4. 2. 6. P16XX Computer and Auxiliary Outputs. 4. 4. 2. 7. P17XX Transmission 4. 4. 2. 8. P18XX Transmission 4. 4. 2. 9. P19XX Category to be Determined by ISO / SAE 203 4. 4. 2. 10. P10XX Category to be Determined by ISO / SAE 4. 4. 3. P2XXX ISO / SAE Reserved 4. 4. 4. P3XXX ISO / SAE Reserved 4. 5. Network Communication Groupings 4. 5. 1. UOXXX ISO / SAE Controlled 4. 5. 2. U1XXX Manufacturer Controlled 4. 5. 3. U2XXX Manufacturer Controlled 4. 5. 4. U3XXX Reserved 5. 0. Messages Each defined fault code has been assigned a message to indicate the circuit, component or system area that was determined to be at fault. The messages are organized such that different messages related to a particular sensor or system are grouped together. In cases where there are various fault messages for different types of faults, the group also has a "generic" message as the first Code/Message of the group. A manufacturer has a choice when implementing diagnostics, based on the specific strategy and complexity of the diagnostic, whether to use one "generic" code for any fault of that circuit, component or system or to use the more specific codes for better defining the type of fault that was detected. The manufacturer must determine what codes and messages best fit the diagnostics actually implemented. The intent is to have only one code stored for each fault detected. » Where messages are broken down into more specific fault descriptions for a circuit, component, or system, the manufacturer should choose the code most applicable to their diagnosable fault. The messages are intended to be somewhat general to allow manufacturers to use them as often as possible yet still not conflict with their specific repair procedures. The terms "LOW" and "HIGH" when used in a message, especially those related to input signals, refer to the voltage, frequency, etc. at the pin of the controller. The specific level of "LOW" and "HIGH" must be defined by each manufacturer to best meet their needs. 6. 0. Examples Manufacturers may chose the depth of diagnosis performed by on board systems and that performed by off board equipment and procedures. In the case of a fault detected with the Throttle Position (TP) Sensor a number of fault codes may be used. If the diagnosis is all to be completed off board then use P0120 (TP Sensor Circuit Malfunction). However if the manufacturer chooses to perform more diagnosis on board then the following codes could be used: - System detects that the input signal is stuck near zero use P0122 (TP Sensor Low Input) 204 - System detects that the input signal is stuck near full scale use P0123 (TP Sensor High Input), - System detects that the input signal is not as expected on idle (e. g. is at 1. 5v rather than l. Ov) use P0121 (TP Sensor Range / Performance). - The generic code P0120 (TP Sensor Circuit Malfunction) could be used in place of any of the above. Even with the more detailed information identification of the root cause of the problem remains as an off board task. For example the higher voltage on idle could be caused by corrosion of electrical contacts or by a poor setting of the throttle plate. 205 PART A POWERTRAIN SYSTEM DIAGNOSTIC TROUBLE CODES NOTE These include systems that might be Following are the Recommended Industry Common Trouble Codes for the Powertrain Control System. into an electronic control module that would be used for controlling Engine functions, such as Fuel, Spark, Idle Speed and Vehicle Speed (Cruise Control) as well as those for Transmission as a Common Industry Code does not imply that it is a Required Code (Legislated), an Emission Related Code, or that it indicates a fault that will cause the Malfunction Indicator Light to be illuminated. that a code control. The recommended integrated fact is P01XX Fuel and Air Metering P0100 P0101 P0102 P0103 P0104 P0105 P0106 P0107 P0108 P0109 P0110 P0111 P0112 P0113 P0114 P0115 P0116 P0117 P0118 P0119 P0120 P0121 P0122 P0123 P0124 P0125 P0126 P0130 P0131 P0132 P0133 P0134 PÔ135 Mass or Volume Air Flow Circuit Malfunction Mass or Volume Air Flow Circuit Range/Performance Problem Mass or Volume Air Flow Circuit Low Input Mass or Volume Air Flow Circuit High Input Mass or Volume Air Flow Circuit Intermittent Manifold Absolute Pressure/Barometric Pressure Circuit Malfunction Manifold Absolute Pressure/Barometric Pressure Circuit Range/Performance Problem Manifold Absolute Pressure/Barometric Pressure Circuit Low Input Manifold Absolute Pressure/Barometric Pressure Circuit High Input Manifold Absolute Pressure/Barometric Pressure Circuit Intermittent Intake Air Temperature Circuit Malfunction Intake Air Temperature Circuit Range/Performance Problem Intake Air Temperature Circuit Low Input Intake Air Temperature Circuit High Input Intake Air Temperature Circuit Intermittent Engine Coolant Temperature Circuit Malfunction Engine Coolant Temperature Circuit Range/Performance Problem Engine Coolant Temperature Circuit Low Input Engine Coolant Temperature Circuit High Input Engine Coolant Temperature Circuit Intermittent Throttle/Pedal Position Sensor/Switch "A" Circuit Malfunction Throttle/Pedal Position Sensor/Switch "A" Circuit Range/Performance Problem Throttle/Pedal Position Sensor/Switch "A" Circuit Low Input Throttle/Pedal Position Sensor/Switch "A" Circuit High Input Throttle/Pedal Position Sensor/Switch "A" Circuit Intermittent Insufficient Coolant Temperature for Closed Loop Fuel Control Insufficient Coolant Temperature for Stable Operation (Bank 1* Sensor 1) 02 Sensor Circuit Malfunction (Bank 1* Sensor 1) 02 Sensor Circuit Low Voltage (Bank 1* Sensor 1) 02 Sensor Circuit High Voltage 02 Sensor Circuit Slow Response (Bank 1* Sensor 1) 02 Sensor Circuit No Activity Detected (Bank 1* Sensor 1) (Bank 1* Sensor 1) 02 Sensor Heater Circuit Malfunction * For systems with single 02 sensors, use codes for Bank 1 sensor, contains cylinder #1. Sensor 1 is closest to the engine. Bank 1 206 P0136 P0137 P0138 P0139 P0140 P0141 P0142 P0143 P0144 P0145 P0146 P0147 P0150 P0151 P0152 PO 153 P0154 P0155 P0156 P0157 P0158 PO 159 PO 160 P0161 PO 162 PO 163 PO 164 P0165 P0166 P0167 PO 170 P0171 PO 172 P0173 PO 174 P0175' P0176 PO 177 PO 178 PO 179 P0180 P0181 P0182 P0183 P0184 P0185 PO 186 P0187 P0188 PO 189 PO 190 P0191 P0192 PO 193 PO 194 P0195 (Bank 02 Sensor Circuit Malfunction (Bank 02 Sensor Circuit Low Voltage (Bank 02 Sensor Circuit High Voltage 02 Sensor Circuit Slow Response (Bank 02 Sensor Circuit No Activity Detected (Bank (Bank 02 Sensor Heater Circuit Malfunction (Bank 02 Sensor Circuit Malfunction (Bank 02 Sensor Circuit Low Voltage (Bank 02 Sensor Circuit High Voltage 02 Sensor Circuit Slow Response (Bank 02 Sensor Circuit No Activity Detected (Bank (Bank 02 Sensor Heater Circuit Malfunction (Bank 02 Sensor Circuit Malfunction (Bank 02 Sensor Circuit Low Voltage (Bank 02 Sensor Circuit High Voltage 02 Sensor Circuit Slow Response (Bank 02 Sensor Circuit No Activity Detected (Bank (Bank 02 Sensor Heater Circuit Malfunction (Bank 02 Sensor Circuit Malfunction (Bank 02 Sensor Circuit Low Voltage 02 Sensor Circuit High Voltage (Bank (Bank 02 Sensor Circuit Slow Response 02 Sensor Circuit No Activity Detected (Bank (Bank 02 Sensor Heater Circuit Malfunction (Bank 02 Sensor Circuit Malfunction (Bank 02 Sensor Circuit Low Voltage (Bank 02 Sensor Circuit High Voltage 02 Sensor Circuit Slow Response (Bank 02 Sensor Circuit No Activity Detected (Bank (Bank 02 Sensor Heater Circuit Malfunction (Bank Fuel Trim Malfunction (Bank System too Lean (Bank System too Rich (Bank Fuel Trim Malfunction (Bank System too Lean (Bank System too Rich 1* Sensor 2) 1* Sensor 2) Sensor 2) 1* Sensor 2) 1* Sensor 2) 1* 1* Sensor 2) 1* Sensor 3) 1* Sensor 3) 1* Sensor 3) 1* Sensor 3) 1* Sensor 3) 1* Sensor 3) Sensor Y Sensor Y Sensor Y Sensor 1' Sensor 1] Sensor Y Sensor 2) Sensor 2] Sensor Sensor Sensor Sensor Sensor Sensor Sensor Sensor Sensor Sensor 1*) 1*) 1*) 2) 2) 2) For systems with single 02 sensors, use codes for Bank 1 sensor. Bank 1 contains cylinder #1. Sensor 1 is closest to the engine. Fuel Composition Sensor Circuit Malfunction Fuel Composition Sensor Circuit Range/Performance Fuel Composition Sensor Circuit Low Input Fuel Composition Sensor Circuit High Input Fuel Temperature Sensor "A" Circuit Malfunction Fuel Temperature Sensor "A" Circuit Range/Performance Fuel Temperature Sensor "A" Circuit Low Input Fuel Temperature Sensor "A" Circuit High Input Fuel Temperature Sensor "A" Circuit Intermittent Fuel Temperature Sensor "B" Circuit Malfunction Fuel Temperature Sensor "B" Circuit Range/Performance Fuel Temperature Sensor "B" Circuit Low Input Fuel Temperature Sensor "B" Circuit High Input Fuel Temperature Sensor "B" Circuit Intermittent Fuel Rail Pressure Sensor Circuit Malfunction Fuel Rail Pressure Sensor Circuit Fuel Rail Pressure Sensor Circuit Fuel Rail Pressure Sensor Circuit Fuel Rail Pressure Sensor Circuit Engine Oil Temperature Sensor Malfunction Range/Performance Low Input High Input Intermittent 207 P0196 P0197 P0198 P0199 Engine Oil Temperature Sensor Range/Performance Engine Oil Temperature Sensor Low Engine Oil Temperature Sensor High Engine Oil Temperature Sensor Intermittent P02XX Fuel and Air Metering P0200 P0201 P0202 P0203 P0204 P0205 P0206 P0207 P0208 P0209 P0210 P0211 P0212 P0213 P0214 P0215 P0216 P0217 P0218 P0219 P0220 P0221 P0222 P0223 P0224 P0225 P0226 P0227 P0228 P0229 P0230 P0231 P0232 P0233 P0235 P0236 P0237 P0238 P0239 P0240 P0241 P0242 P0243 P0244 P0245 P0246 P0247 P0248 P0249 P0250 P0251 P0252 P0253 nder 1 - Injector Circuit Malfunction nder 2 - Injector Circuit Malfunction nder 3 - Injector Circuit Malfunction nder 4 - Injector Circuit Malfunction nder 5 - Injector Circuit Malfunction nder 6 - Injector Circuit Malfunction nder 7 - Injector Circuit Malfunction nder 8 - Injector Circuit Malfunction nder 9 - Injector Circuit Malfunction nder 10 - Injector Circuit Malfunction nder 11 - Injector Circuit Malfunction inder 12 - Injector Circuit Malfunction Injector Circuit Malfunction Cyl Cyl Cyl Cyl Cyl Cyl Cyl Cyl Cyl Cyl Cyl Cyl Cold Start Injector 1 Malfunction Cold Start Injector 2 Malfunction Engine Shutoff Solenoid Malfunction Injection Timing Control Circuit Malfunction Engine Overtemp Condition Transmission Over Temperature Condition Engine Overspeed Condition Throttle/Pedal Position Sensor/Switch "B" Circuit Malfunction Throttle/Pedal Position Sensor/Switch "B" Circuit Range/Performance Problem Throttle/Pedal Position Sensor/Switch "B" Circuit Low Input Throttle/Pedal Position Sensor/Switch "B" Circuit High Input Throttle/Pedal Position Sensor/Switch "B" Circuit Intermittent Throttle/Pedal Position Sensor/Switch "C" Circuit Malfunction Throttle/Pedal Position Sensor/Switch "C" Circuit Range/Performance Problem Throttle/Pedal Position Sensor/Switch "C" Circuit Low Input Throttle/Pedal Position Sensor/Switch "C" Circuit High Input Throttle/Pedal Position Sensor/Switch "C" Circuit Intermittent Fuel Pump Primary Circuit Malfunction Fuel Pump Secondary Circuit Low Fuel Pump Secondary Circuit High Fuel Pump Secondary Circuit Intermittent Turbocharger Boost Sensor "A" Circuit Malfunction Turbocharger Boost Sensor "A" Circuit Range/Performance Turbocharger Boost Sensor "A" Circuit Low Turbocharger Boost Sensor "A" Circuit tligh Turbocharger Boost Sensor "B" Circuit Malfunction Turbocharger Boost Sensor "B" Circuit Range/Performance Turbocharger Boost Sensor "B" Circuit Low Turbocharger Boost Sensor "B" Circuit High Turbocharger Wastegate Solenoid "A" Malfunction Turbocharger Wastegate Solenoid "A" Range/Performance Turbocharger Wastegate Solenoid "A" Low Turbocharger Wastegate Solerioid "A" High Turbocharger Wastegate Solenoid "B" Malfunction Turbocharger Wastegate Solenoid "B" Range/Performance Turbocharger Wastegate Solenoid "B" Low Turbocharger Wastegate Solenoid "B" High Injection Pump "A" Rotor/Cam Malfunction Injection Pump "A" Rotor/Cam Range/Performance Injection Pump "A" Rotor/Cam Low 208 P0254 P0255 P0256 P0257 P0258 P0259 P0260 P0261 P0262 P0263 P0264 P0265 P0266 P0267 P0268 P0269 P0270 P0271 P0272 P0273 P0274 P0275 P0276 P0277 P0278 P0279 P0280 P0281 P0282 P0283 P0284 P0285 P0286 P0287 P0288 P0289 P0290 P0291 P0292 P0293 P0294 P0295 P0296 Injection Injection Injection Injection Injection Injection Injection Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Cylinder Pump "A" Rotor/Cam High Pump "A" Rotor/Cam Intermittent Pump "B" Rotor/Cam Malfunction Pump "B" Rotor/Cam Range/Performance Pump "B" Rotor/Cam Low Pump "B" Rotor/Cam High Pump "B" Rotor/Cam Intermittent 1 Injector Circuit Low 1 Injector Circuit High 1 Contribution/Balance Fault 2 Injector Circuit Low 2 Injector Circuit High 2 Contribution/Balance Fault Injector Circuit Low Injector Circuit High Contribution/Balance Fault Injector Circuit Low 4 Injector Circuit High 4 Contribution/Balance Fault Injector Circuit Low Injector Circuit High Contribution/Balance Fault Injector Circuit Low 6 Injector Circuit High 6 Contribution/Balance Fault 7 Injector Circuit Low 7 Injector Circuit High 7 Contribution/Balance Fault 8 Injector Circuit Low 8 Injector Circuit High 8 Contribution/Balance Fault 9 Injector Circuit Low 9 Injector Circuit High 9 Contribution/Balance Fault 10 Injector Circuit Low 10 Injector Circuit High 10 Contribution/Balance Fault 11 Injector Circuit Low 11 Injector Circuit High 11 Contribution/Balance Fault 12 Injector Circuit Low 12 Injector Circuit High 12 Contribution/Balance Fault P03XX Ignition System or Misfire P0300 P0301 P0302 P0303 P0304 P0305 P0306 P0307 P0308 P0309 P0310 P0311 P0312 Random/Multiple Cylinder Misfire Detected Cylinder 1 Misfire Detected Cylinder 2 Misfire Detected Cylinder 3 Misfire Detected Cylinder 4 Misfire Detected Cylinder 5 Misfire Detected Cylinder 6 Misfire Detected Cylinder 7 Misfire Detected Cylinder 8 Misfire Detected Cylinder 9 Misfire Detected Cylinder 10 Misfire Detected Cylinder 11 Misfire Detected Cylinder 12 Misfire Detected 209 P0320 P0321 P0322 P0323 P0325 P0326 P0327 P0328 P0329 P0330 P0332 P0333 P0334 P0335 P0336 P0337 P0338 P0339 P0340 P0341 P0342 P0343 P0344 P0350 P0351 P0352 P0353 P0354 P0355 P0356 P0357 P0358 P0359 P0360 P0361 P0362 P0370 P0371 P0372 P0373 P0374 P0375 P0376 P0377 P0378 P0379 P0380 P0381 P0385 P0386 P0387 P0388 P0389 or Single Sensor •y or Single Sensor *) or Single Sensor *) or Single Sensor *) or Single Sensor *) *) *) *) (Bank (Bank (Bank (Bank (Bank (Bank 2 (Bank 2 (Bank 2 (Bank 2 Ignition/Distributor Engine Speed Input Circuit Malfunction Ignition/Distributor Engine Speed Input Circuit Range/Performance Ignition/Distributor Engine Speed Input Circuit No Signal Ignition/Distributor Engine Speed Input Circuit Intermittent Knock Sensor 1 Circuit Malfunction Knock Sensor 1 Circuit Range/Performance Knock Sensor 1 Circuit Low Input Knock Sensor 1 Circuit High Input Knock Sensor 1 Circuit Input Intermittent Knock Sensor 2 Circuit Range/Performance Knock Sensor 2 Circuit Low Input Knock Sensor 2 Circuit Eligh Input Knock Sensor 2 Circuit Input Intermittent Crankshaft Position Sensor "A" Circuit Malfunction Crankshaft Position Sensor "A" Circuit Range/Performance Crankshaft Position Sensor "A" Circuit Low Input Crankshaft Position Sensor "A" Circuit High Input Crankshaft Position Sensor "A" Circuit Intermittent Camshaft Position Sensor Circuit Malfunction Camshaft Position Sensor Circuit Range/Performance Camshaft Position Sensor Circuit Low Input Camshaft Position Sensor Circuit High Input Camshaft Position Sensor Circuit Intermittent Ignit Ignit Ignit Ignit Ignit Ignit Ignit Ignit Ignit: Ignit Ignit Ignit Ignit on Coil Primary/Secondary Circuit Malfunction on Coil "A" Primary/Secondary Circuit Malfunction on Coil "B" Primary/Secondary Circuit Malfunction on Coil "C" Primary/Secondary Circuit Malfunction on Coil "D" Primary/Secondary Circuit Malfunction on Coil "E" Primary/Secondary Circuit Malfunction on Coil "F" Primary/Secondary Circuit Malfunction on Coil "G" Primary/Secondary Circuit Malfunction on Coil "H" Primary/Secondary Circuit Malfunction on Coil "I" Primary/Secondary Circuit Malfunction on Coil "J" Primary/Secondary Circuit Malfunction on Coil "K" Primary/Secondary Circuit Malfunction on Coil "L" Primary/Secondary Circuit Malfunction * Bank 1 contains cylinder 1 Timing Reference High Resolution Signal "A" Malfunction Timing Reference High Resolution Signal "A" Too Many Pulses Timing Reference High Resolution Signal "A" Too Few Pulses Timing Reference High Resolution Signal Timing Reference Eligh Resolution Signal Timing Reference High Resolution Signal Timing Reference High Resolution Signal Timing Reference High Resolution Signal Timing Reference EEigh Resolution Signal Timing Reference Eligh Resolution Signal Glow Plug /Heater Circuit Malfunction Glow Plug /Heater Indicator Circuit Malfunction Crankshaft Position Sensor "B" Circuit Malfunction Crankshaft Position Sensor "B" Circuit Range/Performance Crankshaft Position Sensor "B" Circuit Low Input Crankshaft Position Sensor "B" Circuit High Input Crankshaft Position Sensor "B" Circuit Intermittent 'A" Intermittent/Erratic Pulses 'A" No Pulses •B" Malfunction 'B" Too Many Pulses 'B" Too Few Pulses 'B" Intermittent/Erratic Pulses *B" No Pulses 210 P04XX Auxiliary Emission Controls P0400 P0401 P0402 P0403 P0404 P0405 P0406 P0407 P0408 P0410 P0411 P0412 P0413 P0414 P0415 P0416 P0417 P0420 P0421 P0422 P0423 P0424 P0430 P0431 P0432 P0433 P0434 P0440 P0441 P0442 P0443 P0444 P0445 P0446 P0447 P0448 P0450 P0451 P0452 P0453 P0454 P0455 P0460 P0461 P0462 P0463 P0464 P0465 P0466 P0467 P0468 P0469 P0470 P0471 P0472 Exhaust Gas Recirculation Flow Malfunction Exhaust Gas Recirculation Flow Insufficient Detected Exhaust Gas Recirculation Flow Excessive Detected Exhaust Gas Recirculation Circuit Malfunction Exhaust Gas Recirculation Circuit Range/Performance Exhaust Gas Recirculation Sensor "A" Circuit Low Exhaust Gas Recirculation Sensor "A" Circuit EEigh Exhaust Gas Recirculation Sensor "B" Circuit Low Exhaust Gas Recirculation Sensor "B" Circuit High Secondary Air Injection System Malfunction Secondary Air Injection System Incorrect Flow Detected Secondary Air Injection System Switching Valve "A" Circuit Malfunction Secondary Air Injection System Switching Valve "A" Circuit Open Secondary Air Injection System Switching Valve "A" Circuit Shorted Secondary Air Injection System Switching Valve "B" Circuit Malfunction Secondary Air Injection System Switching Valve "B" Circuit Open Secondary Air Injection System Switching Valve "B" Circuit Snorted Catalyst System Efficiency Below Threshold (Bank 1*] Warm Up Catalyst Efficiency Below Threshold (Bank 1*' Main Catalyst Efficiency Below Threshold (Bank 1* (Bank 1* Heated Catalyst Efficiency Below Threshold (Bank 1* Heated Catalyst Temperature Below Threshold (Bank 2) Catalyst System Efficiency Below Threshold (Bank 2) Warm Up Catalyst Efficiency Below Threshold (Bank 2) Main Catalyst Efficiency Below Threshold (Bank 2) Heated Catalyst Efficiency Below Threshold (Bank 2) Heated Catalyst Temperature Below Threshold * Bank 1 contains Cylinder #1 Evaporative Emission Control System Malfunction Evaporative Emission Control System Incorrect Purge Flow Evaporative Emission Control System Small Leak Detected Evaporative Emission Control System Purge Control Valve Circuit Malfunction Evaporative Emission Control System Purge Control Valve Circuit Open Evaporative Emission Control System Purge Control Valve Circuit Snorted Evaporative Emission Control System Vent Control Malfunction Evaporative Emission Control System Vent Control Open Evaporative Emission Control System Vent Control Snorted Evaporative Emission Control System Pressure Sensor Malfunction Evaporative Emission Control System Pressure Sensor Range/Performance Evaporative Emission Control System Pressure Sensor Low Input Evaporative Emission Control System Pressure Sensor High Input Evaporative Emission Control System Pressure Sensor Intermittent Evaporative Emission Control System Gross Leak Detected Fuel Level Sensor Circuit Malfunction Fuel Level Sensor Circuit Range/Performance Fuel Level Sensor Circuit Low Input Fuel Level Sensor Circuit High Input Fuel Level Sensor Circuit Intermittent Purge Flow Sensor Circuit Malfunction Purge Flow Sensor Circuit Range/Performance Purge Flow Sensor Circuit Low Input Purge Flow Sensor Circuit High Input Purge Flow Sensor Circuit Intermittent Exhaust Pressure Sensor Malfunction Exhaust Pressure Sensor Range/Performance Exhaust Pressure Sensor Low 211 P0473 P0474 P0475 P0476 P0477 P0478 P0479 Exhaust Pressure Sensor High Exhaust Pressure Sensor Intermittent Exhaust Pressure Control Valve Malfunction Exhaust Pressure Control Valve Range/Performance Exhaust Pressure Control Valve Low Exhaust Pressure Control Valve High Exhaust Pressure Control Valve Intermittent P05XX Vehicle Speed , Idle Control , and Auxiliary Inputs P0500 P0501 P0502 P0503 P0505 P0506 P0507 P0510 P0530 P0531 P0532 P0533 P0534 P0550 P0551 P0552 P0553 P0554 P0560 P0561 P0562 P0563 P0565 P0556 P0567 P0568 P0569 P0570 P0571 P0572 P0573 P0574 to P0580 Vehicle Speed Sensor Malfunction Vehicle Speed Sensor Range/Performance Vehicle Speed Sensor Circuit Low Input Vehicle Speed Sensor Intermittent / Erratic / High Idle Control System Malfunction Idle Control System RPM Lower Than Expected Idle Control System RPM Higher Than Expected Closed Throttle Position Switch Malfunction A/C Refrigerant Pressure Sensor Circuit Malfunction A/C Refrigerant Pressure Sensor Circuit Range/Performance A/C Refrigerant Pressure Sensor Circuit Low Input A/C Refrigerant Pressure Sensor Circuit High Input Air Conditioner Refrigerant Charge Loss Power Steering Pressure Sensor Circuit Malfunction Power Steering Pressure Sensor Circuit Range/Performance Power Steering Pressure Sensor Circuit Low Input Power Steering Pressure Sensor Circuit High Input Power Steering Pressure Sensor Circuit Intermittent System Voltage Malfunction System Voltage Unstable System Voltage Low System Voltage High Cruise Control On Signal Malfunction Cruise Control Off Signal Malfunction Cruise Control Resume Signal Malfunction Cruise Control Set Signal Malfunction Cruise Control Coast Signal Malfunction Cruise Control Accel Signal Malfunction Cruise Control / Brake Switch "A" Circuit Malfunction Cruise Control / Brake Switch "A" Circuit Low Cruise Control / Brake Switch "A" Circuit Eligh Reserved for Cruise Codes P06XX Computer and Auxiliary Outputs P0600 P0601 P0602 P0603 P0604 P0605 P0606 Serial Communication Link Malfunction Internal Control Module Memory Checksum Error Control Module Programming Error Internal Control Module Keep Alive Memory (KAM) Error Internal Control Module Random Access Memory (RAM) Error Internal Control Module Read Only Memory (ROM) Error (Module Identification Defined by ISO Cdxxxl / SAE J1979) Powertrain Control Module Processor Fault 212 P07XX Transmission P0700 P0701 P0702 P0703 P0704 P0705 P0706 P0707 P0708 P0709 P0710 P0711 P0712 P0713 P0714 P0715 P0716 P0717 P0718 P0719 P0720 P0721 P0722 P0723 P0724 P0725 P0726 P0727 P0728 P0730 P0731 P0732 P0733 P0734' P0735 P0736 P0740 P0741 P0742 P0743 P0744 P0745 P0746 P0747 P0748 P0749 P0750 P0751 P0752 P0753 P0754 P0755 P0756 P0757 P0758 P0758 P0760 P0761 Transmission Control System Malfunction Transmission Control System Range/Performance Transmission Control System Electrical Torque Converter/Brake Switch "B" Circuit Malfunction Clutch Switch Input Circuit Malfunction Transmission Range Sensor Circuit Malfunction (PRNDL Input) Transmission Range Sensor Circuit Range/Performance Transmission Range Sensor Circuit Low Input Transmission Range Sensor Circuit High Input Transmission Range Sensor Circuit Intermittent Transmission Fluid Temperature Sensor Circuit Malfunction Transmission Fluid Temperature Sensor Circuit Range/Performance Transmission Fluid Temperature Sensor Circuit Low Input Transmission Fluid Temperature Sensor Circuit High Input Transmission Fluid Temperature Sensor Circuit Intermittent Input/Turbine Speed Sensor Circuit Malfunction Input/Turbine Speed Sensor Circuit Range/Performance Input/Turbine Speed Sensor Circuit No Signal Input/Turbine Speed Sensor Circuit Intermittent Torque Converter/Brake Switch "B" Circuit Low Output Speed Sensor Circuit Malfunction Output Speed Sensor Circuit Range/Performance Output Speed Sensor Circuit No Signal Output Speed Sensor Circuit Intermittent Torque Converter/Brake Switch "B" Circuit EEigh Engine Speed Input Circuit Malfunction Engine Speed Input Circuit Range/Performance Engine Speed Input Circuit No Signal Engine Speed Input Circuit Intermittent Incorrect Gear Ratio Gear 1 Incorrect Ratio Gear 2 Incorrect Ratio Gear 3 Incorrect Ratio Gear 4 Incorrect Ratio Gear 5 Incorrect Ratio Reverse Incorrect Ratio Torque Converter Clutch Circuit Malfunction Torque Converter Clutch Circuit Performance or Stuck Off Torque Converter Clutch Circuit Stuck On Torque Converter Clutch Circuit Electrical Torque Converter Clutch Circuit Intermittent Pressure Control Solenoid Malfunction Pressure Control Solenoid Performance or Stuck Off Pressure Control Solenoid Stuck On Pressure Control Solenoid Electrical Pressure Control Solenoid Intermittent Shift Solenoid "A" Malfunction Shift Solenoid "A" Performance or Stuck Off Shift Solenoid "A" Stuck On Shift Solenoid "A" Electrical Shift Solenoid "A" Intermittent Shift Solenoid "B" Malfunction Shift Solenoid "B" Performance or Stuck Off Shift Solenoid "B" Stuck On Shift Solenoid "B" Electrical Shift Solenoid "B" Intermittent Shift Solenoid "C" Malfunction Shift Solenoid "C" Performance or Stuck Off 213 P0762 •P0763 P0764 P0765 P0766 P0767 P0768 P0769 P0770 P0771 P0772 P0773 P0774 P0780 P0781 P0782. P0783 P0784 P0785 P0786 P0787 P0788 P0789 P0790 C" Stuck On C" Electrical C" Intermittent Malfunction Performance or Stuck Off Stuck On Electrical Intermittent E" Malfunction E" Performance or Stuck Off E" Stuck On E" Electrical E" Intermittent Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Solenoid Shift Malfunction 1-2 Shift Malfunction 2-3 Shift Malfunction 3-4 Shift Malfunction 4-5 Shift Malfunction Shift/Timing Solenoid Malfunction Shift/Timing Solenoid Range/Performance Shift/Timing Solenoid Low Shift/Timing Solenoid EEigh Shift/Timing Solenoid Intermittent Normal/Performance Switch Circuit Malfunction 214 Appendix 5 ADDENDUM to the Information Document No in accordance with Annex II of Council Directive 70/156/EEC0 relating to type approval and referring to emission control by on-board diagnostic systems for motor vehicles 3. POWER PLANT (q) 3. 2. 12. 2. 8. On-Board Diagnostic (OBD) System 3. 2. 12. 2. 8. 1. Written description and/or drawing of the MI: 3. 2. 12. 2. 8. 2. List and purpose of all components monitored by the OBD system: 3. 2. 12. 2. 8. 3. Written description (general working principles) for: 3. 2. 12. 2. 8. 3. 1. Positive-ignition engines* }: 3. 2. 12. 2. 8. 3. 1. 1. Catalyst monitoring(1): 3. 2. 12. 2. 8. 3. 1. 2. Misfiredetection(1): 3. 2. 12. 2. 8. 3. 1. 3. Oxygen sensor monitoring* ^: 3. 2. 12. 2. 8. 3. 1. 4. Other components monitored by the OBD system(1): 3. 2. 12. 2. 8. 3. 2. Compression-ignition engines(): 3. 2. 12. 2. 8. 3. 2. 1. Catalyst monitoring11): 3. 2. 12. 2. 8. 3. 2. 2. Particulate trap monitoring(1): 3. 2. 12. 2. 8. 3. 2. 3. Electronic fuelling system monitoring(1): 3. 2. 12. 2. 8. 3. 2. 4. Other components monitored by the OBD system(1): 3. 2. 12. 2. 8. 4. Criteria for MI activation (fixed number of driving cycles or stati sti cal method): 3. 2. 12. 2. 8. 5. List of all OBD output codes and formats used (with explanation of each): 3. 2. 12. 2. 8. 6. - Type of (off-board) interrogation tool: n The item numbers and footnotes used in this Information Document correspond to those set out in Annex I to Directive 70/156/EEC. Items not relevant for the purpose of this Directive are omitted. 215 Appendix 6 ESSENTIAL CHARACTERISTICS OF THE VEfflCLE FAMILY Parameters defining the OBD family The OBD family may be defined by basic design parameters which must be common to vehicles within the family. In some cases there may be interaction of parameters. These effects must also be taken into consideration to ensure that only vehicles with similar exhaust emission characteristics are included within an OBD family. To this end, those vehicle types whose parameters described below are identical are considered to belong to the same engine-emission control-OBD system combination. Engine: - combustion process (i. e. positive-ignition, compression-ignition, two stroke, four stroke); - method of engine fuelling (i. e. carburettor or fuel injection). Emission control system: - - type of catalytic converter (i. e. oxidation, three-way, heated catalyst, other) type of particulate trap - secondary air injection (i. e. with or without) - exhaust gas recirculation (i. e. with or without) OBD parts and functioning: - the methods of OBD functional monitoring, malfunction detection and malfunction indication to the vehicle driver. 216 Appendix 7 ADDENDUM to the EC type-approval certificate No. concerning the type-approval of an on-board diagnostic system (OBD) Directive 70/220/EEC, as last amended by Directive. 1. 1. Written description and/or drawing of the MI: 1. 2. List and purpose of all components monitored by the OBD system: 1. 3. Written description (general working principles) for: 1. 3. 1. Misfire detection* ): 1. 3. 2. Catalyst monitoring* }: 1. 3. 3. Oxygen sensor monitoring* }: 1. 3. 4. Other components monitored by the OBD system* }: 1. 3. 5. Catalyst monitoring* }: 1. 3. 6. Particulate trap monitoring* }: 1. 3. 7. Electronic fuelling system actuator monitoring*2): 1. 3. 8. Other components monitored by the OBD system* }: 1. 4. for MI Criteria statistical method): activation (fixed number of driving cycles or 1. 5. List of all OBD output codes and formats used (with explanation of each): 1. 6. Specification of (off-board) interrogation tool: 2. 4. Comments(ifany): (1) *2) In the case of positive-ignition engines. In the case of compression-ignition engines. 217 FINANCIAL STATEMENT B5-3000 Internal Market 1. TITLE OF OPERATION Proposal for a European Parliament and the Council Directive relating to measures to be taken against air pollution by emissions from motor vehicles and amending Directives 70/220/EEC and 70/156/EEC. 2. BUDGET HEADING INVOLVED B5-3000 Internal Market 3. LEGAL BASIS Article 100a of the EU Treaty 4. DESCRIPTION OF OPERATION 4. 1 General Objectives Measures to be taken against air pollution by emissions from motor vehicles 4. 2 Period covered and arrangements for renewal or extension The proposed Directive requires: From 1 January 2000, Member States may no longer grant EC type-approval for a new type of vehicle on grounds relating to air pollution by emissions if it fails to comply with the provisions of "stage 2000". With effect from 1 January 2001, Member States shall refuse the registration, sale or entry into service of new vehicles which do not comply with the provisions of the Directive. As regards the limit values applicable from 1 January 2005, the Commission shall submit, before 31 December 1999, a report to the Council and Parliament concernint the industrial feasibility of the application of such limits, taking account of the technological progress achieved as well as environmental needs and the availability of improved fuels. In the light of this report, the Commission shall submit a proposal for confirming or revising, if necessary, these limit values. 218 5. CLASSIFICATION OF EXPENDITURE OR REVENUE There are no receipts following this action. 6. TYPE OF EXPENDITURE Technical work directly linked to the assessment of envisaged future vehicle technology (A) Technical work linked to the development of new proposals, in particular those dealing with breakthrough technologies (de NOx catalyser, CNG engineered vehicles, other alternatives: fuelled/propelled vehicles), monitoring of air quality, development of Community assessment criteria for non-technical measures (B) Technical work linked to the preparation of Commission Directives through the Committee procedure (notably improvement of OBD requirements), design of prerequisit conditions for type approving of replacement parts ensuring a control of pollution emission equivalent to the original part while not triggering the OBD (C) Organization of a "Review Conference in 1999" (D) 7. FINANCIAL IMPACT 7. 1 Method of calculating total cost of operation (relation between individual and total costs) The expected cost would globally amount to approximately ECU 600 000 dispatched in 1997/1999, for the following actions, in the form of contract, with the following breakdown: (A) 0. 2 (B) 0. 1 (C) 0. 1 (D) 0. 2 7. 2 Itemized breakdown of costs (in ECU million) Budget 96 PDB 97 PDB 98 PDB 99 Total ' A B C D Total 0. 1 0. 1 0. 1 0. 1 0. 2 219 0. 1 0. 2 0. 3 0. 2 0. 1 0. 1 0. 2 0. 6 7. 3 Operational expenditure of studies, experts, included in Part B of the Budget (in ECU million) Breakdown Budget 96 PDB 97-99 Var. in % - Studies - Meetings of experts - Conferences and congresses - Information and publications 0 Total 0. 4 0. 2 0. 6 New 8. FRAUD PREVENTION MEASURES - It will be explicitly specified in contracts that all work performed is the property of the Commission. - Final payment of contractors will only take place after reception and examination of the reports and services requested. 9. ELEMENTS OF COST-EFFECTIVENESS ANALYSIS 9. 1 Specific and quantified objectives; target population On the basis of the data available on the costs and potential benefits of the various technical measures (engine technology, fuel quality and improved inspection and maintenance of emissions control systems), it has been possible to identify the most cost/effective packages of technical measures necessary to achieve a significant reduction of urban NOx, particulate matters in the most polluted areas and ozone precursors at European level. The present proposal corresponds to the most cost/effective strategy found in the Auto/Oil programme. 9. 2 Grounds for the operation The European Union has a longstanding history in reducing vehicle emissions. However, despite the considerable achievements with regard to the emission reduction of individual vehicles, increased traffic activity (increased number of vehicles, increased kilometers travelled) is likely to counteract these improvements thereby preventing the emission reductions necessary to achieve future air quality objectives. The likelihood of further action to reduce vehicle emissions necessitated a reassessment of the existing policy approach; it being apparent that the emission reduction potential offered by further improvements in vehicle technology was limited and possibly very costly in comparison with other potential solutions. 220 Therefore a new, comprehensive and integrated approach was developed which is set out in Directive 94/12/EC, Article 4. Article 4 stipulates that technical and non- technicla measures to be assessed with regard to their cost-effectiveness shall include improved vehicle technology, the use of alternative fuels (e. g. LPG, CNG, biofuels), more appropriate mechanisms to reduce the in-use deterioration of emission control systems (based on an inspection and maintenance programme) and "improvements in fuel quality as far as vehicle emissions of dangerous substances (in particular benzene) are concerned". The proposal forms part of a global Community strategy which will include strengthened requirements for passenger cars, light commercial vehicles and heavy duty vehicles from year 2000, new minimum standards for motor fuels and enhanced in-use vehicle emission requirements. This combination of measures represents, in view of the Commission, an optimal package of legislative actions which will ensure that the Air Quality targets identified in the course of the implementation of the Auto/Oil programme will be met by year 2010. In addition, the present proposal includes a revision of the framework for emission-related fiscal incentives and emissions values corresponding to the foreseen Stage 2005 car emission standards. 9. 3 Monitoring and evaluation of the operation The Commission, in cooperation with the Member States, will monitor the development of air quality on an urban and regional level in order to verify the air quality predictions which have guided the currently proposed legislative measures. 221 ISSN 0254-1475 COM(96) 248 final DOCUMENTS EN 14 12 15 Catalogue number : CB-CO-96-310-EN-C ISBN 92-78-05787-8 Office for Official Publications of the European Communities L-2985 Luxembourg 222

Proposal for a COUNCIL REGULATION (EC) derogating from Regulation (EEC) No 1765/92 establishing a support system for producers of certain arable crops as regards the set-aside requirement for the 1997/98 marketing year

http://publications.europa.eu/resource/cellar/e376cdd1-2fa8-4d00-955c-497fd01bd5c9

eng

COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 18. 06. 1996 COM(96) 285 final 96/0162 (CNS) Proposal for a COUNCIL REGTTTATTnM (FP) derogating from Regulation (EEC) No 1765/92 establishing a support system for producers of certain arable crops as regards the set-aside requirement for the 1997/98 marketing year (presented by the Commission) EXPLANATORY MEMORANDUM In order to qualify for compensation for arable crops under the reform of the common agricultural policy, producers participating in the general scheme must set aside a percentage of their arable land with a view to achieving a balance between Community production and foreseeable outlets. Small producers, on the other hand, can opt for a simplified scheme under which they are dispensed from the set-aside requirement. The set-aside rate for the 1996 harvest is 10% both for rotational set-aside and for other forms. As part of the 1996/97 price package, the Commission has proposed that there should no longer be a distinction between rotational set-aside and other forms of set-aside and that the basic rate be set at 18%. However, the Commission has already stated that it intends derogating from this rate for cereals being sown for the 1997 harvest. Stocks on the world market are currently at an all-time low, mainly as a result of the unfavourable weather which affected the 1995 cereals crop in the principal producer countries. In the Community, production in the southern areas has been particularly hard hit by drought. The present level of stocks worldwide and in the Community together with unfavourable weather conditions in the United States, which are chiefly affecting its production potential for wheat and hence its export prospects throughout the whole of 1996/97, has led to an extremely volatile price situation with prices running at very high levels, aggravated by speculation. This has had a knock-on effect on market prices for other cereals and has encouraged those holding cereals in the Community to maintain some of their stocks throughout 1995/96. In these circumstances and at the request of the Council, the Commission has made use of the market management tools available to it, including the sale of stocks from public storage and controls on exports, to ensure that the Community market obtains supplies at prices which are more in line with the market organization in cereals and the reform objectives. Intervention stocks have fallen, therefore, from 7 million tonnes in early 1995/96 to 3. 5 million tonnes at present, almost all of them consisting of bailey and rye. Higher prices on the world market and in the Community have forced the Commission to impose a charge on exports and have raised appreciably the prices for cereal substitutes in animal feed, resulting in much greater use of Community cereals. Initial, extremely provisional estimates of the Community harvest for 1996/97 put production at around 187 million tonnes on an area sown to cereals of some 37 million hectares. / In the light of the world market situation described above, Community consumption of cereals during the 1996/97 marketing year is expected to be above 162 million tonnes. The crisis in the beef sector and the preference shown by consumers for poultrymeat and pigmeat, sectors that traditionally have overtaken beef in the consumption of cereals, may raise this consumption further. In performing its role of traditional exporter in order to contribute to greater world market stability, the Community is likely to end 1996/97 with very small carry-over stocks. In these circumstances, and in the interests of security of supplies given the weather hazards facing the production of arable crops, steps should be taken to increase production potential temporarily, without however undermining the aim of controlling production by allowing an excessive build-up of public stocks and without making it harder to find alternative outlets for arable crops in industrial uses. A set-aside rate of 5% for cereals sown for 1997/98 seems appropriate therefore. It will be necessary then to adjust the increase in the set-aside percentage to be applied in the event of a transfer by lowering it to 1%. In presenting this proposal for a rate of set-aside which is far below the proposed 18% single rate, the Commissin wishes to stress that it remains firmly attached to the principle of the 1992 reform of the arable regime. It recalls, however, that the Regulation (EEC) N° 1765/92 which instituted this reform in its article 15 provides that the rate of set-aside as well as compensatory payments and compensation for set aside may be changed according to the procedure laid down in Article 43 (2) of the -Treaty in the light of developments in prodution, productivity and markets. The present proposal is limited to set aside but the Commission reserves the right to make proposals on compensatory payments and set aside compensation as and when appropriate. 2. proposal for a COUNCIL REGULATION (EC) No /96 derogating from Regulation (EEC) No 1765/92 establishing a support system for producers of certain arable crops as regards the set-aside requirement for the 1997/98 marketing year THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Articles 42 and 43 thereof, Having regard to the proposal from the Commission1, Having regard to the opinion of the European Parliament2, Whereas the support system for producers of certain arable crops introduced by Regulation (EEC) No 1765/923, as last amended by Regulation (EC) No. /964, provides that, in order to qualify for compensatory payments under the general scheme, producers must set aside a predetermined percentage of their arable land; whereas this percentage is to be reviewed to take account of production and market developments; Whereas, since the introduction of this system, the cereals market has achieved a better balance as a result of a reduction in production and an increase in Community consumption; whereas this situation, together with the very low level of stocks and very firm prices on the world market, has resulted in a significant reduction in stocks and a sharp rise in the prices for cereals on the Community market; 1 2 3 4 OJ No C OJ No C OJ No L 181, 1. 7. 1992, p. 12. OJ No L. 1 Whereas the present market situation for cereals is threatening to undermine, in the short term, the Community's presence on the world market and to jeopardize some of the results achieved since the reform of the arable sector, in particular the continuing rise in the consumption of cereals in animal feed; whereas the rate for set-aside beginning not later than 15 January 1997 should therefore be set for the 1997/98 marketing year at a level lower than that resulting from the provisions in force; Whereas in the event of a transfer of the set-aside requirement, the basic 18% set-aside rate is increased by 3%; whereas this increase should be adjusted in order to maintain the same ratio between the basic rate and the percentage increase due on transfer, as a result of the drop in the basic rate, HAS ADOPTED THIS REGULATION: For the 1997/98 marketing year, notwithstanding Article 7 of Regulation (EEC) No Article 1 1765/92, the set-aside requirement referred to in paragraph 1 is set at 5%; the increase referred to in the second indent of paragraph 7 is set at one percentage point. This Regulation shall enter into force on the seventh day following its publication in the Official Journal of the European Communities. Article 2 It shall apply to set-aside for the 1997/98 marketing year only. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Brussels, For the Council 1 FINANCIAL STATEMENT BUDGET HEADING: Bl-10 DATE: 11/6/1996 APPROPRIATIONS: ECU 17. 185 m TITLE: Proposal for a Council Regulation derogating, as regards the obligation to set aside land for the 1997/98 marketing year, from Regulation (EEC) No 1765/92 establishing a support system for producers of certain arable crops LEGAL BASIS: Articles 42 and 43 of the Treaty AIMS OF PROJECT: To fix the set-aside rate at 5% FINANCIAL IMPLICATIONS 5. 0. 5. 1. EXPENDITURE - CHARGED TO THE EC BUDGET (REFUNDS/INTERVENTION) - NATIONAL ADMINISTRATION - OTHER REVENUE - OWN RESOURCES OF THE EC (LEVIES/CUSTOMS DUTIES) - NATIONAL 5. 0. 1. 5. 1. 1. ESTIMATED EXPENDITURE ESTIMATED REVENUE 5. 2. METHOD OF CALCULATION: SEE ANNEX CURRENT FINANCIAL YEAR (96) million ecu FOLLOWING FINANCIAL YEAR (97) million ecu PERIOD OF 12 MONTHS million ecu 81. 6 1998 50. 9 1999 30. 7 2000 2001 6. 0. 6. 1. 6. 2. 6. 3. CAN THE PROJECT BE FINANCED FROM APPROPRIATIONS ENTERED IN THE RELEVANT CHAPTER OF THE CURRENT BUDGET? CAN THE PROJECT BE FINANCED BY TRANSFER BETWEEN CHAPTERS OF THE CURRENT BUDGET? IS A SUPPLEMENTARY BUDGET NECESSARY? WILL FUTURE BUDGET APPROPRIATIONS BE NECESSARY? YES/NO YES/NO Y-ES/NC YES/NG OBSERVATIONS: ANNEX TO FINANCIAL NOTO The cost evaluation is based on the current situation (10% set-aside rate) 1. SAVINGS IN AID PER HECTARE The 5 point drop in the rate of set-aside liberates an area estimated at 1. 7 million ha. The historic average yield is 4. 84 t/ha, the aid amounts to ECU 68. 83 per tonne for set-aside land and ECU 54. 34 per tonne for land under cereals. It is assumed that all the liberated land will be under cereals. Savings: 1. 7 million ha x (54. 34 - 68. 83) ECU/t x 4. 84 t/ha = - ECU 119. 2 million These savings are chargeable in their entirety to the 1998 financial year. 2. EXPENDITURE ON THE DISPOSAL OF CEREALS It is estimated that the 1. 7 million ha can be allocated as follows: Soft wheat: Barley: Maize: 0. 6 million ha (yield = 6. 05 t/ha) 1. 0 million ha (yield = 4. 12 t/ha) 0. 1 million ha (yield = 7. 60 t/ha) On the basis of the refunds used in the PDB, the disposal cost for these quantities produced is as follows: Soft wheat: Barley: Maize: 0. 6 million ha x 6. 05 t/ha x ECU 4. 25/t = 1. 0 million ha x 4. 12 t/ha x ECU 39. 35/t= 0. 1 million ha x 7. 60 t/ha x ECU 27. 65/t= ECU 15. 4 million ECU 162. 1 million ECU 21. 0 million TOTAL ECU 198. 5 million 85% of the cost (ECU 168. 7 million) is chargeable to the 1998 financial year. The balance (ECU) 29. 8 million) is chargeable to the 1999 financial year. 3. NET COST OF THE MEASURE In relation to the budget cost for the 1996/97 financial year, the fixing of a 5% set-aside rate results in an additional cost: for 1998 of: and for 1999 of (168. 7 - 119. 2) x 1. 029 (DT) 29. 8 x 1. 029 (DT) = ECU 50. 9 million = ECU 30. 7 million G **«*if»t« " " w i w u m , ^ ,^ Hî/. fi, «y Ï3SN 0254-147;: COM(96) 285 final DOCUMENTS EN 03 Catalogue number : CB-CO-96-305-EN-C ISBN 92-78-05732-0 Office for Official Publications of the European Communities L-2985 Luxembourg a

Council Regulation (EC) No 1095/96 of 18 June 1996 on the implementation of the concessions set out in Schedule CXL drawn up in the wake of the conclusion of the GATT XXIV.6 negotiations

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L_1996146EN. 01000101. xml 20. 6. 1996    EN Official Journal of the European Communities L 146/1 COUNCIL REGULATION (EC) No 1095/96 of 18 June 1996 on the implementation of the concessions set out in Schedule CXL drawn up in the wake of the conclusion of the GATT XXIV. 6 negotiations THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 113 thereof, Having regard to the proposal from the Commission, Whereas, in the wake of the accession of Austria, Finland and Sweden, the Community concluded Agreements with certain third countries concerning the conclusion of the negotiations under GATT Article XXIV. 6 (1); whereas those Agreements provide inter alia for certain Community commitments in the field of agriculture; whereas, pursuant to those Agreements, the Commission has drawn up a new Schedule CXL (European Communities), applicable to the customs territory of the Community as constituted at 1 January 1995, to replace Schedule LXXX (European Communities) in the Annex to the Marrakesh Protocol to the GATT, 1994; whereas Schedule CXL has been forwarded to the World Trade Organization; whereas the commitments set out in Schedule CXL and, in particular, the commitments applicable from 1 January 1996, must be implemented at the earliest opportunity; whereas, as a consequence, the Council should authorize the Commission to take the requisite measures in accordance with the management committee procedure; whereas, for the sake of simplification, provision should also be made for the same procedure to be used to introduce such amendments to Schedule CXL as the Council may authorize, HAS ADOPTED THIS REGULATION: Article 1 1. At the earliest opportunity, the Commission shall adopt the measures required as from 1 January 1996 for the implementation in agriculture of the concessions set out in Schedule CXL (European Communities) forwarded to the World Trade Organization and applying to the customs territory of the Community as constituted at 1 January 1995. Such measures shall be adopted in accordance with the procedure provided for in Article 23 of Council Regulation (EEC) No 1766/92 of 30 June 1992 on the common organization of the market in cereals (2), the corresponding provisions of the other Regulations on the common organization of the markets and, as regards products covered by CN code 0701 90 51, in Article 33 of Council Regulation (EEC) No 1035/72 of 18 May 1972 on the common organization of the market in fruit and vegetables (3). 2. Should the Council authorize any amendment to Schedule CXL, the resulting measures shall subsequently be adopted in accordance with the procedure referred to in paragraph 1. Article 2 This Regulation shall enter into force on the day of its publication in the Official Journal of the European Communities. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Luxembourg, 18 June 1996. For the Council The President C. BURLANDO (1)  OJ No L 334, 30. 12. 1995, pp. 25 and 38. (2)  OJ No L 181, 1. 7. 1992, p. 21. Regulation as last amended by Regulation (EC) No 1863/95 (OJ No L 179, 29. 7. 1995, p. 1). (3)  OJ No L 118, 20. 5. 1972, p. 1. Regulation as last amended by Regulation (EC) No 1363/95 (OJ No L 132, 16. 6. 1995, p. 8)

ANNUAL STATUS REPORT BY THE COMMISSION ON THE GUARANTEE FUND AND ITS MANAGEMENT IN 1995

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 17. 06. 1996 COM(96) 271 final ANNUAL STATUS REPORT BY THE COMMISSION ON THE GUARANTEE FUND AND ITS MANAGEMENT IN 1995 CONTENTS 1. LEGAL BASES. ; 2. POSITION OF THE FUND AT 31 DECEMBER 1995 3. PAYMENTS INTO THE FUND '. (a) Payments from the general budget (b) Interest from financial investment of the Fund's liquid assets (c) Recovery from defaulting debtors 4. THE FUND'S LIABILITIES (a) Default payments (b) EIB remuneration ANNEXES 1 1 2 2 3 4 4 4 4 ANNEX I: LEGAL BASES FOR PAYMENTS FROM THE GENERAL BUDGET ANNEX H: EIB STATUS REPORT ON THE FUND AND ITS MANAGEMENT - REVENUE AND EXPENDITURE ACCOUNT AND BALANCE SHEET AT 31 DECEMBER 1995 ANNEX IH: CONSOLIDATED FINANCIAL BALANCE-SHEET AT 31 DECEMBER 1995 O u- ANNUAL STATUS REPORT BY THE COMMISSION ON THE GUARANTEE FUND AND ITS MANAGEMENT IN 1995 1. LEGAL BASES Council Regulation (EC, Euratom) No 2728/94 of 31 October 1994 set up a Guarantee Fund for external actions to repay the Community's creditors in the event of default by beneficiaries of loans granted or guaranteed by the Community. In accordance with Article 6 of the Regulation the Commission entrusted financial management of the Fund to the European Investment Bank (EIB) under an agreement signed between in Brussels and 25 November 1994 in Luxembourg. the EIB on 23 November 1994 the Community and Under Article 8. 2 of the agreement, by 1 March each year the Bank must send the Commission a status report on the Fund and its management, the revenue and expenditure account and the financial statement for the Fund for the preceding year. An extract from the second report, covering 1995, is in Annex II. In addition, Article 7 of the Regulation establishing the Fund requires the Commission to send the European Parliament, the Council and the Court of Auditors a report on the situation of the Fund and its management for each financial year by 31 March of the following year. 2. POSITION OF THE FUND AT 31 DECEMBER 1995 At the close of the 1995 financial year, the Fund totalled ECU 300 847 830. 50. This is the sum, since the Fund was established, of all budget payments (ECU 544 470 000), yearly net results late payments from non-member countries (ECU 35 630 568. 55), minus calls on the Fund's resources (ECU 303 072 580. 90). (ECU 23 819 842. 85) and The total amount of the Fund's assets at the close of the financial year appears on the assets side of the consolidated balance sheet as ECU 574 036 593. 68, which breaks down into ECU 254 000 000 in deposits, ECU 44 444 219. 76 on current account, ECU 2 403 610. 74 in receivables from credit institutions (interest accrued at 31 December 1995 and not paid) and ECU 273 188 763. 18 in receivables from the recipients of loans granted or guaranteed by the interest due and Community, ECU 5 746 750. 83 in. default interest not received at 31 December 1995. including ECU 267 442 012. 35 in principal and - 2- Article 3 of the Regulation establishing the Fund requires that the amount of the Fund has to reach an appropriate level (target amount) set at 10% of the total outstanding capital liabilities arising from each operation, plus unpaid interest due. Outstanding borrowing/lending operations for non-member countries plus unpaid interest due totalled ECU 5 882 million at 31 December 1995, of which ECU 31 million was accounted for by unpaid interest. The ratio between the Fund's resources and outstanding capital liabilities within the meaning of the Regulation was 5. 1%. Since this is lower than the target amount of 10%, there was no surplus to be paid back to the general budget of the Communities, as provided for in the third paragraph of Article 3 of the Regulation. There was also no need to review the provisioning rate, as provided in Article 4 of the Regulation. The following sections describe developments affecting the Fund's resources and liabilities in 1995. 3. PAYMENTS INTO THE FUND (a) Payments from the general budget Articles 2 and 4 of the Regulation establishing the Fund stipulate that it is to be endowed by payments from the general budget equivalent to 14% of the capital value of loan and loan guarantee operations until the target amount is reached. Under Article 5 the provisioning rate rises to 15% for new operations if the Fund's resources fall below 75% of the target amount as a result of guarantees being activated to cover any default. The legal bases for the provisioning arrangements are described in Annex I. The Council Decision of 31 October 1994 concerning budgetary discipline authorized the entry in the general budget of a reserve for loan and loan guarantee operations. This item, which was allocated provisional appropriations of ECU 323 million in 1995, is intended to endow the Fund by transferring amounts into the budget item for payments into the Fund. On these legal bases, three transfers totalling ECU 250 750 000 were adopted by the budgetary authority in 1995 to endow the Guarantee Fund. - Transfer 2/95: ECU 190 750 000 This first transfer at the beginning of the year was for payments into the Fund under the Council Decisions of 15 February 1993, 19 July 1993, 13 December 1993, 24 January 1994 and 21 March 1994, in accordance with the arrangements set out in the Annex to the Regulation establishing the Fund (see Annex I). A - 3- - Transfer 17/95: ECU 30 000 000 This second transfer was for payments into the Fund in respect of loan operations adopted by the Council on 10 April and 1 June 1995. The decisions covered by this transfer are listed in Annex I. - Transfer 47/95: ECU 30 000 000 This third transfer was for payments into the Fund in respect of loan operations adopted by the Council on 23 October 1995. The decision covered by this transfer is listed in Annex I. The three payments into the Fund were made on 12 April, 11 August and 29 December 1995 respectively. (b) Interest from financial investment of the Fund's liquid assets The Fund's liquid assets are invested in accordance with the management principles laid down in the Annex to the Community/EIB Agreement. These principles state that during the Fund's first years of operation it will be treated as a money-market investment fund dealing solely in short-term instruments up to one year, provided that the total amount invested does not exceed ECU 300 million. As the amount of the Fund exceeded this ECU 300 million threshold in 1995, the Commission agreed with the EIB to amend the investment principles early in 1996. The list of banks authorized to receive deposits is agreed by the Commission and the EIB. The original list was revised during 1995 in the light of the latest changes in bank ratings. Most of the banks are members of the ecu clearance system. They all have a Moody's rating of at least Al for long-term investments and PI for short-term ones and investments made with them are governed by rules to ensure a good spread and avoid risk exposure. In 1995 ECU 23 539 827. 79, broken down as follows: interest on the Guarantee Fund's deposits and current account totalled - deposits: ECU 23 189 444. 30. This represents accrued interest at 31 December 1995 - interest being paid not when the accounts are closed, but when investments mature - minus interest for 1994 paid in 1995. - current account: ECU 350 383. 49. This comprises ECU 338 151. 72 in interest on current account balances and ECU 12 231. 77 in interest on the liaison account. The interest received is entered in the results for the financial year. A - 4- (c) Recovery from defaulting debtors Any late repayments by defaulting countries on operations where the Fund has honoured the guarantee are paid into the Fund. The amount recovered in 1995 totalled ECU 35 630 568. 55 (see point 2. 1. 2 of Annex II). 4. THE FUND'S LIABILITIES (a) Default payments The Fund's guarantee was called in on ten occasions in 1995, involving a total of ECU 303 072 580. 90 (see point 2. 1. 2 of Annex H). (b) EIB remuneration Article 6 of the management agreement between the Commission and the EIB sets an annual commission of 0. 125% calculated on the basis of the Fund's average monthly balances. The figure is to be reviewed at the end of any year in which the Fund's liquid assets reach ECU 300 million and no later than three years following the date of the first payment into the Fund, taking into account such things as the growth of the Fund's activities. As the Fund had reached ECU 300 million at the end of 1995, the EIB's remuneration was reviewed. Taking into account the Bank's experience of the workload involved in its management, it was decided by common agreement between the Bank and the Commission that the annual commission should be reduced to 0. 05% and that this rate should be applied retrospectively. In 1995 the remuneration paid to the Bank was ECU 191 444. 18, which is entered in the profit and loss account. - b - ANNEXES ANNEX 1: LEGAL BASES FOR PAYMENTS FROM THE GENERAL BUDGET 1. DECISIONS COVERED BY TRANSFER 2/95 2. DECISIONS COVERED BY TRANSFER 17/95 3. DECISION COVERED BY TRANSFER 47/95 1 2 2 ANNEX II: EIB STATUS REPORT ON THE FUND AND ITS MANAGEMENT REVENUE AND EXPENDITURE ACCOUNT AND BALANCE SHEET AT 31 DECEMBER 1995 1. BASIC ACCOUNTING PRINCIPLES 2. THE FUND'S RESOURCES. 3 3 3. ANALYSIS OF INVESTMENTS MADE DURING 1995. 5 ANNEX m: CONSOLIDATED BALANCE SHEET AT 31 DECEMBER 1995 11 - 1- ANNEXI LEGAL BASES FOR PAYMENTS FROM THE GENERAL BUDGET The Annex to the Regulation concerning arrangements for payments under the Guarantee Fund, stipulates that for borrowing/lending operations or guarantees to financial bodies under a framework facility spread over several years and with a micro-economic and structural purpose, payments will be made in annual tranches calculated on the basis of the annual amounts indicated in the financial statement attached to the Commission proposal, adapted, where appropriate, in the light of the Council decision. In the case of other borrowing/lending operations such as balance of payments loans to non-member countries, irrespective of whether they are made in one or more than one tranche, the amount to be paid into the Fund will be calculated on the basis of the total amount for the operation decided on by the Council. Four transfers were made under this procedure in 1995. L DECISIONS COVERED BY TRANSFER 2/95 - Council Decision of 15 February 1993 calling on the EIB to grant loans for projects of mutual interest in certain non-member countries with which the Community has cooperation agreements, within a fixed ceiling of ECU 250 million a year for a period of three years. - Council Decision of 13 December 1993 renewing the Community guarantee of EIB loans in the countries of Central and Eastern Europe, with a ceiling of ECU 3 billion over three years. - As part of the financial cooperation with the Mediterranean countries: - Council Decision of 19 July 1993 for a five-year loan of ECU 150 million for the Republic of Slovenia; - Council Decision of 24 January 1994 for a three-year loan of ECU 115 million for Syria. - Council Decision of 21 March 1994 empowering the Commission to contract Euratom loans to contribute to financing improvements in the safety and efficiency levels of the nuclear capacity of certain non-member countries for an amount of E C U! 100 million. 5 - 2- 2. DÉCISIONS COVERED BY TRANSFER 17/95 - Council Decision of 1 June 1995 granting a Community guarantee for EIB loans in South Africa, with a ceiling of ECU 300 million over two years from the date of the Decision. - Council Decision of 10 April 1995 concerning the granting of macrofinancial aid of ECU 75 million to Belarus for ten years. 3. D E C I S I ON COVERED BY TRANSFER 47/95 - Council Decision of 23 October 1995 providing further macrofinancial assistance of ECU 200 million to Ukraine for ten years. 5 3- ANNEXlI EBB STATUS REPORT ON THE FUND AND rrs MANAGEMENT REVENUE AND EXPENDITURE ACCOUNT AND BALANCE SHEET AT 31 DECEMBER 1995 1. BASIC ACCOUNTING PRINCIPLES The Fund's liquid assets are managed on behalf of the Community at its own risk (Article 1 of the Agreement) in accordance with the following principles: The Fund operates in a single currency: the ecu. The available funds are managed so as to ensure a degree of liquidity and rapid mobilization in view of the commitments which the Fund may be called on to meet. The funds are invested in instruments and counterparts in accordance with the same credit criteria as applied by the EIB. 2. THE FUND'S RESOURCES 2. 1 The Fund's account Two payments were made into the Fund's account at the end of 1994, and on 1 January 1995 the Fund's assets stood at ECU 293. 9 million. A third payment - of ECU 190. 75 million ~ was made on 12 April, a fourth - of ECU 30 million - on 11 August and a fifth - also of ECU 30 million - on 29 December 1995 The Fund's total assets at 31 December 1995 were ECU 298. 4 million, with ECU 254 million invested in short-term deposits and 44. 4 million on current account. 6 - 4- 2. 1. 1 Payments made by the Fund up to 31 December 1995 From 1 January the Fund's guarantee was called in for a total of ECU 303 million: J Q A I E J O E J E A Y M E N T, AMOUNT 11/01/1995 20/0Ï/1995 30/01/1995 28/02/1995 12/04/1995 24/05/1995 20/07/1995 11/10/1995 17/10/1995 21/11/1995 TOTAL 5 297 222. 07 4 623 981. 98 53 636 023. 92 2 343 806. 01 2 181 421. 01 6 082 283. 85 3 967 469. 82 8 614 739. 60 2 346 828. 80 213 978 803. 84 303 072 580. 901 2-1. 2. Recovery from defaulting debtors Payments by defaulting debtors resulted in the recovery of ECU 35. 6 millions. J3AIEDF RECOVERY AMOUNT 08/03/1995 20/03/1995 15/05/1995 01/03/1995 29/03/1995 13/04/1995 28/04/1995 08/06/1995 15/11/1995 TOTAL 704 696. 00 31925 800. 00 1 353 505. 45 150. 67 457. 30 18 193. 05 776 033. 13 75. 00 851 657. 95 35 630 568. 55 2. 1. 3. The net balance of operations amounted to ECU 267. 4 million. 2. 2. Operating result The net result in 1995 amounted to ECU 23. 3 million, compared with ECU 0. 5 million in 1994. 2. 3. Remuneration Article 6 of the Agreement between the Commission and the EIB sets the Bank's remuneration at 0. 125% of the Fund's assets and provides that the figure is to be reviewed at the end of any year in which the Fund's liquid assets exceed ECU 300 million. 6 - 5- Since the. Fund's liquid assets reached ECU 300 million during 1995, the Bank and the Commission decided to reduce the rate of remuneration to 0. 05% retrospectively from December 1994 to December 1995. The Bank's remuneration thus came to ECU 0. 191 million. 3. ANALYSIS OF INVESTMENTS MADE DURING 1995 3. 1. Yield and performance Investments were made on the best terms available subject to the credit criteria; the average yield was 6. 12%, in other words 27 points higher than the one-month Libid rate over the same period. MONTH YIELD January - December 6. 12% LIBID 1 month 5. 85% MARGIN 0. 27 % 6- 3. 2. Average capital (million ecus) invested with banks in 1995, by country, for a total of ECU 373. 2 million I AVERAGE CAPITAL (million) | SITUATION AT 31. 12. 1995 ,__ (million) - Germany: -Austria: -Belgium: -Denmark: - France: -Luxembourg: - Netherlands: - United Kingdom: TOTAL I 22. 7 127 35. 4 9. 4 2. 5 47. 6 11. 3 4J 65. 5 12. 0 A2 16. 2 35. 4 13. 6 11L2 160. 2 17. 6 4^ 21. 9 53. 3 7. 6 37 11. 3 373. 2 45. 0 45. 0 20. 0 10. 0 30Lfj 60. 0 24. 0 _- 24. 0 700 70. 0 20. 0 - 20. 0 35. 0 - | 254. 0 b - 7- 3. 3. Geographical distribution - end-of-month investment position (million ecus): (see Annex I) COUNTRY Jan 95 Feb 95 Mar 95 Apr 95 May 95 Jun 95 Jul 95 Aug 95 Sep 95 Germany Austria Belgium Denmark France Luxembourg Netherlands UK (MX) 0. 00 22. 00 0. 00 188. 00 20. 00 0. 00 0. 00 0. 00 18. 00 72. 00 0. 00 118. 00 20. 00 0. 00 0. 00 OJÔÔ ÔUÔ" 18. 00 18. 00 72. 00 0. 00 68. 00 20. 00 83. 50 0. 00 70. 00 0. 00 284. 25 20. 00 60. 00 0. 00 0. 00 53. 50 53. 50 5375Ô 74. 00 0. 00 45. 00 40. 00 284. 25 20. 00 55. 00 0. 00 20. 00 25. 00 40. 00 250. 75 0. 00 55. 00 0. 00 20. 00 65. 00 40. 00 135. 00 20. 00 85. 00 30. 00 20. 00 95. 00 40. 00 135. 00 40. 00 65. 00 30. 00 0. 00 95. 00 40. 00 135. 00 40. 00 65. 00 30. 00 T O T AL 230. 00 228. 00 261. 50 452. 25 444. 25 444. 25 448. 50 478. 50 479. 00 "~ "" C O U N T RY "~ Germany Austria Belgium Denmark France Luxembourg Netherlands UK TOTAL ~~ Oct 95 104. 00 0. 00 90. 00 40. 00 110. 00 40. 00 60. 00 25. 00 469. 00 Nov 95 Dec 95 45. 00 0. 00 65. 00 24. 00 65. 00 20. 00 35. 00 0. 00 45. 00 0. 00 60. 00 24. 00 70. 00 20. 00 35. 00 0. 00 254. 00 254. 00 3. 4. The geographical distribution is significantly influenced by the reception given by banks to placements on the money markets Some banks cannot offer competitive returns on proposed investments by the Fund either because they are not interested in ecu deposits or because of the Fund's non- banking status. In order to achieve a wider geographic spread of investments, the possibility of extending such activity to banks in the new Member States was also explored and contacts were pursued with banks on the approved list. In the last quarter of the year the list was revised - three banks that no longer satisfied the criteria were taken off, while two new ones were added (bringing the total to 40). 3. 5. The Fund's coverage of the risk of defaulting debtors Throughout the year the terms of most deposits were fixed in such a way that the Fund would be able to meet any potential guarantee operations, bearing in mind the quarterly scheduling of loans granted by the Commission. The Fund cannot overdraw its accounts and must always be in a position to respond within three months when its guarantee is called in (this is the period of notice between the date when a guarantee is called in and when it is actually paid). The number and scale of the payments made over the year as a whole, peaking at 214 million in November, required an investment 5 -8 policy principally geared to maintaining a sufficient level of liquidity to enable the Fund to meet commitments falling due without having \6 incur the costs entailed by breaking contracts with banks where it had made placements. 3. 6. Movement of the Fund's liquid assets MOVEMENT OF LIQUID ASSETS IN 1995 500 j 4 5 0- 4 0 0- 350- 300 4 250 200 150 100 - 50 - 0 o CD Q CO c CO CO <D LX. CO CM CO Q. 2 < ^- o CO CO CO CO c ZJ o CO 1" s Q. CD CO o < i- CO CO CO o CO Z o CO Q ,- co As the graph shows, the Fund's resources passed the ECU 300 million threshold set in the agreement for altering investment principles. However, for the reasons described at 3. 5, it was considered advisable not to invest in fixed-interest securities during the period in question, as this would increase the liquidity and rate risk and might result in capital losses. e> 3 I a § •a B n 3 O Austria United Kingdom Denmark Luxembourg Germany Netherlands Belgium France Q -° 9 S 8 K K 8 § 2 -° -s 8 S 8 8 8 8 8 8 o5 10 P O S I T I ON OF T HE G U A R A N T EE F U ND AT 31 D E C E M B ER 1995 ASSETS 31 December 1995 Receivables with credit institutions CURRENT ACCOUNT FIXED-TERM DEPOSITS Other receivables ACCRUALS TOTAL 44 444 219. 76 254 000 000. 00 298 444 219. 76 2 403 610. 74 2 403 610. 74 300 847 830. 50 LIABILITIES 31 December 1995 Guarantee Fund GUARANTEE FUND Result Carryover from 1994 Result for 1995 TOTAL PROFIT AND LOSS AT 31. 12. 1995 1. INCOME Interest and similar income Interest on liaison account Interest on current account SUB-TOTAL 2. COSTS Commissions Financial charges NET RESULT 277 027 987. 65 277 027 987. 65 471 584. 52 23 348 258. 33 23 819 842. 85 300 847 830. 50 23 189 444. 30 12 231. 77 338 151. 72 23 539 827. 79 191 444. 18 125. 28 23348 258. 33 5 11- ANNEXin CONSOLIDATED FINANCIAL BALANCE SHEET OF THE GUARANTEE FUND AT 31 DECEMBER 1995 The consolidated financial balance sheet at 31 December 1995 completes the position of the Guarantee Fund set out in Aimex II. The consolidated balance sheet includes, on the assets side, entitlements of ECU 273 188 763. 18 receivable from recipients of loans granted or guaranteed by the Commission. Of this figure, ECU 267 442 012. 35 is due for interest and ECU 5 746 750. 83 for default interest not received at 31 Pecember 1995. This default interest has been calculated in line with the penalty rates laid down in the loan contracts. third countries' arrears on the payment of principal and 6 - 1 2- CONSOLIDATED FINANCIAL BALANCE SHEET OF THE GUARANTEE FUND AT 31 DECEMBER 1995 ASSETS Receivables with credit institutions CURRENT ACCOUNT FIXED-TERM DEPOSITS recipients of Receivables with guaranteed bv the Community FUND OPERATIONS DEFAULT INTEREST DUE BUT NOT RECEIVED loans granted or Other receivables ACCRUALS LIABILITIES Guarantee Fund TOTAL PAYMENTS FROM THE BUDGET DEFAULT INTEREST DUE BUT NOT RECEIVED Result Carryover from 1994 Result for 1995 TOTAL PROFIT AND LOSS AT 31. 12. 1995 1. INCOME Interest and similar income Interest on liaison account interest on current account SUB-TOTAL COSTS Commissions Financial charges o NET RESULT 31 December 1995 44 444 219. 76 254 000 000. 00 267 442 012. 35 5 746 750. 83 571 632 982. 94 2 403 610. 74 2 403 610. 74 574 036 593. 68 31 December 1995 544 470 000. 00 5 746 750. 83 550 216 750. 83 471584. 52 471 584. 52 23 348 258. 33 23 819 842. 85 574 036 593. 68 23 189 444. 30 12 231. 77 338 151. 72 23 539 827. 79 191444. 18 125. 28 23 348 258. 33 6 ISSN 0254-1475 COM(96) 271 final DOCUMENTS EN 01 Catalogue number : CB-CO-96-281-EN-C ISBN 92-78-05468-2 Office for Official Publications of the European Communities L-2985 Luxembourg

REPORT FROM THE COMMISSION TO THE COUNCIL Results of the application of Council Regulation (EC) No 1093/94 setting the terms under which fishing vessels of a third country may land directly and market their catches at Community ports

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 17. 06. 1996 COM(%) 272 final REPORT FROM THE COMMISSION TO THE COUNCIL Results of the application of Council Regulation (EC) No 1093/94 setting the terms under which fishing vessels of a third country may land directly and market their catches at Community ports. CONTENTS Preamble I. Background to Regulation (EC) No 1093/94 A. Market situation and objectives of the Regulation B. C. Situation with regard to direct landings in some other countries Compatibility of Regulation (EC) No 1093/94 with the Community's international commitments: - WTO -EEA II Results of the application of Regulation (EC) No 1093/94 A. B. C. D. Organization of health checks Landing statement Compliance with marketing rules Quantities involved E. General Conclusion Annex: statistics Article 8 of Council Regulation (EC) No 1093/94 of 6 May 1994 setting the terms under which fishing vessels of a third country may land directly and market their catches at Community ports1 lays down that "Before 1 July 1996, the Commission shall submit to the Council a report on the results of the application of this Regulation, accompanied, if need be, by appropriate proposals. " This report has been drawn up in response to this instruction, on the basis of Member States' replies to a Commission questionnaire on the application of the various provisions of the Regulation from its entry into force up to 31 December 1995. Eight Member States replied to the questionnaire, four of them reporting direct landings. The figures sent to the Commission with Member States' replies are contained in the Annex. Before actually examining the results of the application of Regulation (EC) No 1093/94, the Commission considers it would be useful to outline the background and the objectives which led to the adoption of the Regulation and thus place it in its international legal context. OJNoL 121, 12. 5. 1994, p. 3. I. The background to Regulation ( EO No 1093/94 Regulation (EC) No 1093/94 was adopted against the background of a major crisis on the Community market in fishery products, to prevent certain practices liable to disrupt a vulnerable market, in the absence of international legislation on direct landings. A. Market situation and the objectives of the Regulation The crisis situation at the beginning of 1993 on the Community market in fishery products, affecting the main white fish species in particular, was diagnosed and analysed in depth by the Commission2 and also by the Member States and trade circles. It forced prices down on a market which was very sensitive to various cyclical factors. In such a context, it is evident that direct landings by vessels of non-member countries, in the absence of appropriate legislation, present a serious risk that new disturbances will be triggered by the introduction to the market of very low-priced fish competing directly with Community production on the fresh fish market and, above all, threaten to undermine market management measures taken by producers' organizations, with the support of Community or national budgets. Direct landings involve fish being imported by a fishing vessels which is not only the means of transport but also the means by which the fish was caught. Such a practice, on the one hand, avoids all controls by the authorities of the country of origin of the products and, on the other hand, saves on transport, inspection, packing and even fiscal and parafiscal costs as compared with other means of transport (whether by sea, air or land). Direct landings are therefore liable to lead to situations of unfair competition in relation to Community production. Regulation (EC) No 1093/94 was thus adopted by the Council, acting on a proposal from landings subject to certain the Commission, requirements being met and under conditions which were no less stringent than those applying to Community production. to authorize the principle of direct These conditions relate to the following: drawing up a list of authorized ports which have facilities for carrying out the requisite health checks, whereas previously there were no restrictions except national ones on access to ports of fishing vessels of non-member countries (Article 3); the submission to the competent authorities of a statement by the master of the vessel concerning the origin and quantities of products (Article 4); See communication on the crisis in the Community's fishing industry (COM(94) 335 final, 19. 7. 1994). the obligation, in the case of disposal of fresh fish, to comply with any rules decided on and implemented in the area of activity of a producers' organization (Article 5). These rules can be regarded as quite liberal compared with those in force in some countries. B. Situation with regard to direct landings in some other countries On a general note, it should be mentioned that the United Nations Convention on the Law of the Sea expressly recognizes the. right of coastal states to regulate unilaterally conditions of access to their inshore waters and port facilities; and no distinction is made between fishing vessels as the means of transport of their own catches and other cargo vessels used for commercial purposes. The following are a few examples of the legislation on direct landings in force in some countries: USA: Australia: Canada: Chile: ban ban, except with ministerial authorization authorization on a case by case basis for vessels flying the flag of countries with which Canada has good fisheries relations health certificate required from the competent authority in the country of origin for any goods, even those in transit, entering Chile, regardless of the access route. In such a context the legislation adopted by the Community does not appear to be open to dispute and has indeed not been disputed, in particular from the point of view of the Community's international commitments. C. Compatibility of Regulation (EO No 1093/94 with the Community's international commitments Regulation (EC) No 1093/94 does not disregard the rules in force in connection with the WTO, nor does it apply to vessels flying the flag of countries or groups of countries with which the Community has concluded an agreement dealing expressly with direct landings, which is the case only for the Agreement on the European Economic Area. WTO Regulation (EC) No 1093/94 does not impose discriminatory conditions on vessels of non-Community countries making direct landings as compared with Community production. On the contrary, its purpose is to subject such vessels to equivalent conditions to those which apply to Community production with regard to the landing and marketing of fishery products. The compatibility of Regulation (EC) No 1093/94 with the 1994 GATT rules was not called into question when the WTO was established on 1 January 1995. European Economic Area (EEA) Regulation (EC) No 1093/94 is not applicable to vessels flying the flags of countries which are signatories of the EEA Agreement since Article 5 of Protocol 9 to the Agreement expressly regulates the question of access to ports by fishing vessels. The Regulation does, however, apply to all other countries. European Economic Area (EEA) Regulation (EC) No 1093/94 is not applicable to vessels flying the flags of countries which are signatories of the EEA Agreement since Article 5 of Protocol 9 to the Agreement expressly regulates the question of access to ports by fishing vessels. The Regulation does, however, apply to all other countries. IL Results of the application of Regulation (EO No 1093/94 It is difficult to speak of "results" in the strict sense of the application of Regulation (EC) No 1093/94 since the measures in question are essentially of a preventive nature, so no quantifiable effect can be expected. The Regulation therefore needs to be looked at rather from the angle of its general impact and any difficulties of application. The three main provisions of the Regulation are dealt with separately below, followed by some general points. A. Organization of health checks (Article 3) The list of authorized ports sent in to the Commission by each of the Member States was published in the C series of the Official Journal on 28 May 1994, followed by the Finnish and Swedish lists on 29 December 1994. None of the Member States reported any difficulties in this connection. It emerged from the actual health checks carried out that the standards in force were generally met during the reference period; rejections for non-compliance were the exception (one case in Denmark and one in France, both involving small quantities). B. Landing statement (Article 4) No particular problems with this were reported; some Member States underlined the advantage of this procedure, without which no checks or action on infringement would be possible. One Member State expressed the view that the time limit for prior notification (72 hours) sometimes seemed excessive, but this rule derives from Regulation (EEC) No 2874/93 establishing a control system and does not therefore relate specifically to direct landings by fishing vessels of non-Community countries. C. Compliance with marketing rules (Article 5) Only those quantities intended for direct marketing required to meet certain marketing requirements. In actual fact these quantities are marginal, except in Spain, since most direct landings involve fish intended for processing and are not therefore covered by this provision; No Member State reported difficulties in implementing this provision. D. Quantities involved The table in the Annex shows the quantities reported by five Member States for the years 1994 and 1995. The figures are therefore incomplete. The quantities concerned are mainly concentrated in two Member States - Denmark and Spain - plus some in Germany and France. Almost all the direct landings in the northern ports, including France, are intended for the processing industry and involve large tonnages of a small number of species. As regards Spain, the majority of direct landings are in the Canary Islands and involve a large variety of fresh and frozen products, mainly for direct marketing. Between 1994 and 1995 there was a marked decrease in the tonnage landed in Germany, Denmark and France and an increase in the case of Spain. It can also be said that in all cases the number of landings decreased substantially, while the average quantity per landing increased markedly. It should be pointed out that the figures relate to only two years and cannot therefore be regarded as very significant. E. General Most of the Member States which replied to the Commission questionnaire expressed satisfaction with the existence and implementation of Regulation (EC) No 1093/94. There were no suggestions for amendments or improvements. No difficulties of application were. mentioned. CONCLUSION Of the eight Member States which replied to the Commission questionnaire, two said they were still opposed to the principle of the Regulation, four said they were pleased with it, and two made no particular comment. Generally speaking, having regard to the small amount of information supplied by the Member States, the Commission finds it difficult to make an overall assessment of the implementation of Regulation (EC) No 1093/94. Several Member States failed to reply at all to the Commission and those that did supply information made no mention of how often or what kinds of checks were carried out to implement the Regulation. On this point, therefore, the Commission would refer to the comments it makes in the parallel report to the Council on the monitoring of fishing vessels of other countries operating in the Community fishing area, which it undertook to produce at the Council meeting in December. It can state the following, however: The measures in question are generally perceived as having a positive impact. No particular disadvantages have come to light as regards administration or market supply and operation. No action has been taken by a non-Community country, nor have any comments been received since the measure entered into force. The Commission would also point out that one of the main attributes of Regulation (EC) No 1093/94 is that it is a preventive measure, and if it did not exist, the market would probably be adversely affected. Lastly, the Commission would point out that it has always taken the view that the question of direct landings ought to be dealt with on a multilateral international basis and that in that connection it is important to have an internal legal instrument serving as a reference point for future international negotiations, to show the role the Community is playing in ensuring responsible fishing without undermining the principle of free trade. It is symptomatic of the situation that some states, particularly coastal states, wish to open the debate in some regional marine resource management organizations on the possibility of prohibiting landings by fishing vessels of non-contracting parties not observing the management and conservation rules laid down by those organizations. This approach needs to be addressed in the context of the code of conduct on responsible fishing and also the United Nations Agreement on straddling stocks and highly migratory species. The Commission will present guidelines to the Council on this matter at a later date. In the light of the foregoing, the Commission takes the view that there are no grounds for amending Regulation (EC) No 1093/94 by either restricting or expanding its scope. It will not therefore be putting any such proposal to the Council but rather recommends maintaining the status quo. Annex: Quantity (tonnes) and number of vessels involved in direct landings (figures for 1995 provisional) Germany Denmark Spain France Greece Total Q 1994 1928 1995 536 N 286 56 Q N Q 48157 5889 43449 25642 1818 67854 N 623 428 Q 9892 4733 N 11 8 Q N }30' }20' Q 103426 N 6809 98795 2310 1 for the two years. 10 ISSN 0254-1475 COM(96) 272 final DOCUMENTS EN 11 03 02 Catalogue number : CB-CO-96-282-EN-C ISBN 92-78-05479-8 Office for Official Publications of the European Communities L-2985 Luxembourg M

COMMUNICATION FROM THE COMMISSION on the final evaluation of the implementation of the Community programme,Establishment of an Internal Information Services Market (1991-1995) IMPACT 2

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~ 7^ ' COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 17. 06. 1996 COM(96)273 final COMMUNICATION FROM THE COMMISSION on the final evaluation of the implementation of the Community programme, Establishment of an Internal Information Services Market (1991-1995) IMPACT 2 COMMUNICATION FROM THE COMMISSION on the final evaluation of the implementation of the Community programme Establishment of an Internal Information Services Market (1991-1995) IMPACT 2 Summary The final evaluation repprt on the implementation of the IMPACT 2 programme has been established by a committee of five external experts who conclude that the programme has been well managed by the Commission and has provided value for money in the results achieved. The programme has demonstrated the multiplier mechanism, whereby the money spent had an effect substantially greater than the value of the public funds invested. The programme has achieved to enhance the understanding of the information market, to develop a real dialogue with leading market players, to progress on legal issues, to stimulate the use of new media throughout the EU and to encourage business partnerships for collaborative projects to develop new multimedia information products. The programme's initiatives have attracted a large number of partners and have been particularly successful in involving a large number of SMEs. The Evaluation Committee has identified as the main message from the market place that without Community funding the risk in pan-European ventures would be too high. The Committee also has made a number of recommendations with a view to enhancing and extending information market stimulation initiatives under the forthcoming INFO2000 programme, to reinforce the dialogue with market players and to substantially increase the fmancial resources. The Commission on the whole agrees with the conclusions of the Evaluation Committee and will undertake to follow-up the Committee's recommendations within the limits of the financial resources. It should be noted that some of these recommendations go beyond the scope of INFO2000, but are already addressed by other EU programmes related to Information Society developments. Introduction 1. 2. 3. The Community programme on the "Establishment of an Internal Information Services Market" (commonly known and referred hereinafter to as the "IMPACT 2" programme) was launched on the basis of the Council Decision 91/691/EEC of 12 December 1991, covering a period of four years (1991-1995). The total budget estimated as necessary for the implementation of the programme amounted to 64 MECU. The programme had set five objectives to be addressed by measures undertaken within the framework of four action lines. These action lines addressed demand and supply issues of the information services market and complemented each other through the implementation of horizontal and vertical actions to achieve synergy across the programme. The programme specifically required to address SMEs and the development lag of less favoured regions in the European Union. Article 6 of the Council Decision stipulates that at mid-term and at the end of the programme, the Commission shall submit to the European Parliament and the Council, once the committee referred to in Article 4 has examined it, an evaluation report drawn up by independent experts on the results obtained in implementing the action lines referred to in Article 2 and may present, on the basis of these results, proposals for adjusting the orientation of the programme. The final evaluation was carried out by a panel of high-level independent experts set up by the Commission, known as IMPACT 2 Final Evaluation Committee (FEC). The panel, under the chairmanship of Mr B. BLUNDEN, conducted its evaluation between July 1995 and November 1995. 4. The main objectives of the review were to assess whether the objectives of the IMPACT 2 programme have been achieved, to analyse how successful the Commission has achieved its role as a catalyst and stimulator for market development, to identify the needs for and scope of further Community actions to stimulate market development in the context of the European information society. 5. 6. In conducting the evaluation the Final Evaluation Committee has pursued a number of activities including desk research, interviews with EC officials and market actors, and a number of panel meetings. In accordance with articles 4 and 6 of the Council Decision, the IMPACT Programme Committee (IPC) was consulted on the choice of the members of the evaluation panel at its June 1995 meeting, and discussed the contents and conclusions of the Final Evaluation Report at its December 1995 meeting, confirming its overall positive opinion on the implementation of the IMPACT 2 programme and its satisfaction with the report. Preliminary Remarks by the Commission 7. 8. 9. 10. 11. 12. industries and will be The Community has over the last two years been confronted with new challenges emerging from the developments in relation to the Information Society. These developments are leading to a global restructuring of the information and communication economic growth, competitiveness and employment for the next decade. The importance for the EU to play a major role has been recognised and is being reflected in a number of initiatives including the Commission's White Paper on Growth, Competitiveness and Employment, the Bangemann report "Europe and the global information society", the Commission's Action Plan "Europe's Way to the Information Society" and the Brussels Gl Conference devoted to the information society. the key to The multimedia industry is considered to play a key role in the development towards an Information Society, and the growing importance of the content industry is increasingly recognised as a most significant part of that industry, because of its economic potential in terms of turnover, trade balance and employment. This potential is also being perceived by big non-european global players of the ICT industries who are increasingly entering the content business, thus threatening the European position which, hitherto, has been particularly strong in print publishing. The exploitation of Europe's richness in information content is hampered by a number of factors. The European multimedia publishing industry is composed of mainly small and many new actors who are mostly nationally or regionally oriented and operate in an European market environment which is fragmented through linguistic and cultural differences. As a result, the European multimedia market lags behind the US by 3-5 years. This together with the high telecommunication costs and the problems of exploiting public sector information and of trading multimedia rights make the European content industry face serious disadvantages. The Community's IMPACT 2 programme to stimulate information market development has moved in the course of its implementation from a limited IMPACT 2 significance to the centre of economic interests. Although the programme had been designed in expectation of these developments it had to be adapted continuously to respond to the fast changing environment. The IMPACT 2 final evaluation confirms that the Commission has managed to accomodate this situation, as far as it has been possible within the constraints imposed by budget cuts. In implementing the IMPACT 2 programme, the various initiatives have severely suffered from budget reductions by which only 52 MECU had effectively been allocated of the 64 MECU budget estimated as necessary by the Council Decision. The IMPACT 2 programme has operated in a climate of global and highly dynamic change of the information industry. This is leading to a restructuring of the global economy with the multimedia content industries becoming a key element in information society development. General Conclusions of the Evaluation Panel and Commission's comments 13. 14 15. 16. The Final Evaluation Committee concludes that the IMPACT 2 programme has achieved its objectives overall and efficiently spent the budget allocated to it. It has provided value-for-money in the results achieved and has demonstrated the 'multiplier' mechanism, whereby the money spent by the European Commission has had an effect substantially greater than the value of the public funds invested. The programme has contributed to the development of the European Union infrastructure in the development of the information market leading to the information society. The final evaluation report concludes that the recommendations of the mid-term evaluation have been implemented successfully in the remaining two years of the IMPACT 2 programme, and that the dramatic changes in the information market which have taken place since the introduction of the IMPACT 2 programme have been adequately reflected in the programme's implementation. The programme's initiatives have attracted a large number of partners and have been particularly successful in involving a large number of SMEs. The strategic changes occurring in the information market through widespread use of electronic trading and the development of multimedia publishing and technology convergence make the work of the Commission critical to the success of the EU information society. The Evaluation Committee considers the loss of resources through budget reduction a strategic error, in particular because for SMEs the risk in pan-European ventures would be too high to continue without continued EC funding. This emerges as a clear message from the marketplace. Commission comment: The Commission in principle agrees with the evaluation committee's assessment. The multiplier effect underlined in the report will continue after the end of the programme and will create a solid basis on which to build INFO2000. The budget cuts have in fact been difficult to manage, in particular for SME project partners for whom the Community funding is critical for the continuity and success of pan-European ventures. This resource limitations have also limited the exploitation of opportunities for pan-European developments which are becoming increasingly critical in a global marketplace. The Commission welcomes the Committee's recommendations for actions to be the forthcoming 1NFO2000 programme. These recommendations will be taken on board, provided that the budget allocated to this new programme does not deviate too far from the Commission proposal (COM(95) 149 final). launched under Specific conclusions of the Final Evaluation Panel and Commission's comments 17. 18. The Final Evaluation Report provides many valid recommendations which deserve scrutiny and follow-up. The following paragraphs review the essential conclusions. Action Line S aimed at improving the understanding of the information market through the actions of the Information Market Observatory (IMO). 19. 20. 21. 22. Actions have included the publication of working papers analysing specific market segments, a number of strategic studies addressing specific issues, the creation of an Information Policy Institutes Network and the publication of a widely recognised annual report on the main events and developments in the information market. Wide dissemination of the results of this work has taken place in printed and electronic form, including dissemination via the Internet Wrorld Wide Web (WWW). The Final Evaluation Committee concludes that improving the understanding of the market demands greater awareness of change in that market. In that respect the work undertaken by the IMO is considered to be good but insufficient for the needs of the marketplace. The budget reductions have caused constraints in improving the understanding of the market at a time when the development of the information society requires stimulation of the user market. Consequently, the rapidly changing information market in the EU must be reflected in expanded coverage of the IMO which needs reassessment. The Final Evaluation Committee has noted that the three strategic studies published by the IMO had a significant impact on the marketplace and that they are good examples of the Commission understanding properly its role to articulate comprehensively the views of the information content industries, the media and the user community. It is concluded that these studies have been a watershed in changing the relationship between the Commission and the leading players in the EU information industry, and the continuation and extension of that concept is strongly recommended. Commission comment : Ihe Commission is well aware of the continuous need for improving the market transparency and for articulating the views and needs of the information content market. Without such investigative work, the Commission cannot make its proper contribution to the development of a policy in nurturing the EU information society of the future. Accordingly, the Commission fully agrees to implement the recommendations made in the context of the new INFO2000 programme, but it will largely depend on the resources which will be made available whether or not it will succeed fxdly in this undertaking. Action line 2 aimed at overcoming legal barriers in the information market. Actions have contributed to the ELTs regulatory developments in the fields of personal data protection and the legal protection of databases. They have also addressed other legal barriers which require urgent solutions in the context of the information society, such as IPR in the digital age, information security and the legal implications of the convergence of technology and media. A number of actions have been launched to prepare specific initiatives to be undertaken under the INFO2000 programme, including access to and exploitation of public sector information and in the area of copyright dealing. The actions have been supported by the Legal Advisory Board (LAB) which consists of high level experts, policy advisers and information industry representatives. The work of the LAB is widely recognised and has become more visible through the organisation of conferences in Member States. 23. Whereas the evaluators are satisfied with the activities undertaken, they encourage a further strengthening and expansion of such activities, because actions by the EC to overcome legal barriers are critical in view of the strategic changes occurring in the information market. The role of the LAB should further develop to represent the legal and regulatory requirements of the content industries, the media and the user communities. To fulfil this role properly, the LAB should continue to re-structure in favour of increased representation from private sector, and establish better liaison with other consultative industry bodies interested in legal and regulatory matters. 24. 25. 26. 27. Commission comment: The Commission agrees that further improvements in liaison with other industrial bodies is required to better represent the legal and regulatory needs of industry, commerce and consumers. It is intended to look into the question of how best to reinforce such links under the INFO2000 programme. This needs to be part of a wider Commission strategy as provided for in the framework of Information the Commission's action plan "Europe's Way towards the Society" containing a number of initiatives to establish an appropriate regulatory framework. Concerning activities to stimulate the application of norms and standards for information encoding under Action line 3. 1 they have been aiming at increasing the awareness and understanding of information standards among market players and to demonstrate the benefit which can be obtained in their use. The publications of a newsletter, "Oil Spectrum", of guidelines for the application of standards and of an exhaustive list of information standards have efficiently contributed to this objective. Complementary to these actions the Commission has also launched an information initiative to develop specifications for quality assurance of products and services. The regularly updated list of information standards is a unique reference tool which is being used by industry and standardisation bodies throughout the EU and beyond. The Final Evaluation Report identifies the standards stimulating work as important and a unique activity for the EC, because the application of norms and standards will be important, if the Single European Market is to develop into one which captures a significant share of global markets. Although the work done under IMPACT 2 represents good value for money, the budget allocated to it has been too modest. The work on norms and standards must be comprehensive in defining information content owners and information user needs across many related technologies. An extension of this activity to improve coverage and market representation is, therefore, strongly recommended. Commissions comment: Whereas the Commission in principle agrees with this view, it should be noted that the scope of the IMPACT 2 programme, and that of INFO 2000 as well, is too narrow to give leverage to this initiative. Instead, those activities are now being closely co-ordinated with the Commission's European Standardisation policy and the results will be integrated into broader concepts presently being considered 28. 29. 30. 31 Action line 3. 2 on increasing user-friendliness and improving information literacy has been addressed to users of electronic information services and was composed of three mutually supporting initiatives: the operation of the Commission's host service (ECHO) together with the World Wide Web (WWW) server I'M EUROPE as a central tool for training, guidance, awareness and virtual meeting and discussion fpra; the network of National Awareness Partners (NAPs), which in the Member States maintain close contacts with the regional/national user communities, particularly SMEs, and which perform a steadily increasing number of awareness and training actions; and kick-off training for information intermediaries, SME managers and students in less favoured regions which were subsequently multiplied through co-operation with the ELPs COMETT, SOCRATES and LEONARDO programmes. Since the IMPACT mid term evaluation, the number of ECHO users has increased from 16,000 to 33,000, and the number of connect hours has doubled from 5000 to 10,000 per month. The rapidly growing interest in the I'M-Europe WWW server is evident from more than 178,000 document accesses recorded for November 1995, a five-fold increase over the same period in 1994. The level of activity of the NAP network is reflected in more than 2000 awareness events for the period 1993-1995, 1000 out of which took place in 1995. The Final Evaluation Committee acknowledges that ECHO is an exemplar activity in database host facilitation and provides a unique role in the European information market Its I'M EUROPE WWW server has since its recent launch in September 1994 acquired an established position in "cyberspace". The Committee commends the continuation and further development of this successful activity. The evaluators have taken a particular interest in the NAPs activities, because they consider awareness and dissemination as vital features of all EC activities. They conclude that the concept of a distributed system is sound, but noted significant variations in the quality of the NAPs and that their operational concept may not fully reflect the changes in the marketplace. It is, therefore, recommended to review the composition of the network and the scope and modus of operation. A new call should set specifications that cause re- focusing and set criteria against which to measure the performance of the NAPs. With regard to the training activities the Committee recommends their continuation under the INFO2000 programme. Commission comment: The Commission has made provisions to continue the successful activities commended by the Committee under the INFO2000 programme. The very detailed comments and suggestions made in relation to the improvement of NAP operations are considered valid and useful, and the Commission will take account thereof in the forthcoming re-alignment of the NAP network and its activities. in the areas of Strategic Information Initiatives (Action line 4) to stimulate the supply of advanced electronic information products and services have supported pilot projects (IMM), geographic information services (GIS) and information services for business and industry (BIS). A total of 610 proposais were received in response to three calls for proposals published in 1992, 1993 and 1994. From the first two calls (507 proposals), 84 definition phase projects, leading to 30 implementation phase interactive multimedia information 32. 33. projects, were supported. From the third call (103 proposals), 17 full projects were supported, there being insufficient remaining time and budget to operate two phases in 1995. The total budget for these projects amounted to 24. 5 MECU. The number of projects supported decreased from 59 in the first call to 17 in the third one which was due to constant budget cuts. The target of particularly stimulating activities by SMEs has been achieved, in that 65% of the 590 participating organisations in the pilot projects were SMEs. Equally, high participation of organisations from LFRs has been achieved, in that 246 LFR organisations have participated in the pilot projects, i. e. 38%. The Evaluation Committee concludes that the Commission has successfully addressed two distinct aspects with these strategic initiatives. The first is to create exemplars and to reduce risk in experimentation as part of the learning process. As a result many projects are producing healthy commercial results, some even appear to have surpassed expectation. The second aspect is to develop products which enter the marketplace and build infrastructure in a new field, for which visibility is an important feature. These initiatives have contributed to this visibility by presenting high quality products at important events such as IDT Paris, On-line London, the Frankfurt Book Fair and MILIA in Cannes. The evaluators are particularly impressed by the very successful work done in the area of GIS. Because of the interest generated in the pilot projects, this area has expanded into one of policy development and should be considered as an exemplar for further work in other sectors under the INFO2000 programme. It is also confirmed that the criticisms made at the time of the interim review have been overcome. From interviews with project participants, the Evaluation Committee has identified the main message from the marketplace that without continued IMPACT 2 funding under INFO2000 the risk in pan-European ventures would be too high to continue. As a consequence the Committee recommends to reinforce these initiatives in INFO2000 and makes a number of concrete proposals for further improvements. Commission comment: The Commission is aware that there are plenty of opportunities to develop successful European multimedia products and services, and these will increase over the coming years as the information society progresses. It is understood that the private sector is mainly responsible for exploiting such opportunities. However, it is also understood that the public sector has a role to play in creating favourable conditions and in stimulating investment thus reducing the financial risk of the private actors. These public responsibilities need to be fulfilled in consideration of the subsidiarity principle at national and at European levels. The Commission's role consists of addressing these issues in a pan-European context and has made appropriate provisions under the INFO2000 programme. In implementing further initiatives, the Commission will take due account of the many valuable suggestions made in the Evaluation Report. The main obstacle in fully exploiting these unique opportunities for the benefit of the European positions in a global marketplace may ultimately consist of inadequate Community financial resources made available to the programme. 10 Proposals for future developments 34. The Final Evaluation Committee has conducted the evaluation in the light of the information society developments, and it has reflected the Commission's proposal for the INFO2000 programme in its recommendations. In recognition of the success of IMPACT 2 and the growing importance of the information market to EC policy overall, the Committee recommends to extend the Commission's information content initiatives by building on the results of IMPACT 2 and to consider an increase of budget for INFO2000. The report provides a rich source of extremely valid and detailed suggestions for such extensions and further improvements. 35. Commission comment: The Committee's considerations are fully in line with the Commission's views which have found its place in the INFO2000 programme proposal. As a consequence, the suggestions made by the Committee will be taken into account in the implementation ofINFO2000 as far as feasible. M ANNEX 1 Executive Summary of the Report on the IMPACT 2 Final Evaluation Composition of the IMPACT 2 Final Evaluation Committee Mr Brian BLUNDEN, Chief Executive, IEPRC, UK - Chairman, Mr Rolf KAT, Business Development and Analysis, VNU, Netherlands, Mr René MAYER, Président de section honoraire, Conseil Général des Ponts et Chaussées, France, Mr Franz G. MÔSL, Unternehmensberatung, Germany, Mr José Joao CAMPOS RODRIGUES, Director, Challenge, Portugal, Mr Mogens RASMUS SEN, Managing Director, Sarbaek A/S, Denmark, Secretary The full text of the evaluation report is available in English from European Commission DGXIII/E L-2920 LUXEMBOURG Fax:+352-430133190 AL Executive Summary: Final Evaluation Committee (FEC) for the IMPACT 2 programme: The Final Evaluation Committee (FEC) concludesLthat the IMPACT 2 programme has achieved its objectives overall and efficiently spent the budget allocated to it by the Council. - The programme has been well managed by DGXIII/E. It has provided value-for-money in the results achieved. The programme has demonstrated the multiplier mechanism. whereby the money spent by the European Commission (EC) has had an effect substantially greater than the value of the public funds invested. This multiplier effect will continue after the end of the programme and will create a solid basis on which to build Info2000. The IMPACT 2 programme has contributed to the development of European Union (EU) infrastructure in the development of the Information Market leading to the creation of the Information Society. Specifically the achievements of IMPACT 2 are demonstrated by: • ennanced understanding by industry and governments of the Information Market through the work of the Information Market Observatory (IMO) real dialogue with leading players in the information industry through the strategic studies commissioned by DGXIII/E progress on regulatory and legislative issues through the work of the Legal Advisory Board (LAB) reduction in technological barriers to information transfer and electronic trading through work on norms and standards growth in the use of information by industry and commerce through the work of the European Commission Host Organisation (ECHO) stimulation in the use of new media throughout the European Union by exemplars such as the I M-EUROPE W WW server on the Internet amplification in the appreciation in industry of the benefits of cooperation throughout the European Union through the work of the National Awareness Partners (NAPs) through kick-off actions in the area of training in Less Favoured Regions a large multiplier effect has been achieved by the COMETT programme provision of opportunity for the encouragement of business partnerships ~ particularly SMEs - by Calls for Proposals and financial priming to collaborative projects such as those stimulated by the IMM and GIS programmes as a result of the large interest in GIS a communication to Council and the European Parliament is underway creation of a European-wide focus on the benefits from the use of information by industry through the Call for Information Services for Business and Industry (BIS) development of the total European market by international cooperation programmes such as the Copernicus projects Ai The Final Evaluation Committee considers the success of the IMPACT 2 programme to make an overwhelming case for support by Member States, the Council and the European Parliament to the Info2000 programme; and for consideration to be given to increasing the budget allocation given to the Info2000 programme. The reason the Final Evaluation Committee advocates budget increase for Info2000 is that it would follow the logic of recent EC White Papers and the findings of the Bangemann Committee on stimulation to the growth of the Information Society. The EU needs to create jobs and to improve competitiveness in global markets. The Information Market is recognised as a major driver of these two objectives. In turn, the driver of the Information Market is that of users of information and providers of content - such as publishers Without users and content providers there is no demand for software, hardware, or facilities such as telecommunications. Hence the role of DGXIII/E is critical to the development of the Information Market and to the formulation of EC policy overall. At present this work is under-funded when compared with the size of the challenge which it should address. There appears to be a failure in strategic understanding of this driver mechanism in the EC. DGXIII/E must be encouraged to continue to articulate the views and aspirations of all information users - industry, commerce and the many branches of the public sector including cultural communities such as education - together with the views and aspiration of content owners, the media and functional activities of commerce such as advertising DGXIII/E must be mandated to give coherence to these views on all matters related to the Information Market development including the regulatory framework required for competitive trading. Since the introduction of the IMPACT 2 programme the Information Market has changed dramatically. The Information Market now permeates virtually all organisations in the pnvate and public sectors of the European Union. Multimedia has become the focus of activity by global players as well as industry, commerce, academia and the public sectors and governments in the Member States. This change in the Information Services marketplace has been reflected in the work of DGXIII/E. However, the issue of mandate clarity disadvantages the players in the information industries in the EU and deprives Member State programmes of the benefits of leadership in cooperation, and thus gaining the maximum multiplier effect throughout the EU from Information Society programmes. This situation must be changed. It is a subject which requires urgent political attention at the highest level. Thus, the recommendations of the Final Evaluation Committee arising from the IMPACT 2 programme may be summarised as follows. 1 The IMPACT 2 programme has been completed successfully and within the budget guidelines set out by the Council. Au 2 In recognition of the success of IMPACT 2 and the growing importance of the Information Services Market to EC policy overall, consideration should be given to increasing the budget for Info2000. Any attempts by Member States to change - by elimination of activities - any part of the proposed Info2000 programme should be rejected 3 The Council and the European Parliament should support an enhanced mandate for DGXIII/E. Four specific changes are recommended. They are: • to ensure that DGXIII/E has the mandate to realise its mission to articulate the aspirations of the content and media industries and the total information user community • revision by some Member States governments of their representation on the Advisory Committee for Info2000 • increased representation from the information content industries in the Information Society Forum • creation of a small high level group of commercially expert advisers from private and public sector business communities to advise DGXIII/E in matters of policy development 4 Allocation of budget resources in !nfo2000 to the development of a methodology for the stimulation of particular sectors or topics is required. 5 In project calls, the adoption of a standard procedure for feasibility stage work which is minimal in bureaucratic procedure is needed. Independent investigation of the project administration procedures in the administrative departments of the EC to reduce drastically paperwork, timescales. approval, acceptance and project support payment settlement should be instigated. 6 The scope of the work of the IMO should be enlarged to take full account of the changes taking place in the Information Market; the dissemination of the IMO report should be speeded up. 7 Increase in the budget for strategic studies with a minimum provision of 750. 000 ECU per annum during the duration of the Info2000 programme is advisable. 8 An enhanced mandate for the LAB - and if necessary increased budget - is recommended by: • re-statement of the LAB mandate to ensure that all Directorates-General recognise its role to represent the regulatory and legal requirements of the information content industries, the media and the information user community • re-assessment by the management of DGXIII/E to ensure it has adequate budgets and resource provision • management of DGXIII/E to ensure the LAB undertakes systematic and comprehensive liaison with interested organisations concerned with regulation and legal affairs in the Information Services Market • continued re-structuring of the LAB to reduce the representation from academia and increased representation from commercial players in the information market and re structuring of the representation to reflect a proper balance of all interested parties in the Information Services Market. 9 Increased budget allocation to work on the promotion of standards and specifications under the Info2000 programme is proposed; this should specifically address the issues of: xr • measures of quality in new media products • meaningful measures of advertising effectiveness in new media. 10 A new Call for NAPs should go out to demonstrate understanding of the total Information Market, and to put in place a system of milestones and performance criteria which requires the activity to resemble a marketing development programme for EC activities. 11 Continued funding to support ECHO and I'M-EUROPE WWW server is proposed, as well as continued support to training initiatives under Info2000 in conjunction with DGXXII 12 Continued support to interactive multimedia services (IMM) is recommended and specifically: • continued monitoring of IMM projects over the next two years to ascertain their impact on the information marketplace • continuation of a similar initiative to ensure a constant flow of exemplar products • extension of this exemplar concept to include creative use of new media in advertising • continuation to the initiative to ensure the nurturing of SMEs in the EU as producers and users of information services. 12 Re-consideration of soecific allocation of budget resources in line with the communication on GIS to Council and the European Parliament. 14 Development of stimulation to business and industry information services should be encouraged by: • continued support for business and industry information services (BIS) which will contribute • most to the development of EU infrastructure initiating a programme with private sector research and technology organisations (RTOs) and relevant public sector bodies to develop a coherent business and industry information service network in the EU • development of pan-European virtual communities concerned with business and industry futures issues throughout the EU. /& ISSN 0254-1475 COM(96) 273 final DOCUMENTS EN 16 10 Catalogue number : CB-CO-96-283-EN-C ISBN 92-78-05490-9 Office for Official Publications of the European Communities L-2985 Luxembourg

Proposal for a COUNCIL REGULATION (EC) establishing certain measures concerning imports of processed agricultural products from Switzerland in order to take account of the results of the Uruguay Round negotiations in the agricultural sector

http://publications.europa.eu/resource/cellar/ffb7125e-7444-426a-8d9c-9c901710c5f6

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** •A- W,s. I COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 14. 06. 1996 COM(%) 268final 96/ 0156 (ACQ Proposal for a COUNCIL REGULATION (EC) establishing certain measures concerning imports of processed agricultural products from Switzerland in order to take account of the results of the Uruguay Round negotiations in the agricultural sector (presented by the Commission) 1. 2. 3. Explanatory memorandum The Council Decision of 22 December 1994 concerning the conclusion of the agreements reached in the Uruguay Round multilateral negotiations (1986-1994) was implemented for certain agricultural products on 1 July 1995. These agreements provide for the application of specific amounts to processed agricultural products in place of the previous variable components. The existing free trade agreement with Switzerland contains a protocol specifically relating to processed agricultural products. This protocol currently provides only for variable components to be applied, upon import, to certain processed agricultural products. These variable components have been replaced by specific amounts following the implementation of the agreements on agriculture concluded during the Uruguay Round multilateral negotiations. In order to avoid disturbing traditional trade flows and to maintain the existing level of reciprocal preferences, it has proved necessary to make certain technical adjustments by introducing reduced specific amounts. All the changes necessary to implement the results of the Uruguay Round negotiations have been negotiated with Switzerland and will be incorporated in the existing protocol. However, in view of the fact that these negotiations will not be completed by 1 July 1996, it is necessary to extend to the period from 1 July 1996 to 30 June 1997 the autonomous measures adopted by Council Regulation (EC) No 1917/95 and to adapt them to the changes in the Community customs tariff applicable from 1 July 1996, in order to maintain the existing level of reciprocal preferences pending the conclusion of the negotiations. For these reasons, the Commission proposes that the Council adopt the Regulation below. Draft Council Regulation (EC) No. /96 of. 1996 establishing certain measures concerning imports of processed agricultural products from Switzerland in order to take account of the results of the Uruguay Round negotiations in the agricultural sector THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 113 thereof, Having regard to the proposal from the Commission, the European Community and Whereas, under Switzerland, concessions regarding certain processed agricultural products have been granted on a reciprocal basis; the preferential agreement between Whereas, further to Council Decision 94/800/EC of 22 December 1994 concerning the conclusion on behalf of the European Community, as regards matters within its competence, of the agreements reached in the Uruguay Round multilateral negotiations (1986-1994)', certain concessions regarding processed agricultural products have been amended as from 1 July 1995; Whereas as a result certain aspects of the agreement concluded with Switzerland, and in particular the protocol concerning processed agricultural products annexed to this agreement, should be adjusted in order to maintain the existing level of reciprocal preferences; Whereas to that end negotiations are still in progess with Switzerland with a view to the conclusion of amendments to this protocol; whereas, however, it is not possible to conclude these negotiations in time in order to implement the necessary adjustments on 1 July 1996; Whereas in those circumstances it is appropriate for the European Community to adopt autonomous measures in order to maintain the existing level of reciprocal preferences, pending the conclusion of negotiations; Whereas the Council has already adopted transitional measures by Regulation (EC) No 1917/95,2 as amended by Regulation (EC) No 167/963, applicable until 30 June 1996; whereas these measures should be extended; whereas, however, account must be taken of the changes in the Community customs tariff that will apply from 1 July 1996, HAS ADOPTED THIS REGULATION: OJNoL336, 23. 12. 1994, p. 1. OJNoL185, 4. 8. 1995, p. 1. O J N o L 2 5, 1. 2. 1996, p. 1. Article 1 1. From 1 July 1996 to 30 June 1997, the basic amounts to be taken into account in the calculation of the agricultural components and the additional duties applicable at importation into the Community of goods originating in Switzerland shall be those mentioned in the annex to this Regulation. 2. The Commission may, in accordance with the procedure laid down in Article 6 of Council Regulation (EC) No 3448/93, suspend application of the measures provided for in paragraph 1 if Switzerland discontinues the application of its reciprocal measures in favour of the Community. Article 2 This Regulation shall enter into force on the day of its publication in the Official Journal of the European Communities. It shall apply with effect from 1 July 1996. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at. ,. 1996 For the Council ANEXO - Bl LAG - ALLEGATO A Nil AN G BIJLAGE - FI AP APT H M A - ANEXO - LUTE - ANNEX - ANNEXE - BlLAGA Montantes bâsicos, considerados par calcular los elementos agricolas reducidos y derechos adicionales, aplicables a las importaciones en la Comunidad Basisbelob taget i betragtning ved beregningen af de nedsatte landbrugs elementer og tillasgstold anvendelig ved indfersel i Fasllesskabet Grundbetrâge, die bei der Berechnnng der ermâBigten Agrarteilbetràge und Zusatzzôlle, anwendbar bei der Einfulir in die Gemeinschafl beriicksichtigt worden sind BaaiKâ n o aâ nou £\r|q>6r|aav unoijjn Yia T OV uno\oYiajjo TU>V jjsTapXrrrav oroixeicov Kai npoaeeicov 5aa|jd)v nou £(pap|JoÇovrcu a ra aypOTtKà orotxei'a Kara TT]V eiaaYOùYn orriv KoivotriTa Basic amounts taken into consideration in calculating the reduced agricultural components and additional duties, applicable on importation into the Community Montants de base, pris en considération lors du calcul des éléments agricoles réduits et droits additionnels applicables à l'importation dans la Communauté Importi de base, presi in considciazione per il calcolo degli elementi agricoli e dei dazi addizionali applicabili all'importazione nella Comunità Basisbedragen, in aaivmerking genomen bij de berekening van de verlaagde agrarische elementen en aanvullende invoerrechten, geldend bij invoer in de Gemeenschap Montantes de base tornados em consideracâo aquando do câlculo dos elementos agricolas reduzidos e dos direitos adicionais aplicâveis à importaçaô na Comunidade Yhteisôôn tulevaan tuontiin sovellettavia alennettuja maatalousosia ja lisâtulleja 'laskettaessa huomioon otettavat perusmâarât Grundpriser som beaktas vid berâkning av minskade jordbruksbestândsdelar och tillàggstull soin skall utgâ pâ import till gemenskapen Trigo blando / Blod hvede / Weichweizen / MaÀaKÔ a n â pi / Common wheat / Blé tendre / Grano tenero / Zachte tarwe / Trigo mole / Tavallinen vehna / Vête Trigo duro /Hârd hvede / Hartvveizen /ZKÀi~|p6 arxâpt / Durum wheat / Blé dur /Grano duro /Durum tarwe / Trigo duro /Durumvehna / Durumvete Centeno/ Rug / Roggen /ZtKoAri /Rye /Seigle / Segala / Rogge / Centeio / Ruis /Râg Cebada / Byg / Gerste / Kpt8dpi /Barley/ Orge / Orzo / Gerst / Cevada / Ohra / Korn Maiz / Majs / Mais / KaAa(jnOKi / Maize / Maïs / Granturco / Maïs / Milho / Maissi / Majs Arroz descascarillado de grano largo / Ris, afskallet, langkomet / Reis, langkômig, geschàlt / Ano(pAoia)u. évo pû^i fjaKpoonspfJO / Long-grain husked rice / Riz décortiqué à grains longs / Riso semigreggio a grani lunghi / Langkorreîige gedopte rijst / Arroz em peliculas de gràos longos / Pitkajyvâinen esikuorittu riisi / Ris, skalat lângkomigt Lèche desnatada en polvo / Skummetma;lkspulver / Magennilchpulver / Ano(3ouTupu)|jévo yàka ae OKOVT) / Skimrned-milk powder / Lait érémé en poudre / Latte scremato in polvere / Magere-melkpoeder / Leite desnatado em pô/ Rasvaton maitqjauhe / Skununjôlkspulver. eche entera en polvo / Sodmxlkspulver / Vollmslchpulver / îlXnpeq Y ° ^a ae CTKOVTI / Wliole-milk powder / Lait entier en pendre / Latte intero in polvere / Voliemelkpoeder / Leite inteiro ein pô / Rasvainen maitojauhe / Mjôlkpulver Mantequilla / Smor / Butter / BoÛTupo / Butter / Beurre / Burro / Boter / Manteiga / Voi / Smôr Azùcar bianco / Hvidt sukker / WeiBzucker / AeuKrî ^âxapn / White sugar / Sucre blanc / Zucchero bianco / Witte suiker / Açùcar branco / Valkoinen sokeri / Vitt socker ecus/ECU/Ecu/ ecu/écus/ecua/' 100 kg 9,771 15,168 12. 734 12,734 1,040 36,344 137,182 179. 344 260,647 48,000 r ISSN 0254-1475 COM(96) 268 final DOCUMENTS EN 03 02 Catalogue number : CB-CO-96-279-EN-C ISBN 92-78-05347-3 Office for Official Publications of the European Communities L-2985 Luxembourg /

Amended proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE amending Council Directive 80/777/EEC on the approximation of the laws of the Member States relating to the exploitation and marketing of natural mineral waters

http://publications.europa.eu/resource/cellar/54f1e1bb-0ebf-4d12-a421-54b8995c3964

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 13. 06. 1996 COM(96) 276 final 94/0235 (COD) OPINION OF THE COMMISSION pursuant to Article 189 b (2) (d) of the EC Treaty, on the European Parliament's amendments to the Council's common position regarding the proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE amending Council Directive 80/777/EEC on the approximation of the laws of the Member States relating to the exploitation and marketing of natural mineral waters AMENDING THE PROPOSAL OF THE COMMISSION pursuant to Article 189 a (2) of the EC Treaty OPINION OF THE COMMISSION The Commission presented on October 1994 a proposal for a European Parliament and Council Directive (EC) amending Council Directive 80/777/EEC on the approximation of the laws of the Member States relating to the exploitation and marketing of natural mineral waters1. This proposal updates certain provisions of the existing directive on natural mineral waters of 19802. The proposal has followed the codecision procedure established in Article 189b of the EC Treaty. On 22 May 1996 the European Parliament delivered its opinion on the Council's Common Position3 on this proposal. The European Parliament has proposed in its opinion two amendments. In accordance with Article 189b of the EC Treaty, the Commission delivers the following opinion on these two amendments. On 30 January 1996, the Commission had expressed its agreement with the Council's Common Position (Communication from the Commission to the European Parliament, SEC(96) 172 final). The Commission is willing to accept amendment number 1. The Commission would prefer however to locate the contents of this amendment in the article of the directive where the definitions and all the requirements for spring waters are grouped together. With the wording of the amendment, this would be the first time the term "spring waters" would appear in the Directive (in Article 4) while the definition and all the other requirements would appear later on, in Article 9. The Commission attaches a lot of importance to the clarity of the legal texts of the EU. As regards amendment number 2, although the Commission considers that it does not represent a substantial change, it is prepared to accept it in a spirit of compromise. 1 2 3 COM(94) 423 final, 235 (COD). O. J. C 314, 11/11/1994, p. 4 O. J. L 229, 30/8/1980, p. 1 O. J. C 59, 28/2/96, p. 44 Amended proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE amending Council Directive 80/777/EEC on the approximation of the laws of the Member States relating to the exploitation and marketing of natural mineral waters Council's Common Position Amended proposal Article 1, paragraph 2 (Article 4, paragraph 4) "4. Paragraph 1 shall not constitute a bar to the "4. Paragraph 1 shall not constitute a bar to the utilization of natural mineral waters and spring waters in the manufacture of soft drinks. " utilization of natural mineral water manufacture of soft drinks. " in the Article I, paragraph 5 (Article 9, paragraph 4a, first indent) satisfies the conditions of exploitation laid down in Annex II, paragraphs 2 and 3, satisfies the conditions of exploitation laid down in Annex II, paragraphs 2 and 3, which will be fully applicable to spring waters, ISSN 0254-1475 COM(96) 276 final DOCUMENTS EN 06 10 Catalogue number : CB-CO-96-284-EN-C ISBN 92-78-05501-8 Office for Official Publications of the European Communities L-2985 Luxembourg

Re-examined proposal for a COUNCIL REGULATION (EC) amending Regulation (EEC) No 1973/92 establishing a financial instrument for the environment (Life)

http://publications.europa.eu/resource/cellar/97ce84c9-2162-4096-85fd-78d2ce789980

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COMMISSION OF THE EUROPEAN COMMUNITIES A ** Brussels, 13. 06. 1996 COM(96) 295 final 95/0093 (SYN) Re-examined proposal for a COUNCIL REGULATION (EC) amending Regulation (EEC) No 1973/92 establishing a fînancial instrument for the environment (Life) (presented by the Commission pursuant to Article 189 c (d) of the EC Treaty) EXPLANATORY MEMORANDUM On 12 April 1995 the Commission adopted, on the basis of Article 130s(l) of the Treaty, the proposal for a Regulation amending Regulation (EEC) No 1973/92 (Life) with the objective of implementing the second phase of the instrument (1996-1999). l The Economic and Social Committee gave its opinion on 25 October 1995. 2 The European Parliament gave its opinion at the first reading on 17 November 1995. 3 On 26 January 1996 the Commission adopted an amended proposal pursuant to Article 189a(2) of the EC Treaty incorporating 28 of the 34 amendments approved by Parliament. 4 On 18 December, the Council approved a common position on the Commission proposal. 5 The European Parliament adopted its decision on the Council common position on 5-6 June 1996, which it approved subject to 7 amendments. The Commission has examined the amendments adopted by Parliament at the second reading, and incorporated some of them in the current reexamined proposal. The Commission's position on the amendments adopted by Parliament is as follows: Amendments 1 to 4 are accepted in full (the Commission already accepted them at the first reading). These concern: - amendments 1 and 2 designed to clarify, in Article 2(l)(b)(iii), the scope of preparatory measures concerning, firstly, wetlands in coastal areas around river mouths and, secondly, management and protection of water resources; amendment 3 specifying in Article 2(2)(a) nature protection in the areas of activity under Life with regard to third countries other than the countries of Central and Eastern Europe; OJ C 184, 18. 7. 1995, p. 12. OJ C 18, 22. 1. 1996, p. 15. OJ C 323, 4. 12. 1995, p. 158. O J C 9 2, 28. 3. 1996, p. 7. OJ C 134, 6. 5. 1996, p. 1. amendment 4 adapting Article 2(3) to permit the monitoring and dissemination of the results of all the measures receiving Life funding including Phase I, and not merely Phase II as provided for in the common position. Amendment 6 concerning the transparency of procedures is accepted in principle, but the Commission cannot incorporate it in the enacting terms for reasons of consistency of its institutional powers. The Commission proposes to make a declaration in the Council minutes incorporating the substance of amendment 6. 6 Amendment No 7 is accepted. Amendment 5, finally, is not acceptable since it is not possible for budgetary reasons to increase to ECU 600 million the figure of ECU 450 million currently provided for by the Council, with the possibility of review in 1997 on the basis of relevant information supplied by the Commission. NaT Text of the declaration "With regard to the evaluation and selection of the measures proposed in sectors other than nature protection, the Commission informs the institutions that it intends to carry out pre-selection of the proposals followed by classification by order of merit on the basis of the opinion of independent Reexamined proposal for a Council regulation amending Regulation (EEC) n* 1973/92 establishing a financial instrument for the environment (Life) Common position of the Council Amended text Article 1 Article 2(1)(b)(iii), first indent of Regulation (EEC) No 1973/92 Protection of coastal areas and their rational management ; Article 2(1)(b)(iii), third indent of Regulation (EEC) No 1973/92 water protection, including waste water treatment Protection of coastal areas and their rational management, of rivers which flow into coastal areas. their possible wetlands and the sustainable management of those areas and r < « —. management and protection of water resources. including contaminated water treatment waste or Article 1 Article 2(2)(a)a (new) of Regulation (EEC) No 1973/92 (a)a conservation or restoration from the point of view of of n a t u re significant of threatened species of flora and fauna; protection. habitats Article 1 Article 2(3) of Regulation (EEC) No 1973/92 Accompanying measures needed to monitor, evaluate or promote the actions undertaken under points 1 and 2 of information on the experience and the results obtained of such actions. dissemination and Accompanying measures needed to monitor, evaluate or promote the actions undertaken during the first stage and under points 1 and 2 and dissemination of information on the experience and the results obtained of such actions. Article 1 Article 9(5) of Regulation (EEC) No 1973/92 Actions provided for in Article 2, point 1(a) and their flanking measures shall be subject to the procedure set out in Article 21 of Directive 92/43/EEC; other Life actions including, where appropriate, procedures for project selection shall be approved in accordance with the procedure provided for in Article 13 of this Regulation. The Commission shall inform the committees mentioned in Article 21 of Directive 92/43/EEC and Article 13 of this Regulation of the application of criteria and priorities defined in Article 9a. shall be approved Actions provided for in Article 2, point 1(a) and their flanking measures shall be subject to the procedure set out in Article 21 of Directive 92/43/EEC; other Life actions in accordance procedure provided for in Article 13 of this Regulation. The Commission shall inform the committees mentioned in Article 21 of Directive 92/43/EEC and Article 13 of this Regulation of the application and of priorities defined in Article 9a. criteria with the ISSN 0254-1475 COM(96) 295 final DOCUMENTS EN 14 01 Catalogue number : CB-CO-96-296-EN-C ISBN 92-78-05633-2 Office for Official Publications of the European Communities L-2985 Luxembourg c

OPINION OF THE COMMISSION pursuant to Article 189 b(2) (d) of the EC Treaty, on the European Parliament' s amendments to the Council' s common position regarding the proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE amending Council Directive 80/777/EEC on the approximation of the laws of the Member States relating to the exploitation and marketing of natural mineral waters

http://publications.europa.eu/resource/cellar/4bf0b999-f4f6-41d3-b11c-cf706a7dba6d

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 13. 06. 1996 COM(96) 276 final 94/0235 (COD) OPINION OF THE COMMISSION pursuant to Article 189 b (2) (d) of the EC Treaty, on the European Parliament's amendments to the Council's common position regarding the proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE amending Council Directive 80/777/EEC on the approximation of the laws of the Member States relating to the exploitation and marketing of natural mineral waters AMENDING THE PROPOSAL OF THE COMMISSION pursuant to Article 189 a (2) of the EC Treaty OPINION OF THE COMMISSION The Commission presented on October 1994 a proposal for a European Parliament and Council Directive (EC) amending Council Directive 80/777/EEC on the approximation of the laws of the Member States relating to the exploitation and marketing of natural mineral waters1. This proposal updates certain provisions of the existing directive on natural mineral waters of 19802. The proposal has followed the codecision procedure established in Article 189b of the EC Treaty. On 22 May 1996 the European Parliament delivered its opinion on the Council's Common Position3 on this proposal. The European Parliament has proposed in its opinion two amendments. In accordance with Article 189b of the EC Treaty, the Commission delivers the following opinion on these two amendments. On 30 January 1996, the Commission had expressed its agreement with the Council's Common Position (Communication from the Commission to the European Parliament, SEC(96) 172 final). The Commission is willing to accept amendment number 1. The Commission would prefer however to locate the contents of this amendment in the article of the directive where the definitions and all the requirements for spring waters are grouped together. With the wording of the amendment, this would be the first time the term "spring waters" would appear in the Directive (in Article 4) while the definition and all the other requirements would appear later on, in Article 9. The Commission attaches a lot of importance to the clarity of the legal texts of the EU. As regards amendment number 2, although the Commission considers that it does not represent a substantial change, it is prepared to accept it in a spirit of compromise. 1 2 3 COM(94) 423 final, 235 (COD). O. J. C 314, 11/11/1994, p. 4 O. J. L 229, 30/8/1980, p. 1 O. J. C 59, 28/2/96, p. 44 Amended proposal for a EUROPEAN PARLIAMENT AND COUNCIL DIRECTIVE amending Council Directive 80/777/EEC on the approximation of the laws of the Member States relating to the exploitation and marketing of natural mineral waters Council's Common Position Amended proposal Article 1, paragraph 2 (Article 4, paragraph 4) "4. Paragraph 1 shall not constitute a bar to the "4. Paragraph 1 shall not constitute a bar to the utilization of natural mineral waters and spring waters in the manufacture of soft drinks. " utilization of natural mineral water manufacture of soft drinks. " in the Article I, paragraph 5 (Article 9, paragraph 4a, first indent) satisfies the conditions of exploitation laid down in Annex II, paragraphs 2 and 3, satisfies the conditions of exploitation laid down in Annex II, paragraphs 2 and 3, which will be fully applicable to spring waters, ISSN 0254-1475 COM(96) 276 final DOCUMENTS EN 06 10 Catalogue number : CB-CO-96-284-EN-C ISBN 92-78-05501-8 Office for Official Publications of the European Communities L-2985 Luxembourg

Proposal for a COUNCIL REGULATION (EC) providing for the adjustment, as an autonomous and transitional measure, of concessions for certain processed agricultural products provided for in the Europe Agreements to take account of the Agreement on Agriculture concluded during the Uruguay Round Multilateral Trade Negotiations

http://publications.europa.eu/resource/cellar/aa02be0a-2465-4a1c-bdc0-db50647a53fe

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COMMISSION OF THE EUROPEAN COMMUNITIES tV -it Brussels, 12. 06. 1996 COM(%) 263 final 96/0152 (ACC) Proposal for a COUNCIL REGULATION (EC) providing for the adjustment, as an autonomous and transitional measure, of concessions for certain processed agricultural products provided for in the Europe Agreements to take account of the Agreement on Agriculture concluded during the Uruguay Round Multilateral Trade Negotiations (presented by the Commission) EXPLANATORY MEMORANDUM When on 1 July 1995 the Community started to implement its GATT commitment on agriculture this led to an increase in customs duties for certain processed agricultural goods. In order to maintain the preferences granted in the framework of the Europe Agreements to the Associated Central European Countries the Community, by adopting Regulation (EC) No 2179/95, took autonomous measures. These autonomous measures which were extended by Regulation (EC) N° 3064/95, were intended to stay in force until the relevant Europe Agreements are adapted. Since adaptation of the Europe Agreements may not be accomplished by 30. 6. 1996 and in order to avoid any deterioration in access to the EU market for preferential trade from the CEECs the measures foreseen in Regulation (EC) No 3064/95 should be extended until 31 December 1996. This proposal does not entail any additional expenditure other than those already agreed upon adoption of Regulation (EC) No 2179/95. 1 Proposal for a COUNCIL REGULATION (EC) No /96 of providing for the adjustment, as an autonomous and transitional measure, of concessions for certain processed agricultural products provided for in the Europe Agreements to take account of the Agreement on Agriculture concluded during the Uruguay Round Multilateral Trade Negotiations THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 113 thereof, Having regard to the proposal from the Commission, Whereas Protocol 3 of the Europe Agreements establishing an association between the European Communities and their Member States, of the one part, and the Republic of Hungary, the Republic of Poland, the Slovak Republic, the Czech Republic, Romania and the Republic of Bulgaria of the other part1, hereafter referred to as "Europe Agreements", provides for concessions for certain processed agricultural products originating in those countries; whereas those concessions involve, in due cases, reductions in the variable components provided for in Council Regulation (EC) No 3448/93 of 6 December 1993 laying down the trade arrangements applicable to certain goods resulting from the processing of agricultural products2 ; Whereas pending adaptation of Protocol 3 of the Europe Agreements Council Regulation No (EC) No 3064/953 was adopted which, until 30. 6. 1996, maintains the degree of preference granted, thus offsetting possible negative effects the implementation of the results of the Uruguay Round may have on exports of these countries to the Community; Whereas the negotiations which are currently under way with the countries concerned for the conclusion of Protocols amending the Europe Agreements have not yet been concluded; whereas 'interim' Protocols covering solely the trade-related aspects of the amending protocols cannot enter into force on 1 July 1996; whereas it is therefore advisable to extend the concessions on an autonomous basis until 31 December 1996; HAS ADOPTED THIS REGULATION: OJ No L 347, 31. 12. 1993, p. 1 (Hungary) OJNoL348, 31. 12. 1993, p. 1 (Poland) OJ No L 360, 31. 12. 1994, p. 1 (Czech Republic) OJ No L 359, 31. 12. 1994, p. l (Slovak Republic OJ No L 357, 31. 12. 1994, p. l (Romania) OJ No L 358, 31. 12. 1994, p. l (Bulgaria) 2 OJ No L 318, 20. 12. 1993, p. 18 3 OJNoL328, 30. 12. 1995, p. 2 Q " C^ Article 1 1. From 1 July to 31 December 1996, the basic amounts to be taken into account in the calculation of the reduced agricultural components and the reduced additional duties applicable at importation into the Community of goods originating in Poland, Hungary, Slovakia, the Czech Republic, Romania, Bulgaria and listed in Protocol 3 to the Europe Agreements with these countries shall be those mentioned in the annex I to this Regulation. 2. The processed agricultural products originating in Poland, Hungary, Slovakia, the Czech Republic, Romania, Bulgaria and listed in Annex II to this Regulation shall be subject to the duties provided for in that annex. Article 2 This Regulation shall enter into force on the third day following its publication in the Official Journal of the European Communities. It shall apply from 1 July until 31 December 1996. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Brussels, For the Council The President n A N E XO I BI'L. AG I A N H A NG I flAPAPTHMA I A N N EX I A N N E XE I A L L E G A TO I B I J L A GE I A N E XO I L U TE I B i L A GA I Montantes bâsicos, considerados par calcular los elementos agricolas reducidos y derechos adicionales, aplicables a las importaciônes en la Comunidad Basisbelob taget i betragtning ved beregningen af de nedsatte landbrugs elementer og tillaegstold anvendelig ved indforsel i Faellesskabet Grundbetrâge, die bei der Berechnung der ermâBigten Agrarteilbetràge und Zusatzzôlle, anwendbar bei der Einfuhr in die Gemeinschaft beriicksichtigt worden sind BaoïKâ noaâ nou £An,cp0r|aav unoijjr) yia TOV unoXoytcruô TCÙV uexapXriTcov oroixeiaw KCU npôaGeTcov 5aau. a)v nou ecpapuôÇovrai ora aypOTiKâ orotxeia Kcrrâ TT)V eiaaycùYri ornv KoivÔTnra Basic amounts taken into consideration in calculating the reduced agricultural components and additional duties, applicable on importation into the Community Montants de base, pris en considération lors du calcul des éléments agricoles réduits et droits additionnels applicables à l'importation dans la Communauté Importi de base, presi in considerazione per il calcolo degli elementi agricoli e dei dazi addizionali applicabili all'importazione nella Comunità Basisbedragen, in aanmerking genomen bij de berekening van de verlaagde agrarische elementen en aanvullende invoerrechten, geldend bij invoer in de Gemeenschap Montantes de base tornados em consideraçào aquando do câlculo dos elementos agricolas reduzidos e dos direitos adicionais aplicâveis à importaçaô na Comunidade Yhteisôôn tulevaan tuontiin sovellettavia alennettuja maatalousosia ja lisàtulleja laskettaessa huomioon otettavat perusmàârât Grundpriser som beaktas vid berâkning av minskade jordbruksbestândsdelar och tillàggstull som skall utgâ pâ import till gemenskapen R E P Û B L I CA DE P O L O N I A / E P U B L I K EN P O L E N / R E P U B L IK P O L E N / A H M O K P A T IA T HI n O A O N I A I / R E P U B L IC OF P O L A N D / R É P U B L I Q UE DE P O L O G N E / R E P U B B L I CA Dl P O L O N I A / R E P U B L I EK P O L E N / R E P Û B L Ï CA DA P O L O N I A / P U O L AN T A S A V A L L A S T A / R E P U B L I K EN P O L EN Trigo blando / Blod hvede / Weichweizen / MaXaKÔ arcàpl / Common wheat / Blé tendre / Grano tenero / Zachte tarwe / Trigo mole / Tavallinen vehnà / Vête Trigo duro /Hàrd hvede / Hartweizen /lK\r)p6 ailâpi / Durum wheat / Blé dur /Grano duro /Durum tarwe / Trigo duro I /Durumvehnâ / Durumvete ; Centeno/ Rug / Roggen /liKaXrj /Rye /Seigle / Segala / Rogge / Centeio / Ruis /Râg Cebada / Byg / Gerste / Kpl6dpl /Barley/ Orge / Orzo / Gerst / Cevada / Ohra / Korn Maiz/Majs/Mais/ KaXannÔKi/Maize/Maïs/ Granturco/Maïs / Milho / Maissi / Majs Arroz descascarillado de grano largo / Ris, afskallet, langkornet / Reis, langkôrnig, geschâlt / Ancxp\oiu)|iévo pû<5 |iaKpôonep|io / Long-grain husked rice / Riz décortiqué à grains longs / Riso semigreggio a grani lunghi / Langkorrelige gedopte rijst / Arroz em peliculas degrâos longos/Pitkàjyvàinen esikuorittu riisi /Ris, skalat lângkornigt Lèche desnatada en polvo / Skummetmaelkspulver / Magermilchpulver / Anopourupcoiiévo yôika ae CFKÔVTI / Skimmed-milk powder / Lait ërémé en poudre / Latte scremato in polvere / Magere-melkpoeder / Leite desnatado em pô/ Rasvaton maitojauhe / Skummjôlkspulver Lèche entera en polvo / Sodmaelkspulver / Vollmilchpulver / nXr|p8q yâÀ. a oe QKÔvr) / Whole-milk powder / Lait entier en poudre / Latte intero in polvere / Vollemelkpoeder / Leite inteiro ein pô / Rasvainen maitojauhe / Mjôlkpulver Mantequilla / Snw / Butter / BoÛTUpo / Butter / Beurre / Burro / Boter / Manteiga / Voi / Smôr Azùcar bianco / Hvidt sukker / WeiBzucker / AeUKïi Çdxapri / White sugar / Sucre blanc / Zucchero bianco / Witte suiker / Açùcar branco / Valkoinen sokeri / Vitt socker ecus/ECU/Ecu/ ecu/écus/ecua/ 100 kg 9,148 14,199 8,914 ~ 8,751 7,408 25,441 27,436 j 35,869 52,129 32,565 | ^_ R E P Û B L I CA DE H U N G R I A / R E P U B L I K EN U N G A R N / R E P U B L IK U N G A R N / A H M O K P A TI A THZ O Y r r A P I A Z / R E P U B L IC OF H U N G A R Y /R É P U B L I Q U E DE H O N G R I E / R E P U B B L I CA D' U N G H E R I A / R E P U B L I EK H O N G A R I J E / R E P Û B L I CA DA H U N G R I A / U N K A R IN T A SA V A L L A S T A / R E P U B L I K EN U N G E R N Trigo blando / Blod hvede / Weichweizen / MdXaKÔ a i l â pl / Common wheat / Blé tendre / Grano tenero / Zachte tarwe / Trigo mole / Tavallinen vehnâ / Vête Trigo duro /Hârd hvede / Hartweizen /lK\r)pô (Jirâpl / Durum wheat / Blé dur /Grano duro /Durum tarwe / Trigo duro /Durumvehnâ / Durumvete Centeno/ Rug / Roggen /IiKOÀrj /Rye /Seigle / Segala / Rogge / Centeio / Ruis /Râg Cebada / Byg / Gerste / Kpi66pl /Barley/ Orge / Orzo / Gerst / Cevada / Ohra / Korn Maiz / Majs / Mais / KaXajinÔKi / Maize / Maïs / Granturco / Maïs / Milho / Maissi / Majs Arroz descascarillado de grano largo / Ris, afskallet, langkornet / Reis, langkôrnig, geschâlt / AnocpXoiCdiiévo pÛÇl naKpôonepjiO / Long-grain husked rice / Riz décortiqué à grains longs / Riso semigreggio a grani lunghi / Langkorrelige gedopte rijst / Arroz em peliculas de grâos longos / Pitkàjyvâinen esikuorittu riisi / Ris, skalat lângkornigt Lèche desnatada en polvo / Skummetmaelkspulver / Magermilchpulver / AnopouTUpa)|J8Vo yaka ae aKÔvr) / Skimmed-milk powder / Lait érémé en poudre / Latte scremato in polvere / Magere-melkpoeder / Leite desnatado em pô/ Rasvaton maitojauhe / Skummjôlkspulver Lèche entera en polvo / Sodmaelkspulver / Vollmilchpulver / nXrjpeç y â ^a ae (JKÔvri / Whole-milk powder / Lait entier en poudre / Latte intero in polvere / Vollemelkpoeder / Leite inteiro ein pô / Rasvainen maitojauhe / Mjôlkpulver Mantequilla/ Sirnar /Butter /BoÛTUpo/Butter/ Beurre / B u r r o/ Boter / Manteiga / Voi / Smôr Azùcar bianco / Hvidt sukker / WeiBzucker / AeuKrj Çàxapr) / White sugar / Sucre blanc / Zucchero bianco / Witte suiker / Açùcar branco / Valkoinen sokeri / Vitt socker __ | ecus/ECU/Ecu/ ecu/écus/ecua/ 100 kg 2,614 4,057 8,914 8,751 7,408 25,441 96,027 125,541 182,453 32,565 REPÛBLICA E S L O V A C A / D EN S L O V A K I S KE R E P U B L I K / S L O W A K Ï S C HE R E P U B L I K / 2 A O B A K I KH A H M O K P A T I A / S L O V AK REPUBLIC/RÉPUBLIQUE S L O V A Q U E / R E P U B B L I CA S L O V A C C A / R E P U B L I EK S L O W A K I J E / R E P Û B L I CA E S L O V A C A / S L O V A K I AN T A S A V A L L A S T A / S L O V A K I S KA REPUBLIKEN Trigo blando / Blod hvede / Weichweizen / Ma\aK6 ailâpi / Common wheat / Blé tendre / Grano tenero / Zachte tarwe / Trigo mole / Tavallinen vehnâ / Vête Trigo duro /Hârd hvede / Hartweizen /iKArpo aildpl / Durum wheat / Blé dur /Grano duro /Durum tarwe / Trigo duro /Durumvehnà / Durumvete Centeno/ Rug / Roggen /IiKOÀr] /Rye /Seigle / Segala / Rogge / Centeio / Ruis /Râg Cebada / Byg / Gerste / Kpl9âpl /Barley/ Orge / Orzo / Gerst / Cevada / Ohra / Korn Maiz / Majs / Mais / KdXapinÔKi / Maize / Maïs / Granturco / Maïs / Milho / Maissi / Majs Arroz descascarillado de grano largo / Ris, afskallet, langkornet / Reis, langkôrnig, geschâlt / AnocpXoiœnévo pÛÇl |iaKpÔon8p[iO / Long-grain husked rice / Riz décortiqué à grains longs / Riso semigreggio a grani lunghi / Langkorrelige gedopte rijst / Arroz em peliculas de grâos longos / Pitkàjyvàinen esikuorittu riisi / Ris, skalat lângkornigt Lèche desnatada en polvo / Skummetmaelkspulver / Magermilchpulver / AnopouTupa)|iévo yàka oe fjKÔvri / Skimmed-milk powder / Lait érémé en poudre / Latte scremato in polvere / Magere-melkpoeder / Leite desnatado em pô/ Rasvaton maitojauhe / Skummjôlkspulver Lèche entera en polvo / Sodmœlkspulver / Vollmilchpulver / riÀripec; Y ^a ae poudre / Latte intero in polvere / Vollemelkpoeder / Leite inteiro ein pô / Rasvainen maitojauhe / Mjôlkpulver Mantequilla / Sm0r / Butter / BoÛTUpO / Butter / Beurre / Burro / Boter / Manteiga / Voi / Smôr Azùcar bianco / Hvidt sukker / WeiGzucker / AeUKri Çdxapn / White sugar / Sucre blanc / Zucchero bianco / Witte suiker / Açùcar branco / Valkoinen sokeri / Vitt socker CFKOVTJ / Whole-milk powder / Lait entier en ; J I ecus/ECU/Ecu/ ecu/écus/ecua/ 100 kg 9,148 14,199 8,914 2,500 7,408 25,441 27,436 35,869 52,129 32,565 R E P Û B L I CA C H E C A / D EN T J E K K I S KE R E P U B L I K / T S C H E C H I S C HE R E P U B L I K / T Z E X I KH A H M O K P A T I A / C Z E CH R E P U B L I C / R É P U B L I Q UE T C H È Q U E / R E P U B B L I CA C E C A / R E P U B L I EK TS J E C H I Ë / R E P Û B L I CA C H E C A / T S E K IN T A S A V A L L A S T A / T J E C K I S KA R E P U B L I K EN Trigo blando / Blod hvede / Weichweizen / MaÀdKÔ orrâpl / Common wheat / Blé tendre / Grano tenero / Zachte tarwe / Trigo mole / Tavallinen vehna / Vête Trigo duro /Hàrd hvede / Hartweizen /iKAipô fJiràpi / Durum wheat / Blé dur /Grano duro /Durum tarwe / Trigo duro /Durumvehnà / Durumvete Centeno/ Rug / Roggen /XiKOÀri /Rye /Seigle / Segala / Rogge / Centeio / Ruis /Râg Cebada / Byg / Gerste / KplBdpi /Barley/ Orge / Orzo / Gerst / Cevada / Ohra / Korn Maiz / Majs / Mais / KdÀaLtnÔKl / Maize / Maïs / Granturco / Maïs / Milho / Maissi / Majs Arroz descascarillado de grano largo / Ris, afskallet, langkornet / Reis, langkôrnig, geschàlt / AnocpXoicOJiévo pÛÇl paKpoanepiiO / Long-grain husked rice / Riz décortiqué à grains longs / Riso semigreggio a grani lunghi / Langkorrelige gedopte rijst / Arroz em peliculas de grâos longos / Pitkàjyvâinen esikuorittu riisi / Ris, skalat lângkornigt Lèche desnatada en polvo / Skummetmaelkspulver / Magermilchpulver / AnopouTUpa)|iévo yàka ae QKÔVTI / Skimmed-milk powder / Lait érémé en poudre / Latte scremato in polvere / Magere-melkpoeder / Leite desnatado em pô/ Rasvaton maitojauhe / Skummjôlkspulver Lèche entera en polvo / Sodmaelkspulver / Vollmilchpulver / riAripeç yâXci ae aKOVT) / Whole-milk powder / Lait entier en poudre / Latte intero in polvere / Vollemelkpoeder / Leite inteiro ein pô / Rasvainen maitojauhe / Mjôlkpulver Mantequilla / S nw / Butter / BoÛTUpo / Butter / Beurre / Burro / Boter / Manteiga / Voi / Smôr Azùcar bianco / Hvidt sukker / WeiBzucker / AeUKr] Çàxapr] / White sugar / Sucre blanc / Zucchero bianco / Witte suiker / Açùcar branco / Valkoinen sokeri / Vitt socker ecus/ECU/Ecu/ ecu/écus/ecua/ 100 kg 9,148 14,199 8,914 2,500 7,408 25,441 27,436 35,869 52,129 32,565 R U M A N I A / R U M ^ E N I E N / R U M À N I E N / P O Y M A N I A Z/ R O M A N I A / R O U M A N I E / R O M A N I A / R O E M E N I Ë/ R O M É N I A / R O M A N I A N / R U M  N I EN Trigo blando / Blod hvede / Weichweizen / MaAaKO aildpl / Common wheat / Blé tendre / Grano tenero / Zachte tarwe / Trigo mole / Tavallinen vehnâ / Vête Trigo duro /Hàrd hvede / Hartweizen /_KÀr|p6 aiTClpl / Durum wheat / Blé dur /Grano duro /Durum tarwe / Trigo duro /Durumvehnà / Durumvete Centeno/ Rug / Roggen /IiKaArj /Rye /Seigle / Segala / Rogge / Centeio / Ruis /Râg Cebada / Byg / Gerste / Kplôâpl /Barley/ Orge / Orzo / Gerst / Cevada / Ohra / Korn Maiz / Majs / Mais / KaXa|inÔKl / Maize / Maïs / Granturco / Maïs / Milho / Maissi / Majs Arroz descascarillado de grano largo / Ris, afskallet, langkornet / Reis, langkôrnig, geschàlt / AnO(p\oiO)|jévo pÛÇl naKpocrnepHO / Long-grain husked rice / Riz décortiqué à grains longs / Riso semigreggio a grani lunghi / Langkorrelige gedopte rijst / Arroz em peliculas de grâos longos / Pitkàjyvâinen esikuorittu riisi / Ris, skalat lângkornigt Lèche desnatada en polvo / Skummetmaelkspulver / Magermilchpulver / AnoPouTUpa)|iévo yoAa ae aKÔvr] / Skimmed-milk powder / Lait érémé en poudre / Latte scremato in polvere / Magere-melkpoeder / Leite desnatado em pô/ Rasvaton maitojauhe / Skummjôlkspulver Lèche entera en polvo / Sodmaelkspulver / Vollmilchpulver / nXrjpeç YC^a ae CTKÔvri / Whole-milk powder / Lait entier en poudre / Latte intero in polvere / Vollemelkpoeder / Leite inteiro ein pô / Rasvainen maitojauhe / Mjôlkpulver Mantequilla / Snw / Butter / BoÛTUpo / Butter / Beurre / Burro / Boter / Manteiga / Voi / Smôr • Azùcar bianco / Hvidt sukker / WeiBzucker / AeUKrj Çâxapr] / White sugar / Sucre blanc / Zucchero bianco / Witte suiker / Açùcar branco / Valkoinen sokeri / Vitt socker J ecus/ECU/Ecu/ ecu/écus/ecua/ 100 kg 2,614 14,199 8,914 8,751 7,408 25,441 96,027 125,541 182,453 32,565 10 REPÛBLICA DE B U L G A R I A / R E P U B L I K EN B U L G A R I E N / R E P U B L IK B U L G A R I E N/A H M O K P AT I A T HI BOYATAPI AZ/REPUBLIC OF B U L G A R I A / R É P U B L I Q UE DE B U L G A R I E / R E P U B B L I CA DI B U L G A R I A/ REPUBLIEK B U L G A R I J E / R E P Û B L I CA DA B U L G  R I A / B U L G A R I A S TA T A S A V A L L A S T A / B U L G A R I EN REPUBLIKEN Trigo blando / Blod hvede / Weichweizen / MaXaKO aiTàpi / Common wheat / Blé tendre / Grano tenero / Zachte tarwe / Trigo mole / Tavallinen vehnà / Vête Trigo duro /Hârd hvede / Hartweizen /iKÀrpo arrâpl / Durum wheat / Blé dur /Grano duro /Durum tarwe / Trigo duro /Durumvehnâ / Durumvete Centeno/ Rug / Roggen /IiKOXr| /Rye /Seigle / Segala / Rogge / Centeio / Ruis /Râg Cebada / Byg / Gerste / Kpi6âpl /Barley/ Orge / Orzo / Gerst / Cevada / Ohra / Korn Maiz / Majs / Mais / KaXaLtnÔKl / Maize / Maïs / Granturco / Maïs / Milho / Maissi / Majs Arroz descascarillado de grano largo / Ris, afskallet, langkornet / Reis, langkôrnig, geschàlt / Ano(p\oiQ)|iévo pÛÇl |iaKp6crnepLK) / Long-grain husked rice / Riz décortiqué à grains longs / Riso semigreggio a grani lunghi / Langkorrelige gedôpte rijst / Arroz em peliculas de graos longos / Pitkàjyvàinen esikuorittu riisi / Ris, skalat lângkornigt Lèche desnatada en polvo / Skummetmaslkspulver / Magermilchpulver / AnopouTupcoLtévo yàka ae OKÔVÏ) I Skimmed-milk powder / Lait érémé en poudre / Latte scremato in polvere / Magere-melkpoeder / Leite desnatado em pô/ Rasvaton maitojauhe / Skummjôlkspulver Lèche entera en polvo / Sodmaelkspulver / Vollmilchpulver / flÀripeç yaka. ae aKÔvr] / Whole-milk powder / Lait entier en poudre / Latte intero in polvere / Vollemelkpoeder / Leite inteiro ein pô / Rasvainen maitojauhe / Mjôlkpulver Mantequilla / Smor / Butter / BoÛTUpO / Butter / Beurre / Burro / Boter / Manteiga / Voi / Smôr Azùcar bianco / Hvidt sukker / WeiBzucker / AeUKfj Çâxapr| / White sugar / Sucre blanc / Zucchero bianco / Witte suiker / Açùcar branco / Valkoinen sokeri / Vitt socker -- ecus/ECU/Ecu/ ecu/écus/ecua/ 100 kg 2,614 14,199 8,914 8,751 7,408 25,441 96,027 125,541 182,453 32,565 | 10 A N E XO II BlLAG II A N H A NG II riAPAPTHMA II A N N EX II A N N E XE II A L L E G A TO II B I J L A GE II A N E XO II L U TE II BiLAGA II 12 R E P Û B L I CA DE P O L O N I A / E P U B L I K EN P O L E N / R E P U B L IK P O L E N / A H M O K P A T IA THZ n O AH N I A Z / R E P UB LI C OF P O L A N D / R É P U B L I Q UE DE P O L O G N E / R E P U B B L I CA DI P O L O N I A / R E P U B L I EK P O L E N / R E P Û B L I C A DA P O L O N I A / P U O L AN T A S A V A L L A S T A / R E P U B L I K EN P O L EN NC / Codice NC / GN-code / Côdigo NC / CN-koodi / KN-kod Côdigo NC / KN-kode /KN-Code/ I Derecho / Told / Zoll / K_5iKÔq 10 /CN code / Code Aaafiôs / Duty / Droit / Dazio / Invoerrecht / Direito / Tullit / Tull 7. 9% 7. 2% 5JS% 0% 3. 7% , 6. 8% 7. 6% 6. 5% 1704 90 10 2008 11 10 2008 91 00 2101 20 20 2101 20 92 2101 30 11 2101 30 91 2102 10 10 2102 10 90 2102 20 11 2102 30 00 2103 10 2103 20 2103 30 90 2103 90 90 2106 10 20 2106 90 92 2203 3302 10 21 7. 7% 2. 6% 2. 6% 3. 9% 5. 3% 5/7% 4. 4% 7/2% 3. 9% 5. 3% 3. 9% ~~ I 12 13 R E P Û B L I CA DE H U N G R I A / R E P U B L I K EN U N G A R N / R E P U B L IK U N G A R N / A H M O K P AT I A T HZ O Y r r A P I A Z / R E P U B L IC OF H U N G A R Y /R É P U B LI Q U E DE H O N G R I E / R E P U B B L I CA D' U N G H E RI A / R E P U BL I EK H O N G A R I J E / R E P Û B L I CA DA H U N G R I A / U N K A R IN T A S A V A L L A S T A / R E P U B L I K EN U N G E RN Côdigo NC / KN-kode / KN-Code I Derecho / Told / Zoll /KwôiKoq 1 0 / CN code / Code NC / Codice NC / GN-code / Côdigo NC / CN-koodi / KN-kod / Actouôs / Duty / Droit/Dazio/ Invoerrecht / Direito / Tullit / Tull 1704 90 10 2101 20 20 2101 20 92 2101 30 11 2101 30 91 2102 20 11 2102 20 19 2103 10 2103 20 2103 30 90 2103 90 90 2104 10 2104 20 2106 10 20 2106 90 92 2202 90 10*10 2203 3302 10 21 3823 70 00 7. 9% 0% 3. 7% 6. 8% 7. 6% 2. 8% 2. 8% 3. 9% 5. 3% 5. 7% 4. 4% 6. 2% 7. 6% 7. 2% 3. 9% 3. 9% 5. 3% 3. 9% 2. 9% 1 1 ) Demie sats gaslder inden for rammerne af en kvote Zollsatz findet im Rahmen eines Kontingents Anwendung O Aaapôq ecpapnôÇexai evroq TCDV opicov noaôcrrajoTiq Duty rate applies within quota Este tipo se aplica dentro de una cuota Droit de douane applicable dans les limites d'un contingent Tullimaksua sovelletaan kiintiôôn sisàltyvâân mââràan Dazio doganale applicable nei limiti di un contingente Deze voet is van toepassing binnen de grenzen van een tariefcontingent Este direito aplica-se nos limites do contingente Tull sats tillâmpas inom kvot 13 14 R E P Û B L I CA E S L O V A C A / D EN S L O V A K I S KE R E P U B L I K / S L O W A K Ï S C HE R E P U B L I K / Z A O B A K I KH A H M O K P A T I A / S L O V AK R E P U B L I C / R É P U B L I Q UE S L O V A Q U E / R E P U B B L I CA S L O V A C C A / R E P U B L I EK S L O W A K I J E / R E P Û B L I CA E S L O V A C A / S L O V A K I AN T A S A V A L L A S T A / S L O V A K I S KA R E P U B L I K EN Côdigo NC / KN-kode / KN-Code / I Derecho/Told/Zoll/ Aaou. ôç/Duty/Droit/ KCD5IK6Ç ZO / CN code / Code NC / Dazio/Invoerrecht/ Direito/Tullit/Tull Codice NC / GN-code / Côdigo NC / CN-koodi / KN-kod 1704 90 10 210120 20 2101 20 92 2101 30 11 2101 30 91 2102 10 10 2102 10 90 2102 20 11 2102 20 19 2102 20 90 2102 30 00 2103 10 2103 20 2103 30 90 2103 90 90 2104 10 2104 20 2106 10 20 2106 90 20 2106 90 92 2202 90 10 2203 2208 20 12 2208 20 14 2208 20 26 2208 20 27 2208 20 29 2208 20 40 2208 20 62 2208 20 64 2208 20 86 7. 9% 0% 3. 7% f!8% 7 J 5% 6J>% 7. 7% 2. 6% 0% 0% 2. 6% 3_9% 5 3% 5/7% 4. 4% 6. 2% 7,6% 7^2% 16. 72% MIN ECU Q. 96/% vol/hl 3. 9% 3. 9% 53% ECU Q. 88/% vol/hl +ECU 5. 6/hl ECU Q. 88/% vol/hl +ECU 5. 6/hl ECU Q. 88/% vol/hl +ECU 5. 6/hl ECU Q. 88/% vol/hl +ECU 5. 6/hl ECU Q. 88/% vol/hl +ECU 5. 6/hl ECU Q. 88/% vol/hl ECU Q. 88/% vol/hl ECU Q. 88/% vol/hl ECU Q. 88/% vol/hl. [ 14- Côdigo NC / KN-kode / KN-Code / I Kco5iKÔq ZO / CN code / Code NC / Codice NC / GN-code / Côdigo NC /CN-koodi/KN-kod 2208 20 87 2208 20 89 "2208 30 11 2208 30 19 2208 30 32 2208 30 38 2208 30 52 2208 30 58 2208 30 72 2208 30 78 2208 30 82 2208 30 88 2208 40 10 2208 40 90 2208 50 11 2208 50 19 2208 50 91 2208 50 99 2208 60 11 2208 60 19 2208 60 91 2208 60 99 2208 70 10 2208 70 90 2208 90 11 2208 90 19 2208 90 33 2208 90 38 2208 90 41 2208 90 45 2208 90 48 2208 90 52 2208 90 57 2208 90 69 2208 90 71 2208 90 74 2208 90 78 2208 90 91 2208 90 99 3302 10 10 3302 10 21 1 15 Derecho/Told/Zoll/ Aaajiôç/Duty/Droit/ Dazio/Invoerrecht/ Direito/Tullit/Tull ECU Q. 88/% vol/hl ECU Q. 88/% vol/hl ECU Q. 05/% vol/hl +ECU 0. 5/hl ECU Q. 05/% vol/hl ECU Q. 24/% vol/hl +ECU 1,68/hl ECU 0. 24/% vol/hl ECU 0. 24/% vol/hl +ECU 1. 68/hl ECU 0. 24/% vol/hl ECU 0. 24/% vol/hl +ECU 1. 68/hl ECU Q. 24/% vol/hl ECU Q. 24/% vol/hl +ECU 1. 68/hl ECU Q. 24/% vol/hl ECU Q. 61/% vpl/hl +ECU 3. 08/hl ECU 0. 61/% vol/hl ECU 0. 61/% vol/hl +ECU 3. 08/hl ECU 0. 61/% vol/hl ECUO. 96/% vol/hl +ECU 6. 16/hl ECU Q. 96/% vol/hl ECU Q. 78/% vol/hl +ECU 3. 08/hl ECU 0. 78/% vol/hl ECU 0. 96/% vol/hl + ECU 6. 16/hl ECU 0. 96/% vol/hl ECU Q. 96/% vol/hl + ECU 6. 16/hl ECU Q. 96/% vol/hl ECU 0. 61/% vol/hl +ECU 3. 08/hl ECU Q. 61/% vol/hl ECU Q. 72/% vol/hl + ECU 2. 80/hl ECU 0. 78/% vol/hl ECU Q. 96/% vol/hl + ECU 6. 16/hl ECU Q. 88/% vol/hl + ECU 5. 60/hl ECU Q. 88/% vol/hl + ECU 5. 60/hl ECU Q. 96/% vol/hl + ECU 6. 16/hl ECU Q. 96/% vol/hl + ECU 6. 16/hl ECU Q. 96/% vol/hl + ECU 6. 16/hl ECU Q. 88/% vol/hl ECU Q. 96/% vol/hl ECU Q. 96/% vol/hl ECU Q. 96/% vol/hl + ECU 6. 16/hl ECU Q. 96/% vol/hl 16. 72% MIN ECU Q. 96/% vol/hl 3. 9% 15 16 R E P Û B L I CA C H E C A / D EN T J E K K I S KE R E P U B L I K / T S C H E C H I S C HE R E P U B L I K / T Z E X I KH A H M O K P A T I A / C Z E CH R E P U B L I C / RÉ P U B L I Q UE T C H È Q U E / R E P U B B L I CA T S J E C H I Ë / R E P Û B L I CA C E C A / R E P U B L I EK C H E C A / T S E K IN T A S A V A L L A S T A / T J E C K I S KA R E P U B L I K EN Côdigo NC / KN-kode / KN-Code / I K_5IK6Ç 10 / CN code / Code NC / Codice NC / GN-code / Côdigo NC / CN-koodi / KN-kod Derecho/Told/Zoll/ Aaoji. ôç/Duty/Droit/ Dazio/Invoerrecht/ Direito/Tullit/Tull 1704 90 10 2101 20 20 2101 20 92 210130 11 2101 30 91 2102 10 10 2102 10 90 2102 20 11 2102 20 19 2102 20 90 2102 30 00 2103 10 2103 20 2103 30 90 2103 90 90 2104 10 2104 20 2106 10 20 2106 90 20 2106 90 92 2202 90 10 2203 2208 20 12 2208 20 14 2208 20 26 2208 20 27 2208 20 29 2208 20 40 2208 20 62 2208 20 64 2208 20 86. ; \. 7. 9% 0% 3/7% 6 J% 7,6% 6. 5% 7. 7% 2. 6% 0% 0% 2. 6% 3. 9% 53% 5/7% 4. 4% f!2% 7 6% 12% 16. 72% MIN ECU Q. 96/% vol/hl 3. 9% 3. 9% 5. 3% ECU Q. 88/% vol/hl +ECU 5. 6/hl ECU Q. 88/% vol/hl +ECU 5. 6/hl ECU Q. 88/% vol/hl +ECU 5. 6/hl ECU Q. 88/% vol/hl +ECU 5. 6/hl ECU Q. 88/% vol/hl +ECU 5. 6/hl ECU Q. 88/% vol/hl ECU Q. 88/% vol/hl ECU Q. 88/% vol/hl ECU 0. 88/%"vol/hl. 16 17 Côdigo NC / KN-kode / KN-Code / I KcoôiKoq 10 / CN code / Code NC / Codice NC / GN-code / Côdigo NC / CN-koodi / KN-kod DerechoATold/Zoll/ AaafiôçDuty/Droit/ Dazio/lnvoerrecht/ Direito/Tullit/Tull 2208 20 87 2208 20 89 2208 30 11 2208 30 19 2208 30 32 2208 30 38 2208 30 52 2208 30 58 2208 30 72 2208 30 78 2208 30 82 2208 30 88 2208 40 10 2208 40 90 2208 50 11 2208 50 19 2208 50 91 2208 50 99 2208 60 11 2208 60 19 2208 60 91 2208 60 99 2208 70 10 2208 70 90 2208 90 11 2208 90 19 2208 90 33 2208 90 38 2208 90 41 2208 90 45 2208 90 48 2208 90 52 2208 90 57 2208 90 69 2208 90 71 2208 90 74 2208 90 78 2208 90 91 2208 90 99 3302 10 10 3302 10 21 ECU Q. 88/% vol/hl ECU Q. 88/% vol/hl ECU Q. 05/% vol/hl +ECU 0. 5/hl ECU Q. 05/% vol/hl ECU Q. 24/% vol/hl -fECU 1. 68/hl ECU Q. 24/% vol/hl ECU Q. 24/% vol/hl +ECU 1. 68/hl ECU Q. 24/% vol/hl ECU Q. 24/% vol/hl +ECU 1. 68/hl ECU Q. 24/% vol/hl ECU Q. 24/% vol/hl +ECU 1. 68/hl ECU Q. 24/% vol/hl ECU Q. 61/% vol/hl +ECU 3. 08/hl ECU Q. 61/% vol/hl ECU Q. 61/% vol/hl +ECU 3. 08/hl ECU Q. 61/% vol/hl ECU Q. 96/% vol/hl+ECU 6. 16/hl ECU Q. 96/% vol/hl ECU Q. 78/% vol/hl +ECU 3. 08/hl ECU Q. 78/% vol/hl ECU Q. 96/% vol/hl + ECU 6. 16/hl ECU Q. 96/% vol/hl ECU Q. 96/% vol/hl + ECU 6. 16/hl ECU Q. 96/% vol/hl ECU Q. 61/% vol/hl +ECU 3. 08/hl ECU Q. 61/% vol/hl ECU Q. 72/% vol/hl + ECU 2. 80/hl ECU Q. 78/% vol/hl ECU Q. 96/% vol/hl + ECU 6. 16/hl ECU Q. 88/% vol/hl + ECU 5. 60/hl ECU Q. 88/% vol/hl + ECU 5. 60/hl ECU Q. 96/% vol/hl + ECU 6. 16/hl ECU Q. 96/% vol/hl + ECU 6. 16/hl ECU Q. 96/% vol/hl + ECU 6. 16/hl ECU Q. 88/% vol/hl. ECU Q. 96/% vol/hl ECU Q. 96/% vol/hl ECU Q. 96/% vol/hl + ECU 6. 16/hl ECU Q. 96/% vol/hl 16. 72% MIN ECU Q. 96/% vol/hl 3. 9% ] 17. I R U M A N I A / R U M / E N I E N / R U M  N I E N / P O Y M A N I A Z/ R O M A N I A / R O U M A N I E / R OM A N I A / R O E M E N I Ë/ R O M É N I A / R O M A N I A N / R U M  N I EN Côdigo NC / KN-kode / KN-Code / I Derecho / Told / Zoll / K_5IKOC; ZO/CN code / CodeNC Actojiôs / Duty / Droit / Dazio / Invoerrecht / / Codice NC / GN-code / Côdigo NC / Direito / Tullit / Tull CN-koodi / KN-kod 7,9% 7. 2% 5JJ% 0% 3. 7% 6_3% T6% 6. 5% TÏVo 2/6% Z6% Ï9% 5. 3% 5. 7% 4. 4% 6. 2% 7. 6% 7/2% 3. 9% 5. 3% 3. 9% 2. 9% 1704 90 10 2008 11 10 2008 91 00 2101 20 20 2101 20 92 2101 30 11 2101 30 91 2102 10 10 2102 10 90 2102 20 11 2102 30 00 2103 10 2103 20 2103 30 90 2103 90 90 2104 10 2104 20 2106 10 20 2106 90 92 2202 90 10 3302 10 21 3823 70 00 * 1 18 19 R E P Û B L I CA DE B U L G A R I A / R E P U B L I K EN B U L G A R I E N / R E P U B L IK B U L G A R I E N / A H M O K P A T IA T HZ B O Y A T A P I A Z / R E P U B L IC OF B U L G A R I A / R É P U B L I Q UE DE B U L G A R I E / R E P U B B L I CA DI B U L G A R I A/ R E P U B L I EK B U LG A RI J E / R E P Û B L I CA DA B U L G  R I A / B U L G A R I A S TA T A S A V A L L A S T A / B U L G A R I EN R E P U B L I K EN Côdigo NC/KN-kode/KN-Code/ I Derecho/Told/Zoll / Kco5iKoq 1 0 / CN code / Code NC Aaojiôs / Duty / Droit / Dazio / Invoerrecht / / Codice NC / GN-code / Côdigo NC / Direito / Tullit / Tull CN-koodi / KN-kod 2. 6% 83% 6. 1% 7. 9% 7. 2% 5. 8% 13% 5. 3% 6J5% 0% 3/7% 6. 8% 716% 6. 5% 1302 13 00 1302 20 10 1302 20 90 1704 90 10 2008 11 10 2008 91 00 2101 11 11 2101 11 19 2101 12 92 2101 20 20 2101 20 92 2101 30 11 2101 30 91 2102 10 10 2102 10 90 2102 20 11 2102 20 19 2102 20 90 2102 30 00 2103 10 2103 20 2103 30 90 2103 90 90 2104 10 2104 20 2106 10 20 2106 90 92 2202 10 2202 90 10 2203 2205 10 10 2205 90 10 3301 90 21 3302 10 21 : 53% 2^6% Ï5% Ô% 2. 6% 3. 9% 5. 3% 5/7% 4. 4% (x2% ^6% 7/2% 3. 9% 2. 6% 5. 3% 5. 3% 7. 0 ECU/hl 4. 4 ECU/hl 2. 6% 3. 9% 1 19 ISSN 0254-1475 COM(96) 263 final DOCUMENTS EN 03 02 11 Catalogue number : CB-CO-96-274-EN-C ISBN 92-78-05292-2 Office for Official Publications of the European Communities L-2985 Luxembourg oCO

Proposal for a COUNCIL REGULATION (EC) amending Regulation (EEC) No 2081/92 on the protection of geographical indications and designations of origin for agricultural products and foodstuffs

http://publications.europa.eu/resource/cellar/80eb5fe2-67fb-42eb-9eba-99998da2fd04

eng

COMMISSION OF THE EUROPEAN COMMUNITIES * * * ** * * * ** Brussels, 12. 06. 1996 COM(96) 266 final 96/0159 (CNS) Proposal for a COUNCIL REGULATION ŒC) amending Regulation (EEC) No 2081/92 on the protection of geographical indications and designations of origin for agricultural products and foodstuffs (presented by the Commission) EXPLANATORY MEMORANDUM Article 13(2) of Regulation (EEC) No 2081/92 on the protection of geographical indications and designations of origin for agricultural products and foodstuffs specifies a maximum transitional period of five years from the date of the Regulation's publication during which Member States may on certain terms maintain national measures authorizing the use of expressions covered by Article 13(l)(b). The first proposal to register geographical indications and designations of origin, notified under the simplified procedure provided for in Article 17 of Regulation (EEC) No 2081/92, was presented to the Council (under the fourth paragraph of Article 15 of the Regulation) only in March 1996, owing to the amount of time needed to examine all applications and obtain further information. Registration of a name under the Regulation means that its use is reserved to undertakings located in the area indicated in the product specification, i. e. other undertakings cannot use it and must modify their trading practices accordingly. The economic implications of registration can therefore be serious and for that reason a transitional period for adjustment to the Regulation was specified in its Article 13(2). The Commission considers that since the transitional period is due to expire on 25 July 1997 its utility needs to be maintained by altering its commencement date from that on which the Regulation was published, i. e. 24 July 1992, to that on which the names were registered. Furthermore, given that the prohibition provided for in Article 13(l)(a) may overlap with that provided for in point (b), the adjustment period should also apply to Article 13(l)(a) of Regulation (EEC) No 2081/92 and not just to paragraph 1(b) of that Article. Given that existing names, used in the Member States, are those notified under Article 17, the transitional period should apply only to names registered under that Article so as not to prejudice producers when granting them the adjustment period. Proposal for a COUNCIL REGULATION (EC) amending Regulation (EEC) No 2081/92 on the protection of geographical indications and designations of origin for agricultural products and foodstuffs THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 43 thereof, Having regard to the proposal from the Commission(1), Having regard to the opinion of the European Parliament^, Having regard to the opinion of the Economic and Social Committee(3), Whereas Article 13(2) of Council Regulation (EEC) No 2081/92(4), as amended by the Act of Accession of Austria, Finland and Sweden, provides for a transitional period of up to five years from the publication of that Regulation during which the Member States may maintain national measures authorizing the use of the expressions referred to in paragraph 1(b) of that Article under certain conditions; whereas Regulation (EEC) No 2081/92 was published on 24 July 1992; whereas the transitional period will accordingly expire on 25 July 1997; Whereas the first proposal for registration of geographical indications and designations of origin was only submitted to the Council in March 1996 and the greater part of the five-year transitional period has passed; whereas, in order to maintain the full effect of that transitional period, the date of commencement of the five-year period should be amended to start on the date of registration of the names; whereas provision should also be made for the transitional period also to apply to point (a) of Article 13(1) of Regulation (EEC) No 2081/92, given that the prohibition provided for in that point may overlap that provided for in point (b) of the same paragraph; Whereas the transitional period should apply only to names registered under Article 17 of Regulation (EEC) No 2081/92, since the granting of this adjustment period should not prejudice producers with regard to existing names already used in the Member States, (1) OJ No (2) OJ No (3) OJ No (4) OJ No L 208, 24. 7. 1992, p. 1. HAS ADOPTED THIS REGULATION: Article 1 Article 13(2) of Regulation (EEC) No 2801/92 is hereby replaced by the following: "Notwithstanding points (a) and (b) of paragraph 1, Member States may maintain national measures authorizing the use of names registered under Article 17 for a period of not more than five years from the date of publication of registration, provided that: the products have been marketed legally using such names for at least five years before the date of publication of this Regulation; the labelling clearly indicates the true origin of the product. However, this derogation may not lead to the marketing of products freely on the territory of a Member State where such names are prohibited. " Article 2 This Regulation shall enter into force on the third day following that of its publication in the Official Journal of the European Communities. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Brussels, For the Council The President ISSN 0254-1475 COM(96) 266 final DOCUMENTS EN 03 08 Catalogue number : CB-C096-289-EN-C ISBN 92-78-05556-5 Office for Official Publications of the European Communities L-2985 Luxembourg

OPINION OF THE COMMISSION on the amendments proposed by the European Parliament to the Council' s common position on the proposal for a COUNCIL DIRECTIVE ON THE HARMONIZATION OF THE CONDITIONS FOR OBTAINING NATIONAL BOATMASTERS' CERTIFICATES FOR THE CARRIAGE OF GOODS AND PASSENGERS BY INLAND WATERWAY IN THE COMMUNITY

http://publications.europa.eu/resource/cellar/8516872f-5626-4931-8a44-b0bd0e20b507

eng

COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 12. 06. 1996 COM(96) 281 final 94/0196 (SYN) OPINION OF THE COMMISSION on the amendments proposed by the European Parliament to the Council's common position on the proposal for a COUNCIL DIRECTIVE ON THE HARMONIZATION OF THE CONDITIONS FOR OBTAINING NATIONAL BOATMASTERS' CERTIFICATES FOR THE CARRIAGE OF GOODS AND PASSENGERS BY INLAND WATERWAY IN THE COMMUNITY (presented by the Commission pursuant to Article 189 c (d) of the EC Treaty) COMMISSION OPINION on the amendments proposed by the European Parliament to the common position of the Council on the proposal for a COUNCIL DIRECTIVE ON THE HARMONIZATION OF THE CONDITIONS FOR OBTAINING NATIONAL BOATMASTERS' CERTIFICATES FOR THE CARRIAGE OF GOODS AND PASSENGERS BY INLAND WATERWAY IN THE COMMUNITY On 9 May 1996 Parliament proposed amendments to the common position adopted by the Council on the abovementioned proposal on 8 December 1995. The five amendments proposed by Parliament are annexed. Pursuant to Article 189c(d) of the EC Treaty, the Commission has re-examined its proposal and decided not to incorporate these amendments for the following reasons: The amendments are not in line with the compromises accepted by the Commission at Council level. Most of them are designed to restore the Commission's original text or are identical to the amendments proposed at first reading, despite the fact that they were refused by the Council and the Commission accepted its refusal. The Commission also notes that there is no amendment expressing Parliament's position on the new provisions added by the Council's common position. Consequently, the Commission confirms its agreement with the Council's common position of 8 December 1995. Annex: 5 amendments EUROPEAN PARLIAMENT 1996 - 1997 SESSION Decision of the European Parliament on the common position established by the Council with a view to the adoption of a Directive on the harmonization of the conditions for obtaining national boat-Masters' certificates for the carriage of goods and passengers by inland waterway in the Community (A4-0128/96 - C4-0068/96). EXTRACT FROM THE MINUTES OF THE S I T T I NG OF 9 May 1996 PE 1 6 6. 0 20 Boatmasters' certificates **II A4^0128/96 Decision on the common position established by the Council with a view to the adoption of a Council Directive on the harmonization of the conditions for obtaining national boatmasters ' certificates for the carriage of goods and passengers by inland waterway in the Community(C4-0068/96 - 94/0196(SYN) ) (Cooperation procedure: second reading) The European Parliament. having regard to the common position of the Council, C4-0068/96 - 94/0196(SYN), having regard to its opinion at first reading1 on the Commission proposal to the Council, COM(94)03592, having regard to the amended Commission proposal, COM(95)04743, having been consulted by the Council pursuant to Article 189c of the EC Treaty, having regard to Rule 67 of its Rules of Procedure, having regard to the recommendation for second reading of the Committee on Transport and Tourism (A4-0128/96), 1. Amends the common position as follows; 2. Instructs its President to forward this decision to the Council and Commission. Common position of the Council Amendments by Parliament (Amendment 1) Recital 5 Whereas the main objective of these common provisions must be to improve the safety of navigation and the protection of human life; whereas it appears therefore essential that the these the minimum applicant must meet in order to obtain the boatmasters' certificate for inland navigation; establish which requirements provisions provisions Whereas the main objective of these common provisions must be to improve the safety of navigation and the protection of human life; whereas it appears therefore essential that the these the minimum applicant must meet in order to obtain the boatmasters' certificate for whereas provision must be made to ensure that the Member States adopt similar procedures for examining knowledge and skills; establish which requirements navigation; inland 1 OJ C 68, 20. 3. 1995, p. 41. 2 OJ C 280, 6. 10. 1994, p. 5. 3 OJ C 20, 24. 1. 1996, p. 7. L (Amendment 3) Article 6(2) 2. On reaching the age of sixty-five years, the holder of a certificate must, in the following three months and subsequently every year, undergo the examination referred to in paragraph 1 ; the competent authority shall attest on the certificate that the boatmaster has satisfied this obligation. 2. On reaching the age of sixty-five years, the holder of a certificate must, in the following three months and subsequently every three years. undergo the examination referred to 1 ; the competent in paragraph authority shall attest on the certificate that the boatmaster has satisfied this obligation. (Amendment 4) Article 7(3) and (4) and (4a) (new) 3. The minimum duration of the professional experience referred to in paragraph 1 may be reduced by a maximum of three years: 3. The minimum duration of the professional experience referred to in paragraph 1 may be reduced by a maximum of two years : (a) where the applicant has a diploma recognized by the competent confirms which authority specialized training in inland navigation comprising practical navigation work, the reduction may not be greater than the duration of the specialized training; or (a) where the applicant has a diploma recognized by the competent confirms which authority specialized training in inland navigation comprising practical navigation work, the reduction may not be greater than the duration of the specialized training; or (b) where the applicant can provide proof of professional experience acquired on a seagoing vessel as a member of the deck crew; in order to obtain the maximum reduction of three years, the applicant must provide proof of at least four years' experience in maritime navigation. (b) where the applicant can provide proof of professional experience acquired on a seagoing vessel as a member of the deck crew; in order to obtain the maximum reduction of two years, the applicant must provide. proof of at least four years' experience in maritime navigation. minimum duration 4. The of professional experience provided for in paragraph 1 may be reduced by a maximum of three years where the applicant has passed a practical examination in sailing a vessel; the certificate shall in that case cover nautical only characteristics similar to those of the vessel which underwent the practical examination. vessels with minimum duration 4. The of professional experience provided for in paragraph 1 may be reduced by a maximum of two years where the applicant has passed a practical examination in sailing a vessel; the certificate shall in that case cover nautical only characteristics similar to those of the vessel which underwent the practical examination. In this case the shall indicate that its validity is limited until the holder has four years' professional experience. competent authority vessels with 5 4a. The time which an applicant has spent, after reaching the age of twenty-one years, as a member of the deck crew of an inland navigation vessel shall be multiplied by 1. 5 in order to calculate the number of years of professional experience. (Amendment 5) Article 8(2) 2. Subject to consultation of the Commission, a Member State may require a boatmaster to satisfy additional requirements concerning knowledge of the local situation for navigation of certain waterways, with the exception of the waterways of a maritime character referred to in Annex II to Directive 91/672/EEC. to a approval by the 2. Subject Commission, may Member State require a boatmaster to satisfy additional requirements concerning knowledge of the local situation for navigation of certain waterways, with the exception of the waterways of a maritime character referred to in Annex II to Directive 91/672/EEC. state require Subject to the same reservation, a Member the may boatmaster of a passenger vessel, in certain limited areas, to have more detailed professional knowledge of special to passenger safety, particularly in the or accidents, of event shipwreck. provisions relating fire state require Subject to the same reservation, a Member the may boatmaster of a passenger vessel, in certain limited areas, to have more detailed professional knowledge of special to passenger safety, particularly in the or accidents, of event shipwreck. provisions relating fire (Amendment 6) Article 10a (new) and" procedures, encourage shall In order to harmonize the examination the syllabuses Commission the competent authorities of the Member States to consult each other at least once a year on the examination requirements and regulations. ISSN 0254-1475 COM(96) 281 final DOCUMENTS EN 06 07 Catalogue number : CB-CO-96-288-EN-C ISBN 92-78-05545-X Office for Official Publications of the European Communities L-2985 Luxembourg Y

Altered proposal for a Parliament and Council Directive amending Directive 70/220/EEC on the approximation of the laws of the Member States relating to measures to be taken against air pollution by emissions from motor vehicles

http://publications.europa.eu/resource/cellar/d4bf50d3-60d2-4c6c-bd31-01c1ab4ceb23

eng

C O M M I S S I ON OF THE EUROPEAN COMMUNITIES Brussels, 12. 06. 1996 COM(96) 265 final 94/0286 (COD) OPINION OF THE COMMISSION pursuant to Article 189 b (2) (d) of the EC Treaty, on the amendments of the European Parliament to the common position of the Council with a view to adoption of a European Parliament and Council Directive amending Directive 70/220/EEC on the approximation of the laws of the Member States relating to measures to be taken against air pollution by emissions from motor vehicles AMENDING THE PROPOSAL OF THE COMMISSION pursuant to Article 189 a (2) of the EC Treaty Parliament on 9 May 1996 adopted three amendments to the common position adopted by the Council on 22 December 1995 on a Directive amending Directive 70/220/EEC on measures to be taken against air pollution from emissions from motor vehicles. In accordance with Article 189b(2)(d) of the EC Treaty, the Commission hereby delivers a favourable opinion on these amendments, on the following grounds: Amendments 1 and 3 are purely procedural, so there can be no objection to them; Amendment 2 reduces the duration of validity of the certificates issued for the low-powered category of vehicles, according to a specific procedure abolished by Directive 93/59/EEC. Since the expiry dates featuring in Parliament's amendment differ by only three months from those initially proposed by the Commission, and given the Commission finds this amendment acceptable. reduced number of vehicles involved, the For these reasons, the Commission has decided, in line with Article 189a of the EC Treaty, to alter its proposal so as to incorporate the amendments adopted by Parliament. Given the closeness of the dates of entry into force foreseen in the common position, it considers it a matter of urgency that the Council modifies its common position accordingly and adopts the text in question. Altered proposal for a Parliament and Council Directive amending Directive 70/220/EEC on the approximation of the laws of the Member States relating to measures to be taken against air pollution by emissions from motor vehicles (submitted by the Commission pursuant to Article 189a(2) of the EC Treaty) Current proposalAlîered proposal Twelfth recital Whereas the Council should adopt, by 31 December 1997, the requirements valid for the stage beginning in 2000. on the basis of a proposal which the Commission must submit by 30 June 1996 and which is to be aimed at substantially reducing emissions from light commercial vehicles; Whereas the Furooean Parliament and the Council should adopt, by 31 December 1 997, the requirements valid for the stage beginning in 2000, on the basis of the Commission must submit by 30 June 1996 and which is to be aimed at substantially reducing emissions from light commercial vehicles; a proposal which Article 2(3), second subparagraph For vehicles with a power-to-weiaht ratio of no more than 30 kW/t and a maximum speed not exceeding 130 km/h. the dates referred to in The first subparagraph shall be replaced by 1 January 1998 and 1 January 1999 respectively. DeJalsd Article 4 under acting to be submitted by The Council, the conditions laid down in the Treaty, shall decide by 31 December 1997 on proposals the Commission by 30 June 1996, for a further stage in the reduction, by the adoption of Community measures, of air pollution caused by emissions from motor this Directive. The measures shall apply from the year 2000. vehicles covered by The European Parliament and the Council, acting under the conditions laid down in the Treaty, shall decide by 31 December 1997 on proposals to be submitted by the Commission by 30 June 1996, for a further stage in the of the reducTion, Community measures, of air pollution caused by emissions from motor vehicles covered by this Directive. The measures shall apply from the year 2000. adoption by In these proposals, the Commission will follow the approach outlined in Article 4 of Directive 94/1 2/EC. In these proposals, the Commission will follow the approach outlined in Article 4 of Directive 94/12/EC. ISSN 0254-1475 C0M(96) 265 final DOCUMENTS EN 14 07 Catalogue number : CB-CO-96-276-EN-C ISBN 92-78-05314-7 Office for Official Publications of the European Communities L-2985 Luxembourg T

Proposal for a COUNCIL REGULATION (EC) amending Regulation (EC) No 2990/95 regulating compensation for appreciable reductions in the agricultural conversion rates before 1 July 1996

http://publications.europa.eu/resource/cellar/e7ed7228-aafa-44ac-a5a2-48c82d85e985

eng

COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 12. 06. 1996 COM(96)267 final Proposal for a COUNCIL REGULATION (EQ amending Regulation (EC) No 2990/95 regulating compensation for appreciable reductions in the agricultural conversion rates before 1 July 1996 (presented by the Commission) EXPLANATORY MEMORANDUM Regulation (EC) No 2990/95 lays down, until 30 June 1996, the measures to be adopted in the event of appreciable revaluations, in particular to prevent the application of Article 7 of Regulation (EEC) No 3813/92 running counter to compliance with the obligations deriving from the GATT Agreement and budgetary discipline. The fundamental reasons behind the adoption of Regulation (EEC) No 2990/95 remain valid and probably will do so for several months to come. Because of the increase in its value, the Swedish krona has recently been at risk of an appreciable revaluation which could occur after 1 July 1996. In accordance with Article 1(e) of Regulation (EEC) No 3813/92, any fall in the agricultural conversion rate resulting from the halving of a monetary gap of more than five points should be regarded as appreciable because it would be greater than the effects of previous devaluations. In order to afford the Swedish krona the same treatment as the other currencies which have found themselves in similar situations in the past, the validity of Regulation (EEC) No 2990/95 should be extended. The measures to be taken will of necessity be at Community level, because this is an area in which the Community has exclusive competence. They pursue the general objective of uniform application of the common agricultural policy and adapt provisions already laid down by the Council to take account of such situations. z Proposal for a COUNCIL REGULATION (EC) No. 796 of amending Regulation (EC) No 2990/95 regulating compensation for appreciable reductions in the agricultural conversion rates before 1 July 1996 THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, Having regard to the proposal from the Commission, Having regard to Council Regulation (EEC) No 3813/92 of 28 December 1992 on the unit of account and the conversion rates to be applied for the purposes of the common agricultural policy1, and in particular Article 9 thereof, Whereas Council Regulation (EC) No 2990/952 lays down special rules applicable until 30 June 1996 to currencies which experience during that period an appreciable reduction in their agricultural conversion rates and in particular to the Finnish markka and the Swedish krona; whereas the risk of an appreciable reduction has again arisen in the case of the Swedish krona since monetary gaps of more than 5% have occurred for that currency; whereas this situation could lead to an appreciable reduction in an agricultural conversion rate after the period referred to in Regulation (EC) No 2990/95. 1 OJ No L 387, 31. 12. 1992, p. 1. Regulation last amended by Regulation (EC) No 150/95 (OJNoL22, 31. 1. 1995, p. 1. ). OJ No L 312, 23. 12. 1995, p. 7. 3 Whereas A r t i c le 9 of Regulation ( E E C) No 3X13/92 provides lor the Council to take all necessary measures in Ihc event of an appreciable revaluation, w h i e h, primarily to comply w i th obligations under the ( î A TT Agreement and budgetary discipline, may involve derogations f r om the provisions of the said Regulation concerning aid and the amount by w h i ch the monetary gaps are dismantled, w i t h o u t, however, resulting in the threshold being extended; whereas the measures provided for in Articles 7 and X of the said Regulation cannot be applied as they stand; whereas it is necessary lo lake steps at C o m m u n i ty level to prevent distortions of monetary o r i g in affecting the implementation of the c o m m on agricultural p o l i c y; Whereas on the basis ol the information currency available, it is impossible to know what the situation w i ll be after 31 December 1 9 %; whereas application ol the rules and amounts laid d o wn in Regulation ( E E C) No 2990/95 w o u ld be justified in similar cases until that time, H AS A D O P T ED T H IS R E G U L A T I O N: A r t i c le 1 Regulation ( E E C) No 2990/95 is hereby amended as follows: (a), in the title the date "1 July 1996" is replaced by "1 January 1997", (b) In A r t i c le I, the date "30 June 1996" is replaced by "31 December 1996". Ag£kk 2 trais Kciî,uki4ioiv skill enter ink* fence m% the tfciy »>t its puMicsiiion in the (Hlîcuil Journal oi the E-urtvpeiwi: 4 omi$uimtk*s. It stall a©©tv from I. My I**** This Rcgut^Mim. shirfl he Nntftng: m tôs entirety uad directly upgtâeuhle irt aft Member- Slates. EXUM-at Bras»?!*,. Fwi t&*. v t'vwimisHiwB !'«« tÉe t'otjturrl 5 FINANCIAL STATEMENT BUDGE •AD1NG: 390 D AI APPROPRIATIONS: ECU 194m (Item 390) TITLE: Proposal for a Council Regulation amending Regulation (EC) No. 2990/95 regulating compensation for appreciable reductions in the agricultural conversion rates before 1 July 1996 LEGAL BASIS: Regulation 3813/92 - Article 9 AIMS OF PROJECT: Prorogation for 6 months of Regulation 2990/95 fixing in particular for Sweden degressive aid financed by the Community budget to compensate farmers for loss of income as a result of reductions in agricultural conversion rates FINANCIAL IMPLICATIONS PERIOD OF 12 MONTHS CURRENT FINANCIAL YEAR (96) FOLLOWING FINANCIAL YEAR (97) 5. 0. EXPENDITURE - CHARGED TO THE EC BUDGET INTERVENTION - NATIONAL ADMINISTRATION + l: 5. 0. 1 EXPENDITURE PREVISIONS 5. 2. METHOD OF CALCULATION: 1998 + 12 1999 +6 6. 0. 6. 1. 6. 2. 6. 3. CAN THE PROJECT BE FINANCED FROM APPROPRIATIONS ENTERED IN THE RELEVANT CHAPTER OF THE CURRENT BUDGET? CAN THE PROJECT BE FINANCED BY TRANSFER BETWEEN CHAPTERS OF THE CURRENT BUDGET? IS A SUPPLEMENTARY BUDGET NECESSARY? WILL FUTURE BUDGET APPROPRIATIONS BE NECESSARY? YES OBSERVATIONS: At present it is necessary to make assumptions in order to estimate the proposal's financial impact. The calculations are based on monetary gaps during the reference period from 18 to 27 May 1996 of around 5. 5 points for the SKR. The measure proposed avoids the possible application of Article 7 of Regulation 3813/92 which, for 3% revaluation and for EUR- 15, could have a financial impact of around ECU 750 m, together with DR savings of ECU 3 m on the sectors other than those of Art. 7 of Re* 3813/92. C ISSN 0254-1475 COM(96) 267 final DOCUMENTS EN 113 Catalogue number : CB-CO-96-278-EN-C ISBN 92-78-05336-8 Office for Official Publications of the European Communities L-2985 Luxembourg

OPINION OF THE COMMISSION pursuant to Article 189 b (2) (d) of the EC Treaty, on the amendments of the European Parliament to the common position of the Council with a view to adoption of a European Parliament and Council Directive amending Directive 70/220/EEC on the approximation of the laws of the Member States relating to measures to be taken against air pollution by emissions from motor vehicles

http://publications.europa.eu/resource/cellar/76c2b004-5097-4a8e-b530-bfa574161a6e

eng

C O M M I S S I ON OF THE EUROPEAN COMMUNITIES Brussels, 12. 06. 1996 COM(96) 265 final 94/0286 (COD) OPINION OF THE COMMISSION pursuant to Article 189 b (2) (d) of the EC Treaty, on the amendments of the European Parliament to the common position of the Council with a view to adoption of a European Parliament and Council Directive amending Directive 70/220/EEC on the approximation of the laws of the Member States relating to measures to be taken against air pollution by emissions from motor vehicles AMENDING THE PROPOSAL OF THE COMMISSION pursuant to Article 189 a (2) of the EC Treaty Parliament on 9 May 1996 adopted three amendments to the common position adopted by the Council on 22 December 1995 on a Directive amending Directive 70/220/EEC on measures to be taken against air pollution from emissions from motor vehicles. In accordance with Article 189b(2)(d) of the EC Treaty, the Commission hereby delivers a favourable opinion on these amendments, on the following grounds: Amendments 1 and 3 are purely procedural, so there can be no objection to them; Amendment 2 reduces the duration of validity of the certificates issued for the low-powered category of vehicles, according to a specific procedure abolished by Directive 93/59/EEC. Since the expiry dates featuring in Parliament's amendment differ by only three months from those initially proposed by the Commission, and given the Commission finds this amendment acceptable. reduced number of vehicles involved, the For these reasons, the Commission has decided, in line with Article 189a of the EC Treaty, to alter its proposal so as to incorporate the amendments adopted by Parliament. Given the closeness of the dates of entry into force foreseen in the common position, it considers it a matter of urgency that the Council modifies its common position accordingly and adopts the text in question. Altered proposal for a Parliament and Council Directive amending Directive 70/220/EEC on the approximation of the laws of the Member States relating to measures to be taken against air pollution by emissions from motor vehicles (submitted by the Commission pursuant to Article 189a(2) of the EC Treaty) Current proposalAlîered proposal Twelfth recital Whereas the Council should adopt, by 31 December 1997, the requirements valid for the stage beginning in 2000. on the basis of a proposal which the Commission must submit by 30 June 1996 and which is to be aimed at substantially reducing emissions from light commercial vehicles; Whereas the Furooean Parliament and the Council should adopt, by 31 December 1 997, the requirements valid for the stage beginning in 2000, on the basis of the Commission must submit by 30 June 1996 and which is to be aimed at substantially reducing emissions from light commercial vehicles; a proposal which Article 2(3), second subparagraph For vehicles with a power-to-weiaht ratio of no more than 30 kW/t and a maximum speed not exceeding 130 km/h. the dates referred to in The first subparagraph shall be replaced by 1 January 1998 and 1 January 1999 respectively. DeJalsd Article 4 under acting to be submitted by The Council, the conditions laid down in the Treaty, shall decide by 31 December 1997 on proposals the Commission by 30 June 1996, for a further stage in the reduction, by the adoption of Community measures, of air pollution caused by emissions from motor this Directive. The measures shall apply from the year 2000. vehicles covered by The European Parliament and the Council, acting under the conditions laid down in the Treaty, shall decide by 31 December 1997 on proposals to be submitted by the Commission by 30 June 1996, for a further stage in the of the reducTion, Community measures, of air pollution caused by emissions from motor vehicles covered by this Directive. The measures shall apply from the year 2000. adoption by In these proposals, the Commission will follow the approach outlined in Article 4 of Directive 94/1 2/EC. In these proposals, the Commission will follow the approach outlined in Article 4 of Directive 94/12/EC. ISSN 0254-1475 C0M(96) 265 final DOCUMENTS EN 14 07 Catalogue number : CB-CO-96-276-EN-C ISBN 92-78-05314-7 Office for Official Publications of the European Communities L-2985 Luxembourg T

Proposal for a COUNCIL DECISION Concerning the conclusion of an Agreement in the form of an exchange of letters in the area of certification of industrial products under the framework of the Europe Agreement between the European Community and its member states of the one part, and the Republic of Poland of the other part

http://publications.europa.eu/resource/cellar/10c86ce5-12ef-45ed-8967-f446b3f7cee4

eng

COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 12. 06. 1996 COM(96) 260 final 96/0153 (ACC) Proposal for a COUNCIL DECISION Concerning the conclusion of an Agreement in the form of an exchange of letters in the area of certification of industrial products under the framework of the Europe Agreement between the European Community and its member states of the one part, and the Republic of Poland of the other part (presented by the Commission) Explanatory Memorandum The Polish certification system that came into force in May 1995 contained certain provisions that were of concern to the Community in regards to exports of industrial products originating from the Community. The concern was justified by the fact that the Polish certification system required a long list of industrial products to be subject to an obligatory certification procedure in Poland thus creating difficulties to trade. The Association Committee of the Europe Agreement has therefore found it essential to regulate the matter bilaterally by forming a Working Group on certification aiming at solving these problems. Gradual progress was made in the early meetings of this Working Group and the list of products that was subject to the obligatory certification procedure in Poland was reduced. At a meeting of the Commission with the Polish Authorities held in Warsaw on 20- 22 February 1996, a global approach to certification was established by both sides addressing the different issues of certification such as access of Community products to the Polish market, approximation of Polish legislation in relation to EC Directives, mutual recognition agreements and technical assistance. This approach has for its purpose to regulate the issue of certification in its entirety rather than treating each product on its own merits. This solution has been considered as acceptable by the member states within the Council Central European Group. The Commission initialed the texts of this approach on 21 February 1996. It accordingly invites the Council to adopt the annexed proposal for a Council decision aiming at formalising this approach through an exchange of letters. 1 Proposal for a Council Decision Concerning the conclusion of an Agreement in the form of an exchange of letters in the area of certification of industrial products under the framework of the Europe Agreement between the European Community and its member states of the one part, and the Republic of Poland of the other part, THE COUNCIL OF THE EUROPEAN UNION, having regard to the Treaty establishing the European Community and in particular Article 113, in conjunction with Article 228, paragraph 2, thereof, having regard to the proposal of the Commission, HAS DECIDED AS FOLLOWS: Article 1 The Agreement in the form of an exchange of letters between the European Community and the Republic of Poland on a global approach to certification of industrial products as described in the documents entitled " Annex to the minutes from the EU Commission- Poland meeting in Brussels 21-22 November 1995" and the " Declaration on the interpretation of Modalities", under the framework of the Europe Agreement between the European Communities and their Member States, of the one part, and the Republic of Poland, of the other part is hereby approved on behalf of the European Community. The texts of this Agreement on certification are attached to this Decision. Article 2 The president of the Council is hereby authorised to designate the person empowered to sign the Agreement in order to bind the Community. Done at Brussels, For the Council The President. 3 LETTER FROM THE COUNCIL OF THE EUROPE AN IJNION Sir, The European Community and the Republic of Poland have agreed under the framework of the Europe Agreement, on the global approach to certification of industrial products as described in the attached documents entitled " Annex to the minutes from the EU Commission- Poland meeting in Brussels 21-22 November" and the "Declaration on the Interpretation of Modalities" which were initialed on 21 February 1996. This Agreement in the form on an exchange of letters shall be approved by the Contracting Parties in accordance with their respective procedures. It will enter into force when Poland notifies completion of the necessary domestic procedure. In the meantime the Agreement shall apply on a provisional basis from 21 February 1996. I should be grateful if you would kindly confirm the acceptance of your Government of the foregoing. Please accept, Sir, the assurance of my highest consideration. For the Council of the European Union «v LETTER FROM THE GOVERNMENT OF THE REPUBLIC OF POT. AND Sir, I have the honour to receive your letter of which reads as follows: "Sir, The European Community and the Republic of Poland have agreed under the framework of the Europe Agreement, on the global approach to certification of industrial products as described in the attached documents entitled " Annex to the minutes from the EU Commission- Poland meeting in Brussels 21-22 November" and the "Declaration on the Interpretation of Modalities" which were initialed on 21 February 1996. This Agreement in the form on an exchange of letters shall be approved by the Contracting Parties in accordance with their respective procedures. It will enter into force when Poland notifies completion of the necessary domestic procedure. In the meantime the Agreement shall apply on a provisional basis from 21 February 1996. I should be grateful if you would kindly confirm the acceptance of your Government of the foregoing. Please accept, Sir, the assurance of my highest consideration. " I have the honour to confirm that my Government is in agreement with the contents of your letter. Please accept, Sir, the assurance of my highest consideration. For the Government of the Republic of Poland b> »x. ? * V> Annex to the minutes from the EU Commission - Poland meeting in Brussels 21-22. 11. 1995 1. In the framework of the Europe Agreement and, in particular, of its article 68,69, 70 and 74, the declared objective of Poland is ultimately to apply the European Union standards and certification system. 2. To this end, the cooperation between Poland and the EU will help Poland adopting the European Union's norms and certification methods in its own legal and regulatory corpus. 3. To achieve this, the Commission and Poland will act on a mutually agreed plan and time schedule along the following lines. 4. The Commission will provide Poland as soon as possible with: a) the necessary information and communication systems; b) technical advice, training as required and consulting; c) the Commission will study the possibility and will supply technical support to upgrade the capacity and capability of the Polish laboratories and certification bodies. It is understood that technical and financial assistance will be provided by the Phare programme, under the Polish operational programme, within the limits of available resources. 5. Following a proper assessment of the technical competences of the Polish certification institutions, consideration will be given to mutual recognition agreements. Both parties declare their willingness to achieve the first positive results for such agreements in 1996, provided that the Polish conformity assessment institutions designated by the Polish authorities will fulfil the requirements established by the EU harmonised technical regulations. •'e>v 6. Poland declares its intention to introduce in its legislation the relevant Community directives according to the conditions to be defined. 7. Recognising the importance that Poland and the EU attach to the consumer's protection, it is agreed that: a) products legally marketed or certified originating in the Union will not be subject to any certification procedure in Poland; to this end Polish party will perform all necessary changes in Polish legal regulations, within three months in relation to the competence of the Council for Testing and Certification, which then will be effected through a new law to be submitted by the government to the Parliament by the end of 1997 which will replace the existing law on testing and certification. *) a?v «: •"rt-JV' ç # ? ^ ^ * * ^ ^^ : vi?. ' •< b) in accordance with the provisions established in thé above points, for those products subject to compulsory third party certification in the EU, the EU authorities will accept certificates issued by the Polish conformity assessment bodies designated by the Polish authorities, under the mutual recognition agreements to be signed between Poland and the EU, when the Polish conformity assessment bodies are deemed to be competent. c) nevertheless, complaints from citizens, public entities or enterprises on the safety and quality of marketed or certified products originating in the EU exported to Poland will be received by the Polish authorities, and may be notified to the European Commission providing all relevant information. In such cases, the parties shall immediately enter into consultations in order to find mutually acceptable solutions. 8. Both parties will meet on a semeslrial basis in order to review the progress made in the implementation of the above provisions. 9. The Polish party undertakes to put into place the appropriate legal provisions for the continuation of the non-application of sanctions. 10. Both parties agree to formalise the present document through an exchange of letters. v A MtoT** ^W$t!*"r •;» ;-'v. :;-v-^. «v^:^^. ;^^«W-^K'^ ' Ctrl DECLARATION ON THE INTERPRETATION MODALITIES. For the purpose of the implementation of point 7a, the manufacturer or the importer will provide either a third party certificate or a declaration of conformity required according to European Community law, only once for a given product. The products will be admitted in the Polish market as soon as possible and, at the latest, two weeks after the presentation of these above documents. The cost of this procedure is understood to be limited to normal administrative costs. A product admitted to be marketed on this basis in Poland will not be subject again to any such verification. In conformity with the relevant Community and Member States legislation, the civil or criminal liability of manufacturer can be searched before the national courts. 8r ISSN 0254-1475 COM(96) 260 final DOCUMENTS EN 11 Catalogue number : CB-CO-96-270-EN-C ISBN 92-78-05257-4 Office for Official Publications of the European Communities L-2985 Luxembourg

COMMUNICATION FROM THE COMMISSION UNDER THE UN FRAMEWORK CONVENTION ON CLIMATE CHANGE

http://publications.europa.eu/resource/cellar/473db185-bb0d-4923-847f-9d3784ec41af

eng

COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 11. 06. 1996 COM(96) 217 final COMMUNICATION FROM THE COMMISSION UNDER THE UN FRAMEWORK CONVENTION ON CLIMATE CHANGE Article 4. 2. (b) (c) (d) and Article 12 CONTENT EXECUTIVE SUMMARY 1. INTRODUCTION 2. SPECIFIC CIRCUMSTANCES IN THE EUROPEAN COMMUNITY Introduction 2. 1. 2. 2. Geographical setting of the European Community 2. 3. Climate profile 2. 4. Social profile 2. 5. Economic profile 2. 6. Energy profile 3. THE EC EMISSION INVENTORY 3. 1. Introduction Inventory methodology 3. 2. 3. 3. Feedstocks 3. 4. Bunkers 3. 5. Uncertainties involved 4. PROGRAMMES, POLICIES AND MEASURES Introduction 4. 1. 4. 2. The Community strategy to limit C02 page X 1 4 4 4 6 8 9 11 14 14 14 17 17 18 19 19 emissions and improve energy efficiency 19 20 4. 3. Community programmes and initiatives 26 4. 4. The proposal for an energy/carbon tax 27 4. 5. The monitoring mechanism 4. 6. Sectoral policies 28 4. 7. Commission Working Paper on the EU Climate Change Strategy: a set of 33 33 4. 8. Summary options 5. NATIONAL PROGRAMMES OF THE MEMBER STATES Introduction 5. 1. 5. 2. The Member States' National Reports to limit greenhouse gas emissions 5. 3. Summary 37 37 37 58 6. PROJECTIONS OF C02 EMISSIONS IN 2000 6. 1. Introduction 6. 2. Modelling techniques and scenarios 6. 3. Trends in C02 emissions 7. VULNERABILITY ASSESSMENT AND ADAPTATION MEASURES Introduction 7. 1. 7. 2. Possible impacts of climate change on the European Community 7. 3. Adaptation activities 8. FINANCE AND INTERNATIONAL COOPERATION Introduction 8. 1. 8. 2. Cooperation with third countries 8. 3. Cooperation with developing countries 8. 4. Cooperation with the countries of Central and Eastern Europe and the former Soviet Union 8. 5. Summary 9. RESEARCH AND DEVELOPMENT Introduction 9. 1. 9. 2. Second Framework Programme of Research and Development 9. 3. Third Framework Programme of Research and Development 9. 4. Fourth Framework Programme of Research and Development 9. 5. Summary 10. EDUCATION, TRAINING AND PUBLIC AWARENESS 10. 1. Introduction 10. 2. Information, education and training programme 10. 3. Dissemination of research results 10. 4. Research activities regarding education,, training and public awareness LITERATURE LIST OF ABBREVIATIONS ANNEX 1. National greenhouse gas emission inventories ANNEX 2. Scenarios 60 60 60 62 64 64 64 67 69 69 69 71 75 78 79 79 79 80 83 86 88 88 88 91 92 93 95 97 128 EXECUTIVE SUMMARY 1. Introduction 1. 1. The European Community1 signed the UN Framework Convention on Climate Change (UN FCCC) at the UN Conference on Environment and Development (UNCED) in Rio de Janeiro in 1992 and ratified it on the 21st of December 1993. 1. 2. As a Party to the Convention, the European Community has accepted the commitment to adopt policies and take corresponding measures aimed at returning emissions of greenhouse gases to 1990 levels, individually or jointly, by the year 2000. With respect to C02, the European Community set itself the objective to stabilise emissions by the year 2000 at 1990 levels, in the terms agreed by the Joint Energy/Environment Council of October 1990. 1. 3. The present Communication of the European Community under the UN FCCC explicitly describes measures to address climate change which are or will be taken at the Community level in the period 1990-August 1995. Relevant information of Austria, Finland and Sweden, which joined the European Community on 1 January 1995 has been included. The commitments of the European Community are to be reached with complementary Community and national programmes. Since the national programmes have been described in. detail in the National Communications under the UN FCCC of the Member States, these programmes have only been summarized in this communication. 2. Specific circumstances in the European Community 2. 1. The Member States of the European Community vary enormously in size, population, geographical and economic profile. Until 1 January 1995, the European Community consisted of following Member States: Belgium, Denmark, Germany, France, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain and the United Kingdom. Since 1 January 1995, Austria, Sweden and Finland acceded to the European Community. the Throughout the text the term "European Community" is used, since this is the legal name deposited to the United Nations in 1994. The "Commission of the European Communities" is the formal name of the European Commission. 2. 2. The European Community is relatively modest in size (3 240 153 km2). The total number of to 370 million inhabitants of the European Community amounts inhabitants, i. e. the average population density amounts to 114 inhabitants per km2. The territory of the European Community is made up of a wide variety of land of varying quality, almost a quarter of which is arable (28%), approximately a third wooded (35%) and a substantial proportion grassland (18%). 2. 3. The level of development of the national economies in the European Community varies considerably among the Member States. The GDP per capita of the majority of the Member States lies in between 11 500 ECU and 16 500 ECU (figures for 1992 in 1985 prices and exchange rates). Service sectors are the most important economic sectors in the European Community. Manufacturing industries are the second most important sector. The transport sector in the EC has shown above- average C 02 emission growth in recent years and is one of the major sources of C 02 emissions (Green Paper on Transport and Environment; COM (92), 46 final, 20. 02. 92). The EC is depending on imports for most of its energy provision. 3. The EC emission inventory 3. 1. The EC inventory for the year 1990 has been compiled based on the inventories of the 15 Member States. Table El provides a summary of greenhouse gas emission estimates in 1990. To estimate total greenhouse gas emissions in the European Community, total greenhouse gas emissions in each one of the Member States were added together. Estimates of emissions in the Member States were primarily taken from national communications prepared by the Member States under the UN FCCC. If these were not available, national programmes under the EC Decision on a Monitoring Mechanism for C02 and other greenhouse gases were used. In general, the inventories reported in these national reports followed the IPCC guidelines for inventories. If no nationally reported estimates were national greenhouse gas available, CORINAIR and/or Eurostat figures have been used. 3. 2. Since nationally reported inventories were not available for all EC Member States, and CORINAIR does not include removals of C02, C02 emissions and/or removals from Land Use Change have not been quantified in the 1990 EC inventory. 3. 3. The emission estimates presented in Table E. l are structured according to the reporting instructions of the IPCC guidelines for greenhouse gas inventories. For reasons of consistency, EUROSTAT estimates have been used for each of the Member States to calculate their feedstock emissions. These have been reported separately in the category "Final Non Energy Consumption (FNEC)". II Table E. l. EC inventory of greenhouse gas emissions. 1990. (Gg). Short Summary Table. Provisional estimates1. Estimates of greenhouse gases in European Community (EUR-15) - 1990 (Gg). CO, CH4 NX) NOT CO NMVOC All energy Fuel combustion Fugitive fuel Industrial processes Solvent use Agriculture Land use change 1 la lb 2 3 4 5 6 Waste 3153200 3145700 7700 148300 300 500 NE2 25850 5587 793 4795 42 0 10349 8681 Total emissions3 3328350 24660 157 157 1 353 6 385 20 922 13332 13243 88 154 0 50 46184 46092 92 2811 0 2763 71 327 8422 7697 726 1077 4043 738 93 13606 52085 14374 Marine bunkers Aviation bunkers FNEC3 (FNEC = Final Non-Energy Consumption) 113600 56500 243600 NE = Not Estimated Notes: Estimates of greenhouse gas emissions in the European Community are based on estimates of emissions in the Member States, updated up to June 1995. C02 emissions and/or removals from Land Use Change are not known for many countries and hence have not been included in this table. Non-C02 greenhouse gas emissions from Land Use Change have also not been estimated. Emissions from Final Non Energy Consumption (including feedstocks) have not been included in the IPCC total emissions. Therefore, methodology. Emissions from Final Non Energy Consumption (FNEC) are based on the total carbon contained in the related products. The addition of energy emissions and emissions from FNEC would therefore produce an overestimation compared to the IPCC methodology. total emissions are underestimated in comparison with 3. 4. Following the decisions taken at ninth session of the Intergovernmental Negotiating Committee on a Framework Convention on Climate Change (INC-9), emissions from bunkers are not included in the total emissions in summary Table E. l. Since only a few Member States provided estimates of bunker emissions, emission estimates from maritime bunkers are based on Eurostat figures. Aviation bunker emissions have been estimated by reconciling non-road transport figures from • Eurostat against estimates reported in CORINAIR and/or country reports. 3. 5. The uncertainty in the emission estimates has not been quantified, since quantitative estimates of the uncertainty would be highly unreliable. Estimates for C02 emissions from fuel combustion activities (based on energy balance figures) are rather reliable and are likely to be least uncertain (within about +/- 3%). The uncertainty the following order: CO < NOx < CH4 < NMVOC < N20, with uncertainties increasing to several orders of magnitude (several hundreds of percent). in emission estimates from non-C02 gases increasing in is Ill 4. Programmes, policies and measures 4. 1. In October 1991, the Commission presented an overall strategy to limit C02 emissions and improve energy efficiency, with the objective of stabilising C02 emissions in the Community in the year 2000 at the 1990 level. The Community strategy rests on four pillars: - The EC energy conservation and energy technology programmes. the elaboration of the RTD strategy and addresses The THERMIE I programme (1990-1994) aimed at the demonstration and dissemination of cleaner and more efficient energy techniques. The JOULE II to the R&D in the same area; it also programme (1991-1995) is relative concerns the Energy- Economy- Environment dimensions of the Climate Change issue. SAVE (1991- 1995) is a programme of energy efficiency legislation and financial support for the Member States. the creation of energy efficiency ALTENER (1993-1997) provides financial support for activities contributing to the application of renewable energy technologies, and envisages standardization measures for renewable energy equipment. infrastructure in - Fiscal measures. In June 1992, the Commission proposed a draft Council Directive for a tax on fossil fuels whose tax base will be to 50% the energy content and to 50% the carbon content of the energy product. In December 1994, the Council agreed on the need to implement a Community framework for the Member States for the application of national C02/energy taxation. An amended proposal has been adopted by the Commission on 10 May 1995. The main change proposed is that the implementation of a harmonised tax will be preceded by a transitional period during which the Member States, while respecting a harmonised tax structure, are free to set the tax rates product by product provided that the improvement of Community objectives of limiting C02 emissions is fully energy efficiency and fuel switching towards low -no carbon fuels reflected in the structure of the rates applied. through - A monitoring mechanism. The monitoring mechanism surveys the Community and Member State actions aimed at reaching the Community C02 stabilisation target for the year 2000. The Commission evaluates these programmes in order to assess whether progress in to ensure the stabilisation of C02 the Community as a whole is sufficient emissions by the year 2000 at 1990 levels. The results are reported to the European Parliament and the Council. - National programmes. The Community strategy requires policy programmes which limit greenhouse gas emissions at Member State level, and which will be complementary to actions taken at the Community level. IV From 1 January 1995 THERMIE has continued as the new Non-Nuclear Energy programme, better known as JOULE-THERMIE; This new Programme (1995- 1998) brings together for the first time the research and development aspects of JOULE with the demonstration and promotion initiatives of THERMIE. The Commission has adopted its proposal for a new SAVE programme (SAVE-II) on 31 May 1995. Two other programmes with similar aims and activities, the PACE programme for electricity efficiency and the annual Programme of support for Regional and Urban actions will be merged into SAVE-II. It is scheduled to begin on 1 January 1996 and will run until 31 December 2000. The proposed budget is 150 MECU. 4. 2. Next to the policies and measures adopted in the framework of the Community strategy, some sectoral policies also contribute to the limitation of greenhouse gas emissions. the reduction of agricultural support prices and - The 1992 restructuring of the Common Agricultural Policy (CAP) contains the measures, such as introduction of set-aside schemes for agricultural land, that have a limiting impact on greenhouse gas emissions. Moreover, agri-environmental measures, that have been adopted as accompanying measures to the CAP reform, contribute to the limitation of greenhouse gas emissions. the - The EC forestry policies, such as supporting financially afforestation and promoting the environmental productivity of forests by regulation, contribute to the uptake of C02 emissions. - Within the Community, transport is a major and strongly growing source of greenhouse gas emissions. From 1991 to 1994, a series of Council Directives has been adopted which prescribe standards for emissions of CO, hydrocarbons and NOx from various types of vehicles. Fiscal policies with regard to excise duties on transport fuels harmonize minimum rates, and are aimed at a progressive increase of these duties. - Concerning waste, the Directive on packaging and packaging waste and the Directive on landfills of waste were adopted on 20 December 1994 (94/62/EC). Preventing the production of packaging waste, reusing packaging, recycling and reducing the final disposal of waste will result in a reduction of C02 and CH4 emissions. 4. 3. Before the first Conference of the Parties to UN FCCC and in response to the request of the Council the Commission prepared and adopted on 1 March 1995 a "Commission Working paper on the EU Climate Change Strategy: a set of options", (SEC 95/288/fmal). In the document a preliminary analysis of the policy options for C02 limitation in the perspective 2005-2010 is given. The document indicates, amongst others, that a technical potential for C02 emission reduction by 2010 of up to 10% exists, at no or low costs compared to 1990 level, provided V positive synergies between climate change policies and several other policy areas of the Community are exploited. A more detailed analysis will be carried out by_ the Commission at a later stage. 4. 4. An overview of the policies and measures that have been adopted by the Council is provided in Table E. 2. VI Table E. 2. Programmes, policies and measures adopted by the Council. Name Period Budget Description THERMIE I 1990 - 1994 700 MECU Financial support for clean energy technologies SAVE-programme 1991 - 1995 35 MECU Financial support for energy efficiency projects SAVE-legislation 1992 -. 1992 -. 1994 -. Energy Management at Regional and Urban level 1990-1995 Energy efficiency standards for new hot water boilers Energy labelling of major household appliances, Framework Directive Energy labelling of refrigerators and freezers 20 MECU Rationalisation of energy use at regional and urban level ALTENER-programme 1993 - 1997 40 MECU Financial support for renewables Voluntary agreement Monitoring mechanism CAP Reform, price lowering CAP Reform, set-aside scheme 1993 - 2000 Procedures to monitor progress towards C 02 stabilisation target CEN/CENELEC will elaborate standards for thermal solar with CEN/ CENELEC systems, photovoltaics and wind turbines 1992 1992 Reduction of agricultural prices makes the use of mineral fertilizer is one reason for decreasing use of mineral less profitable and fertilizers (and thereby N20 emissions) in the last years Compulsory set-aside scheme promotes growing of biofuels VII Table E. 2. Programmes, policies and measures adopted by the Council (continued). Name CAP Reform, extensification of beef production Period 1992 -. Budget Description Premiums are related to maximum stocking rates, reducing CH4 emissions from ruminants per ha Agri-environmental 1993-1997 measures 3670MECU Financial support for zonal programmes, incl. environmental measures Afforestation 1993 - 1997 1260 MECU Financial support for afforestation Protection of forests from pollution Protection of forests from fires Emission standards for heavy duty vehicles 1092 - 1996 29. 4 MECU Measures increase net primary productivity of trees and thereby potential C 02 uptake. 1992 - 1996 70 MECU Measures contribute to C02 uptake 1993 -. Emission standards for CO, hydrocarbons and NO, Emission standards 1993 -. Emission standards for CO, hydrocarbons and NO, for light duty vehicles Emission standards for passenger cars Fiscal measures for for transport fuels 1997 1992 - Emission standards for CO, hydrocarbons and NO, Minimum excise duties on petrol and diesel fuels VIII Table E. 2. Programmes, policies and measures adopted by the Council (continued). Name Period BudgetDescription Landfill directive 1994 -. Environmental standards for landfilling of waste contributes to limitation of CH4 emissions IX 5. National programmes of the Member States 5. 1. One of the pillars of the strategy of the European Community to limit greenhouse gas emissions consists of the national programmes adopted by the Member States. All Member States, except Belgium, already reported under the UN FCCC. Belgium submitted to the UN FCCC its national programmes under the EC Monitoring Mechanism for C02 and other greenhouse gases. 5. 2. All national reports include a 1990 emission inventory, a list of programmes, policies and measures adopted to limit greenhouse gas emissions, and projections of greenhouse gas emissions in 2000. Since the projections included in the national input reports have been compiled using various modelling assumptions, they cannot be added together to arrive at projections the European Community. tools and key for 5. 3. Eight Member States expect an increase in C02 emissions in 2000 compared to 1990: Austria, Finland, France, Greece, Ireland, Italy, Portugal, and Spain. One Member State expects to reach a stabilisation of C02 emissions in 1990: Sweden2. Five Member States are expecting a decrease in C02 emissions in 2000: Belgium, Denmark3, Luxembourg, the Netherlands4 and the United Kingdom. Germany provides a projection for C02 emissions in 2005 and expects a C02 emission reduction by that year. in CH4 emissions: Eleven Member States provided projections of CH4 and N20 emissions in 2000. Two Member States expect an Ireland and increase Luxembourg; Another two expect a stabilization: Austria and France; and the remaining seven Member States expect a reduction in CH4 emissions: Denmark, Finland, Greece, Italy, the Netherlands, Sweden and the United Kingdom. Six Member States expect an increase in N20 emissions: Denmark, Finland, Greece, Ireland, Luxembourg and two Member States expect a stabilization: Austria and Italy; and three other Member States expect a reduction in N20 emissions: France, Sweden and the United Kingdom. Germany provided projections for 2005 and expects a reduction in both CH4 and N20 emissions. the Netherlands; 2 If based on temperature corrected C02 emissions in 1990. If projected figures are compared with actual C02 emissions in 1990, an increase in C02 emissions of 4% is estimated. 3 If based on C 02 emissions in 1990 which have been corrected for electricity import fluctuations. If projected figures are compared with actual C02 emissions in 1990, an increase in C 02 emissions of 3% is estimated. 4 If based on temperature corrected C02 emissions in 1990. If projected figures are compared with actual C02 emissions in 1990, C02 emissions are estimated to stabilize. X 6. Projections of C02 emissions in 2000 6. 1. As a first attempt to project energy related C02 emissions in the EC, the larg& scale energy planning and forecasting model MIDAS (Model Integrating Demand top-down and Supply) has been used. The model combines an econometric approach with a micro-economic approach. Several scenarios have been applied in the model. The MIDAS model and the scenarios applied differ, in structure and in assumptions with regard to exogenous variables, from the models and scenarios used by Member States to forecast their C02 emissions. Results are therefore not comparable. However, it should be stressed that the simulations described in this report are not official simulations to assess the impact of climate change policies in the EC. The results of the simulations are provided as a first indication of future EC greenhouse gas emission. Further work to develop more accurate is being undertaken modelling tools and scenarios. 6. 2. Table E. 3 shows the trend in energy related C02 emissions in EUR-15. Table E. 3. Trends in energy related C02 emissions in the EC (15 Member States). (1000 Gg. ); preliminary results Ï99Ô 2000 2ÔÏÔ 2Ô2Ô Conventional Wisdom 3,155 3,155 Battlefield 3,155 Forum 3,155 Hypermarket 3,326 3,357 3,089 3,325 3,557 3,428 2,986 3,597 3,648 3,368 2,855 3,686 the most representing a conventional wisdom view of 6. 3. According to the Conventional Wisdom Scenario,which denotes the "business as usual" world likely evaluation of events, C02 emissions in the EC are expected to increase with 5% by the year 2000, with 13% by the year 2010 and with 16% by the year 2020 (compared with 1990 levels). The results of the Hypermarket scenario, which gives show a similar a predominant role to market forces, liberalism and free trade, increase: an increase is expected of 5%, 14% and 17% for the years 2000, 2010 and 2020 respectively. The Battlefield scenario,which assumes amongst others that in a the world reverts to decreasing growth of C02 emissions: an increase of 6% in 2000, of 9% in 2010 and of 7% in 2020. According to the Forum scenario,"which assumes amongst international others that the world moves more to consensus and cooperative structures with a strong role for public administration and intervention," a reduction in C02 emissions is expected: 2% in 2000, 5% in 2010 and 10% in 2020. isolation, power blocks and protectionism, results XI 7. Adaptation and vulnerability 7. 1. Since the territory of the European Community consists of a rich variety of landscapes and also the climate varies considerably among the different parts of the Community, impacts of climate change can differ enormously depending on local or regional circumstances. the possible 7. 2. Assuming a doubling of atmospheric C02 concentrations, average winter temperatures in northern Europe are expected to increase by 2-5 °C, while the winters in the central and southern region can be 1-3 °C warmer. Average summer temperatures are expected to increase by 1-4 0c throughout all of Europe. The change of temperatures and precipitation has enormous impacts for agriculture, depending on the region these impacts could be both positive and negative, despite of partially positive impacts, negative impacts will predominate for agriculture in general. Sea level rise is a potential threat to the large coastal area of the European Community (approximately 89 000 km of coastline, without counting the coasts of the small islands), especially to low lying lands. The impact of major storms will become more widespread as the sea surface rises. Especially in the North and Mediterranean Seas, the impacts of storms are a matter of particular concern. Analysis of economic impacts show that economic costs will most likely be the overall consequence of global warming for the EC, although some sectors and regions may benefit. 7. 3. One of the key targets of the Fifth Action Programme of the EC "Towards Sustainability" is the integrated management of coastal zones. The Commission is currently preparing a Communication on the integrated management of coastal zones. It was felt to be better implemented. Coordination to that end. A three years demonstration programme is proposed in order to investigate and demonstrate the conditions of coordination, horizontally between the multiple sectors of activity (integration) and vertically between (subsidiarity). the Research and development activities will provide a scientific basis for sound ecological management of the coastal zones. levels of competence instruments exist but is seen as a means they need that that 7. 4. In June 1994, the European Community signed the Resolution on strategies for a process of long-term adaptation of forests in Europe to climate change. European research on the linkages between climate change and forests ecosystems is being intensified. 8. Finance and international cooperation 8. 1. Since the adoption of the Fifth Action Programme "Towards Sustainability", progress has been made in integrating environmental requirements into cooperation with transition. Environmental concerns are now reflected in most of the bilateral cooperation contracts established between the Community and its partner countries. countries with developing economies countries and in 8. 2. Cooperation with non Community countries, the so called "third countries" relating to climate change, inter alia, takes place in the frame of the SYNERGY initiative and the European Energy Charter. For all cooperation projects likely to have an impact on the environment an Environment Impact Assessment is required. The Commission has proposed to change this initiative in a programme. The objective XII of the SYNERGY initiative is to improve the long term world energy situation and hence, Community energy security, by helping other countries to make effective energy policy decisions. By encouraging energy planning, the rational use of energy and counselling and training, SYNERGY contributes to the reduction of greenhouse gas emissions. The Programme is to last five years and has a budget of 50 MECU. The European Energy Charter was signed in December 1994. The charter includes a political declaration committing its signatories to cooperate in trade, investment and other policies in all energy sectors. These efforts should lead to the creation of a true energy market throughout Europe. Environment protection and more efficient use of energy brought about by treaties and protocols in the frame of the charter will have a positive impact on limiting C02 and other greenhouse gas emissions in particular by encouraging market prices, and hence, more efficient energy usage. 8. 3. Cooperation with developing countries takes place in the framework of general and more specific cooperation programmes. The specific programmes include research cooperation, energy and forestry related issues. The research cooperation has been targeted through the "Life sciences and technologies for Developing Countries" on areas of relevance for global change issues, and in particular those relative to the use and management of ecosystems, cooperation on energy and forestry related issues have made possible the financing of projects relative to renewable energy in Asian and Latin America countries (ALA) and to conservation and sustainable management of tropical and subtropical forests in the African, Caribbean and Pacific countries (ACP). The most comprehensive of all the general agreements with developing countries are those with the ACP-countries, the so-called Lomé Conventions. Under Lomé IV (1990-1995), environment has become one of the main areas of cooperation. Within the framework of efforts to protect the environment and restore natural the balances, cooperation aims conservation of natural resources, renewable and non-renewable, the protection of ecosystems and the control of drought, desertification and deforestation. Another main area of cooperation is energy development, in particular energy efficiency and the promotion of new and renewable sources of energy. specific operations concerning to promote Since 1976, the Community has been pursuing a policy of financial, technical and, more recently, also economic cooperation with the ALA-developing countnes. Under the new guidelines for Community cooperation with ALA countries, long- term priorities are the protection of the environment and natural resources, and sustainable development. 10 % of the total budget for the period 1991-1995, has been set aside for projects specifically aimed at protecting the environment, in particular tropical forests. 8. 4. EC cooperation with the central and eastern European countries (CEECs) and the is mainly based on the PHARE (Poland and Hungary former Soviet Union Assistance the TACIS (Technical Assistance to the Commonwealth of Independent States) programmes. The PHARE the political and economic programme development of issue are particularly the activities related to energy. to the Restructuring of the Economy) and the CEECs. Of relevance initiative which supports the climate change is an EC to XIII The overall aim of the TACIS programme is to contribute to the transition towards a market economy of the independent states of the former Soviet Union. Since 1993, the TACIS Regulation includes a specific reference to the environment. Energy is specified as one of the priority sectors of the TACIS programme. Important to note is that each project in the energy sector contains an energy saving component. 9. Research, demonstration and development 9. 1. Research on climate change is embedded in the EC Framework Programmes of Research and Development. Within these framework programmes, the specific research programmes on environmental issues, non-nuclear energy and marine science are of particular importance to climate change. Research budgets in all three areas have been largely increased during the last years. 9. 2. During the Second Framework Programme of Research and Development (1987- 1991), the European Programme on Climatology and natural Hazards (EPOCH) had the strongest liaison with the climate change issue. Research focused on: past climates and climate change, climate processes and models, climatic impacts and climate-related hazards, and seismic hazard. 9. 3. The emphasis on environmental research has increased in the Third Framework Programme of Research and Development (1990-1994). The Environment programme consisted of the following research areas: participation in global change programmes, environmental technologies and engineering, research on economic and social aspects of environmental issues, and technological and natural risks. 9. 4. The Fourth Framework Programme of Research and Development (1994-1998) includes a specific programme on Environment and climate. The programme covers four themes: the natural environment, environmental quality and global change; environmental technologies; space techniques applied to environmental monitoring and research, and human dimensions of environmental change. The Joint Research Centre (JRC) will also contribute, through its own programme of activities, to the attainment of the Community objectives in the areas covered by the programme on Environment and climate. 9. 5. Two successive programmes regarding new energy technologies, JOULE I (1989- 1992) and JOULE II (1990-1994), have been established by the Community. Both programmes addressed the development of clean and efficient energy technologies in the three following areas: rational use of energy (in industry, transport and building), advanced technologies for fossil fuels, and renewable energies; a large activity about energy-economy-environment modelling is also undertaken which has been focused in particular on the C 02 strategy. The environment dimension which was already an integral part of JOULE I has been strengthened in JOULE II. 9. 6. A specific programme on non-nuclear energy is continuing under the Fourth Framework Programme. It is called JOULE-THERMIE. This programme will integrate for the first time the R&D and the Demonstration activities. R&D will give more emphasis to the renewable energy and transport, whereas demonstration of energy, fossil fuel technology and activity will support more rational use dissemination, a substantial support to the RDT strategy will be ensured and XIV focused on a Climate Change environmental costs of energy. technology strategy and on the internalisation of 9. 7. The European Community's Marine Science and Technology (MAST) programmes aim to introduce the necessary Community dimension to various on-going research activities of the Member States. MAST intends to contribute to establishing a scientific and technological basis for the exploration, exploitation, management and protection of Europe's coastal waters and the seas surrounding the EC's Member States and thereby to achieve a better balance in the marine science potential of the various areas of the EC. 10. Education, training and public awareness 10. 1. The success of policies and measures addressing the problem of climate change will depend to a large extent on the decisions and actions of the general public. At the EC level, information, education and training programmes concerning climate change and energy use mainly take place within the scope of (sectoral) policy programmes, such as energy supply, transport, urban development and agriculture. 10. 2. Information for the wider public is a key element of the SAVE, ALTENER, THERMIE programmes and the action on Energy Management at Regional and Urban level. THERMIE's dissemination actions include a network of some forty Organisations for the Promotion of Energy Technology (OPET) focusing on distributing and promoting innovative energy technologies across Europe, including Central and Eastern European countries and the former Soviet Union. 10. 3. The EC supports pan-European environmental campaigns of sustainability, or local authorities to global aiming sustainability, such as Sustainable Cities and Towns, the Car Free Cities Club and Cities for Climate Protection. local contribution significant local at 10. 4. Training and education belong to the accompanying measures of the EC research programmes. An example of these activities are the courses which are organised by the European School of Climatology and Natural Hazards. XV 1. INTRODUCTION The Treaty establishing the European Community (EC) entered into force in 1958. Since then, it has been modified several times to allow new States to accede to membership and to reinforce and enlarge its objectives. The two major texts modifying the original Treaty are the Single European Act, which entered into force in 1987, and the Treaty on European Union known also as the Treaty of Maastricht. The latter entered into force at the 1st November 1993. Until 1 January 1995, the European Community consisted of the following Member States: Belgium, Denmark, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain and the United Kingdom. Since 1 January 1995, Austria, Finland and Sweden also became Members of the European Community. Although this communication mainly deals with the the period 1990-1994. relevant information of the three new Member States have been included. In addition, relevant developments on community and national level since 1 January 1995 have been addressed as well. The main objectives of the European Community are set out in article 2 of the Treaty on European Union: "to promote throughout the Community a harmonious and balanced development of economic activities, sustainable and non-inflationary growth respecting the environment, a high degree of convergence of economic performance, a high level of employment and of social protection, the raising of the standard of living and quality of life, and economic and social cohesion and solidarity among Member States"5. The Treaty on European Union has introduced as a principal objective the promotion of the environment. The Treaty sustainable and non-inflationary growth recognizes the integrated definition and implementation of other Community policies. One of the objectives of Community environmental policy is to promote measures at the international level to deal with regional or worldwide environmental problems. that environmental protection requirements must be respecting into the environment The Fifth Environment Action Programme "Towards Sustainability", adopted by the Commission in 1992 and its broad strategy of which was agreed by the Council in 1993 (OJ C138/5, 17. 5. 1993), is the process by which Community environment policy is moving forward. It lays out a strategy for reconciling economic development to the protection of the programme (sustainability). For recognizes the need for a comprehensive and targeted approach towards environmental issues at Community level. It takes as its starting point the need to involve all the relevant "actors" of society in a spirit of shared responsibility to achieve sustainable development. It focuses on five main target areas - industry, agriculture, energy, transport and tourism - where the environmental problems are the most profound and where action can have most benefits for the environment as a whole. The programme recognizes that the legislative or regulatory approach is not sufficient and recommends a broadening of the first time, Art. 2, Treaty establishing the European Community (as amended) by Art. G(l) and G(2) of the Treaty on European Union. 1 instruments, to the range of financial support include economic/fiscal mechanisms, and horizontal instruments such as information, education, research and development, and data gathering. instruments, The tasks entrusted to the European Community are carried out by the following institutions: an elected European Parliament, a Council consisting of a representative of each Member State at ministerial independent Members and a Court of Justice to ensure the interpretation and application of the Treaty. level, a Commission consisting of In order to carry out their tasks, the Commission and the Council acting jointly or in cooperation with the European Parliament can make Regulations, issue Directives, take Decisions, make Recommendations or deliver Opinions. Regulations are of general application. They are binding in their entirety and are directly applicable in all Member States. Directives are binding as to the result to be achieved, but leave to Member States the choice of form and methods. That means that Directives need to be incorporated into national legislation within a certain time limit fixed by the Directive itself. Decisions are are addressed. Finally, to whom binding Recommendations and Opinions have no binding force. their entirety upon those they in legislation under normal conditions, a proposal the To enact Community Commission is necessary. Acting on the basis of such proposal, the legislative bodies under the Treaty (the Council, and to some extent, the Parliament), assisted by some advisory bodies, adopt the final text. from Action by the Community regarding environmental issues has to be taken in accordance with, inter alia, the principle of subsidiarity. This principle states that the Community should only take action if and in so far as the objectives of the proposed actions cannot be sufficiently achieved by the member sates and can therefore, by reason of the scale or effects of the proposed action, be better achieved by the Community. The European Community6 signed the UN Framework Convention on Climate Change (UN FCCC) at the UN Conference on Environment and Development (UNCED) in Rio de Janeiro in 1992. As a follow-up, the Commission submitted a proposal for a Council Decision concerning the conclusion of the UN FCCC in December 1992. This proposal ratification, was inter alia founded on Article 22 of the Convention which allows acceptance or approval by States and by Regional Economic Integration Organisations. In the proposed Council Decision it was considered that "since the Community and its Member States share competence in the areas covered by the Convention, it is necessary according to the Community and its Member States to become Contracting Parties so that all the obligations under the Convention can be properly fulfilled". More specifically it the was considered necessary the Convention and assumed the relevant responsibilities emission stabilisation objective of the Convention while not all the Member States were ready to meet that objective individually. to in order to comply with that the Community became a contracting Party In December 1993, the Council agreed to adopt the Commissions' proposal for the the Council Decision, "recognizing the importance for the Community of ratifying Throughout the text the term "European Community" is used, since under the Treaty of the European Economic Community has been converted into European Community. In this communication, the term European Community refers to either the 12 (EUR-12) or 15 Member States (EUR-15). The "Commission of the European Communities" is the formal name of the European Commission. z the commitment relating Convention before it enters into force and alongside its Member States, so as to allow the fulfilment of the Community by the Community as a whole through action by the Community and its the European Member States, within Community ratified the UN FCCC on 21 December 1993. On the same day, the threshold of 50 ratifications was met, leading to the Convention entering into force on 21 March 1994. their respective competences". As a result, limitation of C02 emissions to the in As a Party to the Convention, the European Community accepts, among others, the commitment to adopt policies and take corresponding measures aimed at returning emissions of greenhouse gases to 1990 levels, individually or jointly, by the year 2000. With respect to C02, the European Community set itself the objective to stabilize emissions by the year 2000 at 1990 levels, in the terms agreed by the Council of Ministers of 29 October 1990. The present Communication of the European Community under the UN FCCC explicitly describes policies and measures to address climate change which are or will be pursued at the Community level. However, the commitments of the European Community are to be reached with complementary Community and national programmes. Only a short summary of the national communications/programmes is included in order to provide a complete overview of activities taking place within the European Community. SPECIFIC CIRCUMSTANCES IN THE EUROPEAN COMMUNITY 2. 1. Introduction The Member States of the European Community vary enormously in size, population, geographical and economic profile. is provided of background information relevant to this report. Basic data and characteristics of the Member States are provided, including data relating to geography, climate, society, economy and energy. this chapter, an overview In 2. 2. Geographical setting of the European Community The European Community, as a geographical entity, is relatively modest in size, but owing to the restricted area it occupies, its situation and favourable natural conditions, it is a densely populated part of the world. In a comparatively small area, the European continent contains a rich variety of landscapes. Four major morphological zones can be distinguished: - - - - the North European Plain, site of many major cities and fertile agricultural lands; the central and southern European Highlands, comprising the Sierra Nevada, Pyrenees, and Alps; the old Fennoscandian Shield and Caledonian the Scandinavian highlands and the north and western part of Ireland and the UK; and the littoral zone of the Mediterranean. range, consisting of The coastal zones of the European Community constitute a unique environmental heritage, with important ecological, cultural and economic resources. As an indication of the scale, the European Community has about 89. 000 km of coastline excluding the small islands and inland seas (CEC, 1993) The territory of the European Community is made up of a wide variety of land of varying quality, almost a quarter of which is arable (27%), approximately a th*ird wooded (35%) and a substantial proportion grassland (18%). Table 2. 1 provides an the relative overview of contribution of land use in the European Community. in the Member States, and Figure 2. 1 shows land use Forests are unevenly distributed, and the proportion of territory they occupy varies from one country to another. Finland (69%) and Sweden (62%) have the highest proportion of forest cover, while Ireland (5%) and the Netherlands (8%) are well below the Community average (20%). Ireland has the highest proportion of agricultural land: 80% of the total area consists of agricultural land. Table 2. 1. Agricultural land, wooded areas and other land (km2) in the Member States (figures provided for 1991). Agricultural area Crop lands1 Meadows2 area Wooded Other land Total area Austria Belgium Denmark Finland France Germany Greece Ireland Italy Luxembourg Netherlands Portugal Spain Sweden United Kingdom European Community 15,060 8,270 25,480 25,130 192,500 119,100 39,050 9,230 119,700 19,860 32,100 5,280 6,170 4,450 2,080 1,200 232,220 148,720 104,120 26,200 3,200 67,680 111,040 52,430 52,550 46,900 48,750 16,700 10,798 11,083 79,600 96,826 • 81,297 14,157 10,955 65,181 560 696 890 446 9,220 31,730 199,460 27,680 65,910 888,080 10,640 3,500 8,380 33,000 102,600 159,150 5,520 280,200 24,250 111,090 579,010 1,125,930 18,120 18,876 43,585 136,560 42,880 647,133 83,860 30,518 43,093 338,150 549,096 356,947 131,957 70,285 301,311 2,586 41,480 91,986 504,759 449,960 244,138 3,240,153 Arable land and permanent crops. Permanent meadows and pastures. 2 Source: Eurostat. Legenda B« Arable land and permanent crops Permanent meadows and pastures Wooded area Other land Figure 2. 1. Land use in the European Community. Source: Eurostat 2. 3. Climate profile This section deals with the EUR-12 since no data could yet be obtained from the three new Member States. Four main types of climate can be identified in the European Community: the maritime climate, with mild winters, cool summers and constant humidity. This climate type dominates the western edge of the European continent. the semi-continental climate, with cold, dry winters and hot, stormy summers. The eastern fringes of the European Community is dominated by this type of climate. the Mediterranean climate, with mild, wet winters, hot dry summers and infrequent but heavy rainfall. This climate is found in the coastal areas of the Mediterranean. the climate found in mountain areas, which depends on altitude and exposure to sun, wind and rain. is provided The average temperature and precipitation varies considerably among countries. An overview in Table 2. 2. The coldest country is Belgium, with average temperatures of 7. 2 °C (minimum) and 9. 7 °C (maximum). The warmest country is Greece with average temperatures of 14. 1 °C (minimum) and 18. 2 °C (maximum). Spain shows the most variation in rainfall: minimum rainfall amounts to 218 mm per year, maximum rainfall amounts to 1702 mm per year. Table 2. 2. Minimum and maximum average temperature and precipitation in Eur-12. Long term averages. Average temperature over the year (°C) Min. Max. Belgium Denmark France Germany Greece Ireland Italy Luxembourg Netherlands Portugal Spain United Kingdom Source: Eurostat 7. 2 7. 5 9. 5 7. 8 14. 1 9. 0 11. 5 8. 4 8. 5 13. 2 11. 0 8. 4 9. 7 8. 1 14. 9 10. 6 18. 2 10. 6 18. 4 9. 7 17. 2 18. 5 10. 9 Precipitation (mm H20) Min. 824 551 493 560 422 781 424 856 562 527 218 496 Max. 1191 874 1236 979 1044 1502 1142 777 1064 1702 967 An indicator for the need for space heating is the number of degree-days, a measure of the severity of the cold dunng a specific period of time. The number of degree-days equals to: (18 °C - Tm) * d, if Tm is lower than or equal to 15 °C (heating threshold); and are nil, if Tm is greater than 15 °C; where Tm is the mean temperature and d is the number of days. Figure 2. 2 provides an overview of the number of degree-days in the Member States. The figure shows that the greater part of the Member States has a relatively high need for space heating. No similar data are available for the need for air-conditionmg in the Member States. 3 S OO 3 0 00 S S OO ^ O OO 1 o oo s oo O e çg r e e - c d e iy s -—• ' 1 1 ;. -:•:• ,:• '—~— -- ••• r" •' ' •; t _H r—*~~ ' — —— — —; • " / : •- B CDK. O QR E F= I f=< I 1_ ML F> Ul Figure 2. 2. Number of degree-days1 in the EUR-15 (figures provided for 1991). Source: Eurostat (EU. 12) The number of degree-days equals to: (18 °C "Tm) * d, if Tm is lower than or equal to 15 °C (heating threshold); and are nil, if Tm is greater than 15 °C; where Tm is the mean temperature and d is the number of days. 2. 4. Social profile In 1993, the total population of the 15 Member States of the European Community, amounted to 370 million. This represented 6. 5% of the total world population, compared with 9. 8% in 1960 and the projected figure of 4. 2% in 2020. This drop in the share of the world's population is due to a relative low increase in population compared to the increase in total world population. The average population density of the European Community amounts to 114 inhabitants per km2. In the more densely populated regions this rises to over 300 per km2. The zones with a high population density are concentrated along a diagonal line from north-west England to the north of Italy through Belgium, the Netherlands and the industrialized regions of the Ruhr in Germany. in population varies The total population, the population density and the considerably among the Member States. An overview of population statistics is provided in Table 2. 3. The most density populated country of the European Community is the Netherlands (369 inhabitants per km2), which also has the highest population increase (33% increase between 1960 and 1990). The average population increase in the European Community between 1960 and 1990 amounts to 17 %. increase The total number of households in the European Community in 1990 amounts to 137 million, while the average household size is 2. 7 persons. Table 2. 3. Population profile in the Member States. Member State Total area (km2) Population (1000) 1993 Population density 1993 Population increase in % 1960 - 1993 Austria Belgium Denmark Finland France Germany Greece Ireland Italy Luxembourg Netherlands Portugal Spain Sweden United Kingdom 83 860 30 518 43 093 338 150 549 086 356 947 131 957 70 285 301 311 2 586 41 480 91 986 504 795 449 960 244 138 7 991 10 084 5 189 5 066 57 655 81 179 10 380 3 563 57 049 398 15 290 9 876 39 083 8 719 58 191 EUR-15 3 240 153 369 715 Source: Eurostat 95 330 120 15 105 227 79 51 189 154 369 107 77 19 238 114 13 11 13 14 26 12 25 26 14 26 33 11 28 16 11 17 2. 5. Economie profile In 1993, the Gross Domestic Product (GDP) of the European Community (expressed in constant prices of 1985) amounted approximately to 4400 billion ECU. The EC economy consists of a rather heterogeneous entity composed of a limited number of big economies and some medium-sized and smaller economies. Table 2. 4 provides an overview of the GDP and the annual growth rate in the Member States. Germany, France, Italy and the United Kingdom, the four Member States with the highest GDP, account for 75% of the total GDP in the EC and, are therefore the driving forces of the EC's economic activities. The level of development of the national economies in the European Community varies considerably among the Member States. Figure 2. 3 shows the GDP per capita in the Member States in 1993. The GDP per capita of the majority of the Member States lies in between 11 500 ECU and 16 500 ECU (figures in 1985 prices and exchange rates). Four Member States have a GDP per capita which is considerably lower than the average GDP per capita for the European Community, ranging from 4 200 ECU to 10 500 ECU. The trend in GDP growth, however, shows that those countries have the highest annual growth rate in GDP and thus are currently catching up with the other countries in the European Community. Table 2. 4. Gross Domestic Products at market prices in the European Community (expressed in 1985 prices and 1985 exchange rates). Member State Austria Belgium Denmark Finland France Germany Greece Ireland Italy Luxembourg Netherlands Portugal Spain Sweden United Kingdom EUR-15 Source: Eurostat • GDP 1993 (bill. ECU) Annual % change 1970-1993 104. 6 125. 3 85. 1 73. 3 808. 0 1049. 6 59. 3 37. 2 658. 5 7. 7 204. 7 41. 2 276. 9 141. 3 708. 7 4381. 2 2. 7% 2. 3% 2. 0% 2. 3% 2. 4% 2. 5% 2. 8% 4. 4% 2. 6% 4. 0% 2. 3% 3. 5% 2. 9% 1. 5% 2. 0% 2. 4% s o o oo -i s o oo -i o o oo s o oo Figure 2. 3. GDP per capita in the European Community in 1993 ( in ECU at 1985 prices and 1985 exchange rates). Source: Eurostat Service sectors (both market and non-market services) are the most important economic sectors in the European Community. Their relative share in economic activities is still growing. Manufacturing industries are the second most important sector. The importance of the agricultural sector is currently decreasing. Table 2. 5 shows the Gross Value Added (GVA) per economic sector. Table 2. 5. Relative contribution of sectoral Gross Value Added in the European Community (in current prices and exchange rates); EUR-12. 10 Sector GVA 1992 (mill. ECU) GVA 1992 Annual change of (% of total GVA) GVA 1980 - 1992 Agriculture/Forestry Energy Manufacturing Building & Construction Market Services Non-Market Services Total of Branches 131,832 241,028 1,139,325 312,820 2,520,722 753,758 5,099,491 2. 6 % 4. 7 % 22. 3 % 6. 1 % 49. 4 % 14. 8 % 100 % Source: Eurostat. (%) £8 % 6. 1 % 5. 9 % 6. 0% 8. 8 % 7. 4 % 7. 4% in the achievement of to economic growth Transport the European Transport has made a major contribution in. It has enabled Community production and led to increased competition. In the EC, the transport sector accounts for approximately 7-8% of the GDP and 4-5% of the total salaried workforce (White Paper on the Common Transport Policy ,COM (92)494 final 2. 12. 1992). The transport sector in the EC is characterised by strong growth. Since 1970, the overall annual growth in inland transport has averaged 3. 1% for passengers and 2. 3% for goods (White Paper on the Common Transport Policy, COM (92)494 final, 2. 12. 1992). Since 1980, the increase in air passenger transport has averaged 6. 2% per annum (CEC, 1993). important economies of scale Transport is a major source of greenhouse gas emissions in the Community. Road transport accounts for 85% of the C02 emissions and 90% of the CH4 of inland transport emissions. Passenger cars are responsible for 45% and commercial vehicles for 32% (Green Paper on Transport and Environment; COM(92),46 final, 20. 02. 92). The average number of cars in the European Community per 1000 inhabitants amounted in 1993 to 420 (Eurostat). Air transport is the second single most important source of C 02 emissions, with a share of 11%. Rail and inland waterways account for 1% and 3% respectively (Eurostat). 2. 6. Energy profile As a result of developments in final energy demand and in inputs for electricity generation, EC Gross Inland Consumption (GIC) of energy in 1990, at 1239 Mtoe, was 17. 7% higher than in 1974. However, this figure hides large fluctuations in the mid- seventies and early eighties, due to the oil shocks of that period. Table 2. 6 shows the Gross Inland Consumption in the EC. 11 Table 2. 6. EC Gross Inland Consumption (Mtoe). 1974 1986 1990 19937 Average Annual Increase 0. 3% 0. 6% 3. 3% 8. 6% Solids Oil Natural gas Other Total Source: IEA and Eurostat 235 626 137 56 243 515 193 219 245 532 216 247 247 561 252 271 1053 1169 1239 1331 1. 2% The increase is entirely due to non-fossil fuels, mainly nuclear power. Furthermore, in 1990 consumption of fossil fuels was at the same level as in 1974 (source: Eurostat). For its energy provision, the EC depends on imports. The degree of self-sufficiency, i. e. total domestic production divided by GIC, rose from 37% in 1974 to 57% in 1986, declining again to 52% in 1992. The composition of indigenous energy production is provided in Table 2. 7. Table 2. 7. EC Primary Production (Mtoe). 1974 1986 1990 1993' Solids Oil Natural gas Nuclear Hydro and wind Geothermal Other 189 15 130 22 21 2 10 176 150 126 155 23 2 42 155 115 131 180 23 2 42 156 125 158 198 25 3 46 Total 389 675 647 709 Source: IEA and Eurostat Average Annual Increase -1. 0% 11. 9% 1. 1% 12. 3% 0. 8% 1. 6% 8. 3% 3. 2% 7Data for 1993 include the NEW BUNDESLANDER and DDR. 8Data for 1993 include the NEW BUNDESLANDER and DDR. 12 Table 2. 8 relates the development of energy intensity, measured as the quotient of GIC_ and Gross Domestic Product (GDP). Moreover, the development of GIC per inhabitant is shown. Table 2. 8. Indicators. 1974 1986 1990 GIC/GDP (toe/1985 MECU) GIC/Capita (kgoe/inhabitant) 358 3027 312 3253 294 3401 19939 304 3600 Source: IEA and Eurostat From 1974 to 1993 the total GDP of EC Member States rose by an annual average of 2. 1%. Energy intensity declined on average by an annual percentage of 0. 9%. GIC per capita rose annually by 0. 9% on average. Regarding Final Energy Consumption by economic sectors, developments from 1974 until 1993 are given in Table 2. 9. Table 2. 9. Final Energy Consumption (FEC) by economic sectors (Mtoe). Industry Transport Domestic and Tertiary TOTAL Source: IEA and Eurostat 1974 1986 1990 199310 304 150 281 736 233 208 332 773 251 247 320 8Ï7 253 271 367 89Ô In industry, there has been a 40% improvement in energy intensity (FEC/production) from "1974 until 1993". Industrial production rose by 28%, while FEC declined. In transport energy demand has grown faster than the overall economic activity. T>ata for 1993 include the NEW BUNDESLANDER and DDR. 10Data for 1993 include the NEW BUNDESLANDER and DDR. 13 3. THE EC EMISSION INVENTORY 3. 1. Introduction This chapter provides a summary of the 1990 emission inventory of greenhouse gases for the EC. The following gases will be discussed: C02, CH4, N20, CO, NOx and NMVOCs. Emission estimates have been calculated on the basis of the national inventories of the 15 Member States and by using the "IPCC guidelines for national greenhouse gas inventories" as far as possible. A more detailed description of the approach applied to arrive at the EC inventory is provided in Section 3. 2. The emission inventories of each of the 15 Member States are included in Annex 1. Details on activity data and emission factors have not been included in this Communication since these have all been reported in national reports or Eurostat and/or CORINAIR databases. In Annex 1, reference is made to the information sources. 3. 2. Inventory methodology Greenhouse gas emissions in the European Community in 1990 are presented in Table 3. 1. The EC inventory for the year 1990 has been compiled based on the inventories of the 15 individual Member States. The following sources have been used to compile the emission inventories of the individual Member States: National communications prepared by the UN Framework Convention on Climate Change and/or national programmes under the EC Decision on a Monitoring Mechanism for C02 and other greenhouse gases. In general, the inventories reported in these national reports followed the IPCC guidelines for National Greenhouse Gas Inventories. the Member States under CORINAIR inventory programme. 1990 databases have been used, which were provided to the European Environment Agency by the Member States. Eurostat. C02 emission estimates have been compiled from Eurostat energy balances and harmonized emission factors derived by Eurostat from an analysis of emission factors used by the Member States in about 1990. To estimate total greenhouse gas emissions in the European Community, total greenhouse together11. Estimates of gas emissions emissions in the Member States were primarily taken from the national reports. If no in each of the Member States were added 11 Estimates provided in Table 3. 1 are provisional figures, updated up to June 1995. 14 nationally reported emission estimates were available, CORINAIR figures were used. Fuel combustion related C02 emissions reported in national reports and/or CORINAIR were compared with Eurostat C02 (non-CORINAIR) emission estimates were used if these figures were available, and consistent with Eurostat figures. However, if the nationally reported estimate was significantly lower than the Eurostat estimate, the Eurostat estimate was used since it was assumed that the nationally reported value was likely to be incomplete. If no nationally reported estimates were available, CORINAIR figures were similarly compared with Eurostat. figures. Nationally reported It should be noted that the national reports of the Member States and/or CORINAIR databases are not complete and thus the emission inventories for each of the Member States do not always cover all source categories identified in the IPCC guidelines for national greenhouse gas emissions. Therefore, the sub-totals of the various categories presented in Table 3. 1 do not add up to the category totals in Table 3. 1. This apparent inconsistency can only be resolved when the sub-totals for all Member States become available. Since nationally reported inventories were not available for all EC Member States, and CORINAIR does not include removals of C02, C02 emissions and/or removals from the category land use change have not been quantified in the EC inventory. 15 Table 3. 1. EC inventory of greenhouse gas emissions. 1990. (Gg). Provisional estimates. Estimates of greenhouse gases in European Community (EUR-15) - 1990 (Gg). CO, CH4 N2Q NO, CO NMVOC Industry Fugitive fuel AU eneigy Fuel combustion 1 la l al Energy & transformation 1 la2 la3 Transport la4 Commercial/institutional la5 Residential la6 Agriculture/forestry la7 Other la8 Biomass lb l bl Oil & gas lb2 Coal mining Industrial processes 2 2a Iron & steel 2b Non-ferrous metals Inorganic chemicals 2c 2d Organic chemicals 2e Non-metallic minerals 2f Other 3 3a 3b Degreasing & Dry cleaning 3c Chemical prods manuf/proc 3d Other 4 4a 4b Animal wastes 4c Rice cultivation 4d Agricultural soils 4e Agricultural waste burning 4f 6 Waste 6a 6b Wastewater 6c Other Agriculture Enteric fermentation Solvent use Paint application Savannah burning Landfills 3142840 3134740 1173200 606600 704900 325000 265900 34500 25400 13200 8100 7800 0 130730 4300 4800 8700 2600 102400 2000 300 100 50 50 100 500 500 0 0 0 0 0 11050 5400 0 5650 , 5599 794 49 60 206 84 286 27 6 87 4806 1485 2817 40 9 0 6 5 2 3 0 0 0 0 0 10361 6267 2571 98 299 141 0 8669 7912 233 90 156 156 66 29 36 12 12 0 0 2 1 0 0 351 0 2 90 234 0 0 6 0 0 0 6 393 0 15 1 277 64 0 20 0 9 11 13290 13202 2947 1412 7883 231 263 268 191 29 88 88 0 151 12 1 60 0 14 14 0 0 0 0 0 50 0 0 0 0 43 0 48 5 0 21 46229 46137 1215 3191 33718 2164 4037 1048 227 1711 92 59 0 2811 1563 398 6 14 0 224 0 0 0 0 0 2763 0 0 0 0 2362 0 125 58 0 51 - 8422 7697 105 99 6529 342 ' 464 155 61 111 849 792 0 1060 21 0 31 584 0 260 4045 1399 352 470 1327 739 0 381 0 178 131 0 109 67 0 13 Total emissions 3285620 24671 928 13546 52006 14397 Marine bunkers Aviation bunkers FNEC Notes: 113600 56500 243600 Estimates of greenhouse gas emissions in the European Community are based on estimates of emissions in the 15 Member States, updated up to June 1995. Sub-totals of categories (e. g. l bl and lb2) do not always add up to total emissions per category (e. g. lb). This is due to the fact that the emission inventories for each of the Member States do not always cover all categories as identified in the draft IPCC guidelines for national greenhouse gas inventories. Emissions from Final Non Energy Consumption (including feedstocks) have not been included in total emissions. Therefore, total emissions are underestimated in comparison with the IPCC methodology. Emissions from Final Non 16 Energy Consumption (FNEC) are based on the total carbon contained in the products. The addition of total emissions and emissions from FNEC would therefore produce an overestimation compared to the IPCC methodology. C02 emissions and/or removals from Land Use Change are not known for many countries and hence have not been included in this table. Non-C02 greenhouse gas emissions from Land Use Change have neither been estimated. 3. 3. Feedstocks inventories. However, The emission estimates presented in Table 3. 1 are structured according to the reporting instructions of the IPCC guidelines for greenhouse gas the category "Final Non Energy Consumption (FNEC)" was added to the table, since inconsistencies exist between the detailed IPCC approach to calculate energy-related C 02 emissions and the IPCC reporting instructions. In general, national reports of the Member States do not explicitly describe their approach to calculate emissions from feedstocks. For reasons of consistency, EUROSTAT estimates have been used for each of the Member States to calculate feedstock emissions. These have been reported separately in the category "Final Non Energy Consumption (FNEC)". It should be noted that this approach results in lower total C02 emissions than the approach followed by the IPCC guidelines. The latter includes carbon emitted by the use of feedstocks in their total estimates of C02 emissions from energy sources, where the approach taken here excludes emissions from feedstocks from total emissions. The emissions reported in the category "Final Non Energy Consumption" should be seen as the potential emissions from feedstocks and other nOn-energy uses. This category also includes the carbon actually stored in products and not emitted into the atmosphere. Thus, total C02 emissions as expressed in Table 3. 1 are underestimated compared with the IPCC methodology, while the addition of total C02 emissions and "Final Non Energy Emissions" would produce an overestimation. 3. 4. Bunkers Following the decisions taken at INC-9, emissions from bunkers are not included in the total emissions in summary Table 3. 1. Total C02 emissions from marine bunkers in the EC amounted to 113,600 Gg in 1990, while total C02 emissions from aviation bunkers amounted to 59 100 Gg. Since only a few Member States provided estimates of bunker emissions, emission estimates from maritime bunkers are based on Eurostat figures. Aviation bunker emissions have been estimated by reconciling non-road transport figures from Eurostat against estimates reported in CORINAIR and/or country reports. Annex 1 provides the emission estimates for each of the Member States. 17 3. 5. Uncertainties involved The uncertainty in the emission estimates has not been quantified, since quantitative estimates of the uncertainty would be highly unreliable. A statistical approach to quantify uncertainties in the emission estimates would not result in reliable figures at this stage for the reasons given below. Estimates for C 02 emissions from fuel combustion activities (based on energy balance figures) are rather reliable and are likely to be least uncertain (within about +/- 3%). The uncertainty is considerably in estimates of non-C02 greenhouse gas emissions higher, due to the lack of knowledge or awareness of some of the sources and appropriate emission factors for these gases. As there may be some as yet unknown sources of these gases, estimates of these emissions are likely to be underestimated. The uncertainty in emission estimates is increasing in the following order: CO < NOx < CH4 < NMVOC < N20, with uncertainties increasing to several orders of magnitude (several hundreds of percent). 4. PROGRAMMES, POLICIES AND MEASURES 4. 1. Introduction This chapter surveys the policies and measures that have been adopted by the European Community with the objective of limiting emissions of greenhouse gases. Policies that are explicitly and primarily directed towards a limitation of greenhouse gas emissions are described in sections 4. 2 to 4. 5. Sectoral policies that include specific environmental measures and/or have side-effects on greenhouse gas emissions are described in section 4. 6, nl. EC policies on agriculture, forestry, transport and waste. If available, assessments are presented of the impact of the policies on greenhouse gas emissions. Section 4. 7 summarizes the policies and measures described in this chapter, distinguishing policies and measures adopted by the Council, proposed by the Commission and in preparation by the Commission. 4. 2. The Community strategy to limit C02 emissions and improve energy efficiency In October 1991, the Commission presented an overall strategy to limit C02 emissions and improve energy efficiency, with the objective of stabilising C02 emissions in the Community in the year 2000 at the 1990 level (SEC(91)1744 final). This so-called "no- regret" strategy consists in unlocking the zero- or low-cost potential for limiting C 02 emissions, which currently exists in all sectors of the economy and which also brings benefits in the field of air pollution and energy security as well as competitiveness and employment. In June 1992, a mutually reinforcing package of measures and programmes was proposed to the Council (COM(92)246 final). It rests on four pillars: The EC energy technology programmes and trans-European networks. The existing Community programmes, THERMIE and SAVE, have been reinforced. A new programme, ALTENER, and an action, which aims at the Rationalisation of Energy Use at Regional and Urban Level, have been adopted since 1990. The THERMIE programme is an energy technology dissemination programme. SAVE and ALTENER provide financial support for various actions in the field of energy efficiency and renewables, but also include the preparation of regulatory measures at EC level. Also "Energy Management at Regional and Urban level" and the development of trans-European networks contributes to the goal of C02 emission limitation (section 4. 3). 19 Fiscal measure. In June 1992, the Commission issued a draft Council Directive proposing a harmonised tax on carbon dioxide emissions and energy use imposed at Member State level, which has not been adopted yet by the Council (section 4. 4). Complementary national programmes. The Community strategy requires policy programmes which limit greenhouse gas emissions at Member State level, and which will be complementary to actions taken at the Community level. The national programmes of the Member States are described in chapter 5. EC Decision on a Monitoring Mechanism for C02 and other greenhouse gases. Part of the Community strategy is a monitoring mechanism to follow whether the C 02 stabilisation target of the Community is attainable. In the framework of the Monitoring Mechanism Member States are required to submit their national programmes to the Commission for evaluation. In June 1993, a Decision establishing the monitoring mechanism was adopted (section 4. 5) Member States. have submitted their national programmes and/or communications under the Convention. The first evaluation was carried out on the basis of national programmes received by the Commission in 1993. A second evaluation of the up dated national programmes/communications under the Convention is foreseen for the fall of 1995. The four pillars constitute the first step towards the goal of reducing emissions of carbon dioxide. With the formulation of the strategy a continuous process has begun of evaluating measures adopted, and formulating, new policies and measures to attain the carbon dioxide objectives the Community has committed itself to. 4. 3. Community programmes and initiatives This section describes the Community programmes for support of energy technology sources (SAVE), (THERMIE), energy efficiency (ALTENER) and the initiative "Energy Management at Regional and Urban level". Moreover, a brief description is included of the recent initiative on trans-European networks and of voluntary schemes. renewable energy the use of THERMIE (Energy Technology Support Programme) impacts through energy efficiency, as well as the The abatement of environmental introduction of renewables or cleaner ways of using fossil fuels ultimately depend on the technologies. The THERMIE programme, Council implementation of better energy the demonstration and dissemination of Regulation (EEC) No. 2008/90, dealt with cleaner and more efficient energy techniques in order to facilitate their widespread market penetration. THERMIE also focused on other Community objectives: security of and social cohesion, energy competitiveness economic and improving supply, 20 employment, the single market and cooperation with Central and Eastern Europe and the CIS (Commonwealth of Independent States). The original THERMIE programme came to an end in 1994, although the projects supported from 1990 to 1994 are still being monitored and promoted. The overall budget amounted to 700 MECU12, or 140 MECU annually (0. 2% of the EC budget). The main portion of the THERMIE budget (85%) was devoted to innovative technologies and projects, which have already passed the R&D stage, but have not been through implemented on a wider scale due to technical and economic risks. The remaining portion of the budget (ca. 15%) was spent on a wide range of promotional activities such as market assessments, monitoring, documentation, databases, workshops, conferences and training. To implement the wide range of measures, the Commission has set up a network of Organisations for the Promotion of Energy Technologies (OPET) in 1991, consisting of 49 organisations from EC Member States that are both from the public and the private sector. The organisations assist in the promotion and dissemination of innovative energy technologies. From 1990 to 1994, 726 THERMIE projects were supported. A cost-benefit analysis of the THERMIE projects supported in 1990-1993, predicted that they would lead to a reduction in C02 emissions of 42 million tonnes in the Community (rising to more than 625 million tonnes with anticipated replication) as well as contributing to reductions in the emissions of other pollutants such as acid rain gases, volatile organic compounds and carbon monoxide. According the Commission every ECU spent in the Programme will contribute, on average , to 1,617 kg of avoided cumulative C02 emissions compared to a "normal" energy technology using fossil fuels. This estimate is encumbered by the following uncertainties: to an assessment made by the Directorate-general for Energy of the supported projects may not have been implemented as planned; included in the assessment is an estimate of the dissemination impact, i. e. the expected replication in other projects of the technologies applied in the projects supported by THERMIE. The replication is estimated to be ca 15 times the direct effect of the supported projects. From 1 January 1995 the programme has continued as the new Non-Nuclear Energy Programme, better known as JOULE-THERMIE, within the European Community's Fourth Framework Programme for Research and technological development including demonstration. This new programme brings together for the first time the research and development aspects of the JOULE with the demonstration and promotion initiatives of THERMIE. The Programme is a vital part of the EC's strategy for meeting the energy challenges we face today. Building on past successes, the JOULE-THERMIE Programme will help to 1 MECU = 1 million ECU. 21 reduce the negative environmental impacts associated with the production and use of energy, ensure lasting and reliable energy sources, at affordable costs and strengthen the technological basis of European industry. SAVE (Specific Actions for Vigorous Enei^gy Efficiency) The SAVE programme was adopted in October 1991 (Council Directive 91/565/EEC). It will terminate at the end of 1995. The objective is to increase energy efficiency and thereby reduce C02 emissions legislation on mandatory energy efficiency standards, quality labels, standardization, creation of infrastructures, pilot actions, training and dissemination of information. By creating a Community framework, SAVE enables the Member States to adopt energy efficiency measures at the national level. The budget of the programme is 35 MECU for the period 1. 1. 1991 - 31. 12. 1995. through SAVE consists of three elements: 1. A programme of energy efficiency legislation, aimed at removing institutional and administrative barriers to investment in energy efficiency and creating standards for energy equipment. The following directives have been adopted: - Efficiency of new hot water boilers (Council Directive 92/42/EEC); - Energy (Council Directive 92/75/EEC). In the framework of this labelling directive, an implementation directive on energy freezers (94/2/EEC) has been adopted. labelling of major household labelling of household refrigerators appliances, and •• Building certification, billing according to actual consumption, third party energy insulation of new buildings, boiler inspection and finance, management (Council Directive 93/76/EEC). 2. in infrastructures the creation of energy efficiency Financial Support for Member States. The programme includes projects in areas such as: education and training, integrated resource planning, third-party financing, cogeneration, monitoring and sectors, and targeting, energy efficiency introduction of Community legislation in Member States. The budget of the financial support programme is 35 MECU for the years 1991 to 1995. The level of support can amount to 50% of total project costs. 204 projects have received support at a total budgetary cost of 21 MECU. transport and building the in 3. Information Exchange Network. The network involves a database on energy efficiency measures and specific promotional activities, such as conferences, symposia and workshops. In the framework of the programme of energy efficiency Directives are in preparation: legislation a number of Directives on appliance standards for energy efficiency. 22 The Council adopted a Decision (OJ No L 157) establishing PACE, a Community action programme for improving the efficiency of electricity use. In the framework of PACE, directives are being prepared on appliance efficiency standards for refrigerators, electric motors, office equipment and commercial lighting. A Directive on Integrated Resource Planning. Integrated resource planning for electricity and gas is actively promoted in the framework of the completion of the internal market for energy. Utilities should therefore investigate supply side and demand side management options (energy efficiency and renewables at consumer level) on an equal footing. This requires that utilities be able to obtain profits, not only from selling gas or electricity, but also from energy services they provide in the form i. a. of energy efficiency • investments in end-use sectors. Labelling directives for washing machines and dish washers, and light bulbs. For the SAVE programme no assessment is available on the impacts in terms of avoided emissions of C02 or other greenhouse gases. its proposal The first SAVE programme terminates at the end of 1995, but energy efficiency remains a key political area: for environmental reasons, for security of supply, and because its promotion is linked to important Single Market/competitiveness and coherent objectives. In the Commission proposed to incorporate both the Electricity End Use Programme (PACE) and the Regional and Urban Energy management Initative. All these actions have complementary goals and the SAVE-II Programme provides a comprehensive framework for undertaking all these related activities. for a new SAVE programme, SAVE-II, (COM (95) 225), The following nine categories of actions on energy efficiency policy are proposed to be financed under the programme: studies and other actions leading to the implementation and completion of Community energy efficiency legislation and performance standards; sectoral pilot actions aimed at accelerating energy efficiency investments and/or improving consumer energy use patterns, to be carried out essentially by Community wide networks; targeted sectoral pilot actions aimed at accelerating energy efficiency investment and improving consumer energy use patterns, to be carried out essentially by public and private enterprises; measures proposed by the Commission or by third parties to foster the exchange of experience mainly through information networks aimed at promoting better , national, regional and local coordination between Community, international for exchanging activities information; the establishment of appropriate means through 23 an action relating to the detailed sectoral; monitoring of energy efficiency progress in the Community, in individual member states and including the SAVE programme itself; specific actions in favour of greater cohesion in member sates and regions in the field of energy efficiency through support for the creation of energy efficiency in those member sates and regions where energy efficiency infrastructures policies are not yet sufficiently developed; specific actions in favour of energy management at the regional and urban level; studies and other actions in support of energy efficiency initiatives, within other programmes or aimed at establishing energy efficiency as a criterion within EC strategic programmes; and evaluation and monitoring of the actions undertaken. SAVE-II is scheduled to begin on 1 January 1996 and will run until 31 December 2000. The proposed budget is 150 MECU. ALTENER (Programme for the Promotion of Renewable Energy Sources) The ALTENER programme was adopted by the Council in September 1993 (Council Decision 93/500/EEC). The overall purpose is to establish a framework for specific actions whose objective is a greater market penetration of renewable energy sources (small hydroelectric plants, wind power, solar energy, biomass, biofuels and biogas, geothermal energy). The programme runs from 1993 until 1997 and has a budget of MECU 40. So far 114 pilot projects have been supported at a cost of MECU 11. Specific objectives for the development of renewable energy sources in the Member States, as set out in ALTENER are: increasing the market share of renewable energy sources from 4% in 1991 to 8% in 2005; tripling the production of electricity from renewable energies; securing a 5% market share of biofuels in motor vehicle consumption. Similar to SAVE, ALTENER has the following elements: the In preparation: legislative and standardization measures. Standardization measures are geared at ensuring free circulation of renewable energy equipment. Envisaged are a harmonization of safety standards for wind generators and specifications for biodiesel as motor fuel. Financial support programme for the development of technical standards and information activities, sectoral pilot projects, specifications, biofuels, integrated resource planning and demand-side management, third party finance, the guarantee of financial risks, local development plans and feasibility studies. In 1993 and 1994, a total of 114 projects have been supported. Information Exchange Network. training and 24 include: coordination of national, Information and promotional activities Community and international activities, symposia, conferences and workshops and databases. For the ALTENER programme no assessment is available on the impacts of the programme in terms of avoided emissions of C02 or other greenhouse gases. Energy management at regional and Urban level This initiative, initiated in 1990, promotes studies on the definition and implementation of energy plans. It further aims to disseminate and transfer the expertise in this field throughout the Union. A fundamental goal of local and regional projects undertaken in is to protect the environment by developing energy the context of and by providing alternative energy management, production options. The initiative, with a total budget of 20 MECU will be incorporated in the SAVE-II programme. improving energy efficiency, initiative the fuel with to cleaner In preparation: Trans-European networks Switching lower carbon content can produce energy and environmental benefits, especially in those regions where due to infrastructure limitations fuels such as natural gas had been unavailable in the past. Trans-European networks have a crucial role to play in bringing cleaner fuel to peripheral regions as well as in improving the flexibility of the European gas supply system. The more efficient and flexible these networks can be operated, the less reason exists for security of supply concerns in the case of a rapid switch to natural gas. The same applies for trans- from European electricity networks which support the use of electricity produced low/zero carbon sources throughout the Community. Voluntary schemes Limitation of C 02 and other greenhouse gases requires the active involvement and participation of all economic and social actors. Voluntary schemes and auto regulation will have to play an important role in the future. The Commission has recently given a mandate to CEN/CENELEC (an international body for standardization in the electricity field) to elaborate European Standards in the field of thermal solar systems and their components. Likewise, standards are being elaborated concerning photovoltaics and wind turbines. The dissemination of cost-effective minimum standards is beneficial in both energy and environmental terms. Commission services have also been collaborating with the European Electricity Supply Industry to find cost-effective ways to limit C02 emissions through electricity related supply and demand side options. Moreover, negotiations are underway for a voluntary labelling programme concerning energy efficiency of computer and other office equipment. This voluntary scheme, which could the USA and Japan, would provide for a quasi worldwide labelling scheme. include manufacturers from 25 4. 4. The proposal for an energy/carbon tax In June 1992, the European Commission proposed a draft Directive (COM(92)226 final) for the introduction of a tax on all energy products, excluding renewables, based 50% on energy content and 50% on carbon content of fuels. The objective was to improve energy efficiency and favour fuel substitution towards products emitting less or no C02. It was proposed to introduce the tax in steps, starting at a rate of 0. 21 ECU/GJ and 2. 81 ECU/t C02 in the first year (equivalent to $3 per barrel of oil). In each of the following seven years these rates were to be increased by one third of the tax rates of the initial year. In the last year these rates would therefore have reached 0. 7 ECU/GJ and 9. 4 ECU/t C02, equivalent to $10 per barrel. Concerning electricity, the inputs in power stations would be taxed according to the carbon content of the fuels used. As regards the energy part, the tax would be fixed in terms of ECU per MWh. Raw materials, i. e. energy sources used as feedstocks, would not be taxed. Graduated reductions and conditional exemptions of the tax were to be applied for energy intensive firms. The reductions would depend on the share of energy costs in total value added of the products obtained using the energy. Full exemption of the tax would be reserved for those firms which use energy-intensive production processes and are very dependent on external trade. The tax proposal has been estimated to lead to a reduction of 3. 8% of 1990 C02 emissions by the year 2000. Present status of the proposal Unanimous approval from the Council is required for adopting a fiscal measure. At its meeting at Essen on 9 December 1994, the Council has taken note of the Commission's intention to present guidelines on common parameters for those Member States willing to apply a C02/energy tax. As a follow-up of these Conclusions the Commission decided on 10 May 1995 to amend its initial proposal, in order to overcome the obstacles raised during previous discussions in Council (COM (95) 172). The main change proposed is that the implementation of a harmonised tax will be preceded by a transitional period during which the Member Sates, while respecting a harmonise structure, are free to set the tax rates product by product, provided that the improvement of energy Community objectives of limiting C02 emissions efficiency and fuel switching towards low- no carbon fuels is fully reflected in the structure of the rates applied. through In addition, the minimum rates set out in the original proposal (3 US$/bbl) are revised (10US$/bbl) and become target rates towards which the Member states endeavour to make their domestic rates converge in the medium term. 26 The Commission also considers preferable to refer as much as possible to the existing provisions of the excise duties Directives for reasons of simplification and reducing administrative costs. Of course this approach does away with the need for certain safeguard clauses (conditionally and temporary suspension of the tax), which are deleted. Moreover, firms should encourage Member states to use the revenues of the tax to reduce other discriminatory charges, particularly those on labour. the competitiveness of Community to safeguard the wish 4. 5. The monitoring mechanism In the Council Decision of 24 June 1993 (93/389/EEC), a monitoring mechanism was established for Member States' anthropogenic emissions of C02 and other greenhouse gases not controlled by the Montreal Protocol. According to the Council Decision, Member States shall devise, publish and implement national programmes for limiting their anthropogenic emissions of C02. The programmes the national shall be periodically updated. The Commission annually evaluates programmes, in order to assess whether progress in the Community as a whole is sufficient to attain the stabilisation objective. The second evaluation report, which covers 1994-1995, is currently under preparation. After its finalisation it will be send to the Council and the European Parliament. The Council Decision specifies the information the national programmes must include: emissions in the 1990 base year, inventories of emissions by sources and removal by sinks, details of national policies and measures contributing limitation and sequestration of C02 emissions, trajectories of national emissions between 1994 and 2000, measures taken or envisaged for the implementation of relevant Community legislation and policies, and an assessment of the economic impact of the above measures. The methodology for determining emissions and removals by sinks must be compatible with the methodology developed by the IPCC. It has to take account of developments decided within the framework of the UN FCCC. to respect to other greenhouse gases With the Commission data concerning emissions of these gases, as well as a description of the measures being taken or envisaged which will limit emissions. the Member States should send to The Decision includes a Committee composed of the representatives of the Member the States and chaired by the representative of the Commission. Until mid 1995 monitoring committee has held five meetings. It has approved two documents ("Content and format of annual inventories" and "Methodology for the evaluation of progress and for the content of national programmes"). 27 4. 6. Sectoral policies those sectoral policies, which This section reviews include specific environmental measures and/or contribute to the limitation of greenhouse gases. Except for transport policy, no assessments have been made with regard to the quantitative impacts of the policies on the emissions of greenhouse gases. Agricultural policy A milestone in EC agricultural policies in the 90's was the Common Agricultural Policy (CAP) Reform in 1992. Some measures of the CAP Reform itself, that was driven primarily by economic and social considerations, have an impact on greenhouse gas emissions. Next to the reform a number of agri-environmental measures were adopted, as a part of the. so-called "accompanying measures". Before the CAP Reform, the Directive concerning the protection of waters against pollution caused by nitrates from agricultural sources (EEC 676/91) and the Community Drinking Water Directive (EEC 778/80) were adopted, with the aim of reducing Nitrate concentrations in drinking water. Together, these two Directives have an impact on the use of Nitrate fertilisers and therefore may result in reductions of N20 emissions. However, the implementation of the Drinking Water Directive took place before 1990, so its impact has mostly already been felt. Also before the CAP Reform, the European Agricultural Guidance and Guarantee Fund (Council Regulation (EEC 2328/91), that provided funds for, inter alia, measures to protect the environment. (EAGGF) was established As to the impacts of the CAP Reform itself, one of the effects of the reform is a reduction of agricultural prices. This reduction of prices makes the use of mineral fertilizers less profitable, leading to a reduction of consumption by about a third. This decreases the total amount of N20 emissions from nitrate and ammonium fertilizers. In addition, the compulsory set-aside scheme (EEC 1765/92) reduces the intensity of the entire rotation13. Moreover, the possibility of growing non-food products on set-aside land constitutes a positive link to the reduction of greenhouse gas emissions, helping to substitute fossil fuel by bio-fuel. Regulation EEC (2066/92) aims to extensify beef production by restricting premiums to maximum stocking rates. The maximum rate is currently 3 Livestock Units per hectare of forage area, to be reduced to 2 Livestock Units in 1996. This reduces emissions of CH4 Intensification on remaining land will only result if there is an increase in market price due to reduced total production. This price effect is hardly to be expected since agricultural markets are still regulated and, therefore, continue to have limited responsiveness. 28 from ruminants per ha. The Member States are authorized to restrict provision of the beef premium to those farmers who comply with certain environmental rules (EEC 3611/93). As accompanying measures to the CAP Reform, the regulations concerning the European Agricultural Guidance and Guarantee Fund (EAGGF) were changed, concerning agri- (EEC environmental measures 2080/92)! the promotion of afforestation (EEC 2078/92) and The agri-environmental measures are established by zonal programmes which are set up on the Member State level. The programmes comprise the promotion of: extensive and environmentally sound production methods; conversion of arable land into grassland; , reduction of livestock density; upkeep of abandoned farmland; 20 years set-aside for ecological purposes; public access to farmland; protection of genetic variety; pilot-projects and training of farmers. The agri-environmental measures are cofinanced by the EAGGF at a rate of 75% in the less developed regions, and at 50% in the other regions. The available budget for the 1993-1997 period is 3670 MECU. The assessment of altogether 214 zonal programmes by the Commission is still going on. Until now, 59 programmes have been approved. Forestry policy regulations promote afforestation A number of EC the contribution of forests to environmental improvement. EC Regulation 1610/89 on the development of forest in rural areas allows for Community co-financing of, inter alia, the following measures: in Member States, and afforestation and improvement of forests; the creation of nurseries; reconstitution of forests damaged by fire; forestry awareness campaigns. These measures are limited to less developed areas and have to be implemented in the framework of regional development programmes submitted by the Member States and approved by the Commission. A measure accompanying the reform of the CAP Reform is the promotion of afforestation to an improved environmental balance by establishing forests in agricultural areas and by enlargement of the C02 absorption capacity. (EEC 2080/92). This measure contributes Financial aid is given on a contractual basis to cover the costs for: afforestation on agricultural land; income losses from agricultural land (20 years); upkeep of afforestated land (5 years); 29 investments on the improvement of forests (fire protection). The measures are cofinanced by the EAGGF at a rate of 75% for the less developed regions, and at 50% in the other regions. The available budget for the 1993-1997 period is 1260 MECU. Indirectly, measures designed to protect forests from atmospheric pollution increase the net primary productivity of the trees and therefore increase potential C 02 uptake (EEC 3528/86 and 2157/92). Measures include regular surveys of forest conditions and pilot projects for the improvement of knowledge on air pollution impacts on forests. In addition, Regulation EEC 2158/92 aims to protect forests from fires. The measure includes: the elaboration by Member States of plans to protect forests against fire; a Community information system on forest fire; a Community support for projects with the aim of fire prevention. Transport policy Transport is a major source of greenhouse gas emissions in the Community. Behind the power generation, it is the second most important C02 emitting sector, before domestic and tertiary sector and industry. Presently, transport accounts for about one- quarter of total Community C02 emissions. Under a business as usual scenario, C 02 emissions from transport are forecasted to grow significantly between 1990 and 2000. This makes it a key concern in any strategy to combat climate change. The transport sector in the EC is characterized by strong growth: expected growth from 1990 to 2000 of vehicle kilometres is 17% for passenger cars, 26% for light-duty vehicles and 13% for two-wheelers; air traffic in Europe (excluding the newly independent states) is expected to grow by 5. 2% per year until 2003, according to the International Civil Aviation Organisation. In relation to greenhouse gas emissions from transport, the Community essentially has two types of instruments at its disposal: Regulatory instruments, i. e. the setting of emission or other technical standards for vehicles, aircraft, etc. Commission Directive 93/226/EC defines a measurement method for C 02 emissions from passenger cars, but no standards have been set in this respect. The Commission intends to present a Communication on this matter in the fall of 1995. The Community has made substantial progress in reducing other transport related greenhouse gases. Building on earlier legislation, between 1990 and 1994 Community standards have been strengthened for NOx, CO and VOC's from road vehicles. The standards are legally binding for Member States. The dates below refer to the mandatory application of the standards to all new vehicles in the Community: 30 * For heavy-duty vehicles, Council Directive 91/542 EEC of 1. 10. 1991 reduces CO, hydrocarbons and NOx emission limits in two steps, from 1. 10. 1993 and 1. 10. 1996 on. * For light-duty vehicles Council Directive 93/59 EEC of 28. 6. 1993 reduces CO, hydrocarbons and NOx emission values from 1994 on. * For passenger cars, European Parliament and Council Directive 94/12 EC of 23. 3. 1994 reduces CO, hydrocarbons and NOx emission values from 1997 on. * Directive 92/6 EEC requires lorries (85 km/h), buses and coaches (100 km/h) to be fitted with speed limiters, in part retroactively. It is estimated that this Directive reduces energy consumption, and thus C02 emissions, by these vehicles by at least 5%. * In the framework of Community tests, Directive 92/55/EEC sets minimum standards and criteria for emission tests on all vehicles. Given that a large share of emissions is caused by badly maintained vehicles, this Directive is likely to have a significant impact. roadworthiness legislation on Fiscal measures, to influence transport demand, modal choice and environmental characteristics of fuels. the incentives to promote The potential of fiscal incentives to promote environmental objectives has been demonstrated by the experience on car emissions. Various Member States have used fiscal introduction of cars that meet new Community standards before their mandatory application, and Council Directive 92/458/EEC on emissions from small cars set a framework for such fiscal incentives. The levying of excise duties on transport fuels raises transport prices and can hence be used to reduce the consumption of these products and thereby contribute to a limitation of greenhouse gas emissions. Council Directive 92/82 EEC sets minimum rates for excise duties on petrol and diesel fuels as follows14: - ECU 337 per 1000 litres for leaded petrol; - ECU 287 per 1000 litres for unleaded petrol; - ECU 245 per 1000 litres of gas oil used as propellant; - ECU 100 per 1000 kg for liquid petroleum gas and methane used as propellant; - ECU 245 per 1000 litres of kerosene used as propellant. So far, this instrument has not been used with the explicit view of reducing C02 emissions and other noxious emissions as the minimum excise duties at Community level exist mainly with concern to national fiscal policies of the Member states and Internal Market requirements. However, in its report on the bi-annual review of minimum excise duties on mineral oils for 1993 and 1994, the Commission identified environmental 14 Specific (lower) rates are valid for Luxemburg. 31 policy and C 02 emissions as topics fiscal policy. that should be considered in the development of The Commission is currently looking into the problem of the external costs of transport and how to internalise them. It is the intention of the Commission to present a Green paper on this subject in the near future. With a view to promoting the use of renewable energy in the transport sector, the Commission has made a proposal for a Directive on excise duties on motor fuels from agricultural sources ("biofuels"). This proposal provides for a détaxation of biofuels in relation to conventional (petrol and diesel) fuels. The proposal for a carbon/energy tax (see section 4. 4), if adopted, will have an impact on greenhouse gas emissions from transport. Under "business-as-usual" total C02 emissions from road transport are expected to increase by 24. 5 % between 1990 and 2000 (DGXVII, (Energy): "Consequences of the proposed carbon/energy tax", 23. 10. 1992). With regard to other greenhouse gases the projections are as follows: emissions in 2000 compared to 1990 CH4 N20 CO NOx NM VOC - 41. 3% + 237. 6% - 53. 3% - 37. 1% - 52. 9% Waste policy Concerning packaging and packaging waste, the Council and the European Parliament adopted on 20 December 1994 a Directive (94/62/EEC) with the aims of harmonizing national measures concerning the management of packaging and packaging waste, and of providing a high level of environmental protection. The measures aim, as a first priority, fundamental the production of packaging waste and, as additional at preventing principles, at reusing packaging, at recycling and other forms of recovering packaging waste and hence, at reducing the final disposal of such waste. Thus it will result in a reduction of C 02 and CH4 emissions. The measures include, inter alia, an obligation for Member States to attain, within five years after implementation of the Directive, a 50% to recoverage rate of packaging waste15. The recycling percentage must be between 25 and 45%. For a second five year period new targets will be established by the Council. In systems, standardization, maximum allowable concentrations of heavy metals, information systems the Directive provides for marking identification addition, and 15 Exceptions are made for Greece, Ireland and Portugal. 32 to harmonize data on packaging waste management between Member States, information for users of packaging and reporting requirements for Member States. The Council of 8 and 9 June 1994 agreed on a common position on a Council Directive on the landfill of waste. The amended Directive contains an obligation for permitting, including requirements for monitoring and control procedures. The contents of the permit will have to satisfy "general requirements for all classes of landfills", among which are the taking of appropriate measures in order to control the accumulation and migration of landfill gas. Landfill gas has to be collected, treated and used, unless the competent authority determines otherwise after environmental evaluation. This will result in more efficient management of landfills and thus in a reduction in methane emissions. 4. 7. Commission Working Paper on the EU Climate Change Strategy : a set of options indicated Analyses that with prevailing expectations concerning energy prices and economic growth the Community could fall short of its C02 stabilisation commitment by 5% to 8%. It was felt that a more vigorous implementation of existing Community and Member State was required. On the request of the Council the Commission prepared on 1 March 1995 a preliminary analysis of the policy options which the Council should consider for C 02 limitation in the perspective of 2005-2010 (SEC 95/288/final). From the preliminary analysis it is already clear that a significant technical potential exists to limit and reduce C02 emissions beyond the year 2000. If this potential is to be exploited, substantive measures will have to be taken: the improvement of energy efficiency and the penetration of renewable energy sources, completion of the internal energy market, a change of transport modes, an upward review of energy taxes, a better focus of its R&D policies, and an intensified cooperation with third countries. In that many of those measures can be introduced addition, the Commission underlined with a view to achieve substantial benefits in other policy areas, like energy, R&D and transport as well as growth, competitiveness and employment, as already indicated in the Commission White Paper of December 1993. In the light of the deliberations on the Working Paper in Council and the Decision of the first Conference of the Parties to the UN FCCC the Commission is currently elaborating on a more detailed analysis. 4. 8. Summary The following tables summarize the programmes, policies and measures described in this chapter. A clear distinction is made between programmes, policies and measures adopted by the Council (listed in Table 4. 1), proposed by the Commission (listed in Table 4. 2) and in preparation by the Commission (listed in Table 4. 3). 33 Table 4. 1. Programmes, policies and measures adopted by the Council. NamePeriodBudgetDescription THERMIE 11990 - 1994 700 MECUFinancial support for clean energy technologies SAVE-programmel991 - 1995 35 MECUFinancial support for energy efficiency projects • SAVE-legislationl992 -. Energy efficiency standards for new hot water boilers 1992 -. Energy labelling of major household appliances, Framework Directive 1994 -. Energy labelling of refrigerators and freezers Energy Management at Regional and Urban level 1990-1995 20 MECUSupport for energy plans at regional and urban level ALTENER-programmel993 - 1997 40 MECUFinancial support for renewables Voluntary agreementCEN/CENELEC will elaborate standards for thermal solar with CEN/ CENELEC systems, photovoltaics and wind turbines Monitoring 1993 - 2000Procedures to monitor progress towards C02 stabilisation target mechanism CAP Reform,1992 -. Lowering of agricultural prices reduces fertilizer use and price loweringthereby N20 emissions CAP Reform,1992 -. Compulsory set-aside scheme promotes growing of biofuels set-aside scheme CAP Reform, 1992 -. Premiums are related to maximum stocking rates, reducing extensification ofCH4 emissions from ruminants beef production 34 Table 4. 1. Programmes, policies and measures adopted by the Council (continued). Name Period Budget Description Agri-environmental 1993 - 1997 3670 MECU measures Financial support for zonal programmes, incl. environmental measures Afforestation 1993 - 1997 1260 MECU Financial support for afforestation Protection of forests from pollution 1992 -1996 29. 4 MECU Measures increase net primary productivity of trees and thereby potential C02 uptake. Protection of 1992 - 1996 70 MECU Measures contribute to C02 uptake forests from fires Emission standards for heavy duty vehicles 1993 - Emission standards for CO, hydrocarbons and NO„ Emission standards 1993 Emission standards for CO, hydrocarbons and NOx for light duty vehicles Emission standards for passenger cars 1997 Fiscal measures for for transport fuels 1992 Emission standards for CO, hydrocarbons and NOx Minimum excise duties on petrol and diesel fuels Landfill directive 1994 Environmental standards for landfilling of waste contributes to limitation of CH4 emissions 35 Table 4. 2. Programmes, policies and measures proposed by the Commission. Name Period Description THERMIE II 1994 - 1998 Financial support for clean energy technologies Energy /carbon tax Tax on fossil fuels based 50/50 on energy and carbon content Packaging waste Directive Harmonization of national measures concerning packaging waste, prescription of 50% recoverage rate and 25 - 45% recycling rate Table 4. 3. Programmes, policies and measures in preparation by the Commission Name Description SAVE-legislation Appliance energy efficiency standards for refrigerators, electric motors, office equipment and commercial lighting Directive on Integrated Resource Planning Labelling directives for washing machines and dishwashers, and light bulbs ALTENER-legislation Harmonization of safety standards for wind generators and specifications for biodiesel Trans European networks Creation of infrastructures for transport of gas and electricity Voluntary agreement Voluntary energy efficiency labelling of computer and other office equipment C02 emission standards for New emission standards for passenger cars will include standards for C02 emissions passenger cars Fiscal measures for transport Rise in minimum rates of fuel excise duties, equalization of minimum rates of excise duties for petrol and diesel fuels, target rates for gradual increase in excise duties on mineral oils 36 5. NATIONAL REPORTS OF THE MEMBER STATES 5. 1. Introduction The national programmes adopted by the Member States are one of the pillars of the strategy of the European Community to limit greenhouse gas emissions. This chapter briefly summarizes the national reports of the Member States to limit their greenhouse gas emissions. All Member States, except Belgium have submitted their communication to the UN FCCC. Information included in their national communications has been summarized in this chapter. Since Belgium did not yet ratify the UN FCCC, a short description is provided of its national programme under the EC Monitoring Mechanism for C02 and other greenhouse gas emissions. In each of the summaries of the national reports of the Member States, an overview is given of greenhouse gas emission estimates as provided in the national reports. The C02 emission estimates correspond with total C02 emissions. C02 removals by sequestering of carbon in sinks have not been subtracted from these total emissions. The estimates of greenhouse gas emissions provided in this chapter do not necessarily correspond with the figures included in the Annex to Chapter 3 "The EC emission inventory". The figures of the latter have been adjusted according to the draft IPCC guidelines for national greenhouse gas inventories for reasons of comparison. Besides estimates of greenhouse gas emissions in 1990, projections are provided of emissions in 2000. Further, for each of the Member States a short description is provided of the policies and measures included in its national report. 5. 2. The Member States' national reports to limit greenhouse gas emissions Austria Austria submitted its national communication to the secretariat of the UN FCCC at 21 September 199416. Austria adopted as its national target a 20% reduction of C02 emissions by the year 2005 compared to 1988 levels. Emissions in 1990 and 2000 Table 5. 1 provides details of emissions of C02, CH4 and N20 in Austria in 1990 and 2000. According to a projection from as early as 1991 ("reference scenario"), C02 emissions are expected National Climate Report of the obligations under Art. 4. 2. and Art. 12 of the Framework Convention on Climate Change (Federal Law Gazette No. 414/1994). Federal Ministry of Environment, Youth and Family Affairs, August 1994. the Austrian Federal Government, in compliance with 37 to increase by 10% in the year 2000 compared with 1990. However, this scenario does not represent all policies and measures implemented or committed to; these are not fully quantified and may permit Austria to stabilize its C02 emissions by the time period around 2000 to 2005. CH4 and N20 emissions are expected to be at roughly the same level as 1990 emissions. Table 5. 1. Emissions of C02, CH4 and N20 in Austria in 1990 and 2000 (Gg). C02 CH4 N2Q 1990 59,200' 602. 8 4T 1 Including process related emissions (2,100 Gg) 2 Not including process related emissions 2000 63,7002 600 42 Policies and measures Austria established two committees to develop an effective climate protection strategy: the Austrian C02 commission and the Interministrial Committee to Coordinate Measures to Protect Global Climate (IMC Climate). With the last interim report of the IMC Climate, Austria adopted a comprehensive catalogue of measures. This strategy includes the following points of main emphasis: C02 Power production/electricity supply industry: Fuel switching at thermal powerplants (e. g. fuel switch to gas); Room heating and water heaters: Mix of measures for a tightening of building regulations and norms, introduction of an energy coefficient, tightening of residential building subsidies, co-ordination of the extension of conducted energy, priority for the utilization of district heating; Renewable energies: Full utilization of the potentials of energy use through renewable fuels (wind, biogas, sewage gas, landfill gas, biomass, sun); Combined heat and power plants: Large-scale replacement of thermal power plants without heat utilization by those by CHP; Traffic: Comprehensive catalogue of measures (extension of infrastructure for combined carriage, traffic organization, R&D, fleet fuel consumption, regulations); Economie instruments: Introduction of a comprehensive energy and C02 levy with due consideration for international competitiveness. CH4 A draft ordinance on landfills has been drawn up to promote the energy utilization of landfill gas. Research and development is being carried out on the economically feasible use of biogas. N20 Biological farming is being promoted. Requirements promote the targeted use of to a further reduction in N20 emissions. fertilizers, leading Belgium Belgium did not yet ratify the UN FCCC. At its Council of Ministers (6 June 1991), Belgium committed itself to achieve a C02 emission reduction of 5% by 2000 compared to 1990. In June 1994, it submitted its national programme under the EC Monitoring Mechanism17. Emissions in 1990 and 2000 C02 emissions in Belgium amounted to 114 410 Gg in 1990. The inventory was carried out using the CORINAIR methodology which was adjusted according to the draft IPCC guidelines for national greenhouse gas inventories. If the total package of (proposed) policies and measures is implemented, Belgium expects to be able to reduce C02 emissions by 8-9% by the year 2000 compared to 1990. This estimate assumes is based on a the application of a European carbon/energy standardization of temperature in 2000 compared to 1990. tax and Policies and measures The Belgium national programme includes various measures and policies to address climate change. It includes measures already adopted by Government as well as proposed measures. Regarding energy, these measures include the establishment of cooperation between the authorities, the business community and the energy distributors, a more efficient electricity production, promotion of the use of renewable energy, the increased use of natural gas and investments to reduce energy electricity demand. Structural modifications are taken in the iron and steel sector to reduce energy consumption. Initiatives are taken in the tax system to promote an energy friendly behaviour. The Belgium Government established at 1 August 1993, an energy tax based on the European proposals for an energy/C02 tax. Other measures are speed limits on roads and motorways, transport plans for personnel information and awareness-raising activities and promotion of research. Belgium also participates in THERMIE, SAVE, PACE and ALTENER. in companies, promotion of the public transport, 17 Belgian National Reduction Programme C02 emissions. Under the "Council Decision concerning a mechanism of monitoring of C02 emissions and other greenhouse gases in the Community". June 1994. 39 Denmark Denmark's national communication18 was submitted to the secretariat of the UN FCCC in August 1994. The national C02 target of Denmark is to achieve an emission reduction of 20% of emissions from energy-use by the year 2005 compared to 1988. Sectoral C02 targets have been set for the energy sector and the transport sector. Apart from the national targets, Denmark has committed itself to stabilize emissions at the 1990 level in 2000 within the framework of the Climate Convention, as well as to achieve a 5% reduction of C02 emissions, as a contribution to the objective of stabilising C02 emissions in the Community as a whole by the year 2000. Emissions in 1990, 2000 and 2005 Table 5. 2 provides details of emissions of C02, CH4 and N20 in Denmark in 1990, 2000 and 2005. According to Denmark's projections, the national C02 target for the year 2000 is most likely to be achieved. A C02 emission reduction of approximately 8% is expected by the year 2000 compared to 1990 levels. This estimate is based on a situation with net zero electricity import, in both the target year and the base year. The projected C02 emission reduction is thus based on corrected 1990 figures for fluctuating imports of electricity. If imports become zero, or change to exports (as happens in dry years in Scandinavia), emissions may surpass the 1990 level by 3% or more. CH4 emissions are expected to decrease by about 13% by the year 2000. N20 emissions are expected to increase by 10% by 2000. Table 5. 2. Emissions of C02, CH4 and N20 in Denmark in 1990, 2000 and 2005 (Gg). \mn 58,353* 406. 32 10. 53 2nûû 53,753 354. 2 11. 5 2QH5 52,051 353. 5 12. 1 C02 emissions are corrected for electricity import. Actual emissions amount to 52. 053 Gg. CH4 emissions are corrected for electricity import. Actual emissions amount to 406. 2 Gg. N20 emissions are corrected for electricity import. Actual emission amount to 10. 3 Gg. C02 CH4 N20 1 2 3 Policies and measures Limitations of greenhouse gas emissions, notably C02, were introduced as explicit targets in the Energy Action Plan and the Transport Action plan, which were adopted in 1990. A package of measures to further decrease greenhouse gas emissions was launched in the action plan "Follow up on Energy 2000", published in November 1993. The objectives of the Danish waste policy were described in the Danish Government's Action Plan for Waste and Recycling 1993-1997 (1992). Climate Protection in Denmark. Ministry of the Environment. Danish Environmental Protection Agency. Denmark, 1994. 40 Energy improvements in both end use The Energy Action Plan ("Energy 2000") emphasized efficiency (especially electricity) and energy supply (notably increased use of combined heat and power), changing to cleaner fuels (a. o. biomass and wind) and increasing energy R&D. Major initiatives taken include inter alia; securing continued growth in the market shares of district heating and natural gas; conversion of local district heating plants to combined heat and power production based on natural gas or biomass; increased use of rënewables; changing the taxation of electricity and fuels to a consistent system of energy and C02 taxes; implementation of efficiency standards; subsidy schemes for energy saving by industry and for installation of individual metering; Transport The transport action plan- promotes an efficient transport system. Experiments are supported with alternative public transport services. Waste The Danish waste policy aims to recycle about 50% of the total amount of waste generated in the year 2000. The remainder should primarily be incinerated and landfilling should be minimized. The energy content of the incinerated waste will be used to replace fossil fuels. The waste objectives will be achieved using a series of instruments, such as agreements with industry and local authorities, increase and differentiation of waste charges, and legislation. Forestry Regarding the forestry sector, the Danish Parliament decided that during a period of rotation, e. g. 80- 100 years, the forest area should be doubled, leading to a C02 fixation rate of approximately 5% of the yearly C02 emission at its highest level. Finland Finland submitted its National Communication19 to the secretariat of the UN FCCC in January 1995. In its energy report to Parliament, the Finnish Government adopted the national goal of halting growth in C02 emissions form energy production and use at the end of the '90s. Emissions in 1990 and 2000 Table 5. 3. provides details of emissions of C02, CH4 and N20 in Finland in 1990 and 2000. C02 emissions are expected to increase by 30% in the year 2000 compared with 1990. This estimate is based on the assumption that all electricity consumed in 2000 is produced in Finland. However, in 19 Finland's National Report under the United Nations Framework Convention on Climate Change. Ministry of Environment, January 1995. 41 1990 Finland imported 17% of its electricity which is equivalent to 11,000 Gg of C02 emissions. A reduction of about 10% in CH4 emissions is expected in 2000 compared to 1990 levels, while N20 emissions are expected to increase by about 20%. Table 5. 3. Emissions of C02, CH4 and N20 in Finland in 1990 and 2000 (Gg). CO,1 CH4 N20 1990 54,200 252 23 2000 70,2002 204 28 1 2 C02 emissions from fossil fuels and peat, and from industrial processes. In the projections of C02 emissions in 2000 it is assumed that all electricity consumed in Finland is also produced in Finland. To compare these figures with 1990 emissions, it should be noted that in 1990 Finland imported 17% of its electricity, equivalent to 11,000 Gg of C02 emissions. Policies and measures The main focus in Finland's climate strategy is to intensify already existing programmes to reduce greenhouse gas emissions, such as improvements in the efficiency of the energy production and utilization system, and the use of energy and carbon taxes. The Finnish action programme also includes measures to enhance carbon reservoirs and sinks. Energy Finland introduced a C02 tax in 1990. This tax favours low-emission energy sources, promotes energy conservation and encourages the use of renewable fuels such as biomass to replace fossil fuels. In 1992, the Finnish Government approved an energy conservation programme aimed at rationalizing end uses of energy in individual sectors. The following targets of reducing specific energy conservation have been adopted (compared to 1990 levels): space heating 10%, household use 15%, services 15% and industry 10%. Measures are being undertaken to promote the use of biofuels. The objective is to increase the use of biofuels by 25% by the year 2005. Research on energy conservation is being continued and new energy technology development programmes have been launched. Transport A tax relief has been granted on cars with catalytic converters. A relatively high tax on car purchases curbed the growth in the car stock. Other measures include subsidies for public transport, investments in the rail network, a cut in the right to tax-deduct business travel costs, and a reduction in the transport subsidies to industry in developing areas. Forestry The forest and timber resources in Finland are still growing substantially. According to the forestry' environmental programme, an annual increment of 5-10 million cubic metres is estimated to be untouched by commercial exploitation, as a result of environmental protection goals, such as the conservation of biodiversity. The forest C02 sink in 1990 is put at around 31000 Gg of C02. Other sectors The Rural Environment Programme approved in 1992 and the agri-environmental support programme both include action to reduce greenhouse gas emissions from farming and greenhouse cultivation. The waste management development programme calls for a substantial decrease in the number of 42 landfills, which will result in more efficient management and thus in a reduction emissions. in methane France France published its national communication in February 199520. In parallel to the commitments of the UN FCCC for developed countnes and the European strategy to stabilize C02 emissions at their 1990 levels by 2000, France has announced its commitment to maintain annual per capita C02 emissions below 2 tonnes of carbon (7. 33 tonne C02). Emissions in 1990 and 2000 Table 5. 4. provides details of emissions of C02, CH4 and N20 in France in 1990 and 2000. Energy related C02 emissions are expected to increase by 9% in 2000 compared to 1990. Total annual per capita C02 emissions are expected not to exceed 2 tonnes of carbon. A relative increase is expected of 7. 5% for net C02 emissions in 2000 compared to 1990. This relative increase amounts to 4. 4% if these estimates are corrected for climate variations. CH4 emissions in 2000 are expected to be at roughly the same level as 1990 emissions. A reduction of 47% in N20 emissions is expected in 2000 compared to 1990 levels. Table 5. 4. Emissions of C02, CH4 and N20 in France in 1990 and 2000 (Gg). C02 CH4 N20 1990 367,000 2,900 177 2000 382,000' 2,900 93 1 Energy related C02 emissions. 1990 energy related C02 emissions amounted to 350,000 Gg. Policies and measures The French national programme emphasises the transport sector, since a strong rise in emissions is expected in this sector. Besides, possibilities of reducing C02 emissions in other sectors are limited, as a substantial emission reduction, amounting to 26. 5%, has already been realized in the eighties. To a large extent, the reduction was achieved by the nuclear programme in the electricity sector. Presently, the electricity sector accounts for only about 10% of total emissions, much less than in other EC Member States. C02 - Energy Tariff policies changing the demand pattern for electricity will enable a larger utilization of nuclear energy. As a general policy, the use of (nuclear produced) electricity instead of fossil fuels is stimulated. For isolated locations, the attention is increasing for stand-alone applications of renewable energies, as an alternative to expensive connections to the net. In the housing and construction sector, information energy end-use efficiency is stimulated by a programme of standards, labelling and Programme National de Prevention du changement de climat. Republique Française, Février 1995. 43 dissemination. Biofuels are exempted from taxes, and the development of technology in this field is stimulated by credits. C02 - Transport Transport policies are directed towards an increase of energy efficiency, stimulation of transport modes with favourable environmental characteristics (public transport, combined transport in road haulage, electric cars), an improvement of the efficiency of transport infrastructure (new technologies for reducing congestion, better coordination of transport by road, railway and water), policies for road haulage (speed increased enforcement of maximum driving time regulations) and limiter, technical measures affecting the efficiency of vehicles. CO2 - Industry Voluntary agreements ("contrats de branch") are being discussed with companies in the most energy intensive branches of industry. A range of support measures are already in place: mandatory energy audits for industrial facilities, financial assistance including R&D support and fiscal incentives. Forestry The objective of forestry policies is an afforestation of 30. 000 ha per year. CH4 The French waste policy is promoting incineration, composting and recycling of waste to limit CH4 emissions. A tax on household wastes will be increased. Technical measures are undertaken against gas leakages from networks. N20 Regulatory action and industrial standardisation using the best available technologies will decrease N20 emissions from adipic, nitric and glyoxylic acid production. A strategy for limiting agricultural N20 emissions is under study. Germany Germany submitted its national communication to the UN FCCC in September 199421. The Federal Cabinet of Germany resolved to strive for a 25-30% reduction of C02 emissions in Germany by the year 2005, in relation to 1987 levels. Emissions in 1990 and 2000 Table 5. 5. provides details of C02, CH4 and N20 emissions in 1990 and 2005. Germany's national communication did not provide projections for the year 2000. CH4 emissions arc expected to decrease by 48% in 2005 compared to the 1990 emission level, N20 emissions are in Germany Environmental policy. Climate protection in Germany. First report of the Government of the Federal Republic of Germany Pursuant to the United Nations Framework Convention on Climate Change. An information paper from the Federal Environment Ministry. September 1994. 44 expected to decrease by 25%. C02 emissions are expected to decrease by 3% in 2005 compared to 1990. However, Germany's national communication does not specify which measures are included in this projection. Policies and measures Germany's national communication provides an extensive list of measures. A distinction is made between measures that have been approved and are being/have been implemented and measures still in the approval phase. Below a summary is given of some of the most important measures already approved. Table 5. 5. Emissions of C02, CH4 and N20 in Germany in 1990 and 20051 (Gg). 1990 1,012,000 6,218 223 2005 — 2 3,233 3 167 4 Germany's national communication does not include projections of greenhouse gas emissions for the year 2000. Germany's national communication provides an estimate of 980 000 Gg C02 emissions in 2005 (table 6. 15, page 144) but does not specify which measures are included in this projection. Germany's national communication does not provide this figure, but states that CH4 emissions are expected to decrease by 48% in 2005 compared to 1990. Germany's national communication does not provide this figure, but states that N20 emissions are expected to decrease by 25% in 2005 compared to 1990. C02 CH4 N ,0 1 2 3 4 Energy supply energy saving programmes and incentives for saving electricity; incentives to increase the use of renewable energy sources; a support programme to increase heat/power cogeneration (including tax breaks) and to modernise the district heating network in former GDR; Traffic and transport increase of the mineral-oil tax; investments in the national transport infrastructure, including long-distance motorways, the railway network and the national waterways; information on energy-saving and environmentally oriented driving habits; Buildings and structures amendment of the Thermal Insulation Ordinance and of the Heating-systems Ordinance; tax breaks for the use of renewable energies; subsidies for modernisation of heating-systems and thermal insulation in the former GDR; 45 New technologies various research programmes on environmentally sound technologies, especially in the field of energy; Agriculture and forestry improving animal digestive efficiency; conservation of existing forests and support for afforestation; Waste management Acts and Ordinances to reduce the total amount of waste, to increase recycling of material and for better waste management. Greece Greece published its national communication in February 199522. The Council of Ministers of Greece accepted the stabilization objective of the European Community based on a fair distnbution of responsibilities and burdens. The Greek Government considers that a realistic objective for its national programme is to restrict the total increase in C02 emissions to 15% (or 12,400 Gg) in 2000 compared to 1990 levels. Emissions in 1990 and 2000 Table 5. 6 provides emissions of C02, CH4 and N20 Greece in 1990 and projected emissions in 2000. Greek expects that a successful implementation of its action programme could reduce the increase in C02 emissions in 2000 to 9,800 Gg or 12%, compared to 1990 levels. Total methane emissions in 2000 are expected to be lower than 1990 emissions, while N20 emissions are expected to increase. The Greek national communication does not quantify future CH4 and N20 emissions. Table 5. 6. Emissions of C02, CH4 and N:0 in Greece in 1990 and 2000 (Gg). C02 CH4 N20 1990 82,000 343 13. 7 2000 91,800 NE NE Policies and measures The main elements of Greece's national programme are the transformation of the energy sector and policies in the transport, waste and forestry sector. C02 Measures being taken in the energy sector are aiming at energy conservation and the substitution of fossil fuels. Measures in the energy supply sector include: increased use of natural gas, increased use Climate Change. The Greek Action Plan for the abatement of C02 and other greenhouse gas emissions. February 1995. 46 of renewable sources of energy (such as wind, solar, biomass, hydro and geothermal energy), improving existing power station's efficiency, promotion of combined heat and power, and the use of cleaner technologies for lignite combustion. Measures taken at the demand side include an evaluation of building standards in force, the promotion of natural gas, renewable energy sources and co- generation in existing buildings, and interventions in the lighting sector. Measures taken in the transport sector are replacement of old vehicles, development of public the establishment of inspections and standards. In the forestry sector, transport services and reafforestation programmes are on the way. CH4 and N20 Greece adopted the following measures to reduce CH4 and N20 emissions: promotion of the use of biogas in controlled waste disposal sites; reduction of solid waste production by the implementation of recycling programmes; improvements of the natural gas distribution system to prevent leakages; the adoption of a "Code of Good Agricultural Practices for the Protection of Water", addressing among others manure disposal and the rational use of fertilizers; subsidizing of ecological agriculture. Ireland Ireland submitted its national communication to the UN FCCC in October 199423. As a member of the EU, Ireland is involved in the achievement of the stabilisation objective of the Union as a whole at 1990 levels by the year 2000. The national objective of Ireland is to limit C02 emissions so as not to exceed 36 988 Gg of C02 in the year 2000. This would represent an increase of 20% above 1990 levels, or an increase of 11% if account is taken of increased carbon sinks capacity. According to Ireland's national communication, this national target is based on the EU policy which recognizes that a number of Member States, including Ireland, will need targets and measures which will accommodate necessary economic growth. Emissions in 1990 and 2000 Table 5. 7 provides details of emissions of C02, CH4 and N20 in Ireland in 1990 and 2000. C02 emissions in Ireland are expected to increase by 20% in 2000 compared to 1990 levels. CH4 emissions are expected to increase slightly in 2000 compared to 1990 levels, while N20 emissions are expected to increase by 3%. Table 5. 7. Emissions of CO,, CH4 and NX» in Ireland in 1990 and 2000 (Gg),. 2ÔÔÔ 1990 C O: CH~ N?0 30,719 795. 9 42. 3 36,988 798. 6 43. 7 Ireland. Communication under the UN Framework Convention on Climate Change. Prepared for the Conference of the Parties in accordance with Article 12 of the Framework Convention on Climate Change. Department of the Environment, Ireland. October 1994. 47 Policies and measures Ireland's national programme includes policies and measures in the field of energy, transport, waste and forestry. Energy Within the energy sector a number of programmes are underway including: promotion of more efficient use of energy by consumers in the domestic, industrial and commercial sectors, including maintenance and operation standards; insulation standards for new buildings; the establishment of a new energy body, the Irish Energy Centre, to operate an enhanced energy conservation programme; initiatives under the EU programmes SAVE and ALTENER; promotion of the use of natural gas and renewables. the Transport transport sector, Within Programme on Transport provides major management. the National Development Plan 1994-1999 and investments to improve public transport and the Operational traffic Waste A recycling strategy for waste has recently been published. The potentials of CH4 recovery from landfills are being examined. Forestry Ireland's annual target for planting (afforestation and reafforestation) is 30 000 hectares. Italy Italy submitted its national communication to the secretariat of the UN FCCC at 16 January 199524. Italy complies with the decisions taken by the EC on 29 October 1990 to stabilize CO; emissions by the year 2000 at 1990 levels. Emissions in 1990 and 2000 Table 5. 8 provides emissions of C02, CH4 and N20 in Italy in 1990 and projected emissions in 2000. Compared with actual emissions in 1990, C02 emissions are expected to increase by 11% in 2000, a CH4 emission reduction is expected of 15% in 2000 compared with 1990, and N:0 emissions in 2000 are expected to be at roughly the same level as 1990 emissions. First Italian National Communication Ministry of Environment, January 1995. to the Framework Convention on Climate Change. 48 Table 5. 8. Emissions of C02, CH4 and N20 in Italy in 1990 and 2000 (Gg). C02 CH4 N20 1990 392,213 3,901 120 20001 435,710 3,300 119. 4 1 Based on "Business as Usual" Scenario Policies and measures Italy's strategy to mitigate greenhouse gas emissions includes policies and measures in the energy, transport, waste, forestry and agricultural sector. Energy The national programme consists of packages of measures aiming at the electricity generating industry and at private production. Programmes have been set up for thermal power stations, aiming at the increased use of natural gas. Energy efficiency is promoted by increasing combined heat and power in private industrial production of electricity. Italy adopted various degrees to reduce energy demand in the residential/commercial and residential sector. A voluntary system has been set up to improve environmental management in industries. Transport An investment plan is being implemented to expand the railway network and the urban underground railway network. A pilot programme is under way aiming at the use of alternative fuels in urban transport systems. Tax exemptions for alternative fuels are adopted. Waste Management Financial incentives are being provided to promote differentiated waste collection and for construction of waste disposal sites. The use of biogas from waste disposal sites is being promoted. the Forestry and Agriculture Italy adopted a National Forestry Plan in 1987. This plan includes among other incentives to promote reforestation, improvement of forestry management and research and promotional activities for the wood industry. Several EU regulations have been implemented leading to a reduction in the use of nitrogen fertilizers. 49 Luxembourg Luxembourg submitted its national communication to the secretariat of the UN FCCC at March 199525. Luxembourg adopted the national target to reduce C02 emissions by 20% by the year 2005 at 1990 levels. Emissions in 1990 and 2000 Table 5. 9 provides details of emissions of C02, CH4 and N20 in Luxembourg in 1990 and 2000. C02 emissions are expected to decrease by 33% in 2000 compared to 1990 levels. CH4 emissions are expected to increase by 5% in 2000 compared to 1990 levels, and N20 emissions are expected to increase by 3%. Table 5. 9. Emissions of C02, CH4 and N20 in Luxembourg in 1990 and 2000 (Gg). C02 CH4 N20 Ï99Ô 11,244' 24. 6 2 0. 6913 Including 105 Gg of "Nature" emissions. Including 0. 802 Gg of "Nature" emissions Including 0. 091 Gg of "Nature" emissions 2ÔÏÏÔ 7,556 26. 1 0. 693 Policies and measures Energy conservation and the promotion of renewable energy sources are important elements of Luxembourg's national programme of Luxembourg. In 1993, a law has been adopted concerning the rational use of energy. This law aims to promote energy savings and the rational use of energy in all economic sectors, and to promote the use of alternative energy sources. As yet, regulations have been adopted concerning the use of renewable energy sources and cogeneration for energy production. In 1991. the Agency for Energy has been established, promoting innovative and pilot projects in the field of renewable energy sources, and the rational use of energy. Structural changes in the iron and steel industry from conventional plants to electric arc furnaces will contribute significantly to the limitation of C02 emissions. Luxembourg's national programme lists inter alia the following measures which have been adopted and/or implemented: Energy Transport establishment of combined heat and power stations; grants to promote investments in energy saving measures; improvement of public transport and rail connections; development of combined transport services for freight transport; Rapport National du Luxembourg en vue de la Ie Conference des Parties a la Convention-Cadres des Nations-Unies sur les Changement Climatiques. Ministère de l'Environnement, Mars 1995. 50 development of water transport by the construction of a channel m cooperation with France and Germany; promotion of cleaner technologies for buses; Industrial sector licenses for new enterprises include obligations for the application of "best available technologies"; existing enterprises need to use best available technologies in future; Domestic sector introduction of subsidies for insulation of housing; studies are being earned out on energy savings and the use of renewable energy sources. The Netherlands The Netherlands' national communication was submitted to the secretariat of the UN FCCC at 21 September 199426. The national C02 target adopted by the Netherlands is to stabilize emissions by 1994-1995 and to achieve an emission reduction of 3-5% by 2000 compared to 1989-1990. The CH4 emission reduction target is 10% by 2000 compared to the 1990 level and the target for N20 is to stabilize emissions at the 1990 level by 2000. Emissions in 1990 and 2000 Table 5. 10 provides details of emissions of C02, CH4 and N20 in the Netherlands in 1990 and in 2000 according to the draft IPCC guidelines for national greenhouse gas inventories. The national C02 target is based on another inventory methodology. So, C02 emission projections for the year 2000 calculated according to the IPCC methodology cannot be compared with the national C02 target. According to the Netherlands' projections (based on the IPCC methodology), the national C02 and CH4 targets are likely to be achieved. A C02 emission reduction of approximately 4% compared to 1990 levels is expected by the year 2000. This estimate is based on temperature corrected figures for C02 emissions in 1990. Compared to actual C02 emissions in 1990, a C 02 emission stabilisation is expected by the year 2000. CH4 emissions are expected to decrease by about 25% by the year 2000. The stabilisation target for N20 emissions is unlikely to be achieved: emissions are expected to increase by 5% by 2000. Table 5. 10 Emissions of C02, CH4 and N20 in the Netherlands in 1990 and 2000 (Gg). C02 CH4 N20 26 1990 174,000' 1,067 59. 6 2000 167,600 786 62. 2 C 02 emissions corrected for temperature influences. Actual emissions in 1990 amount to 167,600 Gg. Netherlands' National Communication on Climate Change Policies. Prepared for the Conference of the Parties under the Framework Convention on Climate Change. The Netherlands, August 1994. 51 Policies and measures The Netherlands' policy package to address climate change has been formulated in a number of memoranda and plans (such as in the National Environmental Policy Plan 2 and the Second Memorandum on Energy Conservation) and has been approved by Parliament. It includes a wide range of policies and measures in various sectors, primarily energy, transport and waste. C02 To a large extent, the policy package for reducing C02 emissions is directed at energy conservation. The package consists of voluntary agreements (especially with industry, including the energy and transformation sector and the energy distribution sector), standards (especially for residential use and investment, financial support for renewables and energy for buildings), transport infrastructure to energy recovery. In selecting landfilling conservation, and reduction of waste appropriate instruments, preference is given to support for 'self-regulation', i. e. voluntary agreements. This usually takes the form of a Long Term Agreement between the Government and intermediary organisations, such as branch organisations. The principle reason for the emphasis on voluntary agreements is the acceptance of measures by all relevant participants. in addition CH4 Direct measures for reducing methane emissions include regulations for waste management and improvement of gas distribution networks. Agro-environmental policies and the Common Agricultural Policy of the European Community will lead to a decreasing number of cattle and manure production. N20 Specific policies whose aim is the reduction of N20 emissions are being studied. Any reduction in N20 emissions is the result of policies in other areas than climate change, mainly the acidification abatement policy. Portugal Portugal submitted its national communication to the secretariat of the UN FCCC at the end of 199427 Portugal's strategy to mitigate climate change is "in compliance with its commitments as a European Union country, in accordance with the principle of joint but different responsibilities. " Portugal adopted the national target of limiting the increase of C02 emissions to 40% in 2000 compared to 1990. Emissions in 1990 and 2000 Table 5. 11 provides emissions of CO:, CH4 and N20 in Portugal in 1990 and projected emissions in 2000. C02 emissions from fossil fuels are expected to increase by 29% in the year 2000 compared with 1990 emissions. Portugal's national communication does not provide projections for future CH4 and N20 emissions. Portuguese report in accordance with Article 12 of the United Nations Framework Convention on Climate Change. Ministry of the Environment and Natural Resources, Lisbon, 1994. 52 Table 5. 11. Emissions of C02, CH4 and N20 in Portugal in 1990 and 2000 (Gg). 1990 42,148 227 10. 6 2000 54,274' NE NE Relates to C02 emissions from fossil fuel combustion. 1990 C02 emissions from fossil fuel combustion amount to 38,686 Gg. C02 CH4 N20 1 Policies and measures Portugal's strategy to mitigate greenhouse gas emissions includes policies and measures energy, industrial, transport and agricultural sector. in the Energy The major policies adopted in the energy sector by Portugal are in compliance with environmental protection objectives, aiming at an increase m diversification and energy efficiency, the use of clean technologies and the promotion of renewable energy sources. Policies and measures include: the use of natural gas for electricity production and end use (starting in 1997); promotion of combined heat and power in various industrial sectors; promotion of renewable energy sources for energy production; improvements of efficiency of thermal power stations; promotion of rational use of energy in all end users sectors. Industry In the industrial sector, economic instruments, legislative measures and information campaigns are adopted to support environmental protection. Transport Policy measures in the transport sector are targeted at strengthening the competitiveness of rail transport. Important investments have been made in both road and rail infrastructure. Agriculture and forestry Policies and measures in the agncultural sector relate to the Common Agricultural Policy (CAP) reform of the EC, which is targeted at reducing incentives for agncultural production. Support measures introduced within the context of the CAP reform lead to reduction in the use of fertilizers and the number of cattle, and thus to a reduction in CH4 and N20 emissions. Measures taken in the forestry sector encourage the maintenance, expansion and protection of forests. 53 Spain Spain submitted its national communication to the UN FCCC in September 199428. Emissions in 1990 and 2000 Table 5. 12 provides details of emissions of C02, CH4 and N20 in Spain in 1990 and 2000. The projected C02 emissions in 2000 only relate to energy. C02 emissions from fuel combustion are expected to increase by 24% in 2000 compared to 1990 levels. Spain's national communication did not provide projections for CH4 and N20. Table 5. 12. Emissions of C02, CH4 and N20 in Spain in 1990 and 2000 (Gg). C02 CH4 N ,0 1990 260,655' 2,129. 8 86. 5 2000 276,5042 Total C O: emissions. Spain included in its national communication an estimate for total net emissions, including CO; removals by land use change and forestry, amounting to 256,476 Gg. Energy related C 02 emissions. Energy related C 02 emissions in 1990 amounted to 222,908 Gg. 2 Policies and measures The mam element of Spain's national programme to reduce greenhouse gas emissions is the 1991 National Energy Plan. Measures are also taken in the industry, transport, agriculture and forestry sector. Energy The main instrument of the 1991 National Energy Plan to address the greenhouse effect Energy Saving and Efficiency Plan. This plan consists of four sets of measures: is the the Energy Saving Programme to reduce the final energy consumption without reducing the economic activity; the Energy Substitution Programme to increase the use of natural gas as an alternative to oil and coal products in industry and in the residential and commercial sector; the Cogeneration Programme to encourage combined heat and power generation. Projects are especially aiming at energy-intensive industnes (such as refining and chemicals), and in hotels and hostels; the Renewable Energies Programme to increase the use of renewable energy sources for electricity generation and for end use. The 1991 National Energy Plan also includes measures in the energy generation and supply sector. The main measures in this area are fuel switching to natural gas, and the promotion of clean coal technologies. Report by Spain on the United Nations Framework Convention on Climate Change. Provisional Version. National Climate Committee. Spain. 54 Industry The Industrial and Technological Environmental Programme encourages industry to meet increasingly stringent environmental standards. Transport State subsidies are granted to promote public transport. The Plan on Transport in Large Cities 1990- 1993 aims to modernize public transport systems. Freight transport by rail is encouraged. Agriculture Relevant agricultural policy includes energy saving measures, the use of biomass as an energy source, information on good farmers practices regarding the storage of manure and the application of fertilizers. Forestry Cooperation agreements between the Spanish Government and the Autonomous Communities, which already lead to reafforestation of 63 700 hectares took place between 1990 and 1993. Further, efforts are undertaken to prevent forest fires and to protect ecosystems against pests and atmospheric pollution. Sweden The Swedish Government adopted its national communication on the 15th of September 199429. Since 1970, C02 emissions have been reduced with approximately 40%. The national target adopted by Sweden is, pursuant to the UN FCCC, to stabilize C02 emissions from fossil fuels in the year 2000 at the 1990 level and to reduce these emissions after that. Furthermore, CH4 emissions from landfills shall be reduced by 30% between 1990 and 2000. Emissions in 1990 and 2000 Table 5. 13 provides details of emissions of C02, CH4 and N20 in Sweden in 1990 and 2000. Sweden stresses that estimates of C02 emissions in 1990 are based on actual emissions, and that these estimates have not been adjusted for temperature influences. If figures are adjusted for average climatic circumstances, C02 emissions in 2000 are expected to be at the same level as C02 emissions in 1990. If compared to actual emissions in 1990, C02 emissions are expected to increase by 4% in 2000. CH4 emissions are expected to decrease by 10% in 2000 compared to 1990 levels, and N20 emissions by 15%. Sweden's national report under the United Nations Framework Convention on Climate Change. Ministry of the Environment and Natural Resources, September 1994. 55 Table 5. 13. Emissions of C02, CH„ and N20 in Sweden in 1990 and 2000 (Gg). 1990 61,256' 329 15. 2 2000 63,800 300 13 Actual C02 emissions. C02 emissions adjusted for temperature influences amount to 64,000 Gg. C02 CH4 N20 1 Policies and measures A concrete strategy for Swedish climate policy has been formulated in the "Government Bill on Actions to Counteract Climate Change" of 1993. The main element of Sweden's strategy is to limit the demand for fossil fuels and to increase the contribution of renewable energy sources, along with improved energy management and more efficient use of energy. Taxation of fossil fuels is the central policy instrument to limit C02 emissions. Energy and transportation Measures to improve energy efficiency include technology procurement and demonstration of energy electricity efficient products, processes and systems in homes, non-housing premises and industry. In 1991, a C02 tax was introduced as part of a major tax reform, aiming to reduce taxes on income and capital and to increase environmental taxes. Several programmes have been adopted to promote and stimulate energy efficiency and the use of renewable energy sources. These programmes include the programme for energy management and promotion of biofuels, wind power and solar energy. In the transport sector, several research and development programmes (concerning the use of alternative fuels and hybrid and electrical vehicles) have started. Since only 5% of the electricity production in Sweden is based on fossil fuels, the potential of greenhouse gas reduction in the electricity sector is very limited. Forestry and agriculture Sweden adopted various measures to reduce carbon releases from soils, e. g. through restrictions on forest site preparation operations and drainage. Some of the policies of the new agricultural policy adopted improved nitrogen application methods, land use change from arable land to grazing grounds or forests, and increased use of winter overgrown land. in 1990 indirectly effect greenhouse gas emissions. These include United Kingdom The United Kingdom's national communication was published in January 1994 and presented to the Ninth Session of the Intergovernmental Negotiating Committee (INC)30. An executive summary and minimum tables for greenhouse gas emissions according to the guidelines for the preparation of first Climate Change. The UK report. United Kingdom's Report under the Framework Convention on Climate Change. January 1994. 56 communications by Annex I countries (Decision 9/2, INC/FCCC, 1994) was submitted in August 1994. The UK's C02 programme is currently being updated in the light of new energy projections published in March 1995 and other developments which have taken place since the programme was first published. This update will be available in the autumn of 1995. Figures for C02 emissions given in this document are based on the forthcoming update. The UK accepts the commitment of the UN FCCC to take measures aimed at returning emissions of greenhouse gases to 1990 levels by the year 2000. Emissions in 1990 and 2000 Table 5. 14 provides emissions of C02, CH4 and N20 in the United Kingdom in 1990 and projected emissions in 2000 taking into account the policies and measures in the national programme. The programme is expected to produce a small reduction in C02 emissions, a 10% reduction of CH4 emissions and a 75% reduction of N20 emissions. Table 5. 14. Emissions of C02, CH4 and N20 in the United Kingdom in 1990 and 2000 (Gg). C02 CH4 N20 1990 580,268 4,844 109 2000 551,283 4,400 30 Policies and measures The UK's national communication "Climate Change; the UK Programme" sets out measures aimed at returning emissions of each of the main greenhouse gases to 1990 levels by the year 2000. C02 The C02 programme is based on a national partnership approach drawn up after extensive public consultation, involving business, voluntary, environmental and other interest groups. Measures are spread across all sectors: domestic energy consumption, through measures which include the introduction of taxation on domestic fuel and power, and a new Energy Saving Trust; energy consumption by business, including energy efficiency advice and information; energy consumption by the public sector, through targets for central and local government and public sector bodies; and transport, through increases in road fuel duties, and a commitment to real increases of at least 5% on average in future budgets. CH4 Initiatives are being taken to encourage the use of CH4 for energy generation and reducing emissions from coal production. New guidance on limiting emissions from several industrial sectors is also being prepared. 57 N20 An 75% reduction is expected by 2000 compared to 1990 levels, mainly through the reduction of nitrous oxide emissions from nylon manufacture. 5. 3. Summary ratified submitted the UN FCCC and their national All Member States, except Belgium, communications to the secretariat of the UN FCCC. Besides the commitments of the UN FCCC, most of the Member States adopted also national targets to reduce greenhouse gas emissions, varying in objectives and time scales. All Member States, except Belgium, carried out inventories of C02, CH4 and N20 emissions in 1990. Belgium provided estimates of C02 emissions in 1990. Estimates for emissions in 1990 provided in the national reports are not always comparable. In general, the draft IPCC guidelines for national greenhouse gas inventories have been used, while some countries base their estimates on CORINAIR. Some countries apply conection factors to adjust for temperature influences or for imported/exported electricity. Most of the Member States provided projections of C02, CH4 and N20 emissions in 2000. Important to note is that projections of greenhouse gas emissions included in the national reports are not comparable and cannot be added together. The projections included in the national reports have been compiled using various modelling the representation of measures and policies. Some Member States have only estimated fuel related C02 emissions in 2000, and one Member State projected emissions in 2005 instead of 2000. Further, the projections do not always only take account of adopted measures, but include proposed measures as well. input assumptions, sources projected, and tools, key 8 Member States expect an increase in C02 emissions in 2000 compared to 1990: Austria, Finland, France, Greece, Ireland, Italy, Portugal, and Spain. 1 Member State expects to reach a stabilisation of C02 emissions in 1990: Sweden3' and 5 Member States are expecting a decrease in C02 emissions in 2000: Belgium, Denmark32, Luxembourg, the Netherlands33 and the United Kingdom. Germany provides a projection for C02 emissions in 2005 and expects a C02 emission reduction by that year. 11 Member States provided projections of CH4 and N20 emissions in 2000. 2 of them expect an increase in CH4 emissions: Ireland and Luxembourg; Another 2 expect a stabilization: Austria and France. The remaining 7 Member States expect a reduction in CH4 emissions: Denmark, Finland, Greece, Italy, the Netherlands, Sweden and the United Kingdom. 31 If based on temperature corrected C 02 emissions in 1990. If projected figures are compared with actual C O: emissions in 1990, an increase in C 02 emissions of 4% is estimated. If based on C 02 emissions in 1990 which have been corrected for electricity import fluctuations. If projected figures are compared with actual C 02 emissions in 1990, an increase in C 02 emissions of 3% is estimated. If based on temperature corrected C O; emissions in 1990. If projected figures are compared with actual C O: emissions in 1990, C 02 emissions are estimated to stabilize. 58 increase 6 Member States expect an Ireland, Luxembourg and the Netherlands while 2 Member States expect a stabilization: Austria and Italy; and 3 other Member States expect a reduction in N20 emissions: France, Sweden and the United Kingdom. Germany provided projections for 2005 and expects a reduction in both CH4 and N20 emissions. in N20 emissions: Denmark, Finland, Greece, 59 PROJECTIONS OF CO, EMISSIONS IN 2000 6. 1. Introduction This chapter provides first estimates of projections of future greenhouse gas emissions in the European Community. As a first attempt to arrive at greenhouse gas emission projection, several scenarios have been applied. These, as well as the modelling techniques used, are described in section 6. 2. Section 6. 3 provides estimates of C02 emissions in 1990, 2000 and 2020. The 1990 figures presented in this section differ from the figures provided in the 1990 EC emission inventory given in chapter 3, since they are estimated using the same methodology as has been used for the 2000, 2010 and 2020 figures. The 1990 figures presented here are only provided to show the trend in C02 emissions in the European Community. It should be stressed that the simulations descnbed in this chapter are not official simulations to assess the impact of climate change policies in the EC. The results of the simulations are provided as a first indication of future EC greenhouse gas emission. Further work is being undertaken to develop more accurate modelling tools and scenarios. The models and scenarios used to arrive at the projections for future EC emissions differ, in structure and in assumptions with regard to exogenous variables, from the models and scenarios used by Member States to forecast their C02 emissions (see Chapter 5). Results are therefore not comparable. Estimates of the effects of policies and measures on greenhouse gas emissions, if available, have been provided in chapter 4. 6. 2. Modelling techniques and scenarios The projections of future EC greenhouse gas emissions provided in this chapter are based on the EC model MIDAS (Model Integrating Demand and Supply) and various scenarios, which differ in assumptions with regard to exogenous variables. Below, a short desenption of MIDAS and the various scenarios is provided. Annex 2 provides a more detailed outline of the scenarios applied. MIDAS (Model Integrating Demand and Supply) Funded by the EC JOULE programme, the large scale energy system planning and forecasting model MIDAS (Model Integrating Demand and Supply) has been developed. MIDAS performs a dynamic simulation of the energy system, which is represented by combining engineering process analysis and econometric formulations. The model is used for scenario analysis and forecasting. An econometric top-down approach has been combined with a micro-economic approach. MIDAS covers the whole energy system, including energy demand by sector and fuel, power generation, oil refinenes, natural gas, solid fuels production, imports and energy market prices. The 6c model ensures, on an annual basis, the consistent and simultaneous projection of energy demand, energy supply, energy pricing and costing, so that the system is in a quantity and price-dependent balance. On the basis of exogenous projections of import prices, macroeconomic indicators and the necessary capacity resource availability, MIDAS forecasts energy demand and computes expansion and operation of the supply sectors to meet demand and their mutual energy exchanges. The model evaluates the energy production costs by sector and fuel and determines consumer prices, by considering also international energy prices, the national pricing policy and the government tax policy. Consumer prices are feeding again the demand sub-model that re-adjusts demand projections and, therefore, supply activities. Thus, a closed-loop iteration is established which converges on an annual basis to provide a consistent simulation of energy demand, supply and prices. Emission factors per plant and fuel are incorporated in the model to calculate emissions. scenario denotes the "business as usual" world, Conventional Wisdom scenario The Conventional Wisdom representing a conventional wisdom view of the most likely evolution of events. Economic growth gradually weakens in the long term. The GDP growth rates in the EC are expected to decrease from 2. 9% in the period 1995-2000 to 1. 8% in the penod 2015-2020. Energy policy remains fragmented, the result of unresolved conflicting objectives for competitiveness, environment, security of supply and differing national aims. Some penetration of new, more efficient demand and supply technologies is expected. Regarding energy demand issues, continuation of current actions with some concern on increasing efficiency is expected. Energy prices are increasing smoothly. Gas prices are relatively low compared to oil prices, due to deregulation and growing networks. The development of energy prices can be found in Table 6. 1. Table 6. 1. Primary energy prices (in constant 1993 prices and exchange rates). Conventional Wisdom Scenario. Crude oil (ECU/toe) 188. 1 128. 5 153. 3 182. 5 211. 7 219. 0 226. 3 Natural Gas N. Europe (ECU/toe) 101. 5 91. 5 123. 6 139. 9 158. 3 161. 8 167. 2 Natural Gas S. Europe (ECU/toe) 111. 6 100. 6 133. 5 148. 2 164. 6 164. 9 167. 2 Steam Coal (ECU/toe) 65. 0 54. 8 60. 0 63. 0 64. 0 68. 0 75. 0 1990 1995 2000 2005 2010 2015 2020 the world scenario instabilities Battlefield scenario isolation, power blocs and protectionism. In the Battlefield Contradictions and in the global system make economic integration very difficult. Globalization is seen as too ambitious. The geopolitical system fragments into blocs, with tensions and friction between and within blocs. The GDP growth rates in the EC are expected to decrease from 3. 1% in the period 1995-2000 to 1. 3 in the period 2015-2020. Energy policies are aimed at reducing import dependency. Supply side measures are likely to be more successful than demand reverts to 61 inhibit side measures. In spite of attempts to introduce alternative fuels, efficiency gains. The increasing dependency on fewer major suppliers leads to an oil pnce shock. Some penetration of new, more efficient demand and supply technologies is expected, partly driven by public standards and partly through industnal competitiveness. tension and conflict Forum scenario for collective public action. National, European and In Forum, the world moves more to consensus and cooperative international structures with a strong role for public administration and intervention. The process of global integration produces new imperatives institutions are gradually restructured so as to be able to deal more effectively with broader, more complex shared problems and interests. The GDP growth rate in the EC increases from 2. 3% in the penod 1995-2000 to 2. 6% in the period 2010-2015 and decreases somewhat after that period. Energy policies are most significantly affected by concern for the environment. Major policy shifts are expected through reinforced environmental concerns, limiting energy demand growth. Energy prices are expected to be stable. A strong penetration of more efficient demand and supply technologies will occur, which will go together with a high level of technology transfer. international Hypermarket scenario In the Hypermarket scenario, the predominant themes are market forces, liberalism and free trade; there is a minimum of intervention from government and public administrators. Global economic integration is self-reinforcing and continues. The force driving this scenario is continued application of the market mechanism which is seen as the best way to produce wealth and handle complexity and uncertainty. Liberalization and privatization deliver results and produce new market entrants who demand more of the same. The GDP growth rates in the EC are expected to decrease from 3. 2% in the period 1995-2000 to 1. 9% in the penod 2015-2020. Energy policy is driven by the desire to minimise government control and maximise efficient operations of free markets, nonetheless achieving desired standards. A strong growth in energy demand is expected. Penetration of new, international more efficient demand and supply competition. Energy prices are increasing smoothly. technologies depends on market forces and 6. 3. Trends in C02 emissions Table 6. 2 provides projections of energy related C02 emissions in 2000, 2010 and 2020. It should be noted that these results are first estimates of future EC greenhouse gas emissions. For reasons of companson, estimates of C02 emissions are also provided for the year 1990, using the same calculation methodology. Since the calculation methodology differs, the 1990 emission estimates provided in this section cannot be compared with the EC emission inventory as included in Chapter 3. the "business as usual" world According to the Conventional Wisdom Scenano, which denotes representing a conventional wisdom view of the most likely evaluation of events, C02 emissions in the EC are expected to increase with 5% by the year 2000, with 13% by the year 2010 and with 16% by the year 2020 (compared with 1990 levels). The results of the Hypermarket scenario, which 62 gives a predominant role to market forces, liberalism and free trade, show a similar increase: an increase is expected of 5%, 14% and 17% for the years 2000, 2010 and 2020 respectively. The Battlefield scenario, which assumes, amongst others, that the world reverts to isolation, power blocs and protectionism, results in a decreasing growth of C02 emissions: an increase of 6% in 2000, of 9% in 2010 and of 7% in 2020. According to the Forum scenario, which assumes, amongst others, that the world moves more to consensus and cooperative international structures with a strong role for public administration and intervention, a reduction in C02 emissions is expected: 2% in 2000, 5% in 2010 and 10% in 2020. Table 6. 2. Trends in energy related C02 emissions in the EUR-15. (1000 Gg. ); preliminary results. 1990 2000 2010 2020 Conventional Wisdom 3,155(0) 3,155(0) Battlefield 3,155(0) Forum 3,155(0) Hypermarket 3,326(+5%) 3,357(+6%) 3,089(-2%) 3,325(+5%) 3,557(+13%) 3,428(+9%) 2,986(-5%) 3,597(+14%) 3,648(+16%) 3,368(+7%) 2,855(-10%) 3,686(+17%) 63 VULNERABILITY ASSESSMENT AND ADAPTATION MEASURES 7. 1. Introduction This chapter describes the possible impacts of climate change on the European Community and adaptation activities taken at the Community level. The Second, Third and Fourth Framework Programme of Research and Development contain specific programmes dealing with the assessment of possible impacts of climate change on various environmental sectors. The programmes on climate change impacts include research on sea level rise and subsequent impacts on European coastal resources, and the impacts of climate change on European land resources (agnculture and forestry). Also included in the research programmes is the research on "Desertification in the Mediterranean Area", as well as studies related to the socio-economic impacts of and policy responses to extreme events due to climate change. Section 7. 2 provides a brief overview of the possible impacts of climate change on the European Community. Details on research programmes related to climate change are not discussed in this section, but can be found in Chapter 9 "Research and Development". Section 7. 3 gives a brief overview of adaptation activities taken at the Community level. 7. 2. Possible impacts of climate change on the European Community that the extent of temperature Temperature increases The timing and extent of a possible rise in temperature due to the enhanced greenhouse effect is highly uncertain, in particular on a local or regional level. Although the results of models predicting the increase in temperature can only be considered as rough estimates, it has become clear that temperature increases will be greater in the high latitudes than in the low latitudes. Therefore, it is expected the temperature in the Meditenanean regions. Assuming a doubling of atmospheric C02 concentrations, scenario studies show that average winter temperatures in the far northern countries may increase by 2-5 °C, while the winters in the central and southern region can be 1-3 °C warmer. For the summer, average temperatures are 3-4 °C warmer throughout all of Europe (Thimbal et al. , 1995; Cabasch et al. , 1995). Aerosols emitted in the atmosphere have a net negative radiative forcing. However, any negative forcing due to aerosols cannot be regarded as a simple offset to the effect of greenhouse gases, because the regional patterns of the forcing are different (IPCC, 1994). in northern Europe will be larger than increases increase Precipitation Large uncertainties exists with regard to the impacts of climate change on precipitation. Most likely summers will be drier. This is partly because earlier snow melt would affect the seasonal cycle of soil moisture reserves, and partly because warmer temperatures may lead to increased evaporation and évapotranspiration (Warnck et al. , 1990). the The IPCC (Houghton et al. , 1992) estimated under greenhouse effect can lead to 15 -25 % less soil moisture in summer for Mediterranean countnes. Since these countries already depend heavily on irrigation, this may have enormous impacts on their to the agricultural potentials. Increased andity may also breakdown of organic matter, salt accumulation and the formation of surface crusts. Therefore, impacts on the agricultural potential could be even more severe. their business-as-usual scenario land degradation due lead to severe that 64 Water resources Climate change also has significant potential impacts on water resources, their distnbution in space and time, the hydrological cycle of water masses, water quality and water supply systems and requirements for water resources of different regions. This may lead to complex impacts on natural resources and human activities, in particular water storage and distribution, agriculture and electrical energy production. One of the most vulnerable areas in the European Community, with respect to impacts on water resources, is the Mediterranean area. Sea level rise and extreme events Sea level rise is one of the main impacts of global warming, due to the thermal expansion of sea water, the melting of mountain glaciers, the melting of inland ice caps and changes in the Antarctic ice sheet. Consequent effects of sea level rise vary from continuously inundation of low-lying lands, increased frequency of flooding, changes in erosion of beach, cliff or dunes, salinisation and changes in nver hydrology. A changed sea level is also likely to have impacts on the tides, by altering the resonance of sea basins. The recent best-estimate business-as-usual scenario of a greenhouse gas induced rise in the global sea surface of 45 cm by 2100 provides only a general guide for possible changes in the relative sea level along the European coasts. Climate change affects to a large extent the occurence and severity of extreme events. Flooding associated with major storms is most likely of greater consequence than sea level rise on a human time scale. However, knowlegde of the pattern and incidence of storminess around European coasts in North West Europe and parts of the Mediterranean. The impact of major storms will become more widespread as the sea surface rises. Especially in the North and Mediterranean Seas, the impacts of storms are a matter of particular concern. Currently, the EC administers several contracts to estimate the risk of coastal flooding along selected areas of the European Coastline and to provide bases for the monitoring and mapping of coastal changes on European coasts and of the impacts of change. to a few areas is limited Agriculture Although uncertainties remain in research results, it has been found that higher temperatures will shorten the duration of the growing period for annual crops (Harrison and Parry, 1993). This will lead to a decreased yield of the crop, although the direct fertilizer effects of increased C02 concentrations may offset this for some crops. Conditions in southern Europe will generally become hotter and probably dner, which will have negative effects on crop yields. Parts of western Europe (e. g. northern France and Germany) may benefit if there is an average increase in precipitation. Agricultural practices, such as sowing times, irrigation and the use of cultivars may have to change due to higher temperatures and potential droughts. Grassland production is expected to increase across Europe (Jones et al. 1993). The production will be stimulated by the direct fertilizer effect of C02 and temperature increases. Assuming an equivalent doubling of preindustnal C02 levels, grassland production in temperate Europe will be about 10-15% higher than at present due to the direct fertilizer effect and a further 18% higher than at present due to the expected temperature increase. Forestry Changes in temperature and rainfall patterns are likely to alter the composition, distribution and growth patterns of forests. To avert irreparable damage and loss of forests, research programmes are being carried out to quantify the impacts of climate change on the forestry sector. Based on these studies, it can be concluded that responses vary not only between species, but also between juvenile and mature tissues. Nutrition is also a very important parameter in the responses of the plant to elevated CO^ concentrations. 65 Only indicative estimates are available of regional effects of climate change on vegetation zones. However, models suggest a north-northeast movement of vegetation zones over Europe (Bengtsson, 1994). Analysis of impacts in monetary terms Although large uncertainties exist with respect to the type and magnitude of climate change impacts, experts and policy makers recognize that global warming will take place over the next century. Climate change is likely to affect nearly all economic sectors. An analysis of economic impacts for EUR-12 (ERM, 1992a) shows that although global warming will most likely result in a net economic cost for the EC as a whole, there will be sectoral and regional variations. For example, it is likely that there will be an increase in revenue to the agricultural sector as a whole in the EC, but this is due to large increases losses m revenue in southern Europe. Economic costs in the EC are likely to occur in other economic sectors, although economic benefits may occur in some regions, e. g. tourism in Belgium, manufactunng in Luxembourg and the services sector in the UK. 90% of the accumulated economic costs is likely to occur in the second half of the next century. in northern Europe outweighing Monetary impact values have been estimated by impact indicator and by country (ERM, 1992b). Annual costs have been estimated, assuming a global warming of 1 °C and 4 °C. Assuming that no action is taken to control emissions, global warming could range from approximately 0. 5 °C to 1 °C in the year 2020, and from 1. 75 °C to 4 °C in the year 2100. Monetary impact values are related to levels of global warming rather than to particular years in the future. The years in which such values can be expected to occur depends on the emission control scenario selected. For this reason the estimates are presented as annual values and are not discounted. As the monetary' impact values are not related to time, no projected economic growth rate is incorporated in the calculations. National income is assumed to remain constant. Table 7. 1 shows the monetary impact values for the EUR-12 at 1°C and 4°C. It can be seen that economic damage costs are likely to be significant as a proportion of GDP. Although the indicators agricultural yields, comfort threshold and heating and cooling degree days are positive, the total is negative. This is caused by the high economic costs of sea level nse. Table 7. 1. Monetary impact values for the EUR-12 by impact indication per year (Bn 1989 ECU1) and as % of 1989 National Income Bn 1989 ECU1 % of National Income Global Temperature increase 1. 0 4. 0 Sea level rise Run-off Comfort Threshold2 Heating and cooling degree days Agricultural yields Source: ERM. 1992 b. -67. 6 -5. 7 4. 7 13. 4 3. 2 -272. 2 -18. 4 27. 1 35. 5 12. 2 1. 0 -1. 9 -0. 2 0. 1 0. 4 0. 1 4. 0 -7. 6 -0. 5 0. 8 1. 0 0. 3 Billion of ECU, 1989 level. Indicator based on temperature, precipitation and sunshine, indicating the attractiveness for tourism. 66 Table 7. 2 shows the monetary impact values for the Member States of EUR-12. It can be seen that significant differences exist between countries. For southern EC countries, monetary impact values are mostly negative: cooling requirements increase, and the attractiveness for tourism is decreasing due to the negative effects of sea level rise and water shortages. An exception is the agricultural yield indicator, which is positive or zero for all Member States. It should be noted that a positive indicator for agricultural yield does not imply that the agricultural sector as a whole will face economic benefits. Other factors such as the total agricultural land potential play an important role as well. Table 7. 2. Monetary impact values by impact indicator for Member States at 4 °C (Bn 19891). Sea Level Rise Run-off Comfort Threshold2 Heating and cooling degree days yields Agri- cultural Total Belgium Denmark France Germany Greece Ireland Italy Luxembourg Netherlands Portugal Spain United Kingdom -2. 1 -37. 1 -78. 2 -43. 9 -3. 4 -13. 0 -37. 2 0. 0 -10. 7 -1. 5 -18. 4 -26. 6 Source: ERM, 1992 b. -0. 3 0. 0 1. 7 -3. 7 -0. 6 0. 0 -5. 4 0. 0 0. 0 -1. 5 -5. 4 0. 0 4. 0 1. 0 6. 0 15. 4 -2. 1 0. 0 -2. 9 0. 2 1. 4 0. 7 2. 8 0. 6 2. 4 1. 1 4. 1 11. 0 -0. 5 0. 7 0. 6 2. 3 2. 9 -0. 1 -0. 4 11. 4 0. 8 1. 1 2. 2 3. 0 0. 0 0. 5 0. 8 0. 0 1. 8 0. 1 0. 9 1. 1 4. 8 -33. 9 -67. 6 -18. 2 -6. 6 -11. 8 -44. 1 2. 5 -4. 6 -2. 3 -20. 5 -13. 5 1 2 Billion of ECU, 1989 level. Indicator based on temperature, precipitation and sunshine, indicating the attractiveness for tourism. 7. 3. Adaptation activities Coastal Zones One of the key targets of the Fifth Action Programme of the ECs "Towards Sustainability" (CEC, 1993) is the integrated management of coastal zones. By request of the Council of Ministers (Environment), in a Resolution adopted on 25 February 1992, the Commission is currently preparing a Communication on the integrated management of coastal zones, with a view to providing a coherent environmental integrated and sustainable forms of development. The Communication will deal with the entire ambit of the coastal zones of the EC, including fore-shore, coastal waters and estuaries, and coastal land up to the limit of the marine or coastal influence. Research and development activities, e. g. Environment and Climate and "MAST" programmes (see Chapter 8) will provide a scientific basis for sound ecological management of these zones. In framework for 67 appropriate cases, financial support could be provided from existing istruments where rules and criteria would authorise potential stakeholders to submit projects in line with the Communication. Foreseen for approval by the Commission in October 1995 is a Communication, which proposes a three years demonstration programme in order to investigate and demonstrate the conditions of coordination, horizontally between the multiple sectors of activity ( priciple of integration) and vertically between the levels of territorial competence (principle of subsidiarity). In effect it should show -on the coastal area example- how to better put in practice the driving pnnciples of the fifth Environment Action Programme. The stakeholders at the various levels(local, regional, national, european) would have perform following tasks: the Description - state of the environment - existing environmental measures - planned developments Analysis - causes of existing environment problems - potential impacts of planned developments - potential impacts of the evaluation of the global environment - identification of management options Concertation - setting up mechanisms of coordination or adjusting existing ones - evaluation of management options - agreeing on plans/programmes:strategies for sustainable development of coastal areas The Commission must ensure that the programme is set up, and that the results are discussed and disseminated in order to generate practical results on the way to achieve more quickly sustainable development in coastal areas. The programme should also identify needs for further action at European and other levels. Forests In June 1993, at the Helsinki Ministerial Conference on the protection of forests in Europe, the European Community signed the Resolution on strategies for a process of long term adaptation of forests in Europe to climate change. The European Community actively participates in the follow-up process of this conference and its resolutions. One of the objectives of the Resolution on climate change the understanding of the linkages between climate change and forest ecosystems, including feedbacks from the ecosystem to the climate system. This should help to adjust European forest management systems in order to optimize the adaptation of forests to climate change. Another objective of the Resolution is the adaptation of existing forest monitoring schemes to assess alterations in forests that may be due to climate change. international cooperation intensify European research and improve its to to is 68 8. FINANCE AND INTERNATIONAL COOPERATION 8. 1. Introduction As Party, listed in Annex II of the UN FCCC, the EC is obliged to communicate details of measures taken in accordance with Article 4, paragraphs 3, 4 and 5. This chapter describes multilateral and bilateral cooperation between the European Community and developing countries and between the European Community and the countries with economies in transition. As a result of the Fifth Action Programme, progress has been made in integrating environmental requirements into cooperation with non Community countries, the so called "third countries". Environmental concerns are now reflected in most of the bilateral cooperation contracts established between the Community and its partner countries (CEC, 1994d). Most of the cooperation programmes and structures mentioned in this chapter have elements related to climate change, but are not specifically orientated towards it. Also, some of these programmes and structures are not only orientated towards developing countries or countries with economies in transition, but to all "third countries". The first Conference of the Parties to UN FCCC decided, amongst others, that the restructured Global Environment Facility (GEF) shall continue, on an interim basis, to be the international entity entrusted with the operation of the financial mechanism of the Convention. It decided also to review the financial mechanism within four years and take approppriate measures, including a determination of the definitive status of the GEF in the context of the Convention (Decision 9/CP. l). The European Parliament has expressed itself, in the Resolution on the Global Environment Facility (EP Resolution, report A3-0378/93, 18. 01. 1994), to be in favour of the participation of the European Community in the GEF as this would facilitate its coordinating role in international environmental matters. The GEF has been requested on 15 June 1995 to invite the European Community as observers to attend future GEF Council meetings. Discussions are currently taking place with the European Parliament on how to allocate the foreseen 3 MECU for EC participation in the GEF. 8. 2. Cooperation with third countries Cooperation with third countries relating to climate change takes place in the framework of an initiative called SYNERGY since 1980 , the LIFE instrument since 1992 and the European Energy Charter since 1994. 69 SYNERGY The Commission has proposed on 23 May 1995 that the Council prolong and change the SYNERGY initiative in a programme( COM (95) 197 final). The objective of SYNERGY is to improve the long term world energy situation and hence, Community energy security, by helping other countries to make effective energy policy decisions. By encouraging energy planning, the rational use of energy and counselling and training, SYNERGY contributes to the reduction of greenhouse gas emissions. The funding of the initiative amounted to 8 MECU per year. Energy cooperation under this programme is aimed at all third countries, and that is an advantage over the other EC cooperation programmes which all have a limited field of geographical application. Within the context of the SYNERGY initiative , the EC has contributed to regional planning studies by providing funds and experts. The impact of energy consumption on climate change is always taken into account in those studies. The EC has contributed to the following planning studies: energy plan for the state of Rio Grande do Sul, Brazil; study on improving demand forecasting tools for Brazil; energy study for the province of Buenos Aires, Argentina; energy prospects for South Amenca: urban energy plan for Bydgoszcz and Gliwice, Poland: urban energy plan for Miskolc, Hungary; energy policy studies for China; energy planning in Maghreb countnes; urban energy plan for Ankara, Turkey; national energy plan for Cyprus. Concerning the rational use of energy, the mam means in the SYNERGY initiative are the transfer of technology and methods for rational use of energy, the evaluation of potential energy savings in several economic sectors or countries and the promotion of cogeneration in energy production. The EC has supported the following projects: optimization of energy use in buildings in Brazil; energy efficiency in road transport and industry in Brazil; methodology for cogeneration in Brazil; promotion of cogeneration in Chile, Peru and Mexico; energy efficiency in the grain processing industry in Argentina; seminar on energy audits in Tunisia; plan for rational use of energy in industry, transport and buildings in Morocco; promotion of rational use of energy in Israel; energy savings in buildings in Mediterranean countries; industrial energy efficiency audits in Hungary. Institution building is also an important element of the SYNERGY initiative. This is pursued by the establishment of energy centres in the countries of Eastern Europe and developing countries. The objectives of these centres are the stimulation of the market penetration of efficient energy 70 technologies, providing a permanent representation of European energy industnalists and experts, and assisting in setting up of effective energy infrastructure (CEC, 1994c). At present, energy centres have been set up in Slovenia, Hungary, Albania and Rumania. In the near future it is intended to establish energy centres in China, Indonesia, Senegal and Argentina. The Commission has proposed that the Programme MECU. is to last five years with a total budget of 50 LIFE On 21 May 1992 the Community agreed upon the regulation on LIFE (Lending Instrument for the Environment)(1992/73/EEC). This provides for EC co-funding of demonstration actions, awareness raising campaigns and technical assistance projects in the area of environmental protection. The funding has been divided into several parts. The larger part is concerned with nature conservation, while the smaller part is concerned with environmental quality. European Energy Charter The European Energy Charter Treaty and the Energy Efficiency Protocol have been signed in Lisbon on 17 December 1994, after negotiations encompassing some 50 countries had been successfully concluded in June 1994. The European Energy Charter (COM (95) 440) is a political declaration committing its signatories to cooperate in trade, investment and other policies in all energy sectors. These efforts should lead to the creation of a true energy market throughout Europe. Environment protection and more efficient use of energy brought about by Treaties and Protocols in the frame of the charter will have a positive impact on limiting C02 and other greenhouse gas emissions in particular by encouraging market pnces, and hence more efficient energy usage. 8. 3. Cooperation with developing countries Cooperation with developing countnes takes place in the framework of general and more specific cooperation programmes. The specific programmes include research cooperation, energy and forestry related issues. Research cooperation Since 1982, the European Community has financed scientific cooperation with developing countries. A specific programme in this field which was targeted towards research cooperation with developing countnes, was Life Sciences and Technologies for Developing Countnes. This programme ran dunng the Third Framework Programme of Research and Development (1990-1994). The Fourth Framework Programme of Research and Development (1994-1998) covers activities specifically aiming at the promotion of international scientific cooperation. This area has a budget of 540 MECU (i. e. approximately 5% of the total budget of the fourth framework programme) The largest part of the budget will be used for cooperation with the countries of Eastern and Central Europe, the independent states of former Soviet Union and developing countries. 71 to all developing countries and of prime The forthcoming research cooperation with developing countnes covers topics that are seen to be to their economic and social common development. The new programme opens new areas: underlines the concept of sustainable development and strengthens interdisciplinary approaches. The programme will target three sectors: importance sustainable management of renewable natural resources; improvement of agncultural production and agro-industnal production; health research for development. Areas of relevance to processes of global environmental change cover research on the use and management of ecosystems (e. g. forests, coastal zones, wetlands, drylands, oceans, mountain areas and highlands). Human driving forces behind changes in the use and management of ecosystems will also be covered, for instance the impact of vanous policies on land-use systems. While agnculture and agro-industrial production are sectors of great importance for developing countries, there is a need for research on sustainable production systems taking account of socio-economic as well as environmental considerations. An example is the improvement of systems for processing and use of crop and animal production. Additional scientific areas of mutual interest may also be covered. Cooperation with developing countries will be implemented in close liaison with other forms for cooperation such as the Lomé Convention, the new Mediterranean policy and the regulation on financial and technical assistance to. and economic cooperation with, the developing countnes in Asia and Latin America. Cooperation on energy related issues Energy projects in Asian and Latin American countnes are funded within the frame of economic cooperation from Budget Line B7-3013. Since, 1990 eight projects have been set up within this budget line which are of direct relevance to the climate change issue. These projects involved the expenditure of around 1'5 MECU. Since 1992, no. specific budget line covers energy projects, which are funded under Economic cooperation or Financial and technical cooperation. For example, mid 1995 there are 16 energy projects on-going in Asia, for a total commitment of 56 MECU. Cooperation on forestry related issues With respect to forestry, worth mentioning is the establishment of the Community budget line "Tropical forest activities" (Budget Line B7-5041). This budget line is intended to finance projects concerned with the conservation and sustainable management of tropical and subtropical forests. The budget line was established in 1990 and resulted in an allocation of 2 MECU to tropical forest projects in 1991. This amount was increased to 50 MECU in the following years. Approximately one third of the budget line is devoted to projects in the African, Caribbean and Pacific countries and two-thirds to projects in Asia and Latin America. A proposal for a regulation to establish the legal basis of the budget line has been presented to the Council. 72 Some of the major actions financed to date or presently under preparation under the tropical forests budget line include: The Pilot programme for the Conservation of Brazilian Tropical Forests: an initial EC contribution of 11. 9 MECU was made to the Rain Forest Trust Fund in 1992, and cofinanced actions began in 1993 with a contribution of 4. 8 MECU to the directed research component. Cofinancing of 4 MECU for the demonstration projects component, which will support local community and NGO activities for forest conservation and sustainable development, and a further 5MECU for extractive reserves aimed at assisting rubber tapers and other traditional forest users was committed in 1994. In 1995, a 16. 7 MECU commitment for the Natural Resources Policy project has been decided. In Colombia, funding has already provided for an Amazon Fund for sustainable development, geared to channelling resources to small-scale local initiatives aimed at sustainable use of forest resources. Funding is also provided for the implementation of the Alto Orinoco biosphere reserve in Venezuela, and is under consideration for the manus Biosphere reserve in Peru. In 1995 further new projects may be undertaken in Paraguay and Mexico. their Pro Tempore The Community provides support to the Amazon pact countries through for the pact, together with regional Secretariat in Lima. A programme of institutional strengthening areas across the region, and for the projects for the planning and management of protected consolidation of indigenous areas, have already been initiated. Another important regional project which seeks to address the fundamental causes of deforestation concerns the control of the expansion of the agricultural frontier in Central America. A number of initiatives have been undertaken in the context of the Community's forest sector support programme to Indonesia, and a sustainable forest management project for Berau in East Kalimantan was committed in 1994. A Geographical Information Systems project has been agreed with Malaysia, and a national parks programme with the Philippines. In one country, in particular, Indonesia, actions, represented, for the years 1993-1995 the backbone of the EC development cooperation with a total of 4 major projects presently in place and further 2 planned (100 MECU). Other countries targeted for EC assistance in the forestry sector (under budget line B7-3000) include, amongst other, Bangladesh, India, Bhutan, Laos, Vietnam, Malaysia and the Philippines. in favour of tropical forests have indeed forest monitoring Important projects undertaken in ACP countries include a regional Central African project (3. 5MECU), Korup national park in Cameroun (7. 3 MECU) and substantial programmes in Nigena, Tanzania, Ivory Coast, Guinea and Papua New Guinea. Numerous smaller-scale projects local NGOs and implemented by European, community groups and indigenous peoples' organisations have received support. Close attention has to participatory sustainable been paid to the human aspects of forest conservation, development activities at local level. Biosphere reserves have provided a useful framework for the international or through 73 combination of sustainable which have benefited or for which assistance is under consideration. resource use with forest conservation, and there are around 10 reserves are under A number of non-country specific or horizontal actions have been financed or consideration, notably in the fields of promoting the establishment of timber certification systems, sustainable paper production, information federation of European parks and protected resources, and partnership arrangements between the areas in Latin America and Asia. forests and biodiversity forest monitoring, tropical Other bilateral cooperation African. Caribbean and Pacific countnes (ACP) The most comprehensive of all the Community's regional agreements with developing countries are those with the African, Caribbean and Pacific (ACP) countries, the so-called Lomé Conventions. The fourth convention was signed in Lomé on 15 December 1989 (Lomé IV) and will be into force from 1990 to 1995. The main objective of the convention is cooperation between ACP and EC countnes in order to promote and expedite the economic, cultural and social development of the ACP States and to consolidate and diversify their relations in a spirit of solidarity and mutual interest (Article I of the Convention). Under Lomé IV, environment is one of the main areas of cooperation. Within the framework of efforts to protect the environment and restore natural balances, cooperation aims to promote specific operations concerning the conservation of natural resources, renewable and non-renewable, the protection of ecosystems and the control of drought, desertification and deforestation. Other operations on specific themes are also being undertaken, notably locust control, the protection and utilization of water resources, the preservation of tropical forests and biological diversity, the promotion of a better balance between urban and rural areas, and the urban environment (Article 14 of the Convention). Another main area of cooperation is energy development. The ACP States and the Community have agreed to cooperate in view of the senousness of the energy situation in the majority of ACP States, owing partly to the crisis caused in many countries by dependence on imported petroleum products and the increasing scarcity of fuelwood, and in view of the effects the use of fossil fuels have on the climate (Article 105 of the Convention). In ACP-EC, cooperation particular emphasis shall be placed on energy programming, operations for saving and making efficient use of energy, reconnaissance of energy potential and the economically and technically appropriate promotion of new and renewable sources of energy. Asian and Latin-American developing countries (ALA) Since 1976, the Community has been pursuing a policy of financial, technical and, more recently, also economic cooperation with the Asian and Latin American developing countries (ALA). Under 74 the new guidelines for Community cooperation with Asian and Latin American (ALA) countries sustainable (Regulation 443/92), protection of development, are long-term pnonties. 10 % of the total budget of 2,750 MECU for the period 1991- 1995, has been set aside for projects specifically aimed at protecting the environment, in particular tropical forests (Article 5 of the Regulation). the environment and natural resources, and Environmental Impact Assessment have been fully integrated in the activities of the EC operations with developing countries. The overall volume of the financial resources committed to sustainable development cooperation is increasing since 1990, reaching 770 MECU in 1993, which were provided for projects in ALA, ACP and the Mediterranean countnes in areas relevant to the implementation of Agenda 21 and other Rio Conference agreements, for example energy, biodiversity, forests, rural environment and desertification, water and urban environment. While the bulk of this expenditure is channelled through bilateral (or regional) programmes, there are also two budget lines specifically devoted to environment in developing countries and to tropical forest. The first (B7-5040) targeted at the environment in developing countries (13. 2 MECU in 1995) is being used for small scale concrete activities related to the management of natural and urban environment including airpollution. A significant proportion of the budget line is devoted to assist developing countries to enhance their institutional capacity to deal with environmental issues, training establishment of local sustainable development plans and in environmental management and strategies with strong local community participation are some of its items. The second budget line (B7-5041) concerns the protection of forests on which reference has been made in previous chapters. 8. 4. Cooperation with the countries of Central and Eastern Europe and the former Soviet Union The cooperation with the central and eastern European countries (CEECs) and the former Soviet Union is mainly based on the PHARE (Poland and Hungary Assistance to the Restructuring of the Economy) and the TACIS (Technical Assistance to the Commonwealth of Independent States) programmes. The PHARE programme was established in 1989 and its main objective was to provide direct assistance to Poland and Hungary. Since then, the programme has been expanded to other countries in Central and Eastern Europe. The TACIS programme, oriented on the Commonwealth of Independent States (CIS), was formally established by a regulation adopted by the Council of Ministers in July 1991 (EEC/Euratom, no. 2157/91). A new and revised regulation was passed in 1993 (EEC/Euratom, no. 2053/93). Close links are being maintained between the PHARE and the TACIS programme. 75 PHARE The PHARE programme is an EC initiative which supports the political and economic development of the CEECs. PHARE provides grant finance to support the process of economic transformation and to strengthen newly created democratic societies. PHARE also provides grant finance to help countries with Europe Agreements to integrate with the EC. Within PHARE, close cooperation exists with the partner countries on how funds are to be spent, within a framework agreed by the EC. Initial PHARE support in the environment area covered urgent actions such as the supply of equipment to monitor air and water pollution, studies on specific problems and help in establishing standards and legislation. Later, the focus was switched to develop a more strategic approach, including the development of policies and programmes for specific sectors such as waste treatment. The main priorities for PHARE funding are common to all countries, although every country is at a different stage of transformation. The key areas include restructuring of state enterprises including agriculture, private sector development, reform of institutions and public administration, reform of social transport and telecommunications infrastructure, and environment and nuclear safety. At the end of its first five years of operation in 1994, the European Community, through the PHARE programme, made available 4,284 MECU to 11 partner countnes (CEC, 1994b). services, employment, education and health, development of energy, Of relevance to the climate change issue are particularly the activities in the key areas "environment and nuclear safety" and "development of energy". Other Community programmes are complementing the assistance in the energy sector, such as THERMIE (Section 4. 3) and SYNERGY (Section 8. 2). For all the CEECs and the EC, the European Energy Charter reflects common interests in the energy sector. The support in the area of environment is being provided either in the form of yearly National or Regional Environmental Sector Programmes or through environmental components in the General Technical Assistance Facilities. In 1991, technical assistance programmes in the energy sector started in Poland, the Czech and Slovak Federative Republic, Hungary and the Baltic States. In 1992 and 1993, PHARE extended its activities in the energy sector to the other partner countries and to "multi-country" activities. The aim of the multi-country energy programme is to facilitate cooperation between all the PHARE partner countnes. These regional projects cover the following areas: interconnection of energy networks; twinning and training programmes; energy and environment. Regarding "energy and environment", an important programme is cunently being prepared, namely the development of a coordinated strategy in the field of clean and rational use of coal in central and eastern Europe (CEC, 1994b). 76 TACIS The overall aim of the TACIS programme is to contnbute to the transition towards a market economy of the independent states of the former Soviet Union. By the end of 1994, TACIS included 13 partner countries: Armenia, Azerbijan, Belarus, Georgia, Kazakhstan, Kyrgyzstan, Moldova, Mongolia, the Russian Federation, Tajikistan, Turkmenistan, Ukraine en Uzbekistan. The TACIS programme provides support in the form of grant finance to foster the exchange of knowledge and expertise through partnerships, links and networks at all levels of society'. TACIS started in 1991 with an annual budget of 400 MECU, which rose to 510 MECU in 1994 (CEC, 1994a). The European Community and its partner countries work closely together to assess reform objectives and the needs for TACIS support based on the economic situation and progress of reform. The major focal areas currently supported by TACIS are: human resources development; enterprise restructuring and development; infrastructures; energy, including nuclear safety; food production, processing and distribution. Although the first TACIS Regulation did not mention the environment as a focal area, environmental concerns have played a major role in all TACIS activities from the programme's inception. The Commission has chosen to integrate the environment in all sectors, rather than focusing on projects which are purely "environmental". Environmental impact assessment and auditing was an integral part or part of the feasibility study of all larger projects. However, the new TACIS Regulation (1993- 1995) includes a specific reference to the environment. Article 4, paragraph 3 of the Regulation states taken of environmental considerations when designing and implementing programmes". that "due regard shall be the beginning of 1995, the European Community has reinforced In the environment in the former Soviet Union, through the Environmental Support Facility project. The projects' main purpose is to provide a framework for environmentally sound economic growth in the region and to help restore areas which have suffered from senous environmental damage in the past. It will help industry, governments and non-governmental organisations to plan and implement environmental projects. its commitment to Energy is specified as one of the prionty sectors of the TACIS programme. Important to note is that each project in the energy sector contains an energy saving component. Advice is also offered to assess the potential of renewable resources, mainly hydropower but also solar, wind and geothermal power. The TACIS programme has inter alia financed a number of energy centres which were established under the THERMIE programme (CEC, 1994a). These energy centres develop energy saving strategies, promote commercial cooperation and establish dialogues between international energy 77 experts. Also a number of energy audits are carried out at industrial plants as a first step in demonstrating energy saving technologies. This technical assistance is aimed at reducing the energy intensity of the industrial and commercial sectors and is provided directly to specific energy-intensive enterprises through demonstration projects. Recent actions include energy audits in the aluminium, steel, cement and paper industries (CEC, 1994d). In the following years TACIS will provide energy saving advice to the existing institutions involved in energy distribution. 8. 5. Summary Table 8. 1 gives an overview of budgets which have been spent on or reserved for programmes in the field of international cooperation. However, it should be emphasized that international cooperation programmes usually encompass a wide range of activities. It is difficult to isolate the environmental or energy component of the various integrated development projects. The table should be read in that context. Climate change related projects only cover a minor part of the total budgets. Table 8. 1 Summary of expenditures on EC cooperation programmes with third countries, especially developing countries and countries with economies in transition. Cooperation programme Time period Total budget (MECU) All third countries: SYNERGY LIFE Developing countries: Research cooperation Energy cooperation (B7-3013) Forestry cooperation (B7-5041) ACP-countries ALA-countries Countries with economies in transition: PHARE TACIS 1990-1994 1991-1995 1990-1994 1990-1994 1990-1994 1990-1995 1991-1995 1990-1994 1991-1994 400 2,750 4,284 1,870 78 9. RESEARCH AND DEVELOPMENT 9. 1. Introduction Pursuant to Articles 4. 1 (g), 5 and 12. 1 (b) of the Convention, this chapter gives information about research efforts on physical and human aspects of global climate change, with a view to supporting the process of policy-making. These research efforts are described in the light of the Second, Third and Fourth Community Framework Programme of Research and Development (Section 9. 2 to 9. 4). Within these framework programmes, the specific research programmes on environment, energy and marine science are of particular importance to climate change (another action about RDT cooperation with third countries, also important for the Climate Change and Developing Countnes issue, is presented in section 8. 3). The framework programmes have given emphasis to the integration of environmental concerns into the EC's activities over time. Protection of the environment and improvement of the quality of life were already important objectives of the third framework programme. These objectives have been considerably reinforced in the fourth framework programme, both through its overall commitment to promote sustainable development, and through the substantial increase in financial resources allocated to environment (CEC, 1994d). 9. 2. Second Framework Programme of Research and Development During the Second Framework Programme of Research and Development (1987-1991), research projects regarding climate change were included in the European Programme on Climatology and natural Hazards (EPOCH), the Science and Technology for Environmental Protection (STEP) programme and the Remote Sensing programme of the Joint Research Centre. From these three programmes, EPOCH had the strongest liaison with the climate change issue. The programme consisted of the following research areas: - past climates and climate change; - climate processes and models; - climatic impacts and climate-related hazards; - seismic hazard. 79 The research activities on past climates and climate change focused on the functioning of the climate system (atmosphere, oceans, biosphere, cryosphere) apart from changes induced by human activities. The general goal of the research on climate processes and models was to understand the mechanisms ruling the various components of the climate system, and their interactions, in order to improve the physical formulation and the parametrization of climate models, and hence the ability to predict climate change. The research on climatic impacts and climate-related hazards aimed to reach insight in the effects of climate change upon various sectors of the European environment, such as agriculture. Finally, the research on seismic hazard was oriented on developing and improving of the means for predicting, preventing and mitigating the seismic risk in Europe. EPOCH also covered a large part of the research subjects foreseen in the International Geosphere-Biosphere Programme (IGBP), the World Climate Research Programme (WCRP) and the World Climate Impact Programme (WCIP). 9. 3. Third Framework Programme of Research and Development The Third Framework Programme of Research and Development (1990-1994) is organised around 15 specific programmes. Three of these programmes are relevant with regard to climate change, namely environment, energy technology and marine science and technology. Environment The emphasis on environmental research has increased in the third framework programme: 261 MECU have been devoted to the Environment programme. The Joint Research Centre (JRC) contributed through its own programme 257 MECU to the Environment programme. In this programme, attention was paid for the first time to socio-economic environmental research. The Environment programme included four research areas: - participation in global change programmes; - environmental technologies and engineering; - - research on economic and social aspects of environmental issues, and technological and natural risks. A significant proportion of the Environment programme is dedicated to research with direct relevance to global climate change. The part of the programme concerning climatology and natural hazards consists of the following research themes: 80 - natural climate change, - anthropogenic climate change; - climate change impacts; - desertification in the Mediterranean area; - natural risks. The research in the area of natural climate change focused mainly with the reconstruction of past climates and past environmental conditions. The two main purposes of the research were to gain more insight into the global climate system by analysing and modelling past climates and climate change, and to help validate and improve climate models by the provision of high quality reconstructions for reference and testing. The main issues within the theme of anthropogenic climate change were the understanding of the present climate and the prediction of climate change. The theme mainly focused on the development and application of complete climate models to predict future climate. The research on climate change impacts focused on prediction and quantification of the effects of climate change, including primary physical effects as well as secondary effects on important socio-economic sectors. The main research themes were centred around the consequences of sea level change, and climatic impacts on water resources, forests and agriculture in Europe. Part of the Environment programme was for example the ECOCRAFT project which originally started in 1991 under the EPOCH programme. The acronym ECOCRAFT is based on "European Collaboration on C02 Responses Applied to Forests and Trees". The project was concerned with the impacts of rising carbon dioxide and temperature on the growth processes of trees, the use of models to upscale the responses of the processes to the scale of forests over tens of years and the use of flux measurements to test the models, as well as to measure directly the sequestration of carbon by European forests. The research on desertification in the Mediterranean area was aimed at a thorough understanding of the desertification phenomenon, its genesis and evolution, and to provide guidelines for management of desertification prone-areas as well as for protecting and rehabilitating such areas. The research on natural risks was divided into at one hand meteorological and telluric research and at the other hand research on wildfires. Meteorological and telluric research was orientated towards the physical causes, frequency, severity and means of prediction and hazard reduction of natural disasters, such as storms, floods, landslides, earthquakes and volcanic eruptions. A major aim was to assess the European vulnerability to these natural hazards and to improve the scientific basis for disaster reduction. Research on wildfires was aimed at understanding the factors, natural and human, favounng or hindering the occurrence of wildfires, in order to develop suitable means for forecasting, prevention and risk management. In order to promote and facilitate coordinated research and to utilise this research for the various policies of the European Community, the Commission has established the European Network for Research in Global CHange (ENRICH). ENRICH's major role is to support policy objectives by acting as a clearinghouse for the exchange of information and by promoting cooperation in research and capacity building. In addition to promoting collaboration in Western Europe, ENRICH also helps to encourage the endogenous research capabilities in developing countries mainly, but not exclusively, in Africa and the Mediterranean Basin, and to support relevant research in the CEECs and the former Soviet Union. An ENRICH Council, Office, Liaison Offices and an Interservice Group have been set up to carry out the functions of the network. Energy technology Two successive programmes regarding new energy technologies, JOULE I (1989-1992) and JOULE II (1990-1994), have been established by the Community. Both programmes addressed the development of clean and efficient energy technologies in the three following areas: rational use of energy (in industry, transport and building), advanced technologies for fossil fuels and renewable energies. An additional activity relative to the elaboration of energy-environment models and analysis of RTD strategies was also part of these programmes; such an activity has provided background information for the Community C02 strategy through a major study called "C02-Crash programme", addressing the cost-effectiveness of the different options and the economic impacts of the taxation. In general terms, the environment dimension which was already an integral part of JOULE I has been strengthened in JOULE II. Furthermore, an accompanying action has' been undertaken consisting of associating Eastern countries teams within some research projects of JOULE II. The budget for both programmes was respectively 122 MECU and 258 MECU. SESAME is a documentary or full text data base containing information on more than 6,000 Community energy projects and 7,000 energy projects administered by the Member States and Norway. The SESAME data base contains administrative and technical information on RTD projects in the following sectors: - energy saving in buildings, industry, transport and the energy industry; - solid fuels; - biomass and energy from waste; - geothermal energy; - small hydroelectricity; - solar energy (photovoltaics and thermal); 82 - wind energy; - hydrocarbon technology (oil and gas). Marine sciences and technology The European Community's Marine Science and Technology programmes (MAST) aim to introduce the necessary Community dimension to various on-going research activities of the Member States. MAST intends to contribute to establishing a scientific and technological basis for the exploration, exploitation, management and protection of Europe's coastal waters and the seas surrounding the EC's Member States and thereby achieve a better balance in the marine science potential of the various areas of the EC. MAST II (1991-1994) has superseded the first MAST pilot programme (1989-1992). MAST IPs geographical scope has expanded and also included the North Atlantic Ocean and the subpolar Arctic seas. The budget of MAST II amounted to approximately 100 MECU, aimed at supporting collaborative research projects and improving marine research in Europe. The fundamental aim of MAST II is to contribute to knowledge of the marine environment and its variability, in order to improve its management and protection and to predict its change. The MAST II programme was divided into 5 areas: - marine sciences; - coastal zone science and engineering; - marine technology; - supporting initiatives; - large scale targeted projects. 9. 4. Fourth Framework Programme of Research and Development The Fourth Framework Programme of Research and Development (1994-1998) is organised around nineteen specific programmes. Three of these programmes are of direct relevance with regard to climate change, namely environment and climate, clean and efficient energy technologies, marine science and technology. The specific programmes orr agriculture and fishenes, transport, the Joint Research Centre and cooperation with third countries and international organisations are more indirect related to climate change. Environment and climate. The fourth framework programme includes a specific programme of research and technological development, including demonstration, in the field of environment and climate (1994-1998). For this programme an amount of 532 MECU has been reserved. The programme covers four themes: 83 - the natural environment, environmental quality and global change; - environmental technologies; - space techniques applied to environmental monitoring and research; and - human dimensions of environmental change. A first objective of the programme on environment and climate is to understand the basic processes underlying environmental change, in particular those of the climate system, including the atmosphere, the oceans, the land surfaces, the continental ice masses and the biosphere. Detailed analysis of human and social behaviour and of the patterns of economic development responsible for adverse effects on the environment will be carried out in parallel with the study of natural processes. A second objective is to improve assessment of the consequences of climate and other environmental change. Consequences for the natural environment and for society will be considered, including ecosystems, societal and economic activities, energy demand and consumption, and the use and management of natural resources, especially water, agriculture, forestry and coastal resources. A third objective is to contribute to the technological development necessary for environmental observation, monitoring and research, including methodologies and technologies for the monitoring, warning and management of natural hazards. Particular attention will-be paid in this respect to applied space technologies. JRC will also contribute through its own programme of direct activities, to the attainment of the Community RTD objectives in the areas covered by the programme on Environment and climate. In addition, the JRC will make a significant contribution to the implementation of the Centre for Earth Observation (CEO). The EC is now initiating the implementation of ENRICH in the context of the Fourth Framework programme. ENRICH will provide a basic mechanism for facilitating the coordination of global change research in the EC's programmes, notably those on Environment and climate research, Marine Sciences and Technologies and the Specific Programme on Cooperation with Third Countries and International Organisations. On the international scene, ENRICH would aim to collaborate with the various international entities involved in global change research. The international research effort in this field requires, in turn, harmonised commitments of financial resources. Clean and efficient energy technologies A specific programme on non-nuclear energies will be continued under the Fourth Framework Programme. This programme, called "Clean and Efficient Energy 84 Technologies" (CEET), merges for the first time both the R&D and the Demonstration (for this reason it is also called JOULE-THERMIE by reference to the previous programmes). The motivation of the RTD strategy supporting the new programme is to ensure the energy security, considered in the broadest sense i. e. ensuring reliable energy services at affordable cost and conditions. The main driving force for technological change are the environmental effects due to production and use of energy (in particular the C02 issue). Furthermore, the RTD policy must integrate regional dimensions and international must build on concertion with other Community policies, including cooperation. The budget of the CEET programme is 967 MECU for the period 1994-1998. The main component of the programme is technological development in the same areas mentioned for JOULE and THERMIE; R&D will give more emphasis to the introduction of renewable energy (including third countries), whereas demonstration activities will support more substantially rational use of energy and fossil fuel technologies. A wide range of activities for the RTD strategy definition will be undertaken: global analysis, socio-economic research, energy, environment and economy modelling; these activities will be focused in particular on the Climate Change issue and its relationship with technological change and sustainable development. Exchange of information with third countries and dissemination of tools and results will be part of this activity. Marine science and technology The MAST III programme (1994-1998) extends, develops and refocuses the activities carried out under the first two MAST programmes i. e. the pilot phase of 1989-1992 and the MAST II programme 1990-1994. For the period considered, MAST III is a step in a longer term strategy which will enable Europe to make a full contribution to the knowledge and management of the oceans. Its general objective is to foster the scientific knowledge and technological development necessary to understand how marine systems function at basin scales, in order to prepare for sustainable use of the oceans consistent with the preservation of marine environmental quality, and to determine their role in global change. The programme comprises four areas of activity: - marine science; - strategic marine research; - marine technology; - supporting initiatives. research activities may, where appropriate, The international programmes such as IGBP, WCRP and HDP, as well as with certain aspects of the development of the Global Ocean Observing System (GOOS). liaise with other 85 ETERNE The EC launched in 1991, together with the US Department of Energy, a joint research project to assess the external costs of fuel cycles. On the European side the project is co- funded by the JOULE programme. It is known as the Externe project. In the first phase, the teams jointly developed the conceptional approach and the methodology and shared scientific information for its application to a number of fuel cycles. The EC further co-financed the second phase of the project under JOULE-II. It was started in 1993 and has been completed in 1995. The main objectives were to apply the methodology to a wide range of different fossil, nuclear and renewable fuel cycles for power generation and energy conservation options. In addition, the general methodology and accounting framework were extended to address the evaluation of externalities associated with the use of energy in the transport and domestic sectors. The third phase of the project has been undertaken within the ECs Fourth Framework Programme and will concentrate on the dissemination of the results and the application of the accounting framework in support of policy issues and decision making. 9. 5. Summary Table 9. 1 gives an overview of budgets which have been spent on or are reserved for research programmes in the areas of climate change, non-nuclear energy and marine sciences. The table shows that research budgets in all three areas have been largely increased during the last years. The expenditures on research projects primarily oriented towards climate change are included in the total budgets in Table 9. 1; no data are available to specify these expenditures separately. 86 Table 9. 1. Summary of expenditures on EC research programmes relevant to the climate change issue. Research programme Time period Total (MECU) budget Environment and Climate : STEP EPOCH Environment Environment and climate Joint Research Center: Non-nuclear energy: JOULE I JOULE II CEET Marine sciences: MAST I MAST II MAST III 1989-1992 1989-1992 1991-1994 1994-1998 1991-1994 1994-1998 1989-1992 1990-1994 1994-1998 1989-1992 1991-1994 1994-1998 75 40 261 532 150 320 122 258 967 50 118 228 87 10. EDUCATION, TRAINING AND PUBLIC AWARENESS 10. 1. Introduction The success of policies and measures addressing the problem of climate change will depend to a large extent on the decisions and actions of the general public. Education, training and increasing public awareness through information campaigns are important tools to enable a change of consumer attitudes and choices. The fifth Action Programme of the EC "Towards Sustainability" emphasizes that it is essential to provide adequate information to the general public on the relation between the activities of individuals and environmental pollution (by e. g. awareness campaigns), and to offer alternatives to the general public to reduce environmental pollution. Also, the active involvement of and participation of non-governmental organisations (NGOs), trade unions and professional associations is highly valued in the fifth Action Programme. On the basis of existing Community legislation on freedom of access to information on the environment (90/313/EEC), local and regional authorities can facilitate greater public involvement in environmental protection. The objective of this directive is to ensure freedom of access to, and dissemination of, information on the environment held by public authorities and terms and conditions on which such information should be made available (Article 1 of the directive). to set out the basic This chapter respectively deals with information, education and training programmes (Section 10. 2), dissemination of research results (Section 10. 3) and research activities regarding education, training and public awareness (Section 10. 4). 10. 2. Information, education and training programmes At the EC level, information, education and training programmes concerning climate the scope of (sectoral) policy take place within change and energy use mainly programmes, such as energy supply, transport, urban development and agriculture. Energy supply Information for the wider public is a key element of the SAVE, ALTENER and THERMIE/JOULE programmes. These programmes have been described extensively in the provision of Chapter 4. This section only describes information. SAVE has set up an information exchange network on energy efficiency aimed at all the levels of the EC, the goal being that all EC citizens will ultimately be aware that energy efficiency not only provides financial benefits but brings benefits to the relevant parts about 88 levels of renewable energy the environment as well. ALTENER has also established an information exchange network and has launched in 1994 a major information programme stressing the benefits in the EC's energy mix and the resulting of greater levels. THERMIE's environmental benefits, especially dissemination actions include a network of some forty Organisations for the Promotion of Energy Technology (OPET) focusing on distributing and promoting innovative energy technologies across Europe, including Central and Eastern European countries and the former Soviet Union. terms of C02 emission in An extensive part of the SYNERGY initiative is focusing on training activities (see also Section 8. 2) relating to the climate change problem and emissions of greenhouse gases. The following activities may be mentioned in this respect: training courses in India; training courses in China, for example about clean coal combustion technology; seminar on energy and environment in Shanghai; courses about energy planning and savings in Latin America; training courses on energy saving in Estonia. Transport The European Community's evolving strategy for transport is most recently expounded in the White Paper on The Future Development of the Common Transport Policy: A Global Framework for Sustainable Mobility. The strategy includes the promotion of more environmentally rational use of the pnvate car, along with changes in driving rules and habits. Urban development The EC supports pan-European environmental campaigns of local authorities aiming at local sustainability, or significant local contribution to global sustainability, such as Sustainable Cities and Towns, the Car Free Cities Club and Cities for Climate Protection. The Sustainable Cities Project was launched by the Expert Group on the Urban Environment, to run from 1993 to 1995. The expert group was established by the European Commission in 1991 following the publication of the Green Paper on the Urban Environment. The principle aims of the Sustainable Cities Project are to contribute to the development of thinking about sustainability in European urban settings, to foster a wide exchange of experience, to disseminate best practice about sustainability at local level, and, in the longer term, to formulate recommendations to influence policy making at Community, Member State, regional and local level, as called for in the Council resolution of 1991 (Fudge & Mills, 1994). The planned outputs of the Sustainable Cities Project are a policy report, a good practice guide and a database of relevant practice. The exchange of information and experience is being further encouraged through the European Campaign for Sustainable Cities and 89 local authorities and 253 representatives of Towns launched in May 1994 during the First European Conference on Sustainable Cities and Towns held in Aalborg, Denmark. At this conference, the Campaign was joined by 80 European international organisations, national governments, scientific institutes, consultants and individuals who signed the Aalborg Charter. According to the Charter, the signatories take responsibility for the global climate. It is stated that the significant risks posed by global warming to the natural and built environments and to future human generations require a response sufficient into the to stabilize and then to reduce emissions of greenhouse gases atmosphere as soon as possible. Renewable energy sources are mentioned as the only sustainable alternatives for the present ones. A second European Conference on Sustainable Cities and Towns is planned for 1996 in Lisbon, Portugal. This conference will assess progress on sustainability, receive the second draft policy report from the expert group and ensure continuation of the Sustainable Cities and Towns Campaign (Fudge & Mills, 1994). In June 1992, the Environment Commissioner has proposed to establish a network of car free cities and to organize a conference about the topic. The main purpose of this proposal was to start a discussion about the daily traffic problems in cities, to set up a platform for the exchange of experiences and to find solutions for improvement of the urban environment. This proposal was adopted by the European Commission. Finally, the conference about car free cities was held on 24 and 25 March 1994 in Amsterdam. As a result of the conference a charter was drafted and signed by the representatives of 40 European cities. According to the charter, one of the explicit objectives is to stimulate the efficient use of energy and to diminish emissions by traffic which contribute to ozone and greenhouse problems (Car Free Cities Club, 1994). It is considered necessary to push back the use of private cars and to stimulate the use of less harmful means of transport. the the European Secretariat of In 1993, the Convention of European Municipal Leaders on Climate Change was organized by for Local Environmental Initiatives (ICLEI), under the auspices of the Commission of the EC and the United Nations Environment Programme (UNEP). The outcome of the Convention was the launching of the Campaign European Cities for Climate Protection. The aim of the joint campaign on saving energy and reducing C02 emissions is to help nations implement to support the goals set at the Rio summit as fast as possible and municipalities in their efforts to fight the causes of climate change. International Council ICLEI, co-sponsored by the European Commission, also organised the second Local Government Leaders' Summit on Climate Change held in Berlin back to back to the first Conference of the Parties to the UN FCCC. This summit on climate change served to exchange information on innovative local policies and practices and explored possible future strategies. The summit, attended by 159 municipal leaders, issued on 29 March 90 1995 a Communiqué, in which, amongst others, the local authorities are called upon to develop local action plans to reduce C02 emissions 20% by 2005. In the framework of the "Energy Management in Regions and Cities" initiative, the Commission encouraged the setting up of the ENERGY-CITES network which aims at the implementation of a sustainable use of energy in urban areas. Through the creation of Cities Energy Agencies it is hoped that the elected people and citizen will perceive more the challenge and the potential of good energy management. This should properly contribute to reduce consumption in cities and to promote local and new energies which should have impact on the urban and global environment but also on the life quality in urban areas. This approach will be strengthened within the SAVE-II programme. Agriculture Concerning agricultural soils, since 1992, efforts are undertaken to promote "integrated control" by in particular training activities to reach an equilibrium between input of nutrients and the absorption capacity of soils and plants. This will lead in the future to a reduction of N20 emissions from the application of fertilizers. 10. 3. Dissemination of research results Training and education are also important parts of the accompanying measures of the European Community research programmes. Activities with regard to the EPOCH, the Environment and the Environment and Climate programmes (see chapter 9) are pursued through: the European School of Climatology and Natural Hazards, through annual or biennial courses on selected relevant topics, to be held in cooperation with various European research institutions; sectoral grants for European graduates and post-graduates in fields relevant to climatology and natural hazards; the publication of a series of books and monographs dealing with important topics relevant to the research areas of the programme and meeting the needs of different kinds of concerned audiences. The European School of Climatology and Natural Hazards takes the form of courses dealing with current research issues in the fields of climate and natural hazards. The courses which are organized in cooperation with leading European institutions, are open to graduating or post-graduate students in appropriate fields of research. 91 Relevant courses in relation to climate change organized by the European School of Climatology and Natural Hazards:. Climatic change and impacts: A general introduction, 11-18 September 1988;. Climate and global change, 4-12 Apnl 1990;. Forest fire risk and management, 27 May-4 June 1992;. Desertification in a European context. Physical and socio-economic aspects, 6-13 October 1993;. Statistical analysis of climate variability, 30 October-6 November 1993;. Foreseen in 1995: Climate change impacts on agriculture, forest and water resources. 10. 4. Research activities regarding education, training and public awareness The Directorate General for Environment, Nuclear Safety and Civil Protection (DGXI) of the Commission of the European Communities commissioned a study to examine the scope for improved education, training and public awareness activities regarding climate change (CEC, 1992). An inventory of activities which are taking place in the individual Member States lead to the following conclusions: their C02 reduction programmes, many EC countries are not placing to support in sufficient emphasis on educational and promotional activities legislative measures; large differences exist the standard of energy education between EC in countries; in all EC countries, a need for energy training has been recognized within industry, commerce and educational establishments. The study showed that an integrated packet of government-run promotions of energy conservation, backed by and is most effective to address climate change. incentives and legislation linked to financial 92 LITERATURE Bengtsson, L. (1994). Climate of the 21st century. 1994. Agricultural and Forest Meteorology 72 (1994) 3-29. Car Free Cities Club (1994). Car Free Cities Charter. Brussels. Commission of the European Communities (1992). Policy Measures in the Field of Education, Training, Public Information and Public Relations to contribute to the limitation of C02 emissions. DG XI, Contract No B91/B - 3046/9493. Brussels, March 1992. Commission of the European Communities (1993). Towards Sustainability: A European Community programme of policy and action in relation to the environment and sustainable development, Brussels, 1 February 1993. Commission of the European Communities (1994a). What is TACIS? Partnerships and cooperation with the New Independent States. DG I, TACIS Information Office, Brussels, May 1994. Commission of the European Communities (1994b). What is PHARE? A European integration with central and eastern European Union countries. DG I, PHARE Information Office. Brussels, September 1994. for economic initiative Commission of the European Communities (1994c). Evaluation of progress on integration of the environment into other areas of Commission policy and action. Detailed note. Brussels, 20 October 1994, XVII/A/2/MD. Commission of the European Communities (1994d). Interim review of implementation of the European Community programme of policy and action the environment and sustainable development "Towards Sustainability". COM (94) 453 final. Brussels, 30 November 1994. in relation to Cubasch, U. , J. Waszkewitz, G. C. Hegerl, J. Perlwitz (1995). Regional climate changes as simulated in time-slice experiments. Max-Planck-Institut fur Météorologie. Hamburg. ERM (1992a). Development of a Framework for the Evaluation of Policy Options to deal with the Greenhouse Effect. Summary report: Assessment of strategic options. A for report for Environment, Nuclear Safety and Civil Protection. Climate Research Unit and Environmental Resources Limited. the Commission of European Communities, Directorate General ERM (1992b). Development of a Framework for the Evaluation of Policy Options to deal with the Greenhouse Effect. Economic valuation of impacts and adaptive measures in the European community. A report for the Commission of European for Environment, Nuclear Safety and Civil Communities, Directorate General Protection. Climate Research Unit and Environmental Resources Limited. 93 Fudge, C. and L. Mills (1994). European Sustainable Cities. First report EU Expert the Urban Environment. Sustainable Cities Project. XI/822/94-EN. Group on Brussels, October 1994. Harrison, P. A. , and M. L. Parry (1993). The effect of climate change on agricultural and horticultural potential in Europe. Environmental Change Unit. University of Oxford. Paper presented at EC Symposium on Climate Change and Climate Change Impacts, Copenhagen, 6-10 September 1993. Houghton, J. T. , B. A. Callander, S. K. Varney (eds. ) (1992). Climate Change 1992 - The IPCC Supplementary Report on University Press, Cambridge. the IPCC Scientific Assessment. Cambridge IPCC (1994). Radiative forcing of climate change. The 1994 Report of the Scientific Assessment Working Group Intergovernmental Panel on Climate Change. of IPCC. Summary for Policy Makers. Jones, M. B. , T. Ashenden, A. J. Parsons, H. Payer, A. Raschi, J. H. M. Thornley (1993). The effects of rising C02 and changing climate on grassland communities in Europe. Paper presented at EC Symposium on Climate Change and Climate Change Impacts, Copenhagen, 6-10 September 1993. Thimbal, B. et al (1995). Sensitivity to prescribed changes in sea-surface temperature and sea-ice in doubled carbon dioxide experiments. Meteo-France, no. 42. Warrick, R. A. , E. M. Barrow, T. M. L. Wigley (1990). The greenhouse effect and its implications for the European Community. Report for the Commission of the European Communities. Contract No: EV4C-0098-UK. Climatic Research Unit, University of East Anglia, Norwich. 94 ABBREVIATIONS ALTENER CAP CEECs CEET CEO CIS CORINAIR EAGFF EC ECOCRAFT ECU ENRICH EUROSTAT EPOCH FEC FNEC GCOS GDP GIC GOOS GTOS GVA HDP IGBP INC IPCC JOULE JRC OECD OPET PACE PERU PHARE Programme for the Promotion of Renewable Energy Sources Common Agricultural Policy Central and Eastern European Countries Programme on Clean and Efficient Energy Technologies Centre for Earth Observation Commonwealth of Independent States CORINE AIR emissions inventory European Agriculture Guidance and Guarantee Fund European Community Project on European Collaboration on C02 Responses Applied to Forests and Trees European Currency Unit European Network for Research In global Change Statistical Office of the European Communities European Programme On Climatology and natural Hazards Final Energy Consumption Final Non Energy Consumption Global Climate Observing System Gross Domestic Product Gross Inland Consumption Global Ocean Observing System Global Terrestrial Observing System Gross Value Added Human Dimension of global environmental change Programme International Geosphere-Biosphere Programme Intergovernmental Negotiating Committee Intergovernmental Panel on Climate Change Programme on Joint Opportunities for Unconventional or Longer- term Energies Joint Research Centre the Promotion of Energy for Organisation for Economic Cooperation and Development Network of Organisations Technologies Action programme for improving the efficiency of energy use Planning of Energy at Regional and Urban level Programme Restructuring of the Economy and Hungary Assistance on Poland to the 95 R &D RTD SAVE STEP SYNERGY TACIS THERMIE UN FCCC UNO WCIP WCRP Research and Development Research, Technological development and Demonstration for Environmental Programme on Specific Actions for Vigorous Energy efficiency Programme on Science and Technology Protection Programme for energy cooperation with all non-Community countries Programme on Technical Assistance to the Commonwealth of Independent States Energy Technology Support Programme United Nations Framework Convention on Climate Change United Nations Organisations World Climate Impact Programme World Climate Research Programme Chemical formulae and references CO C02 CH4 NMVOC N20 NO. Gg toe Carbon Monoxide Carbon Dioxide Methane Non-Methane Volatile Organic Compounds Nitrous Oxide Nitrogen Oxides Gigagram (1 Gg = 1 kilotonne) tonne of oil equivalent 96 ANNEX 1 NATIONAL GREENHOUSE GAS EMISSION INVENTORIES ^- Estimates of greenhouse gases in Austria - 1990 (Gg). AUSTRIA CO, CH4 N ,0 N O. CO NMVOC Industry Fugitive fuel All enetgy Fuel combustion 1 la l al Energy & transformation 1 a2 1 a3 Transport la4 Commercial/institutional la5 Residential la6 Agriculture/forestry la7 Other la8 Biomass lb l bl Oil & gas lb2 Coal mining Industrial processes 2 2a Iron & steel 2b Non-ferrous metals Inorganic chemicals 2c 2d Organic chemicals 2e Non-metallic minerals 2f 3 3a 3b Degreasing & Dry cleaning 3c Chemical prods manuf/proc 3d Other 4 4a 4b Animal wastes 4c Rice cultivation 4d Agricultural soils 4e Agricultural waste burning 4f 6 Waste 6a 6b Wastewater 6c Other Other Solvent use Paint application Agriculture Enteric fermentation Savannah burning Landfills 57100 57100 16500 12300 16200 12100 IE IE IE 0 2100 116 24 <1 1 15 8 IE IE IE 92 259 230 28 228 1. 4 1 <1 1 <1 <1 IE IE IE 1 216 216 12 47 145 12 IE IE IE 0 1391 1391 6 27 582 776 IE IE IE 0 241 269 253 <1 24 130 99 IE IE IE 16 130 20 60 12 <1 26 Total emissions 59200 603 222 1692 445 Marine bunkers Aviation bunkers FNEC IE = Included Elsewhere NE = Not Estimated 0" 1200° 4600* * CORINAIR figures used a) Reconciliation of CORINAIR and EUROSTAT transport emission estimates * Eurostat figures used 98 Sources: National Climate report of the Austrian Federal Government. In Compliance with the obligations under Art. 4. 2 and Art. 12 of the Framework Convention on Climate Change (Federal Law Gazette No. 414/1994). Vienna, 1994. Eurostat CORINAIR Estimates for all greenhouse gases are taken from the National Report, unless indicated otherwise. 99 Estimates of greenhouse gases in Belgium - 1990 (Gg). BELGIUM C 02 CH4 N20 NOx CO NMVOC Industry Fugitive fuel All energy Fuel combustion 1 la lal Energy & transformation la2 la3 Transport la4 Commercial/institutional la5 Residential la6 Agriculture/forestry la7 Other la8 Biomass lb l bl Oil & gas lb2 Coal mining Industrial processes 2 Iron & steel 2a 2b Non-ferrous metals 2c Inorganic chemicals 2d Organic chemicals 2e Non-metallic minerals 2f 3 3a 3b Degreasing & Dry cleaning 3c Chemical prods manuf/proc 3d Other 4 4a 4b Animal wastes 4c Rice cultivation 4d Agricultural soils 4e Agricultural waste burning 4f 6 Waste 6a 6b Wastewater 6c Other Other Solvent use Paint application Agriculture Enteric fermentation Savannah burning Landfills # 71 25 <1 5 14 6 IE IE 46 14 106400 106400 33800 25500 20600 26500 IE IE 0 7200 2600 4600 0 0 0 270 8 8 2 3 1 2 IE IE 0 5 0 9 # # 330 330 56 67 195 12 IE IE 0 5 0 0 # 1085 1085 2 110 918 55 IE IE 0 108 0 0 216 203 <1 6 291 7 IE IE 13 54 90 1 900 5 0 3 16 0 900 Total emissions 114500 359 22 338 1219 361 Marine bunkers Aviation bunkers FNEC IE = Included Elsewhere NE = Not Estimated 13300 2000 10200 a) * U = CORINAIR figures used a) Reconciliation of CORINAIR and EUROSTAT transport emission estimates * = Eurostat figures used 100 Sources: Belgian National Reduction Programme C02 emissions. Under the "Council Decision concerning a mechanism of monitoring of C02 emissions and other greenhouse gases in the Community. June 1994. Eurostat (indicated with *) CORINAIR (indicated with *) C02 estimates are taken from National Report, unless indicated otherwise. Figures for non-C02 gases are CORN AIR estimates. 101 Estimates of greenhouse gases in Denmark - 1990 (Gg). N20 NO. CO NMVOC c 2 2 1 <1 1 0 <1 0 269 269 96 17 138 1 5 13 770 737 39 6 547 1 139 5 129 119 2 1 106 0 33 10 34 26 2 7 2 DENMARK Industrial processes Iron & steel 1 All energy la Fuel combustion lal Energy & transformation la2 Industry la3 Transport la4 Commercial/institutional la5 Residential la6 Agriculture/forestry la7 Other la8 Biomass lb Fugitive fuel lbl Oil &gas lb2 Coal mining 2 2a 2b Non-ferrouw metals 2c Inorganic chemicals 2d Organic chemicals 2e Non-metallic minerals 2f Other 3 Solvent use 3a Paint application 3b Degreasing & Dry cleaning 3c Chemical prods manuf/proc 3d Other 4 Agriculture 4a Enteric fermentation 4b Animal wastes 4c Rice cultivation 4d Agricultural soils 4e Agricultural waste burning 4f Savannah burning 6 Waste 6a Landfills 6b Wastewater 6c Other CO. 50900 50200 25700 6000 11200 1500 5000 800 # b 700 700 1200 1200 0 0 0 ca 23 12 2 1 3 0 6 0 11 8 3 0 262 137 125 122 120 2 Total emissions 52100 406 Marine bunkers Aviation bunkers FNEC 3000 1900 1000 * 0 <1 11 0 <1 270 770 5 66 1 17 165 <1 3 IE = Included Elsewhere NE = Not Estimated * = Eurostat figures used # = CORINAIR figures used 102 Sources: in Denmark. Ministry of the Environment. Danish Environmental Protection Climate Protection Agency. Denmark, 1994. (National Communication under the UN FCCC). Eurostat (indicated with *) CORINAIR (indicated with #) Estimates for all greenhouse gases are taken from National Report, unless indicated otherwise. Footnotes: a. Denmark included C02 emissions from oil/gas extraction (including flaring) in its estimate. Based on CORINAIR figures, these emissions have been subtracted. Denmark corrected its fuel combustion emissions for electricity import/export. This correction (6300 Gg of COj) has been ignored for reasons of comparison. b. Denmark included C02 emissions from oil/gas extraction (including flaring) in category 1A. Therefore, CORINAIR c. estimates have been used. Correction for electricity import/export has been ignored for reasons of comparison and consistency with other Member States. 103 Estimates of greenhouse gases in Finland - 1990 (Gg). FINLAND C02 CH4 N ,0 N O, CO NMVOC Fugitive fuel All energy 1 Fuel combustion la Energy & transformation al Industry 1 a2 la3 Transport la4 Commercial/institutional la5 Residential la6 Agriculture/forestry la7 Other la8 Biomass lb l bl Oil & gas lb2 Coal mining Industrial processes 2 2a Iron & steel 2b Non-ferrous metals Inorganic chemicals 2c 2d Organic chemicals 2e Non-metallic minerals 2f 3 3a 3b Degreasing & Dry cleaning 3 c Chemical prods manuf/proc 3d Other 4 4a 4b Animal wastes 4c Rice cultivation 4d Agricultural soils 4e Agricultural waste burning 4f 6 Waste 6a 6b Wastewater 6c Other Other Solvent use Paint application Agriculture Enteric fermentation Savannah burning Landfills 291 291 64 41 160 IE 8 18 484 484 9 32 368 IE 61 14 156 142 0 0 79 IE 51 12 14 15 1 12 2 48 52600 52600 19500 13700 11500 IE 5800 2100 100 1200 100 1100 0 7 7 1 1 5 IE 12 19 19 1 2 8 IE 6 2 94 83 11 139 105 34 Total emissions 53900 252 22 295 487 219 Marine bunkers Aviation bunkers FNEC IE = Included Elsewhere NE = Not Estimated 2800 1400a) 6000* * Eurostat figures used U CORINAIR figures used 0 Reconciliation of EUROSTAT and CORINAIR transport emission estimates 104 Sources: Finland's National Report under the United Nations Framework Convention on Climate Change. Ministry of the Environment, January 1995. Eurostat CORINAIR - Estimates for all greenhouse gases are taken from the National Report, unless indicated otherwise. 105 FRANCE Industry Fugitive fuel All eneigy Fuel combustion 1 la l al Energy & transformation la2 la3 Transport la4 Commercial/institutional la5 Residential la6 Agriculture/forestry la7 Other la8 Biomass lb l bl Oil & gas lb2 Coal mining Industrial processes 2 2a Iron & steel 2b Non-ferrous metals Inorganic chemicals 2c 2d Organic chemicals 2e Non-metallic minerals 2f 3 3 a 3b Degreasing & Dry cleaning 3c Chemical prods manuf/proc 3d Other 4 4a 4b Animal wastes 4c 4d Agricultural soils 4e Agricultural waste burning 4f 6 Waste 6a 6b Wastewater 6c Other Other Solvent use Paint application Agriculture Enteric fermentation Savannah burning Rice cultivation Landfills Estimates of greenhouse gases in France - 1990 (Gg). co2 349800 349700 60800 71100 128100 23700 58200 7800 200 16700 600 500 2500 12700 500 0 8000 1800a 6200 CH4 N ,0 N O, CO NMVOC 495 184 5 6 23 3 126 21 311 106 204 3 1640 1444 159 10 19 748 716 15 18 12 12 2 2 4 1 3 0 103 47 55 61 61 10047 10047 29 596 7062 18 1895 447 668 623 43 2 223 223 9 1675 1671 163 • 154 1194 18 68 74 4 4 23 3 20 4 20 20 1667 1530 6 8 1199 1 250 67 137 137 86 3 18 27 39 640 253 72 74 240 18 10 13 5 Total emissions 366500 2896 176 1722 10947 2424 Marine bunkers Aviation bunkers FNEC 8100 *b 9000 * c 39800 * IE = Included Elsewhere NE = Not Estimated * = Eurostat figures used U = CORINAIR figures used 106 Sources: Program National de Prevention du changement de climat. Republique Française, Février, 1995. Eurostat (indicated with *) CORINAIR (indicated with #) Estimates for all greenhouse gases are taken from National Report, unless indicated otherwise. Footnotes: a. It has been assumed that the estimate of 1800 Gg for Landfills applies to emissions from non-organic/non-recyclable material. The national report of France does not provide estimates of bunker emissions. Reconciliation of Eurostat and CORINAIR transport estimates b. c. 107 Estimates of greenhouse gases in Germany - 1990 (Gg). GERMANY CO, CH4 N,0 NO, CO NMVOC 1 All energy la Fuel combustion lal Energy & transformation 1 a2 Industry la3 Transport la4 Commercial/institutional la5 Residential la6 Agriculture/forestry la7 Other la8 Biomass lb Fugitive fuel lbl Oil & gas lb2 Coal mining Industrial processes 2 Iron & steel 2a 2b Non-ferrous metals 2c Inorganic chemicals 2d Organic chemicals 2e Non-metallic minerals 2f Other 3 Solvent use 3 a Paint application 3b Degreasing & Dry cleaning 3 c Chemical prods manuf/proc 3d Other 4 4a Enteric fermentation 4b Animal wastes 4c Rice cultivation 4d Agricultural soils 4e Agricultural waste burning 4f 6 Waste 6a 6b Wastewater 6c Other Savannah burning Agriculture Landfills 984000 983000 436000 169000 159000 65000 a 129000 5000 21000 1000 1000 29000 1000 3000 25000 0 1767 228 12 16 69 5 91 1 3 31 1539 317 1222 11 6 2043 1420 623 IE IE 2397 2318 79 IE 33 33 15 4 9 2 3 0 0 0 0 0 0 100 14 86 6 80 11 69 4 IE 2923 2921 672 217 1732 35 73 2 183 7 2 2 0 21 3 13 10104 10078 921 899 5990 183 1483 35 224 234 26 26 0 664 549 113 2 1679 1474 11 15 1252 10 96 2 60 28 205 205 0 129 9 59 61 1170 480 110 200 380 0 IE IE IE IE IE IE Total emissions 1013000 6218 223 2944 10768 2978 8000 11000 68400 * NE NE 155 50 37 58 16 9 Marine bunkers Aviation bunkers FNEC IE = Included Elsewhere NE = Not Estimated * = Eurostat figures used 108 Sources: "^ Environmental Policy. Climate Protection in Germany. First report of the Federal Republic of Germany Pursuant to the United Nations Framework Convention on Climate Change. September 1994. Eurostat (indicated with *) Estimates are taken from National Report, unless indicated otherwise. Footnotes: a. b. Germany indicated in its National Report that C02 emissions from waste incineration are included in energy related Indicated as "Small consumers" in Germany's report. emissions. FNEC emissions were not included in Germany's National Report. , Hence, Eurostat figures have been used. c. 109 Estimates of greenhouse gases in Greece - 1990 (Gg). GREECE CO, CH< N20 N O, CO NMVOC Industry Fugitive fuel All energy Fuel combustion 1 la l al Energy & transformation la2 la3 Transport la4 Commercial/institutional la5 Residential la6 Agriculture/forestry la7 Other la8 Biomass lb l bl Oil & gas lb2 Coal mining Industrial processes 2 2a Iron & steel 2b Non-ferrous metals Inorganic chemicals 2c 2d Organic chemicals 2e Non-metallic minerals 2f 3 3 a 3b Degreasing & Dry cleaning 3c Chemical prods manuf/proc 3d Other 4 4a 4b Animal wastes 4c Rice cultivation 4d Agricultural soils 4e Agricultural waste burning 4f 6 Waste 6a 6b Wastewater 6c Other Other Solvent use Paint application Agriculture Enteric fermentation Savannah burning Landfills 77400 77400 43800 9700 15600 8300 IE IE a a * b * b 369 6 1 <1 5 <1 IE IE 0 364 8 8 7 <1 1 <1 IE IE 502 502 111 3 386 1 IE IE 777 777 6 <1 770 1 IE IE 189 185 1 <1 184 <1 IE IE 8100 # 34 25 22 5900 0 0 82 363 13 341 32 600 # 202 600 Total emissions 86100 936 24 543 1143 325 Marine bunkers Aviation bunkers FNEC 8200 2000 1800 * * c * IE = Included Elsewhere NE = Not Estimated * = Eurostat figures used # = CORINAIR figures used 110 Sources: Climate Change. The Greek Action Plan for the abatement of C 02 and other greenhouse gas emissions. February 1995. Eurostat (indicated with *) CORINAIR (indicated with #) C 02 estimates are taken from National Report, unless indicated otherwise. Figures for non-C02 gases are CORN AIR estimates. Footnotes: a. b. Taken from the C02 emission tables as an update to the 1992 national report C02 emission estimates provided in the Greek report are higher than Euro stat/CORIN AIR figures. The report explains that estimates for Energy & Transformation are higher due to a higher emission factor for lignite. However, it provides no explanation why estimates for the other combustion categories are higher. Therefore, Eurostat figures have been used. Reconciliation Eurostat and National Programme bunker estimates. c. I ll Estimates of greenhouse gases in Ireland - 1990 (Gg). IRELAND CO, CH4 N,0 NO, CO NMVOC Industry 1 AH energy la Fuel combustion lal Energy & transformation la2 la3 Transport la4 Commercial/institutional la5 Residential la6 Agriculture/forestry la7 Other la8 Biomass lb Fugitive fuel lbl Oil & gas lb2 Coal mining Industrial processes 2 2a Iron & steel 2b Non-ferrous metals 2c Inorganic chemicals 2d Organic chemicals 2e Non-metallic minerals 2f Other 3 Solvent use 3 a Paint application 3b Degreasing & Dry cleaning 3 c Chemical prods manuf/proc 3d Other 4 4 a Enteric fermentation 4b Animal wastes 4c Rice cultivation 4d Agricultural soils 4e Agricultural waste burning 4f 6 Waste 6a 6b Wastewater 6c Other Savannah burning Agriculture Landfills 2 2 1 <1 <1 <1 1 <1 40 40 15 5 0 <1 1 <1 3 <1 10 10 <1 0 644 551 52 39 2 136 136 29100 29100 10900 5400 4900 1400 5800 700 0 1600 0 0 50 50 111 111 46 11 45 1 5 3 390 390 3 1 305 4 76 1 38 38 1 74 71 <1 <1 63 <1 8 <1 21 6 5 5 5 83 78 4 <1 Total emissions 30720 796 42 114 429 197 Marine bunkers Aviation bunkers FNEC 0 1100 1500 * * 100 160 5345 2187 364 IE = Included Elsewhere NE = Not Estimated * = Eurostat figures used M = CORINAIR figures used 112 Sources: Ireland. Communication under the UN FCCC. Prepared for the Conference of the Parties in accordance with Article 12 of the Framework Convention on Climate Change. Department of the Environment, Ireland. October 1994. Eurostat (indicated with *) CORINAIR (indicated with #) Estimates for all greenhouse gases are taken from National Report, unless indicated otherwise. Footnotes: a. Ireland's national communication does not provide emissions from marine bunkers. Other notes: Ireland provides in its national communication an estimate of NMVOC emissions from land use change and forestry. However, since only few Member States have provided emissions and/or removals from land use change and forestry, this category has not been included in the EU emission inventory at all. 113 Estimates of greenhouse gases in Italy - 1990 (Gg). ITALY CO, CH4 N ,0 NO, CO NMVOC Industry Fugitive fuel AH energy Fuel combustion Industrial processes Iron & steel 1 la lal Energy & transformation 1 a2 1 a3 Transport la4 Commercial/institutional la5 Residential la6 Agriculture/forestry la7 Other la8 Biomass lb lbl Oil & gas lb2 Coal mining 2 2a 2b Non-ferrouw metals 2c Inorganic chemicals 2d Organic chemicals 2e Non-metallic minerals 2f 3 3a 3b Degreasing & Dry cleaning 3 c Chemical prods manuf/proc 3d Other 4 4a 4b Animal wastes 4c Rice cultivation 4d Agricultural soils 4e Agricultural waste burning 4f 6 Waste 6a 6b Wastewater 6c Other Other Solvent use Paint application Agriculture Enteric fermentation Savannah burning Landfills 401400 401400 138400 91300 95600 26300 41200 8100 500 0 27600 400 1500 2300 0 23000 400 0 7300 5100 2200 413 66 8 10 27 2 5 3 10 347 337 10 4 2 1860 654 887 64 158 97 1611 1526 34 51 42 42 20 10 4 3 5 <1 15 15 1981 1981 462 377 967 22 34 109 8 2 0 <1 7155 7155 41 656 5645 27 55 535 3 193 0 371 173 182 2 14 20 0 59 32 1704 1 57 1 <1 32 14 1704 29 29 1276 1137 27 19 996 2 8 69 1 15 140 140 73 3 <1 9 41 538 238 49 64 187 492 381 14 97 22 22 <1 Total emissions 436300 3889 116 2034 9258 2401 Marine bunkers Aviation bunkers FNEC 8600 * 4800 * * 30200 * IE = Included Elsewhere NE = Not Estimated * = Eurostat figures used U = CORINAIR figures used 114 Sources: First Italian National Communication to the Framework Convention on Climate Change. Ministry of the Environment, January 1995. Eurostat CORINAIR - Italy's national programme does not provide estimates according to the IPCC format. Nationally reported tables are given in terms of fuel and end use. Therefore, Eurostat and CORINAIR figures have been used for C02 emissions, for the non-C02 gases CORINAIR estimates have been used. Footnotes: * Reconciliation of Eurostat and CORINAIR transport estimates. 115 Estimates of greenhouse gases in Luxembourg - 1990 (Gg). N ,0 <1 <1 NO, CO NMVOC 154 154 <1 98 48 1 5 1 17 17 14 12 <1 11 4 1 <1 1 2 <1 23 23 <1 11 11 0 1 <1 <1 23 171 19 LUXEMBOURG C02 CH4 Industry Fugitive fuel AH energy Fuel combustion 1 la l al Energy & transformation la2 la3 Transport la4 Commercial/institutional la5 Residential la6 Agriculture/forestry la7 Other la8 Biomass lb l bl Oil & gas lb2 Coal mining Industrial processes 2 2a Iron & steel 2b Non-ferrous metals 2c Inorganic chemicals 2d Organic chemicals 2e Non-metallic minerals 2f 3 3 a 3b Degreasing & Dry cleaning 3 c Chemical prods manuf/proc 3d Other 4 4a. Enteric fermentation 4b Animal wastes 4c 4d Agricultural soils 4e Agricultural waste burning 4f 6 Waste 6a 6b Wastewater 6c Other Other Solvent use Paint application Savannah burning Rice cultivation Agriculture Landfills Total emissions Marine bunkers Aviation bunkers FNEC IE = Included Elsewhere NE = Not Estimated * = Eurostat figures used U = CORINAIR figures used 12600 12600 1900 6600 2900 300 800 100 0 600 600 0 0 100 <1 100 13300 0 300 0 * b * 18 16 2 4 4 <1 1 24 116 Sources: Rapport National du Luxembourg en vue de la Ie Conference des Parties a la Convention-Cadres des Nations-Unies sur les Changement Climatiques. Ministère de l'Environment, Mars, 1995. Eurostat CORINAIR (CORINAIR 1990 - Luxembourg, final report) C02 estimates are taken from Luxembourg's National Report, unless indicated otherwise. Figures for non- C02 gases are CORN AIR estimates. Footnotes: a. Luxembourg's national communication provides an estimate for emissions from "nature". These have not been included in total C02 emissions. b. Reconciliation of Eurostat and CORINAIR transport estimates. 117 Estimates of greenhouse gases in the Netherlands - 1990 (Gg). N ,0 NO, CO NMVOC 6 6 <1 <1 5 <1 IE IE 16 22 22 15 4 11 59 570 570 92 86 337 31 IE 24 800 800 6 10 716 68 IE IE 231 231 19 1 195 16 IE IE 229 77 145 d 575 1029 459 THE NETHERLANDS Industry All energy 1 la Fuel combustion lal Energy & transformation la2 la3 Transport la4 Commercial/institutional la5 Residential la6 Agriculture/forestry la7 Other la8 Biomass lb Fugitive fuel lbl Oil & gas lb2 Coal mining Industrial processes 2 2a Iron & steel 2b Non-ferrous metals 2c Inorganic chemicals 2d Organic chemicals 2e Non-metallic minerals 2f Other 3 Solvent use 3a Paint application 3b Degreasing & Dry cleaning 3 c Chemical prods manuf/proc 3d Other 4 4 a Enteric fermentation 4b Animal wastes 4c Rice cultivation 4d Agricultural soils 4e Agricultural waste burning 4f 6 Waste 6a Landfills 6b Wastewater 6c Other Savannah burning Agriculture CO, 14900 14900 51400 33400 26900 9500 19200 8600 1900 700 800 400 0 900 900 CH4 177 28 149 149 0 508 402 106 382 377 5 Total emissions 151800 1067 Marine bunkers Aviation bunkers FNEC 35900 4500 28600b IE = Included Elsewhere NE = Not Estimated * = Eurostat figures used U = CORINAIR figures used 118 Sources: Netherlands' national communication on Climate Change Policies. Prepared for the Conference of the Parties under the Framework Convention on Climate Change. The Netherlands, August 1994. Eurostat CORINAIR Estimates for all greenhouse gases are taken from National Report, unless indicated otherwise. Footnotes: a. Netherlands' national communication provides estimates for actual emissions from feedstocks (14800 Gg) and statistical differences (1000 Gg). For reasons of consistency with emission inventories from other countries these have not been included. Also, the Netherlands applied a correction for temperature influences. This correction has been ignored for reasons of comparison. b. The Netherlands provides in its national communication an estimate of 28600 Gg C02 emissions for potential emissions from feedstocks. To be consistent with emission inventories from other countries, this estimate is used for emissions from FNEC. The Netherlands provides in its national communication an estimate for emissions from polluted inland and coastal waters. These emissions have not been included here, since this source is not identified in the draft IPCC guidelines for national greenhouse gas inventories and other countries did not provide estimates. c. d. N20 emissions from polluted inland and coastal waters. 119 Estimates of greenhouse gases in Portugal - 1990 (Gg). PORTUGAL CO, CK4 N ,0 N O. CO NMVOC Fugitive fuel All energy Fuel combustion 1 la l al Energy & transformation 1 a2 Industry la3 Transport la4 Commercial/institutional la5 Residential la6 Agriculture/forestry la7 Other la8 Biomass lb l bl Oil & gas lb2 Coal mining Industrial processes 2 2a Iron & steel 2b Non-ferrous metals 2c Inorganic chemicals 2d Organic chemicals 2e Non-metallic minerals 2f 3 3a 3b Degreasing & Dry cleaning 3 c Chemical prods manuf/proc 3d Other 4 4a 4b Animal wastes 4c Rice cultivation 4d Agricultural soils 4e Agricultural waste burning Savannah burning 4f 6 Waste 6a Landfills 6b Wastewater 6c Other Other Solvent use Paint application Agriculture Enteric fermentation 210 210 60 18 108 2 1 21 1072 1072 68 264 614 63 54 9 436 0 11 11 117 109 11 3 81 6 5 3 13 8 15 <1 1 5 9 67 26 2 6 32 0 U a 38700 38700 19400 6100 9900 1000 900 1300 NE 3400 <100 <100 300 3100 <100 0 400 # 400 13 11 2 2 1 3 3 5 2 2 <1 176 105 58 13 35 33 2 Total emissions 42500 227 11 214 1083 199 Marine bunkers Aviation bunkers FNEC 2100 1800 6600 IE = Included Elsewhere NE = Not Estimated Eurostat figures used CORINAIR figures used 120 Sources: Portuguese report in accordance with Article 12 of the United Nations Framework Convention on Climate Change. Ministry of the Environment and Natural Resources, Lisbon, 1994. Eurostat CORINAIR - C02 estimates are provided by Portugal in reply to the request of the Council of Ministers, unless indicated otherwise. Figures for non-C02 gases are CORINAIR estimates. Footnotes: a. Nationally reported estimates of C02 emissions from transport amount to 8700 Gg, while Eurostat estimates amount to 10200 Gg and CORINAIR estimates amount to 9800 Gg. Most likely, the nationally reported estimates do not include all transport sources, and therefore CORINAIR estimates have been used. b. Reconciliation of Eurostat estimates and nationally reported estimates. 121 Estimates of greenhouse gases in Spain - 1990 (Gg). SPAIN CO, CH4 N,0 NO, CO NMVOC Industry All energy 1 la Fuel combustion lal Energy & transformation la2 la3 Transport la4 Commercial/institutional la5 Residential la6 Agriculture/forestry la7 Other la8 Biomass lb Fugitive fuel lbl Oil & gas lb2 Coal mining Industrial processes 2 2a Iron & steel 2b Non-ferrous metals Inorganic chemicals 2c 2d Organic chemicals 2e Non-metallic minerals 2f Other 3 Solvent use 3 a Paint application 3b Degreasing & Dry cleaning 3 c Chemical prods manuf/proc 3d Other 4 4a Enteric fermentation 4b Animal wastes 4c Rice cultivation 4d Agricultural soils 4e Agricultural waste burning 4f 6 Waste 6a Landfills 6b Wastewater 6c Other Savannah burning Agriculture 222900 222900 78400 52300 63300 28900 IE IE 758 74 11 6 14 44 IE IE 0 684 35300 900 600 15100 18600 0 0 2500 1800s 700 4 3 <1 <1 0 0 <1 0 875 346 426 11 70 22 494 470 23 21 21 11 5 2 3 IE IE 10 0 0 10 0 0 0 0 1158 1158 270 144 723 21 IE IE 15 2 0 8 0 0 5 0 4032 4032 20 401 2721 890 IE IE 248 188 60 0 0 0 <1 0 55 397 55 0 29 28 397 272 261 12 634 568 11 9 489 59 IE IE 66 70 4 <1 3 16 0 48 302 87 38 38 138 95 74 22 10 2 <1 7 Total emissions 227300 4531 94 1189 4725 1120 Marine bunkers Aviation bunkers FNEC 12200 *b 4100 *c 18800 * IE = Included Elsewhere NE = Not Estimated * = Eurostat figures used # = CORINAIR figures used 122 Sources: Report by Spain on the United Nations Framework Convention on Climate Change. Provisional Version. National Climate Committee. Spain. Eurostat (indicated with *) CORINAIR (indicated with #) Estimates for all greenhouse gases are taken from National Report, unless indicated otherwise. Footnotes: a. Spain provided an estimate of 1800 Gg C02 emissions. It has been assumed that these emissions are from non- organic/non-recyclable material. Emissions from bunkers have not been provided in Spain's National Report. Reconciliation of Eurostat and figures provided in Spain's National Report. b. c. 123 Estimates of greenhouse gases in Sweden - 1990 (Gg). co2 55200 55100 7000 13400 23100 11500 IE IE IE <100 <100 0 5000 1600 700 2500 200 300 100 50 50 100 500 500 IE CH4 N,0 NO. CO NMVOC 33 33 1 4 17 10 IE IE IE 4 4 1 2 1 IE IE IE 362 362 20 39 285 19 IE IE IE 1606 1606 8 6 1503 69 IE IE IE 0 0 11 1 1 2 196 188 375 375 4 11 201 141 IE IE IE 18 18 67 2 59 98 40 15 7 36 0 300 300 100 100 SWEDEN Industry 1 All energy la Fuel combustion lal Energy & transformation la2 1 a3 Transport la4 Commercial/institutional la5 Residential la6 Agriculture/forestry la7 Other la8 Biomass lb Fugitive fuel lbl Oil & gas lb2 Coal mining 2 Industrial processes Iron & steel 2a 2b Non-ferrous metals 2c Inorganic chemicals 2d Organic chemicals 2e Non-metallic minerals 2f Other 3 Solvent use 3a Paint application 3b Degreasing & Dry cleaning 3 c Chemical prods manuf/proc 3d Other 4 4a Enteric fermentation 4b Animal wastes 4c Rice cultivation 4d Agricultural soils 4e Agricultural waste burning 4f 6 Waste 6a Landfills 6b Wastewater 6c Other Savannah burning Agriculture Total emissions 61300 329 15 373 1612 540 Marine bunkers Aviation bunkers FNEC 4200 IE 5700* IE = Included Elsewhere NE = Not Estimated * = Eurostat figures used U = CORINAIR figures used 124 Sources: Sweden's National Report under the United Nations Framework Convention on Climate Change. Ministry of the Environment and Natural Resources - September 1994. Eurostat CORINAIR - Estimates for all greenhouse gases are taken from the National Report, unless indicated otherwise. 125 Estimates of greenhouse gases in United Kingdom - 1990 (Gg). UNITED KINGDOM CO, CH4 N ,0 N O, CO NMVOC Fugitive fuel All energy Fuel combustion 1 la l al Energy & transformation Industry 1 a2 la3 Transport la4 Commercial/institutional la5 Residential la6 Agriculture/forestry la7 Other la8 Biomass lb l bl Oil & gas lb2 Coal mining Industrial processes 2 2a Iron & steel 2b Non-ferrous metals Inorganic chemicals 2c 2d Organic chemicals 2e Non-metallic minerals 2f 3 3a 3b Degreasing & Dry cleaning 3 c Chemical prods manuf/proc 3d Other 4 4a 4b Animal wastes 4c Rice cultivation 4d Agricultural soils 4e Agricultural waste burning 4f 6 Waste 6a 6b Wastewater 6c Other Other Solvent use Paint application Agriculture Enteric fermentation Savannah burning Landfills 566000 560400 231300 96700 120600 30200 78900 2700 5700 5700 7400 7400 0 b 4800 2800 2200 c 1316 78 5 7 11 2 46 <1 3 4 1238 482 756 5 1141 1004 125 12 2078 2007 71 3 0 93 13 80 11 4 7 2710 2628 823 180 1498 56 68 4 82 82 21 6317 6284 57 65 5884 8 269 1 1396 1306 13 2 115 1 37 33 33 90 90 220 455 12 0 220 0 417 38 674 237 61 72 304 0 19 19 Total emissions 577000 4531 108 2740 6682 2540 f Marine bunkers Aviation bunkers FNEC 7200 1400 36700 d e * IE = Included Elsewhere NE = Not Estimated * = Eurostat figures used M = CORINAIR figures used 126 Sources: Climate Change. The UK report. United Kingdom's Report under the Framework Convention on Climate Change. January, 1994. Figures have been updated for consistency reasons with the latest UK emission data in the 17th Digest of Environmental Protection and Water Statistics. Eurostat CORINAIR Estimates for all greenhouse gases are taken from the UK's National Report, as revised by the UK Department of the Environment for consistency with the updated emission inventory in the 17th Digest of Environmental Protection and Water Statistics, unless indicated otherwise. Footnotes: a. Not included in emission totals. b. Based on UK's nationally reported estimates of 2500 Gg for landfills, and 6051 Gg for incineration. In the UK's report, the latter has been presented in category 2F. C02 emissions from incineration. c. d. UK estimate of international marine bunker emissions. e. UK estimate of international aviation^bunker emissions. f. NMVOC emissions from land use change (80 Gg) have not been included as part of the total. 127 ANNEX 2 SCENARIOS 128 Conventional Wisdom Scenario: energy indicators SCENARIO CONVENTIONAL WISDOM General Description: Macro- economics: Taxation: Environment: The "business as usual' scenario denoting a conventional wisdom view of the most likely evolution of events. Economic growth gradually weakens in the long term. Although some progress is made, many of the world's structural social and economic problems remain. Energy policy remains fragmented, the result of unresolved conflicting objectives for competitivity, environment and security of supply as well as differing national aims. EU GDP annual growth rates of 2. 9% from 1995 to 2000; 2. 4% to 2005; 2. 2% to 2010; 1. 9% to 2015; and 1. 8% to 2020. Discount rate 8% real. No reform: Already high tax rates leave little room for further increases to contain public deficits; no inclusion of external costs. Although high on EU agenda, environmental approach limited by conflicting economic objectives. Progress is made in a number of areas, particularly S02, NOx, etc. Measures to meet global warming continue only on a mild precautionary basis. Energy Prices: Crude ($1993) Gas Coal Increasing smoothly. Rising in real terms as world demand increasingly met by Middle East producers. $17. 6/bbl in 1995, $21/bbl in 2000, $29/bbl in 2010 and $31/bbl in 2020. Deregulation and growing network bring lower prices relative to oil after 2000, reinforced by increasing as to gas price competition. International process increasing slightly, reflecting expected long-run marginal production costs. Delivered prices flat as cheap imports displace expensive domestic supplies. Technology: Some penetration of new, more efficient demand and supply technologies, partly driven by public standards and partly by industrialists aiming at increased industrial competitiveness. Energy Demand Issues: Oil Gas Coal Electricity Continuation of current actions with some concern on increasing efficiency. Gross consumption expected to increase modestly and ever more slowly. Very little growth expected as oil is increasingly limited to transportation. However, it remains the predominant fuel overall. Fastest growing of all primary fuels with increasing share in all end-use sectors, particularly power generation. Gains could slow post-2000 as coal becomes more attractive in power sector. Share declines to 2000 as a result of competition from gas in electricity generation. Increasingly competitive prices could mean later recovery of market share in the power sector. Electricity likely to gain share in residential, commercial and industrial sectors in the medium term although market saturation and efficiency gains could slow the growth towards 2020. 129 Energy Supply Issues: Oil Gas Coal Electricity Renewables » Import dependency accelerates, potentially increasing from 50% at present to two thirds or more by 2020. Domestic production not expected to decline significantly until beyond 2010. Import dependency remains relatively close to today's levels. Although domestic production likely to be maintained, strong demands rise means rapid increase in imports. Liberalisation and infrastructure developments essential in expanding penetration of gas in Europe. Deregulation and reduced subsidies will result in substantial decline in domestic EU hard coal production and escalating imports. No public policy on nuclear or security of supply of fossil fuel imports. No limits for use of each primary source. Supply could increase strongly but from very low base. Overall contribution of renewables likely to remain small. 130 Battlefield Scenario: energy indicators SCENARIO BATTLEFIELD General Description: Macro- Economics: Taxation: Environment: Energy Prices: Crude ($1993) Gas Coal Technology: Contradictions and instabilities in the global system make economic integration very difficult. Globalisation is seen as too ambitious. The geo political system fragments into blocs, with tensions and friction between and also within the blocs. This leads to a "Europe à la carte". Energy policies are aimed at reducing import dependency; supply side measures such as protectionism of domestic energy production industries, likely to be more successful than demand side measures. EU GDP annual growth rates of 3. 1% from 1995 to 2000; 1. 1% to 2005; -1. 8% to 2010; 1. 4% to 2015; and 1. 3% to 2020. Discount rate 7% real. No tax reform: harmonisation of VAT and excises as it stands today, without equality of treatments across fuels; some inclusion of external costs (transport sector); taxation levels continue to be set aiming at Government revenue levels. Precautionary principles on C02 to 2005, but C02 proven as a contributor to global warming thereafter. Nonetheless, environmentalism an excuse for protectionism and effectiveness frequently compromised. Increasing dependency on fewer major suppliers leads to an oil price shock. Rising from $16/bbl in 1995 to $24/bbl by 2004. Price shock to $40/bbl in 2005, falling to $18/bbl in 2009 then rising again to $28/bbl in 2020. Remain tied to oil, so reflecting the price shock but lagging in response. International prices flat until the price shock of 2005, although falling back thereafter to pre-shock levels. European prices track international prices but inflated by the cost of maintaining domestic production. As Conventional Wisdom - Some penetration of new, more efficient demand and supply technologies, partly driven by public standards and partly by industrialists aiming at increased industrial competitiveness. 131 Energy Demand Issues: Oil Gas Coal Electricity Energy Supply Issues: Oil Gas Coal Electricity Renewables In spite of attempts to introduce alternative fuels, tension and conflict inhibit efficiency gains. Energy demand likely to rise, then to fall back in response to the energy price shock and subsequent economic recession before rising again. Impact of price shock expected to be considerably, particularly in substitutable sectors. Transport growth likely to be checked but could rise again later, albeit increasingly constrained by social and environmental concerns. Underlying strong demand growth but interruption by the price shock expected. Coal increasingly perceived as a more stable and secure energy source allowing it to fight back against gas post-2000, particularly in power generation. Some penetration of new, more efficient demand supply technologies partly driven by public standards and partly by industrialists aiming at increased industrial competitiveness. Policy dominated by unresolved conflicts of competitiveness, environment and geopolitical considerations. Policy aimed at maintaining European production as high as possible in response to security of supply concerns, aided by increasing real prices. As with oil, policies such as benign upstream taxation aim to enhance and extend domestic production to minimise imports. Production declines steadily but state aids moderate rate of decline. Efforts to maintain current level of nuclear capacity in Europe; Setting of limits for the use of each primary source (oil, coal, gas) for security reasons. Public attempts to develop renewables meet with only limited success. 132 Forum Scenario: energy indicators SCENARIO FORUM General Description: Macro- Economics: Taxation: Environment: Energy Prices: Crude ($1993) Gas Coal The process of global economic integration produces new imperatives for collective public action National, European and international institutions are gradually restructured so as to be able to deal more effectively with broader, more complex shared problems and interests. Energy policies most significantly affected by concern for the environment. A global unity of purpose allows positive action across the energy spectrum. EU GDP annual growth rates of 2. 3% from 1995 to 2000; 2. 5% to 2005; -2. 5% to 2010; 2. 6% to 2015; and 2. 4% to 2020. Discount rate 5% real. General taxation reform: harmonisation of VAT and excises and equality of treatment across fuels on an energy basis; external costs included - on a "precautionary" approach to 2005 and under a C02 driven world thereafter, leads to general fuel tax increases in real terms. T°e ecologically driven scenario. The proven case against C02 from 2005 reinforces strong environmental concerns throughout society and results in major policy shifts. Stable throughout Flat at $16/bbl to 2020 representing an average which captures a variation within the range of $10 to $20/bbl. Weak demand prevents producers from controlling the market. Consumers governments extract much of the economic rent. Rising relative to oil as environmental pressures put premium on clean fuels. International prices constant in real terms in face of environmental pressures and thus weak demand. Average EU prices fall substantially with phase-down of expensive domestic production. Technology: Strong penetration of new, more efficient demand and supply technologies mainly driven by public standards on a world-wide scale - high level of technology transfer. 133 Energy Demand Issues: Oil Gas Coal Electricity Energy Supply Issues: Oil Gas Coal Electricity Renewables Radical policy changes and major technology developments aimed at limiting energy demand growth. Aiming at rapid decline, although difficult in transport. Goal is for transport fuel demand to flatten to early 2000s then fall thereafter with some growth in more efficient diesel, decline in gasoline and increasing penetration of non-oil clean technologies towards 2020. Environmental advantages likely to ensure significant increases in share although lower overall energy requirements could limit volume increases. Limited by environmental disadvantages but RTD develops to meet environmental challenge. Strongly influenced by public conservation policies and utilities demand-side management. Fundamental policy changes and major RTD push to limit emissions, notably C02. While enhanced recovery technologies ensure more than adequate supplies to meet lower demand, low prices hinder production from higher cost reserves. Domestic production strong, aided by technology. Well-head conversion to hydrogen for new energy technologies appears towards 2020. Domestic production rapidly phased out. No nuclear phase-out with re-launch in some countries (France, Japan, NICs); Opportunities for new technologies enhanced. Strong growth in share of renewables, accelerating towards the period end as new technologies and radical changes in agricultural policy are pushed forward. 134 Hypermarket Scenario: energy indicators SCENARIO HYPERMARKET General Description: I Macro- Economics: Taxation: Environment: Energy Prices: Crude ($1993) Gas Coal Global economic integration is self-reinforcing and continues. The force driving this scenario is continued application of the market mechanism which is seen as the best way to produce wealth and handle complexity in uncertainty. Liberalisation and privatisation deliver results and produce new market entrants who demand more of the same. Strong belief in free market principles result in energy policy driven by desire to minimise government control and maximise efficient operation of free markets, nonetheless achieving desired standards. | ' "~ EU GDP annual growth rates of 3. 2% from 1995 to 2000; 2. 8% to 2005; 2. 3% to 2010; 2. 1% to 2015; and 1. 9% to 2020. Discount rate 10% real. Some tax reform: harmonisation of VAT and excises taxes towards current limits, without equality of treatment across fuels; no inclusion of external costs. Precautionary principles on C02 to 2005, after which the case against C02 is proven. Governments cannot be indifferent to environmental problems but look first and foremost to the market for solutions and only secondly to public policy. Public concern reinforces the need for the creation of markets for environmental protection. Increasing smoothly Rising in real terms as world demand increasingly met by Middle East producers. $17. 6/bbl in 1995, $21/bbl in 2000, $29/bbl in 2010 and $31/bbl in 2020. Deregulation and growing network bring lower prices relative to oil, reinforced by increasing gas-to gas price competition. International prices slightly increasing reflecting expected long- run marginal production costs. Domestic prices flat as cheap imports displace expensive domestic supplies. Technology: Penetration of new, more efficient demand and supply technologies substantially dependent on market forces and international competition; little Government action. 135 Energy Demand Issues: Oil Gas Coal Electricity Energy Supply Issues: Oil Gas Coal Electricity Renewables High economic grow th and hands-off public policy mean efficiency gains made only for competitive reasons; strong energy demand growth likely. Oil up against strong competition from cheap deregulated gas and imported coal, although transport sector likely to limited only by saturation effects. The dash for gas becomes a stampede, although there is increasing competition from low cost coal imports post-2000 Likely to decline steeply in the near term but competitive prices present potential for strong recovery in the power sector thereafter. Little public influence in terms of conservation policies. No special concerns on security of supply. Domestic eneigy production only develops where viable on internationally competitive basis with no special government support Imports rise but downstream investments by producer countries allay security of supply worries. Domestic production develops in response to rising prices. Import dependency increases but mutual commercial interests of producers and consumers reduce security risks. Withdrawal of subsidies and deregulation lead to phase-out of domestic supply. No public policy on nuclear. No limits for use of each primary source. With little public RTD investment or incentives, renewable growth limited to commercially viable opportunities only. 136 ISSN 0254-1475 COM(96) 217 final DOCUMENTS EN 14 Catalogue number : CB-CO-96-228-EN-C ISBN 92-78-04176-9 Office for Official Publications of the European Communities L-2985 Luxembourg A?>-^_

COMMUNICATION FROM THE COMMISSION - REVIEW OF THE METHOD FOR ADJUSTING REMUNERATION

http://publications.europa.eu/resource/cellar/64b8b38c-588e-49bb-85a1-d09e648f0125

eng

COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 11. 06. 1996 COM(%) 258 final COMMUNICATION FROM THE COMMISSION REVIEW OF THE METHOD FOR ADJUSTING REMUNERATION CONTENTS REVIEW OF THE METHOD 1. INTRODUCTION 1. 1. Terms of reference 1. 2. Background: the need to adjust remuneration 1. 3. Remuneration: the underlying principles 1. 4. The 1991 method 1. 5. Results 2. COMPONENTS OF THE METHOD 2. 1. Changes in the purchasing power of remuneration in the national civil services 2. 2. Change in the cost of living in Brussels 2. 3. Changes in the cost of living in other places in relation to Brussels 3. APPLICATION OF THE METHOD Interim review 3. 1. Annual review 3. 2. Arrangements for recovering overpayments 3. 3. 3. 4. Recruitment requirements 3. 5. Exception clause 3. 6. Results of the application of the 1991 method 4. QUID PRO QUO FOR THE METHOD 4. 1. Temporary contribution 4. 2. Increase in pension contributions 5. CHANGES IN REMUNERATION 1991 TO 1995 5. 1. Changes in remuneration in Brussels and Luxembourg 5. 2. Remuneration in other places of employment in relation to Brussels 5. 3. Change in the purchasing power of remuneration 5. 4. Comparison with the change in purchasing power of national civil servants 6. CONCLUSION 1. INTRODUCTION 1. 1. Terms of reference Article 15(2) of Annex XI to the Staff Regulations provides that the provisions of the Annex «shall be reviewed at the end of the fifth year and revised, if appropriate, on the basis of a report transmitted to the European Parliament and the Council and a proposal from the Commission after consulting the other institutions within the framework of the Staff Regulations». 1. 2. Background: the need to adjust remuneration The need to recruit from a wide geographical base and to preserve the quality and independence of the European public service calls for competitive remuneration with regular adjustments to keep pace with trends in the purchasing power of remuneration on the labour market. In order to maintain harmonious staff relations, the general principles applied must be established by consensus. The Council has long favoured the principle of parallel development with remuneration in the national public services. This calls for a rigorous procedure. Hence the adoption by the Council of a method based on detailed and binding principles (Annex XI to the Staff Regulations) which has the advantage of not requiring annual negotiations and of avoiding the risk of dispute. The Council decision combines a negotiated approach and a procedural approach with a view to limiting conflict. Periodic negotiations since 1971 have produced a series of agreements spelling out the rules for implementing Articles 64 and 65 of the Staff Regulations: the 1971 and 1976 agreements; the 1981 method adopted for a period of 10 years, introducing a crisis levy; the 1991 method adopted for a period of 10 years, introducing a temporary contribution; staff contributions to the pension scheme were also increased. 1. 3. Remuneration: the underlying principles Remuneration, legally grounded exclusively in the Staff Regulations of Officials of the European Communities, comprises basic salary, and family and other allowances, from which are deducted social security contributions, tax and the temporary contribution. Adjustments are governed by a system based on two principles: parallel development of the remuneration of officials of the European institutions and that of civil servants in the Member States of the European Union; purchasing power parity for the remuneration paid in the various places of employment and in Brussels. 1. 4. The 1991 method The 1991 method was adopted following lengthy negotiations involving both the trade unions and staff associations representing the staff of the Community institutions (also consulted by referendum) and the institutions themselves. At its 1528th meeting, the Council endorsed the compromise produced by the Concertation Committee, subsequently confirming its agreement by adopting the corresponding regulations on 19 December 1991. The note transmitted by Coreper to the Council prior to its decision describes the compromise as a comprehensive solution comprising several interdependent components: the method, applying from 1 July 1991 to 30 June 2001; and its «quid pro quo», namely the temporary contribution and the increase in staff contributions to the pension scheme. In other words, the final compromise not only introduced a procedure for adjusting remuneration but also had an impact on its level through these two additional components which have reduced purchasing power. The method negotiated with the Council and adopted by it in December 1991 is valid for ten years (till 2001) with provision for a review in 1996 and, if appropriate, revision on a proposal from the Commission. The Staff Regulations also had to be amended to make provision for the temporary contribution; it too is payable until 30 June 2001 and is equivalent to a gross rate of 5. 83% of the base to which it is applied. In addition, staff contributions to the pension scheme were increased from 6. 75% to 8. 25% of basic salary. 1. 5. Results Since 1991 civil servants in the Member States - and consequently the officials of the European Communities - have suffered a 3. 1% loss in purchasing power, a 13. 8% rise in the cost of living in Brussels producing a 10. 4%1 increase in the salary scale. The two binding measures introduced as the quid pro quo for the method have led to an additional 4. 2% reduction in purchasing power: 2. 9% as a result of the temporary contribution and 1. 3% as a result of the increase in staff contributions to the pension scheme. So, if the impact of this quid pro quo is added to the above, the result is a 5. 7% increase in net remuneration, which actually represents a 7. 1% loss in purchasing power for officials of the European institutions over five years, 4. 2% more than for national civil servants. 1 96,9/100 x 113,8/100 = 110,4/100 = +10,4 4 2. COMPONENTS OF THE METHOD Article 1(1) of Annex XI provides that each year Eurostat «shall draw up. a report on changes in the cost of living in Brussels, the economic parities between Brussels and the other places of employment in the Member States, and changes in the purchasing power of salaries in the national civil services». 2. 1. Changes in the purchasing power of remuneration in the national civil services 2. 1. 1. The specific indicator measures changes in the purchasing power (increase minus inflation) of the remuneration of national civil servants in the Member States of the European Union. Table 1 shows that between 1991 and 1995 they suffered an average loss in purchasing power of 3. 1%. Table 1 SPECIFIC INDICATOR Average change in the purchasing power of remuneration in the national civil services of the Member States of the European Union (1) Date 1. 7. 91 1. 7. 92 1. 7. 93 1. 7. 94 1. 7. 95 (3) (2) Adjustment of remuneration % t/t-1 cumulative % +4,1 +4,8 +1,9 +1,0 +3,1 +4,1 +9,1 +11,2 +12,3 +15,8 % t/t-1: percentage change year on year (4) (5) (6) (7) Consumer price index Purchasing power (specific indicator) % t/t-1 cumulative % +4,8 +4,2 +3,2 +3,0 +2,9 +4,8 +9,2 +12,8 +16,1 +19,4 % t/t-1 -0,7 +0,6 -1,3 •1,9 +0,2 cumulative % -0,7 -0,1 -1,4 -3,3 -3,1 cumulative %: cumulative values are calculated by multiplying the year-on-year changes 20 10 -10 -20 CUMULATIVE % CHANGE Consumer price index. -~r»^FT&;4 _ - * + i 5 ,8. - • - + i 6 ; i*. ^**9X _M - - 'X+§$ *-*l?Z Adjustment of remuneration Purchasing power (specific indicator) T ^ —r -3,1 1. 7. 91 1. 7. 92 1. 7. 93 1. 7. 94 1. 7. 95 - 4- The method for calculating the specific indicator derives essentially from decisions taken by the Council (Annex XI to the Staff Regulations). The rules for its practical application are laid down by the Article 65 Working Party, chaired by Eurostat. All calculations are based on the data sent to Eurostat by the national administrations in the Member States relating to the remuneration of central government staff on 1 July of the current year. The data are for a sample population, relating as a rule to the first and last steps of the main grades. Figures are provided for unmarried staff and married staff with two dependent children. The 1994-95 specific indicator already takes account of changés in Finland, Austria and Sweden but with a weighting of only 50% (membership of the European Union from 1 January 1995). Table 2 shows the changes in purchasing power by country. Table 2 SPECIFIC INDICATOR BY MEMBER STATE (1. 7. 90 -1. 7. 95) Change in the purchasing power of remuneration in the national civil services of the Member States of the European Union (D Country (2) Nominal change in net remuneration (3) Change in consumer price index (4) Real change in net remuneration B DK D GR E F IRL 1 L NL P UK (%) +17,7 +12,7 +13,5 +44,9 +21,7 +13,8 +26,7 +13,5 +35,6 +10,8 +46,9 +19,1 (%) +13,6 +10,9 +18,1 +90,3 +29,5 +12,2 +13,6 +28,7 +15,8 +15,7 +42,6 +18,0 SPECIFIC INDICATOR (1. 7. 94 -1. 7. 95) +2,3 +1,4 +1,3 A FIN s +2,6 ~ +1,0 +3,0 SPECIFH EU C INDICATOR +15,8 +19,4 ' (%) +3,8 +1,6 -3,8 -23,8 -5,8 +1,5 -11,9 +17,1 -4,3 +3,0 +1,0 -0,3 +0,4 -1,7 -3,1 (5) Weighting factor 95. (%) 4,1 1,7 26,3 0,8 ~ ^ \ 5 ,0 24,6 0,7 16,1 0,2 3,0 2,3 13,2 1,2 0,4 0,7 100,0 EUR12 until 1. 1. 1995 then EUR 15 Cumulative real values (4) are calculated by multiplying the year-on-year changes Rounding can produce discrepancies between these cumulative values and the relationship (2)/(3). 2. 1. 2. Control indicator Annex XI provides for the year-on-year change in real per capita emoluments in the national civil services to be used as a control indicator to check the gross specific indicator. Table 3 compares the changes in the two indicators. Table 3 CONTROL INDICATOR Change in the purchasing power of gross remuneration in the national civil services of the Member States of the European Union (1) Date 1. 7. 91 1. 7. 92 1. 7. 93 1. 7. 94 1. 7. 95 (2) (3) Gross specific indicator cumulative % +0,0 +0,1 -0,4 -2,8 -1,0 % t/t-1 +0,0 +0,1 -0,5 -2,4 +1,8 (4) Control indicator (5). (6) (7) Difference % t/t-1 +2,7 +4,5 +2,6 -0,1 +0,9 cumulative % +2,7 +7,3 +10,1 +10,0 +11,0 % t/t-1 -2,6 -4,2 -3,0 -2,3 +0,9 cumulative % -2,6 -6,7 -9,5 -11,6 -10,8 Cumulative values are calculated by multiplying the year-on-year changes [--ngrjiauonwE %7^TARgE 20 10 -10 -20 Control indicator. -•-+1Q. -1- - - * H H ^ ^ ^ ^ ^ t i1- -Q Gross specific indicator -"--•--•2,$"" OT5 _ - •++#• TOT Difference 1. 7. 91 1. 7. 92 1. 7. 93 1. 7. 94 1. 7. 95 —\ 2. 2. Change in the cost of living in Brussels Changes in the cost of living in Brussels are measured by the composite index, which is constituted as follows: 75% by the joint index for European officials in Brussels; 25% by the Brussels consumer price index. Table 4 CHANGE IN THE COST OF LIVING IN BRUSSELS d) (2) (3) (4) (5) (6) (7) Date Brussels joint index Brussels consumer price index Brussels composite index cumulative % +4,2 +8,0 +10,2 +12,8 +13,7 Brussels composite index(6) = 75% Brussels joint index(2) + 25% Brussels CPI(4) cumulative % +3,9 +7,3 +9,9 +12,9 +14,3 % t/t-1 +4,2 +3,6 +2,1 +2,3 +0,8 % t/t-1 +3,9 +3,3 +2,4 +2,7 +1,3 1. 7. 91 1. 7. 92 1. 7. 93 1. 7. 94 1. 7. 95 Cumulative values are calculated by multiplying the year-on-year changes 30 20 Cumulative. 0/? change — -• — Brussels joint index - - • - - Brussels consumer price index —•— Brussels composite index % t/t-1 +4,1 +3,5 +2,2 +2,4 +0,9 cumulative % +4,1 +7,7 +10,1 +12,8 +13,8 + 13,8 1. 7. 91 1. 7. 92 1. 7. 93 1. 7. 94 1. 7. 95 — f— These two indices are calculated in agreement with the Belgian Ministry of Economic Affairs. The joint index measures the change in the cost of living for officials of the European institutions in Brussels, while the consumer price index measures the overall cost of living in the Belgian capital. The weighting used to aggregate the 173 basic indices into the joint index is obtained from a survey of the family budgets of Community officials in Brussels, while the weightings used for the Belgian index are derived from a sample survey of Belgian family budgets conducted by the Belgian National Statistical Institute. And, for the purposes of calculating the joint index, the rent index is replaced by a corresponding index calculated by Eurostat on the basis of an annual survey of Community officials employed in Brussels. 8 2. 3. Changes in the cost of living in other places in relation to Brussels 2. 3. 1. Economic parities Article 1(3)(a) of Annex XI provides that «the Statistical Office, in agreement with the national institutes, shall calculate the economic parities which establish the equivalence of purchasing power of the salaries of European officials serving in the capitals of the Member States and in certain other places of employment specified in Article 9 with reference to Brussels». The economic parity is thus the amount in national currency needed to purchase in the place of residence the equivalent in goods and services to what could be purchased in Brussels with 1 Belgian franc. Table 5 shows the change in economic parities. Table 5 (1) COUNTRY/PLACE B DK D(Berlin) Bonn Kaisruhe Munich GR E F IR I Varese NL A P FIN S UK Culham ECONOMIC PARITIES (2) 1. 7. 91 1 0,23145 0,051095 * 0,045743 0,044747* 0,050291' 4,1453 3,1897 0,18617 0,017600 40,556 37,424 0,053563 (3) 1. 7. 92 1 0,22602 0,052053 * 0,046686 0,045974 * 0,051495 4,7891 3,3062 0,18703 0,017838 41,694 38,893 0,055358 (4) 1. 7. 93 1 0,23175 0,054986 * 0,048548 0,048764 * 0,053788 5,5159 3,4770 0,19031 0,018256 44,756 41,709 0,055442 3,6093 3,8702 4,1109 0,019399 0,016929 0,020171 0,017241 0,020582 0,018072 (5) 1. 7. 94 1 0,22931 0,054036 0,049267 0,048398 0,053520 5,8780 3,5112 0,18840 0,018464 45,218 43,315 0,056037 0,37963 4,0149 0,17527 0,24010 0,021103 0,018030 (6) 1. 7. 95 (7) % 95/91 1 0,23354 0,053954 0,049032 0,048641 0,053612 6,3003 3,6192 0,18894 0,018926 46,671 44,812 0,056253 0,38860 4,1809 0,17760 0,24490 0,022178 0,018502 +0,9 +5,6 +7,2 +8,7 +6,6 +52,0 +13,5 +1,5 +7,5 + 15,1 +19,7 +5,0 +15,8 +14,3 +9,3 * Commission proposal not adopted by the Council; Bonn parity is applied Article 1 (3)(b) provides that «the economic parities shall be calculated in such a way that each basic component can be checked by a direct survey at least once every five years». In practice: one third of the basic parities are checked each year and replaced by the new parities produced by the latest price survey; the basic parities are then updated using detailed indices. The economic parity determines remuneration in national currency arrived at by updating the following two components: the annual exchange rate applied to remuneration (July exchange rate); the weighting (ratio economic parity/exchange rate). 2. 3. 2. Exchange rates Table 6 shows that certain currencies fluctuated strongly against the Belgian franc during the period under consideration. Table 6 (D REMUNERATION EXCHANGE RATE* (6) 1. 7. 95 (7) % 95/91 (2) 1. 7. 91 (3) 1. 7. 92 (4) 1. 7. 93 (5) 1. 7. 94 1 0,18665 0,048593 5,9133 3,0703 0,16337 0,018230 36,767 0,054765 1 0,18774 0,048544 5,3189 3,0482 0,16479 0,018151 36,148 0,054692 1FB= FB DKR DM DRA PTA FF IRL LIT HFL OS ESC FMK SKR UKL Article 63 of the Staff Regulatbns: exchange rate used for the implementation of the EC general budget on 1 July* 1 0,18984 0,048638 7,9001 4,2517 0,17057 0,021333 57,113 0,054490 0,34204 5,13901023 0,14923 0,25372 0,022033 1 0,19059 0,048515 7,3282 3,9920 0,16642 0,020048 47,987 0,054413 0,34123 4,9903 0,16114 0,23386 0,019784 1 0,18699 0,048650 6,6260 3,7205 0,16389 0,019945 44,236 0,054558 0,016567 0,016756 0,019187 4,2335 4,0512 4,6281 +1,1 +0,2 +48,5 +39,5 +3,5 +17,5 +58,0 -0,4 +21. 4 +33,0 10 2. 3. 3. Weighting The weighting equals the ratio economic parity/exchange rate. In other words, it is the amount in Belgian francs at the July remuneration exchange rate needed in another place of employment to purchase articles which would cost Bfrs 100 in Brussels. The weightings set out in Table 7 show the relationship in July of each year between the salaries paid in the other places of employment and those paid in Brussels. Table 7 (1) COUNTRY/PLACE B /L DK D(Berlin) Bonn Kalsruhe Munich GR E F !R I Varese NL A P FIN S UK Culham (2) 1. 7. 91 100,0 123,3 105,3 * 94,2 92,2 * 103,6 77,9 104,6 113,0 97,0 112,2 103,5 97,9 WEIGHTINGS (3) 1. 7. 92 100,0 121,1 107,1 * 96,1 94,6 * 106,0 81,0 107,7 114,5 97,8 113,4 105,8 101,1 (4) 1. 7. 93 100,0 123,9 113,0 * 99,8 100,2 * 110,6 83,2 93,5 116,1 91,5 101,2 94,3 101,6 85,3 95,5 88,8 117,1 102,2 120,4 102,9 107,3 94,2 (5) 1. 7. 94 100,0 120,3 111,4 101,6 99,8 110,3 80,2 88,0 113,2 92,1 94,2 90,3 103,0 111,3 80,5 108,8 102,7 106,7 91,1 (6) 1. 7. 95 100,0 123,0 110,9 '100,8 100,0 110,2 79,7 85,1 110,8 88,7 81,7 78,5 103,2 113,6 81,4 119,0 96,5 100,7 84,0 (7) % 95/91 -0,2 +5,3 +7,0 +8,5 +6,4 +2,3 -18,6 -1,9 -8,6 -27,2 -24,2 +5,4 -4,6 •14,0 •17,8 * Commission proposal not adopted by the Council; Bonn weighting is applied With effect from 1 July 1994, the Berlin weighting became the weighting for Germany; this led to the introduction of weightings for Karlsruhe and Bonn. As of 1 January 1995, the weightings for Finland, Austria and Sweden were calculated in accordance with Annex XI. The substantial reductions in a number of weightings were basically caused by increases in the exchange rates (national currency/Belgian franc). 11 3. APPLICATION OF THE METHOD 3. 1. Annual review Article 3(1) of Annex XI provides that «with effect from 1 July and pursuant to Article 65(3) of the Staff Regulations, the Council, acting on the Commission proposal and on the basis of the criteha set out in Section I, shall take a decision before the end of each year adjusting remunerations». These adjustments (see 3. 6) were generally made in December. 3. 2. Arrangements for recovering overpayments The establishment of new weightings at the end of the year effective from 1 July can lead to retroactive upward or downward adjustments to remuneration and pensions. Hence the inclusion in regulations adjusting remuneration, from 1994 onwards, of a provision for the payment of arrears in the event of an increase and for the recovery of sums overpaid in the event of a reduction. The institutions have introduced the necessary implementing measures. 3. 3. Interim review Article 4(1) of Annex XI provides that «interim adjustments of remuneration pursuant to Article 65(2) of the Staff Regulations, taking effect on 1 January, shall be made in the event of a substantial change in the cost of living if the sensitivity threshold is reached and with due allowance being made for the forecast of the change in purchasing power during the current annual reference period». During the period under consideration interim adjustments were made for Italy, Greece, Spain and Portugal. 3. 4. Recruitment requirements Article 2 of Annex XI provides that «the Commission shall produce, before the end of 1992 and every three years thereafter, a comprehensive report on the recruitment requirements of the institutions and transmit it to the European Parliament and the Council. On the basis of this report the Commission shall, if necessary, present proposals based on all relevant factors to the Council after consulting the other institutions within the framework of the Staff Regulations». The second report (SEC(95)2298) was transmitted to the Council and Parliament on 27 December 1995. 12 3. 5. Exception clause Article 10 of Annex XI provides that «if there is a serious and sudden deterioration in the economic and social situation within the Community, assessed in the light of objective data supplied for this purpose by the Commission, the Commission shall submit appropriate proposals on which the Council shall act by qualified majority after consulting the other institutions concerned in accordance with the procedure laid down in the second subparagraph of Article 24(1) of the Treaty establishing a Single Council and a Single Commission of the European Communities». In its report (SEC(94)1027) transmitted to the Council on 27 June 1994, the Commission concluded that the economic situation had already impacted on the remuneration of national civil servants and, through the specific indicator, on the remuneration of Community officials. 13 3. 6. Results of the application of the 1991 method 3. 6. 1. The purpose of the adjustment of the basic salary table is to ensure that the purchasing power of Community officials develops in parallel with that of national civil servants. The change in the cost of living in Brussels as measured by the composite index was+13. 8%. The average change in the purchasing power of the national civil services in the European Union as measured by the specific indicator was -3. 1%. The resulting adjustment to the basic salary table (in Belgian francs) was +10. 4%. Table 8 shows the year-on-year calculations as well as the cumulative results. Table 8 Adjustment of the table of basic salaries of officials of the EU institutions (7) (1) (2) (3) (4) (5) (6) (7) Date Brussels composite index Specific indicator Adjustment of basic salary table 1. 7. 91 1. 7. 92 1. 7. 93 1. 7. 94 1. 7. 95 cumulative % +3,4 +7,6 +8,6 +9,2 +10,4 (7) Basic salary adjustment = (100+ Brussels composite index (2)) x (100+ specific indicator (4)) /100 ) -100 (3) (5) (7) Cumulative values are calculated by multiplying the year-on-year changes cumulative % +4,1 +7,7 +10,1 +12,8 +13,8 cumulative % -0,7 -0,1 -1,4 -3,3 -3,1 % t/t-1 -0,7 +0,6 -1,3 -1,9 +0,2 % t/t-1 +3,4 +4,1 +0,9 +0,5 +1,1 % t/t-1 +4,1 +3,5 +2,2 +2,4 +0,9 20 10 -10 -20 i IL^CUMI^ATIVE°/o- CHANGE Brussels composite index. --•• +>2,8-. ^ • +4 Adjustment of basic salary table - • + 1 3 ,8 i j-1Û,4 - ^ e ^— -9rt^--~^-_ ,4 _ " ! _ _ "_ ^SpecificjndicatQr. -3;3- 1. 7. 91 1. 7. 92 1. 7. 93 1. 7. 94 1. 7. 95 H 14 3. 6. 2. The adjustments in national currency made it possible to guarantee the principle of purchasing power parity with Brussels. In most countries devaluation against the Belgian franc was greater than the inflation differential with Belgium (see Tables 5 and 6). The result was a reduction in the price ratio between the other places of employment and Brussels, reflected in the 102. 5% to 86. 6% reduction in the average weighting for the other places of employment. In order to ensure the principle of purchasing power parity, this reduction also has to be reflected in the relationship between remuneration paid in the other places of employment and that paid in Brussels. This is shown in Table 9. Table 9 120 115 110 105 100 95 90 - 85 - 80 Average weighting weighted by the number of officials outside Belgium and Luxembourg 1. 7. 91 1. 7. 92 1. 7. 93 1. 7. 94 1. 7. 95 86,6 15 4. QUID PRO QUO FOR THE METHOD 4. 1. Temporary contribution When it adopted the method, the Council introduced a temporary contribution as one of the interdependent components of a comprehensive solution. The level of the contribution, the rules for its application, and its commencement and expiry dates were negotiated in this context. The temporary contribution was introduced by inserting Article 66a into the Staff Regulations (Council Regulation (ECSC, EEC, Euratom) No 3831/91 of 19 December 1991) and terminates at the same time as the method. Article 66a(1) and (2) provides that: «1. By way of derogation (EEC, Euratom, ECSC) No 260/68, a temporary measure regarding remuneration paid by the Communities to staff in active employment, to be known as the "temporary contribution", shall be applied for a period running from 1 January 1992 to 1 July 2001. from Article 3(1) of Regulation 2. (a) The rate of this temporary contribution, which shall apply to the base defined in paragraph 3, shall be 5. 8%. (b) The Council, acting in accordance with the procedure laid down in Article 24(1) of the Treaty establishing a Single Council and a Single Commission of the European Communities after consulting the other institutions concerned, may, if appropriate, in the context of the review provided for in Article 15(2) of Annex XI to the Staff Regulations, alter the rate of the temporary contribution referred to in point (a) on the basis of a report and proposal from the Commission». This measure resulted in an average loss in purchasing power of approximately 2. 9%. 4. 2. Increase in pension contributions The Council considered it advisable, in the course of negotiations for a comprehensive solution, in the interests of longer-term stability of the pension scheme to raise the rate of In Article 83(2) of the Staff Regulations, the rate of staff contributions to the scheme. 6. 75% was accordingly replaced by 8. 25% by Council Regulation (ECSC, EEC, Euratom) No 3832/91 of 19 December 1991. This measure resulted in an average loss in purchasing power of approximately 1. 3%. 16 5. CHANGES IN REMUNERATION 1991 TO 1995 5. 1. Changes in remuneration in Brussels and Luxembourg The economic situation has impacted on the salaries of national civil servants in the Member States of the European Union and consequently, through the parallel development principle, on the salaries of officials of the European institutions. Moreover, the purchasing power of officials has been reduced beyond what would be required by this principle, as a result of the supplementary measures (temporary contribution, increased pension contributions). The change in the remuneration in Belgian francs of officials in Brussels and Luxembourg was therefore as follows: Change in the remuneration of officials of the EU institutions (1) (2) (3) (4) (5) Date 1. 7. 91 1. 7. 92 1. 7. 93 1. 7. 94 1. 7. 95 Adjustment of basic salary table % t/t-1 +3,4 +4,1 +0,9 +0,5 +1,1 cumulative % +3,4 +7,6 +8,6 +9,2 +10,4 Change in deductions % t/t-1 cumulative % -2,9 •1,3 -2,9 -4,2 -4,2 -4,2 (6) (7) Adjustment of remuneration % t/t-1 +3,4 +1,1 -0,5 +0,5 +1,1 cumulative % +3,4 +4,5 +4,0 +4,5 +5,7 (4) Temporary contribution: payable from 1. 1. 92 Increased pension contributions: payable from 1. 1. 93 (6) Adjustment of remuneratbn = ( (100+ basic salary adjustment (2)) x (100+adjustment of deductbns (4)) /100 ) -100 (3) (5) (7)Cumulath/e values are calculated by multiplying the year-on-year changes J CUMULATIVE % CHANGE „ - ^-+7+3 " —B + 4 ,5 ^QiQrr Adjustment of basic salary table ,6 f=f9^ , ^*-M0A +5,7 Adjustment of remuneration -•--2,9- -4,2- •--•••-42- Change m deductions «-4,2 •i 1. 7. 91 1. 7. 92 1. 7. 93 1. 7. 94 1. 7. 95 20 10 •10 -20 Table 10 17 5. 2. Remuneration in other places of employment in relation to Brussels Average remuneration in the other places of employment in relation to Brussels was as follows: Table 11 Average weighting weighted by the number of officials outside Belgium and Luxembourg 1. 7. 91 102,5 1. 7. 92 104,6 1. 7. 93 97,5 1. 7. 94 94,5 1. 7. 95 86,6 5. 3. Change in the purchasing power of remuneration If the change in remuneration of officials in Brussels (+5. 7%) is set against the change in the cost of living (+13. 8%), the result is a 7. 1% reduction in purchasing power. This is shown in Table 12. Table 12 Relative change in the purchasing power of the remuneration of officials of the institutions of the European Union (1) Date 1. 7. 91 1. 7. 92 1. 7. 93 1. 7. 94 1. 7. 95 (2) (3) Adjustment of remuneration (4) (5) (6) (7) Brussels composite index Purchasing power % t/t-1 +3,4 +1,1 -0,5 +0,5 +1,1 cumulative % +3,4 +4,5 +4,0 +4,5 +5,7 % t/t-1 +4,1 +3,5 +2,2 +2,4 +0,9 cumulative % +4,1 +7,7 +10,1 +12,8 +13,8 % t/t-1 -0,7 -2,3 -2,6 -1,9 +0,2 cumulative % -0,7 -3,0 -5,5 -7,3 -7,1 (3) Temporary contribution: payable from 1. 1. 92 Increased pension contributions: payable from 1. 1. 93 (7) Purchasing power - 100 x (100+adjustment (3)) / (100+ Brussels composite index(5))-100 (3) (5) (7) Cumulative values are calculated by multiplying the year-on-year changes 20 10 -10 -20 CHANGE IN CUMULATIVE %. - • " + 7 ; 7" * * é pT - • + i t J , 1- -»-»-4,e- Brussels composite index. -••-+Î2& « + 1 3. 8 Adjustment of remuneration -•-^4r5- • +5,7 Purchasing power -7r3 "-7,1 1. 7. 91 1. 7. 92 1. 7. 93 1. 7. 94 1. 7. 95 H —\ 18 5. 4. Comparison with the change in purchasing power of national civil servants Since 1991 there has been a 3. 1% loss in the purchasing power of national civil servants in the Member States and, as a result of the method, in that of officials of the European institutions. If the impact of the temporary contribution (-2. 9%) and of the increase in pension contributions (-1. 3%) is added to the above, the result is a 7. 1% loss in the purchasing power of officials over five years. These figures show that the remuneration of officials of the European institutions has closely followed trends in the social and economic situation, changing at the same rate as national civil service salaries but with an additional reduction in purchasing power. Table 13 Change in the purchasing power of the remuneration of officials of the Member States and of the EU institutions (6) (4) (3) (2) (7) (5) (1) Remuneration of civil servants in the Member States of the EU Remuneration of officials of the EU institutions Date Difference % t/t-1 -0,7 -2,3 -2,6 -1,9 +0,2 (6) Temporary contribution: payable from 1. 1. 92 cumulative0/ •0,7 •0,1 -1,4 •3,3 •3,1 % t/t-1 -0,7 +0,6 -1,3 -1,9 +0,2 1. 7. 91 1. 7. 92 1. 7. 93 1. 7. 94 1. 7. 95 cumulative % •0,7 •3,0 •5,5 -7,3 -7,1 % t/t-1 +0,0 -2,9 -1,3 +0,0 +0,0 cumulative % +0,0 -2,9 -4,2 -4,2 -4,2 Increased pension contributions: payable from 1. 1. 93 (3) (5) (7) Cumulative values are calculated by multiplying the year-on-year changes 20 10 •10 -20 CUMULATIVE % CHANGE IN PURCHASING POWER _J Remuneration of civil servants in the Member States of the EU " " " • • - - • - 3 , 0. •A A -•-5,5 _ "•-3:3 -•-7-,3 *-3,1 «-7,1 Remuneration of officials of the EU institutions 1. 7. 91 1. 7. 92 1. 7. 93 1. 7. 94 1. 7. 95 +- - 19 6. CONCLUSION Annex XI to the Staff Regulations (the method) was adopted by the Council for a period of ten years (until 30 June 2001). As such, in common with all other regulations, it is part of the acquis communautaire, with which the Community institutions and all Member States must comply. There is provision for it to be reviewed after five years - an objective review to check that the principle of parallel development has been properly applied. Only if it were established that the method had failed to operate properly could the Commission present a proposal for revision of the Staff Regulations to the Council after consulting the other institutions. The review shows that: there has been a reduction (3. 1%) in the purchasing power of the remuneration of officials of the European institutions, the same as for the salaries of national civil servants; there has been a further reduction (4. 2%) in purchasing power as a result of the temporary contribution and the increase in pension contributions; staff relations have remained conflict-free as a result of the introduction of the procedure. The Commission therefore feels that any proposal to amend the method would affect the very substance of the final compromise resulting from the 1991 negotiations and the commitments entered into by the parties to it. Any departure from this compromise, which has attained its objectives, would undermine the legitimate expectations of staff as regards the institutions' compliance with the commitments entered into and would have grave consequences for the operation of the institutions. The Commission consequently considers that there are no grounds for any proposal to amend any of the components of the compromise. 20 ISSN 0254-1475 COM(96) 258 final DOCUMENTS EN 01 Catalogue number : CB-CO-96-268-EN-C ISBN 92-78-05235-3 Office for Official Publications of the European Communities L-298S Luxembourg 2/)

Proposal for a COUNCIL DECISION on the exchange of letters between the European Community and Chile concerning the provisional application of certain provisions of the framework cooperation Agreement in preparation for the eventual establishment of a political and economic association between the European Community and its Members States, of the one part, and the Republic of Chile, of the other part

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* ** * ' "* * * * ** I COMMISSION OF THE EUROPEAN COMMUNITIES j I I Brussels, 11. 06. 1996 COM(%)259 final 96/ 0149 (ACC) 96/0150 (ACC) Proposal for a COUNCIL DECISION concerning the conclusion of the framework cooperation Agreement in preparation for the eventual establishment of a political and economic association between the European Community and its Members States, of the one part, and the Republic of Chile, of the other part (presented by the Commission). mm mum • • • n. — —— ni • — i- i • ,. — » • •• Proposal for a COUNCIL DECISION on the exchange of letters between the European Community and Chile concerning the provisional application of certain provisions of the framework cooperation Agreement in preparation for the eventual establishment of a political and economic association between the European Community and its Members States, of the one part, and the Republic of Chile, of the other part (presented by the Commission) EXPLANATORY MEMORANDUM 1. By means of a decision of 29 January, the Council authorized the Commission to open negotiations with Chile with a view to concluding a framework cooperation agreement in preparation for the eventual establishment of a political and economic association between the European Community and its Member States, of the one part, and the Republic of Chile, of the other part, and adopted directives to that end. Two negotiating sessions were held in Brussels, the first on 25 and 26 March and 2. the second on 25 and 26 April at which the Agreement was initialled. A meeting was held between those two sessions between Mr Prat and the representatives of the Troika and the Chilean negotiators in Santiago, Chile, on 19 April. The text of this Agreement has now been submitted to the Council for signature and conclusion. 3. In consultation with the special committee appointed by the Council to oversee negotiations, when the Agreement was initialled, the negotiators agreed to adopt the arrangements for the provisional application of the Agreement, and in particular those provisions relating to Community responsibility on trade cooperation under Title III of the Agreement and the institutional framework for such cooperation. The Commission also proposes that the Council approve and sign an exchange of letters on the provisional application of the Agreement's provisions. The Agreement between the European Community and Chile signed on 20 December 1990 will remain in force until the new Agreement comes into force. However, in order to ensure continuity between the two Agreements, the Joint Committee set up under the new Agreement will assume the duties of the 1990 Agreement's Joint Committee. The Commission considers that the initialled Agreement conforms 4. negotiating directives adopted by the Council. to the 5. With a view to signing and concluding the framework cooperation Agreement in preparation for the eventual establishment of a political and economic association between the European Community and its Member States, of the one part, and the Republic of Chile, of the other part, the Commission proposes that the Council adopt the proposals for Decisions in the Annex. i- ? Proposal for a ^ /. Î5 J H^ (fc^O COUNCIL DECISION (EC) No concerning the conclusion of the framework cooperation Agreement in preparation for the eventual establishment of a political and economic association between the European Community and its Members States, of the one part, and the Republic of Chile, of the other part (presented by the Commission to the Council) 7 THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Articles 113 and 130y thereof, in conjunction with the first sentence of Article 228(2) and the first subparagraph of paragraph 3 thereof, Having regard to the proposal from the Commission, Having regard to the opinion of the European Parliament, Whereas Article 13 Ou of the Treaty provides that Community policy in the sphere of development cooperation should foster the sustainable economic and social development of the developing countries, the smooth and gradual integration of those countries into the world economy and the combating of poverty in those countries; the eventual Whereas the framework cooperation Agreement establishment of a political and economic association between the Community and its Member States, of the one part, and the Republic of Chile, of the other part, should be approved, in preparation for HAS DECIDED AS FOLLOWS: Article 1 The framework cooperation Agreement in preparation for the eventual establishment of a political and economic association between the European Community and its Member States, of the one part, and the Republic of Chile, of the other part, is hereby approved on behalf of the European Community. The text of the Agreement is attached to this Decision. Article 2 In accordance with Article 33 of the framework cooperation Agreement, the President of the Council shall chair the Joint Cooperation Council and shall represent the Community on that Council. A representative of the Commission shall chair the Joint Cooperation Committee and the Joint Subcommittee on Trade in accordance with their rules of procedure and, assisted by the representatives of the Member States, shall represent the Community on those committees. Article 3 The President of the Council shall give the notification provided for in Article 42 of the Agreement on behalf of the European Community. Article 4 This Decision shall be published in the Official Journal of the European Communities. Done at Brussels, For the Council The President / DRAFT FRAMEWORK COOPERATION AGREEMENT IN PREPARATION FOR THE EVENTUAL ESTABLISHMENT OF A POLITICAL AND ECONOMIC ASSOCIATION BETWEEN THE EUROPEAN COMMUNITY AND ITS MEMBER STATES, OF THE ONE PART, AND THE REPUBLIC OF CHILE, OF THE OTHER PART * THE KINGDOM OF BELGIUM, THE KINGDOM OF DENMARK, THE FEDERAL REPUBLIC OF GERMANY, THE HELLENIC REPUBLIC, THE KINGDOM OF SPAIN, THE FRENCH REPUBLIC, IRELAND, THE ITALIAN REPUBLIC, THE GRAND DUCHY OF LUXEMBOURG, THE KINGDOM OF THE NETHERLANDS, THE REPUBLIC OF AUSTRIA, THE PORTUGUESE REPUBLIC, THE REPUBLIC OF FINLAND, THE KINGDOM OF SPAIN, THE UNITED KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND, Parties to the Treaty establishing the European Community and the Treaty on European Union, hereinafter referred to as the "European Community Member States", t THE EUROPEAN COMMUNITY, hereinafter referred to as the "Community" THE REPUBLIC OF CHILE hereinafter referred to as "Chile", of the one part, and of the other part, CONSIDERING their common cultural heritage and the deep historical, political and economic ties which unite them; CONSIDERING the significant contribution made by the Framework Agreement for Cooperation between the Community and Chile signed on 20 December 1990 to strengthening all these ties; CONSIDERING their full commitment fundamental human rights as set out in the Universal Declaration of Human Rights; to respect for democratic principles and CONSIDERING the importance which both Parties attach to the principles and values set out in the final Declaration of the World Summit for Social Development in Copenhagen in March 1995; MINDFUL of both Parties' desire to ensure sustainable development and also to conserve and protect the environment; CONSIDERING their attachment to the market economy and reaffirming their willingness to maintain and strengthen the rules of free international trade in compliance with the rules of the World Trade Organization (WTO) and emphasizing, in particular, the importance of open regionalism; CONSIDERING their mutual interest in establishing new contractual links in order to develop closer and more extensive cooperation, to expand and diversify trade and to increase investment; CONSIDERING the political will of both Parties to achieve the ultimate objective of a political and economic association between the European Community and its Member States and Chile founded on greater political cooperation and progressive and reciprocal liberalization of all trade, with due allowance for the sensitivity of certain products and in compliance with the rules of the World Trade Organization, and on investment promotion and closer cooperation; J MINDFUL of the terms of the Joint Solemn Declaration on political dialogue in which both Parties have agreed on closer political dialogue to promote more intensive consultation on matter of mutual interest, with a view to basing their relations on the above long-term aim, HAVE DECIDED to conclude this Agreement: cyCo TITLE I NATURE AND SCOPE ARTICLE 1 Basis of the Agreement Respect for democratic principles and fundamental human rights as set out in the Universal Declaration of Human Rights is at the heart of both Parties' domestic and external policies and constitutes an essential element of this Agreement. ARTICLE 2 Nature and scope 1. This Agreement shall be aimed at strengthening existing relations between the Parties on the basis of reciprocity and mutual interest, paving the way for the progressive and reciprocal liberalization of trade, ultimately leading to the establishment of a political and economic association between the European Community and its Member States and Chile in conformity with the rules of the World Trade Organization (WTO) and with due allowance for the sensitivity of certain products. 2. To this end, the Agreement covers political dialogue, trade and economic matters, cooperation and other matters of mutual interest, its objective being to forge closer relations between the Parties and their respective institutions. TITLE II Political dialogue ARTICLE 3 1. 2. The Parties agree to institute regular political dialogue on bilateral and international matters of mutual interest. Such dialogue shall be conducted in accordance with the Joint Declaration, which shall form an integral part of the Agreement. The ministerial dialogue provided for in the Joint Declaration shall take place within the Council established by Article 33 of this Agreement or within other agreed forums of an equivalent level. SA TITLE III TRADE COOPERATION AND PREPARATION FOR LIBERALIZATION OF TRADE ARTICLE 4 Objectives The Parties undertake to forge closer relations with the aim of increasing and diversifying trade, preparing for progressive and reciprocal liberalization of trade and creating conditions conducive to the eventual establishment of a political and economic association, in conformity with WTO rules and with due allowance for the sensitivity of certain products. ARTICLE 5 Dialogue on trade and economic matters 1. The Parties undertake to hold regular dialogue on trade and economic matters, within the institutional framework established by Title VII of the Agreement, in order to meet the Agreement's trade objectives and prepare the ground for the eventual liberalization of trade. 2. The Parties shall agree on the areas to be covered by trade cooperation without excluding any sector. 3. Such cooperation shall in particular focus on the following: (a) market access and liberalization of trade, the study and establishment of programmes for the reciprocal liberalization of trade (timetable and structure of negotiations, transitional periods, etc. ); (b) tariff and non-tariff barriers, quantitative restrictions on imports and exports and measures having equivalent effect: analyses, studies and management, including quotas, administrative standards applied to external trade, anti-dumping duties, safeguard clauses, technical standards, health and plant health legislation, mutual recognition of certification systems, etc; (c) the Parties' tariff structure; (d) compatibility of trade liberalization with WTO rules; (e) identification of potential tariff reductions and elimination of quasi-tariff measures; (f) definition of sensitive products and products given priority by the Parties;. ^2- (g) cooperation and exchange of information, within the Parties' respective areas of responsibility on transport, insurance and financial services, (h) monitoring of restrictive practices; (i) rules of origin which promote the use of regional inputs with a view to encouraging integration. ARTICLE 6 Cooperation on standardization, accreditation, certification, metrology and conformity evaluation 1. The Parties agree to cooperate on standardization, accreditation, certification, metrology and conformity evaluation. Such cooperation shall take the form in particular of: (a) provision of technical assistance for Chile on standardization, accreditation, certification and metrology to develop an appropriate system and structures compatible: - with international standards; - with the basic requirements of health and safety protection, plant and animal protection, consumer protection and environmental conservation; (b) negotiation of a mutual recognition framework agreement once an appropriate level of technology has been reached in the sectors concerned; (c) cooperation between the Parties on technical standards to facilitate market access. ARTICLE 7 Customs cooperation 1. The Parties shall promote customs cooperation, acting within their respective areas of responsibility, with a view to improving and consolidating the legal framework for their trade relations. A further objective of customs cooperation shall be to strengthen the Parties' customs arrangements and improve their operation within the framework of interinstitutional cooperation. 2. Such cooperation may take the form in particular of: (a) exchanges of information, taking into account the need to protect personal data; (b) development of new training techniques and coordination of activities within the relevant international organizations; (c) exchanges of officials and senior personnel from customs and tax departments; (d) simplification of customs procedures; (e) technical assistance. The Parties affirm their intent to give future consideration, within the institutional framework established by this Agreement, to the conclusion of a customs mutual assistance protocol. k ARTICLE 8 Temporary importation of goods The Contracting Parties undertake to take account of relief from duties and taxes on temporary importation into their territory of goods covered international agreements on such matters. ARTICLE 9 Cooperation on statistics The Parties agree to promote the approximation of statistical methods with a view to using, on a mutually acceptable basis, statistics on trade in goods and services and, in general, statistics in any area which lends itself to statistical processing. ARTICLE 10 Cooperation on intellectual property 1. The Parties agree to cooperate on intellectual property matters in order to promote trade in goods and services, investment, technology transfer, dissemination of information, cultural and creative activities and related economic activities. M 2. For the purposes of this Article, intellectual property shall in particular encompass copyright, including copyright for computer programmes and databases, and related rights, trade or service marks, geographical indications, including designations of origin, industrial designs and models, patents and integrated circuit topographies, data protection and prevention of unfair competition as defined in Article lObis of the Paris Convention for the Protection of Industrial Property. 3. The Parties agree to guarantee, within their respective laws, regulations and policies, adequate and effective protection of intellectual property rights in accordance with the highest international standards laid down in the Agreement on aspects of trade- related intellectual property rights (TRIPS) concluded in the framework of the WTO, and, where necessary, to consider strengthening it, for example by concluding an agreement on the reciprocal protection and recognition of geographical indications and designations of origin. 4. Cooperation in this area may include technical assistance between the Parties in the form of joint programmes and projects. 5. 6. In the event of trade disputes connected with the protection of intellectual property, the Parties may hold consultations in order to settle any doubt or difficulty relating to the application of their respective rules on the protection of intellectual property rights. In research and other joint scientific activities undertaken in the field of science and technology, the Parties shall agree on the intellectual property rules to be applied to their results. ARTICLE 11 Cooperation on public procurement 1. The Parties agree to ensure, on a reciprocal basis, open, non-discriminatory and transparent procedures for their respective government and public sector procurement at central, federal, regional, provincial and local level. to cooperate 2. In order to attain this objective, the Parties agree to consider the possibility of concluding an agreement on access in these sectors of procurement, generating transparent, fair conditions subject to clear complaint procedures. 3. Cooperation between the Parties in this area shall include technical assistance in matters connected with the Agreement on Government Procurement. 4. The Parties shall consider the possibility of holding annual consultations on this sector. ^ TITLE IV ECONOMIC COOPERATION ARTICLE 12 Objectives 1. In the light of the achievements of the Framework Agreement for Cooperation between the Community and Chile of December 1990, both Parties undertake, under this Agreement, to consolidate and expand all areas of economic cooperation by cultivating synergies in productive activities, creating new opportunities and increasing economic competitiveness. 2. Economic cooperation between the Parties shall be as broad-based as possible. No sector shall be excluded from the outset, and account shall be taken of the Parties' respective priorities, mutual interests and areas of responsibility. 3. The Parties shall focus on cooperation which will foster economic and social relations and networks between companies (trade, investment, technology, information or communication systems). 4. Within the framework of this cooperation the Parties shall promote the exchange of regular monitoring of information which will serve as a basis macro-economic policies and balances and efficient market operation. the for 5. In view of the degree of liberalization achieved by Chile in the area of services, investment and scientific, technological and industrial cooperation, the Parties undertake to make a special effort to expand and consolidate cooperation in these areas. 6. The need to conserve the environment and ecological balances shall be taken into account by the Parties in any economic cooperation measures they undertake. 7. Any measures sponsored by the Parties in this field shall be guided by the principle of social development, and the promotion of fundamental social rights in particular. yU ARTICLE 13 Industrial and business cooperation 1. The Parties shall promote industrial and business cooperation with the aim of establishing a climate conducive to economic development taking account of their mutual interests. 2. Such cooperation shall focus in particular on: (a) increasing trade flows, investment, industrial cooperation and technology transfer; (b) supporting industrial modernization and diversification; (c) identifying and eliminating obstacles to industrial cooperation between the Parties by means of measures which encourage respect for competition laws and help gear industry to market requirements, allowing for the participation and consultation of operators; (d) encouraging cooperation between economic operators on both sides, particularly small and medium-sized enterprises (SME); (e) promoting industrial innovation by developing an integrated and decentralized approach to cooperation among operators on both sides; (f) ensuring the overall consistency of measures which may have a positive influence on cooperation between businesses on both sides. 3. Such cooperation, which shall be based on a dynamic, integrated and decentralized approach, shall take the form in particular of: (a) encouraging closer organized contacts between businesses, particularly small and medium-sized enterprises (SME), and economic operators on both sides which will provide them with an opportunity to identify and exploit areas of mutual interest, paving the way for increased trade, investment and industrial and business cooperation projects in general, particularly by promoting joint ventures, (b) promoting business initiatives and cooperation projects which shall be identified through closer dialogue between Chilean and European operators' networks; (c) undertaking measures to support business cooperation, notably regarding industrial quality policies and industrial innovation, training and applied research, development and technology transfer. ^ ARTICLE 14 Cooperation on services 1. The Parties recognize the growing importance of services for their economic development. To this end they shall consolidate and step up cooperation in this sector, within their respective areas of responsibility and in accordance with the rules of the General Agreement on Trade in Services (GATS). 2. In terms of practical implementation the Parties shall identify the priority sectors in this area in order to ensure efficient use of available instruments. Measures shall focus mainly on: (a) helping SME gain access to capital resources and market technologies; (b) promoting trade between the Parties and with the markets of third countries; (c) encouraging better and diversified productivity and competitiveness in this sector; (d) exchanging information on the rules, laws and regulations which govern trade in services; (e) exchanging information on the procedure for granting: - licences and certificates to professional service providers and - recognition of professional qualifications. (f) developing the tourism sector, with a view to improving the exchange of information and know-how in order to promote a sustainable and ordered development of the tourist amenity. To this end human resources development and joint operations in the tourist promotion and marketing fields will be encouraged. ARTICLE 15 Investment promotion The Parties shall help create, within their respective areas of responsibility, an attractive and stable environment for reciprocal investment. Such cooperation shall take the form inter alia of: (a) arrangements for information, identification and dissemination relating to investment legislation and opportunities; (b) promoting the development of a legal environment conducive to investment between if necessary, Chile and Community Member States could conclude the Parties; bilateral agreements to promote and protect investment and bilateral agreements to prevent double taxation; (c) developing harmonized and simplified administrative procedures; (d) developing joint investment, in particular with SME on both sides. ARTICLE 16 Scientific and technical cooperation 1. The Parties agree to cooperate in the field of science and technology in areas of mutual interest, taking account of their respective policies. 2. The aims of such cooperation shall be: (a) to encourage exchanges of information and know-how on science and technology, especially on the implementation of policies and programmes, (b) to promote sustainable relations between communities; the two Parties' scientific (c) to foster innovation in Chilean and European businesses; (d) to promote technology transfer; 3. Cooperation shall take the form in particular of: (a) joint research projects in areas of mutual interest, with the active participation of business where appropriate; (b) exchanges of scientists to promote research, project preparation and high-level training; (c) joint scientific meetings to promote the exchange of information, encourage interaction and identify areas where joint research might be undertaken; (d) dissemination of results and development of links between the public and private sectors; (e) exchanges of know-how on standardization; (f) evaluation of the activities concerned. 4. In terms of practical implementation, the Parties shall encourage their respective higher education institutions, research centres and industrial sectors, in particular SME, to play an active role. sV 5. The Parties shall agree, without excluding any sector from the outset, on the areas, scope, nature and priorities of this cooperation, by establishing a multiannual programme which can be adapted to circumstances. ARTICLE 17 Energy cooperation Cooperation between the Parties shall focus on fostering closer links between their economies in the sectors of renewable and non-renewable, conventional and non- conventional energies, and energy-saving technologies. Cooperation shall in particular take the following forms: (a) exchanges of information in all appropriate forms, including the development of databanks to be shared by economic operators on both sides, training and joint conferences; (b) technology transfer; (c) preparatory studies and project implementation by the relevant institutions of both Parties; (d) the participation of economic operators from the two Parties in joint technological development or infrastructure projects; (e) where appropriate the conclusion of specific agreements in key areas of mutual interest; (f) aid for Chilean institutions dealing with energy matters and the formulation of energy policy; (g) technical training programmes. 2x> ARTICLE 18 Cooperation on transport 1. Cooperation in this area shall be aimed essentially at: (a) support for the modernization of Chile's transport systems; (b) efforts to increase personal mobility, the movement of goods and access to the transport market; (c) promotion of operating standards. 2. Cooperation shall take the form in particular of: (a) exchanges of information on respective transport policies and on other topics of mutual interest; (b) training programmes for economic operators and senior public officials; (c) exchange of information on the installation of monitoring stations forming part of the infrastructure of the Global Navigation Satellite System (GNSS). 3. Acting within their respective areas of responsibility, international undertakings, the Parties shall look at all aspects relating to international maritime transport services to ensure that they do not hamper the mutual expansion of trade, paying particular attention to the maintenance of unrestricted access to markets on a commercial and non-discriminatory basis. laws and ARTICLE 19 Cooperation on the information society and telecommunications 1. The Parties recognize that advanced information and communication technologies are a key sector in modern society and are vital to economic and social development and the smooth transition to an information society. 2. Cooperation between the Community and Chile in this area shall focus in particular on: (a) dialogue on all aspects of the information society including telecommunications policy; (b) exchanges of information and any technical assistance required on regulations and standardization, conformity testing and certification for information and telecommunication technologies; (c) dissemination of new telecommunications and information technology and development of new advanced communication, services and information technology facilities; (d) promoting and undertaking joint research and technological or industrial development projects in the field of new information, communication, telematics and information society technologies; (e) providing an opportunity for Chilean institutions to take part in pilot projects and Community programmes, especially in the regional field, under the arrangements pertaining to the areas concerned; (f) interconnection and interoperability of telematic networks and services in the Community and Chile. ARTICLE 20 Cooperation on environmental protection 1. The Parties undertake to develop cooperation to protect, improve and prevent degradation of the environment, control pollution and encourage the rational use of natural resources, in the interests of sustainable development. The emphasis shall be on conservation of ecosystems, the integrated management of natural resources, the environmental impact of economic activities, the urban environment and depollution programmes. 2. Cooperation shall focus on: (a) projects to strengthen environmental structures and policies in Chile; (b) exchange of information and know-how covering various areas including the Parties' respective rules and standards; (c) environmental training and education; (d) technical assistance and the establishment of joint research programmes. 12- ARTICLE 21 Cooperation on the agricultural and rural sector 1. The Parties shall promote mutual cooperation in the agricultural and rural sector. To this end they shall examine: (a) measures to promote mutual trade in agricultural products; (b) environmental health and plant health measures and other related aspects, taking account of the legislation in force for both parties, in compliance with WTO rules. 2. The Parties shall take measures such as the mutual exchange of information, technical assistance and scientific and technological experiments to promote agricultural development cooperation. TITLE V OTHER AREAS OF COOPERATION ARTICLE 22 Objectives and scope The Parties will maintain cooperation on social development, public administration, information and communication, training and regional integration with particular emphasis on areas likely to contribute to the process of cooperation and to the eventual establishment of a political and economic association between the Parties. ARTICLE 23 Financial and technical cooperation and cooperation on social development 1. The Parties reaffirm the importance of their financial and technical cooperation, which should be geared towards combating extreme poverty and generally assisting the most deprived sections of the community. 2. Such cooperation may take the form of pilot programmes in the following areas: (a) job creation and vocational training; (b) management and administration of social services; (c) rural development and housing and regional planning; (d) health and primary education; (e) support for the grassroots organizations in civil society; (f) programmes and projects to create business and employment opportunities and thereby help to combat poverty. (g) programmes to improve the quality of life, notably of the most deprived sections of the community. ARTICLE 24 Cooperation on public administration and regional integration 1. The Parties shall support cooperation on public administration to promote the adjustment of Chilean administrative systems to open trading in goods and services with Europe. 2. In this context the Parties shall work together to promote the administrative changes deriving from Latin American integration. 3. To this end, in support of Chile's objectives of administrative modernization, decentralization and regionalization, the Parties shall encourage cooperation within all institutions, drawing lessons from the instruments and policies of the European Community. 4. Cooperation shall be undertaken in particular through: (a) (b) technical assistance to Chilean policy-making and executive bodies, including their Chilean contacts between staff of the European counterparts; institutions and regular exchange of information taking whatever form is appropriate, including the use of computer networks; personal data protection shall be guaranteed in all areas where data are to be exchanged; (c) transfers of know-how; (d) preliminary studies and implementation of joint projects; (e) training and institutional support. if ARTICLE 25 Inter-institutional cooperation 1. The Parties agree on the need to promote closer administrative cooperation between the institutions concerned. 2. Such cooperation shall be as broad-based as possible and shall focus in particular on: (a) any means of fostering regular exchanges of information, including joint development of computerized communication networks; (b) advice and information; (c) transfer of know-how. ARTICLE 26 Cooperation on communication, information and culture 1. In view of Chile's very close cultural ties with Community Member States, the Parties will intensify cooperation in this area and on communication and information. 2. Within the Parties' respective areas of responsibility, the aim of such cooperation shall be to promote: (a) meetings between senior information and communication representatives and, where appropriate, technical assistance; (b) greater exchanges of information on matters of mutual interest; (c) organization of cultural events. (d) activities - studies and training schemes - aimed at protecting the cultural heritage. 3. The parties agree to promote the broadest possible cooperation in the audiovisual and press sector. K ARTICLE 27 Cooperation on training and education 1. The Parties shall identify, within their respective areas of responsibility, ways of improving primary education, youth training, vocational training and inter-university and inter-business cooperation. Particular emphasis shall be given to vocational training for the most deprived sections of the community. 2. The Parties shall place emphasis on measures designed to create permanent links between Community and Chilean specialized agencies which will encourage the pooling of technical resources and exchanges of know-how. 3. These projects shall be undertaken mainly through: (a) agreements between educational and training institutions; (b) meetings between bodies responsible for education and training. 4. A further objective of cooperation in this area shall be the conclusion of sectoral agreements on education, training and youth-related matters. ARTICLE 28 Cooperation on combating drug trafficking 1. Within their respective areas of responsibility, the Parties shall coordinate their efforts and intensify their cooperation to prevent drug abuse and illegal trafficking in drugs, the misuse of chemical precursors and the laundering of profits from drug-trafficking. To this end the Parties shall coordinate their cooperation activities and areas at bilateral level and in international organizations and forums. 2. Such cooperation, which shall make use of specialized agencies, shall focus on: (a) projects to train, educate, treat and rehabilitate drug addicts and programmes to prevent the illegal consumption of drugs; (b) joint research programmes; (c) training programmes for public officials on preventing and controlling drug trafficking, money laundering and on monitoring trade in essential chemical precursors etc; (d) exchange of relevant information and adoption of appropriate measures to combat drug trafficking and money laundering, in the framework of multilateral agreements in force and the recommendations of the Financial Action Task Force on Money Laundering (FATF); 24 (e) prevention of the diversion of chemical precursors and other essential substances used for the illegal production of drugs and psychotropic substances. This prevention is based on the 1988 United Nations Convention, the principles adopted by the Community and the relevant international authorities and on the recommendations of the Chemical Action Task Force (CATF). 3. The Parties may agree to extend such cooperation to other areas. ARTICLE 29 Cooperation on consumer protection 1. The Parties agree that cooperation in this area should be aimed at refining their consumer protection systems and seeking, within their respective legislations, to make their systems compatible. 2. Cooperation shall focus mainly on: (a) exchange of information and experts; (b) organization of training schemes and provision of technical assistance. ARTICLE 30 Cooperation on fishing 1. The Parties agree that, acting trade and environmental undertakings, cooperation in this area shall take the form of a regular dialogue to examine the possibility of establishing closer cooperation in the fisheries sector which could lead to a fisheries agreement. in compliance with international ARTICLE 31 Triangular cooperation The Parties, acknowledging the value of international cooperation for promoting equitable and sustainable development, agree to encourage triangular cooperation programmes with other countries in areas and sectors of mutual interest. TITLE VI MEANS 2. ? ARTICLE 32 In order to help attain the cooperation aims set out in this Agreement, the Parties undertake to make available, within the limit of their abilities and through their own channels, the appropriate resources, including financial resources. The Parties shall call on the European Investment Bank to step up its activities in Chile in accordance with its own procedures and financing criteria. TITLE VI INSTITUTIONAL FRAMEWORK ARTICLE 33 1. A Joint Council of the Framework Cooperation Agreement, hereinafter referred to as the Joint Council, is hereby established. It shall supervise the implementation of this Agreement and shall meet at ministerial level periodically and whenever circumstances require. 2. The Joint Council shall discuss important matters arising in connection with the Agreement and any other bilateral or international issues of mutual interest, with the aim of fulfilling the Agreement's objectives. 3. The Council may also make appropriate proposals by agreement with both Parties. In carrying out its duties, the Cooperation Council shall be responsible in particular for making recommendations which contribute to the ultimate objective of political and economic association. ARTICLE 34 1. The Joint Council shall be composed of members of the Council of the European Union and Members of the European Commission on the one hand, and Chilean representatives, on the other. 2. The Council shall adopt its own rules of procedure. 3. The Council shall be chaired in turn by a Community representative and a Chilean representative. ARTICLE 35 The Joint Council shall be assisted in the performance of its duties by a Joint Committee composed of members of the Council of the European Union and tt Members of the European Commission, on the one hand, and of Chilean representatives, on the other. 2. The Joint Committee shall generally meet once a year, on a date and with an agenda agreed in advance by the Parties, in Brussels one year and Chile the next. Special meetings may be convened by mutual agreement. The office of chairman of the Joint Committee shall be held alternately by a representative of each of the Parties. 3. The Joint Council shall set out the Joint Committee's operating procedures in its own rules of procedure. 4. The Council may delegate all or part of its powers to the Joint Committee. The latter shall provide continuity between its meetings. 5. The Joint Committee shall assist the Council in the performance of its duties In fulfilling these functions, the Joint Committee shall in particular: (a) (b) (c) foster trade relations in accordance with the objectives of this Agreement and in accordance with the provisions of Title III; exchange opinions on future cooperation programmes and the resources available for their implementation and on any matter of mutual interest which relates to progressive and reciprocal liberalization of trade; submit to the Joint Council proposals made by the Subcommittee on Trade with the aim of cultivating preparations for the progressive and reciprocal liberalization of trade and proposals intended to bring about closer cooperation in this area; and (d) in general, make proposals to the Joint Council which will contribute to the ultimate aim of an EU-Chile political and economic association. ARTICLE 36 The Joint Council may decide to set up any other body to assist it in the performance of its duties and shall determine the body's composition, objectives and operating procedures. tî ARTICLE 37 1. The Parties agree to establish a Joint Subcommittee on Trade which shall ensure that the trade-related objectives set out in Article 5 of the Agreement are fulfilled and shall undertake the preparatory work for the progressive and reciprocal liberalization of trade. 2. The Joint Subcommittee on Trade shall be composed of members of the Council of the European Union and Members of the European Commission, on the one hand, and Chilean representatives, on the other. ^ It may commission any studies or technical analyses which it deems necessary. i\ The Joint Subcommittee on Trade shall report at least once a year to the Joint Committee set up under Article 35 of the Agreement on the development of its work, and shall make proposals regarding the subsequent liberalization of trade. 5", The Joint Subcommittee on Trade shall submit its rules of procedure to the Joint Committee for approval. ARTICLE 38 Consultation Within their respective areas of responsibility, the Parties undertake to hold consultations on any matter covered by this Agreement. The procedure for the consultations referred to above shall be laid down in the rules of procedure of the Joint Committee. TITLE VIII FINAL PROVISIONS ARTICLE 39 Definition of the Parties For the purposes of this Agreement, "the Parties" shall mean the Community, its Member States or the Community and its Member States, within their respective areas of responsibility, as defined in the Treaty establishing the European Community, on the one hand, and Chile, on the other. J •o ARTICLE 40 Future developments The Parties may agree to extend the Agreement with the aim of broadening and supplementing the scope and level of cooperation in accordance with their respective legislation, by concluding agreements on specific sectors or activities in the light of the experience gained during its implementation. ARTICLE 41 Territorial application This Agreement shall apply to the territories in which the Treaty establishing the European Community is applied under the conditions laid down in that Treaty, on the one hand, and to the territory of the Republic of Chile, on the other. ARTICLE 42 Duration and entry into force l. This Agreement shall be valid indefinitely. 2. The Parties shall determine the suitability and timing of transition to political and economic association in the light of progress made under the Agreement in accordance with their own procedures and in the light of the work carried out and the proposals made within the institutional framework of this Agreement. 3. This Agreement shall enter into force on the first day of the month following the date on which the Parties notify each other of the completion of the procedures necessary for this purpose. 4. Notification shall be sent to the Secretariat-General of the Council of the European Union which shall be the depositary for the Agreement. 5. On its entry into force the Agreement shall replace the Framework Agreement for Cooperation between the European Community and the Republic of Chile signed on 20 December 1990. yi ARTICLE 43 Non-execution l. The Parties shall adopt any general or specific measure required for them to fulfil their obligations under this Agreement and shall ensure that they comply with the objectives laid down in the Agreement. If one of the Parties considers that another Party has failed to fulfil an obligation under this Agreement it may take appropriate measures. Before doing so, except in cases of special urgency, it must supply the Joint Committee with all the relevant information required for a thorough examination of the situation with a view to seeking a solution acceptable to the Parties. In this selection of measures, priority must be given to those which least disturb the functioning of this Agreement. These measures shall be notified immediately to the Joint Committee and shall be the subject of consultation in that Committee if the other Party so requests. 2. The Parties agree that the term "cases of special urgency" in paragraph 1 of this Article means a case of material breach of the Agreement by one of the Parties. A material breach of the Agreement consists of: (a) repudiation of the Agreement not sanctioned by the general rules of international law; (b) violation of the essential elements of the Agreement referred to in Article 1. 3. The Parties agree that the "appropriate measures" referred to in this Article are measures taken in accordance with international law. If a Party takes a measure in a case of special urgency as provided for under this Article, another Party may ask that an urgent meeting be called to bring the Parties together within 15 days. ARTICLE 44 Authentic text This Agreement is drawn up in duplicate in the Danish, Dutch, English, Finnish, French, German, Greek, Italian, Portuguese, Spanish and Swedish languages, each of these texts being equally authentic. 3L JOINT DECLARATION ON POLITICAL DIALOGUE BETWEEN THE EUROPEAN UNION AND CHILE Annex I 1. Preamble The European Union and Chile, Conscious of their common cultural heritage and the deep historical, political and economic ties which unite them, Guided by their attachment to democratic values, and reiterating the fact that respect for human rights, the freedom of the individual and the principles of the rule of law, as the foundations of a democratic society, lie at the root of their domestic and foreign policies and of their joint undertaking, Wishing to consolidate international peace and security in accordance with the principles set out in the United Nations Charter, and determined to apply the principles of preventing and peacefully resolving international disputes, Declaring their interest in using regional integration to promote sustainable and harmonious development for their inhabitants, using as a foundation the principles of social progress and solidarity between their members, Taking as a basis the special ties established by the Framework Cooperation Agreement between the European Community and Chile, Have decided to give relations between them a long-term perspective. 2. Aims Mindful of the conclusions adopted by the Council of the European Union on 17 July 1995 in the wake of the communication on the strengthening of relations between the European Union and Chile, the Parties reiterate their intention to enter into an agreement which will express their political will to achieve their ultimate goal of political and economic association. To that end, the Parties have agreed to step up political dialogue in order to ensure that there is closer consultation in areas of common interest, primarily through coordination of the Parties' positions in the appropriate multilateral forums. Such dialogue could include other participants from the region or, where possible, be conducted simultaneously with other established forms of political dialogue. 33 3 Procedures The Parties have agreed that political dialogue on bilateral and international issues of common interest should take the form of: (a) periodic meetings between the President of Chile and the highest authorities of the European Union; the Parties should decide on the procedure to be used; (b) periodic meetings between Foreign Ministers; the Parties should decide on the procedure to be used; (c) periodic meetings between other ministers to discuss matters of common interest in cases in which the Parties consider that such meetings will result in closer relations; (d) periodic meetings between senior officials of both Parties. 4. The European Union and Chile agree that this Joint Declaration should signal the beginning of closer and deeper relations. W [Annex II] JOINT DECLARATION ON THE DIALOGUE AT PARLIAMENTARY LEVEL The Parties support the initiative put forward by the European Parliament and the Chilean Parliament to institutionalize a dialogue between them and state their willingness to foster the establishment and development of this Parliamentary dialogue. jr Annex III JOINT DECLARATION ON INTER-REGIONAL ECONOMIC COOPERATION 1. By common accord the Parties will seek ways of linking their methods of preparing for the liberalization of trade with the methods they employ in connection with other individual countries or regional entities, and particularly with the Southern Cone Common Market (Mercosur). Such activities will depend on how regional integration has progressed and on the degree to which they help to achieve the aims of the Agreement. 2. In that connection, the Parties will examine the possibility of Chile becoming involved in the cooperation programmes provided for in the Agreement between the European Community and its Member States and the Southern Cone Common Market and its member countries, and of Mercosur becoming involved in the cooperation programmes provided for in this Agreement. Procedures will be determined on a case-by-case basis by all interested Parties. fcf Proposal for a g Q [^ ^^ r > < ^ >) COUNCIL DECISION (EC) No on the exchange of letters between the European Community and Chile concerning the provisional application of certain provisions of the framework cooperation Agreement in preparation for the eventual establishment of a political and economic association between the European Community and its Members States, of the one part, and the Republic of Chile, of the other part (presented by the Commission to the Council). U THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular' Articles 113 thereof, in conjunction with the first sentence of Article 228(2) thereof, Having regard to the proposal from the Commission, Whereas the framework cooperation Agreement in preparation for the eventual establishment of a political and economic association between the European Community and its Member States, of the one part, and the Republic of Chile, of the other part, was signed by the Community and its Member States on ; Whereas the European Community and Chile undertook to establish procedures for the early application of certain provisions of that Agreement which deal with trade cooperation between the parties and the institutional framework for such cooperation; Whereas the provisional application of the provisions in question will facilitate and promote closer trade relations between the European Community and Chile, pending the completion of the procedures required to bring the Agreement into force, HAS DECIDED AS FOLLOWS: Article 1 The attached exchange of letters between the Community and Chile, which provides for the provisional application of certain provisions of the framework cooperation Agreement in preparation for the eventual establishment of a political and economic association between the European Community and its Member States, of the one part, and the Republic of Chile, of the other part, is hereby approved on behalf of the European Community. Article 2 The Commission shall represent the Community within the bodies referred to in Articles 35 and 37 of the Agreement. Article 3 This Decision shall be published in the Official Journal of the European Communities. Done at Brussels, For the Council The President 3? Annex EXCHANGE OF LETTERS concerning the provisional application of certain provisions of the framework cooperation Agreement in preparation for the eventual establishment of a political and economic association between the European Community and its Members States, of the one part, and the Republic of Chile, of the other part Brussels, 1996 Sir, Letter No 1 I have the honour to refer to the framework cooperation Agreement in preparation for the eventual establishment of a political and economic association between the European Community and its Member States, of the one part, and the Republic of Chile, of the other part, signed on 22 June 1996. Pending the entry into force of that Agreement, I would propose that the European Community and the Republic of Chile, if the legal system of the latter so permits, apply provisionally the provisions of that trade cooperation Agreement as set out in Articles 4 to 7 and 9 of Title III of the Agreement. During the period of provisional application, the relevant provisions of the framework cooperation Agreement between the European Community and the Republic of Chile, signed on 20 December 1990, will remain in force provided that they do not replicate or conflict with the provisions of the Agreement signed on 22 June 1996 which are applied provisionally. I would propose, in addition, the provisional application of certain provisions concerning the setting-up of bodies to supervise the implementation of the cooperation Agreement as set out in Articles 35, 37 and 38 of the Agreement signed on 22 June 1996. The Joint Committee specified in Article 35 of that Agreement will be responsible for matters which fell within the scope of the Joint Cooperation Committee set up under Article 17 of the Agreement signed on 20 December 1990. 3? The subcommittees and working groups set up under the 1990 Agreement will continue to perform the functions which fall within their scope. Finally, I have the honour to propose that, if the foregoing points are accepted by Chile, this letter and its confirmation should together constitute an agreement between the European Community and Chile which would enter into force with effect from the date of your letter of confirmation. Please, accept, Sir, the assurance of my highest consideration. For the Council of the European Community Ho Letter No 2 Sir, I have the honour to acknowledge receipt of your letter of today's date concerning the provisional application of certain provisions of the framework cooperation Agreement in preparation for the eventual establishment of a political and economic association between the European Community and its Member States, of the one part, and the Republic of Chile, of the other part, signed on 22 June 1996, which reads as follows: "Pending the entry into force of that Agreement, I would propose that the European Community and the Republic of Chile, if the legal system of the latter so permits, apply provisionally the provisions of that trade cooperation Agreement as set out in Articles 4 to 7 and 9 of Title III of the Agreement. During the period of provisional application, the relevant provisions of the framework cooperation Agreement between the European Community and the Republic of Chile, signed on 20 December 1990, will remain in force provided that they do not replicate or conflict with the provisions of the Agreement signed on 22 June 1996 which are applied provisionally. I would propose, in addition, the provisional application of certain provisions concerning the setting-up of bodies to supervise the implementation of the cooperation Agreement as set out in Articles 35, 37 and 38 of the Agreement signed on 22 June 1996. The Joint Committee specified in Article 35 of that Agreement will be responsible for matters which fell within the scope of the Joint Cooperation Committee set up under Article 17 of the Agreement signed on 20 December 1990. The subcommittees and working groups set up under the 1990 Agreement will continue to perform the functions which fall within their scope. Finally, I have the honour to propose that, if the foregoing points are accepted by Chile, this letter and its confirmation should together constitute an agreement between the European Community and Chile which would enter into force with effect from the date of your letter of confirmation. " I have the honour to confirm that the Government of Chile is in agreement with the contents of your letter. Please accept, Sir, the assurance of my highest consideration. For the Republic of Chile 7/ FINANCIAL STATEMENT 1. TITLE OF OPERATION: Framework cooperation agreement with Chile Recommendation for a Council Decision authorizing the Commission to negotiate a framework cooperation agreement with Chile. 2. BUDGET HEADING INVOLVED (a) Implementation of the agreement will directly involve the following items: B7-310: B7-311 B7-870 B7-872 B7-6200: B7-6201: B7-611: B7-6210: B7-703: B7-6211: B7-6000: B7-643: B7-651: B7-653: B7-650: Financial and technical cooperation with Latin American developing countries Economic cooperation with Latin American developing countries Commercial and economic cooperation agreements with third countries Promotion of Community investment in developing countries in Asia, Latin America and the Mediterranean and in South Africa by economic cooperation and trade agreements Environment in the developing countries Tropical forests Women in development North-South cooperation schemes in the context of the campaign against drug abuse Democratization process in Latin America Health programmes and the fight against HIV/AIDS in developing countries Community contributions towards schemes concerning developing countries carried out by non-governmental organizations Decentralized cooperation in the developing countries Coordination of development policy, evaluation of the results of Community aid and practical follow-up measures Development cooperation inspectorate Measures to combat fraud in the cooperation sector (b) Other items that may be used: B6-7211: B4-1041: B4-1000: B7-631: international third countries and International cooperation with organizations European Energy Charter and cooperation with third countries in the energy field Thermie II (Community programme of financial support for the promotion of energy technology in Europe) Aid for population policies and programmes in developing countries, and follow-up of the Conference on population and development Hi- 3. LEGAL BASIS Bilateral framework agreement on trade and economic cooperation. 4. DESCRIPTION OF OPERATION 4. 1 General objective Conclusion of a framework cooperation agreement with Chile. 4. 2 Period covered and arrangements for renewal or extension This is an interim agreement intended to pave the way for a political and economic association between the Union and Chile. 5. CLASSIFICATION OF EXPENDITURE OR REVENUE 5. 1 Non-compulsory expenditure 5. 2 Differentiated appropriations 5. 3 Type of revenue involved Not applicable 6. TYPE OF EXPENDITURE OR REVENUE Expenditure will usually take the form of a 100% grant, though operations may sometimes be cofinanced by other donors (Member States). The recipients will systematically be required to contribute according to their means. 7. FINANCIAL IMPACT 7. 1 Method of calculating total cost of operation (definition of unit costs) This agreement establishes a framework for new measures to reflect the changing content and methods of Community cooperation/relations with Chile in the light both of recent social and economic developments in the country and of the process of strengthening ties between the parties. Although the quality and quantity of cooperation with Chile will be improved, there will be no specific budget for new operations. 8. FRAUD PREVENTION MEASURES; RESULTS OF MEASURES TAKEN In order to ensure maximum accountability in the management of budget resources, projects are subject to the following procedures: committee for the assessment of restricted invitations to tender (technical assistance); system of co-directors (one local and one Community); project administration involving analytical accounts; supervisory missions by desk officers and/or technical and/or financial units, if necessary, evaluation by independent experts; if necessary, ad hoc evaluation in conjunction with the relevant units of DG VIII. For projects of above-average duration and involving large budgets, there will be annual audits by internationally recognized firms, e. g. Price Waterhouse or Ernst & Young. 9. ELEMENTS OF COST-EFFECTIVENESS ANALYSIS 9. 1 Specific and quantified objectives; target population The specific objectives of each project worth over ECU 1 million are set out in the relevant financing proposal approved by the ALA Committee, which includes an economic and financial analysis. For all other projects, specific objectives are set out in the detailed commitment form that accompanies each one. The target population is everyone in Chile, but more particularly: - - the manufacturing and service sectors, especially SME; the most disadvantaged groups. 9. 2 Grounds for the operation The projects launched will be financed under existing budget items and are therefore underpinned by the financial statements accompanying those items in thePDB. 10 ADMINISTRATIVE EXPENDITURE (PART A OF SECTION m OF THE BUDGET) 10. 1 Extra staff The administrative the Commission's annual decision on resource allocation depending on the staff and finance approved by the budgetary authority. resources needed will be mobilized through Staffing Relations with Chile have so far been handled by an A official assisted by a part-time C official. They are unable to cope with the steady increase in political contacts, cooperation programmes and the day-to-day workload of the desk office generated by the stepping-up of relations over the past year. The objective of the framework agreement is to strengthen relations between Chile and the Union in all areas with a view to a future political and economic association. if The agreement will therefore bring with it qualitative requirements quite distinct from the volume of aid granted. This agreement has to reflect the Union's will to maintain closer relations not only in the context of cooperation but in the form of deeper political dialogue and trade cooperation geared to the future liberalization of trade. It is estimated, therefore, that the following extra staff will be needed: one new A official, one B official and one part-time C official. Their tasks will be as follows. Grade A official and temporary member of staff * * Overall direction, general consistency, coordination of activities, in-house coordination, dealings with Chile, information and dissemination, overall administration; technical monitoring of trade relations, supervision of the working parties that will be set up, coordination of trade-related issues with other departments, day- to-day handling of trade questions, preparations for meetings of the joint trade subcommittee, drawing-up of reports, studies and analyses on trade aspects of the future bilateral association agreement; cooperation: identification, implementation, management, monitoring, etc. * Grade B official * Support for A officials, particularly data searches, processing of statistics, data processing, administration and accounting. Grade C officials * Secretarial back-up. The above estimates do not include extra staff that might be needed by other Directorates General as a result of closer ties with Chile. yr Posts to be allocated Staff administering operation to Source Period Permanent Temporary Additional resources Existing resources within DG or department 1 0. 5 1 1 0. 5 Indefinite, starting 1996 2 1 1 or A B C (Officials temporary staff) Other resources TOTAL 4 1. 5 2. 5 The above remarks concerning the need for additional resources are subject to a Commission decision. The allocation of the additional posts will have to be considered in terms of the Commission's priorities when it examines the 1996 budget. 10. 2 Total financial implications of extra staffing A officials B C TOTAL Amounts 100 000 90 000 64 000 254 000 Calculation method Gross salary. List of average annual cost of existing posts The amounts represent the total cost of extra staff for the duration of the operation, if it is of fixed duration, or for one year if it is open-ended. 11. MISSION EXPENSES From its very first contacts with the EC, Chile has expressed a desire for technical assistance from the EC in a number of fields in which Community institutions have acquired experience. To this end, it has expressly asked to be allowed to work directly with the officials of the institutions concerned. u In response to these requests, the Commission has attempted to involve its various DGs and departments in one-off projects to impart the benefits of its experience of integration. While a number of DGs have expressed a desire to take part in this type of project, they have been seriously hampered in financing the relevant missions and many of Chile's requests have had to be turned down for want of a specific budget for such assistance. If appropriate machinery is not set up to facilitate these specific projects, the situation will become even more serious with the advent of the framework cooperation agreement, which seeks to expand the scope of technical assistance. Since it is impossible to predict how much extra will be needed for each DG in the absence of agreements between DGs on mission authorizations, a budget of an extra ECU 50 000 a year from 1996 should be planned to finance projects solely in this field. The budget should be initiated and coordinated by the relevant departments of the DG responsible for relations with Chile. An extra allocation is therefore requested for EC-Chile know-how transfer projects concerned specifically with the Community institutions. The amounts requested represent the cost of organizing missions averaging one week for 10 officials. Budget heading Amount (ECU) Calculation method A-1300 TOTAL 50 000 50 000. See table below No of missions Average cost trip 3 800 10 oflA verage expenses dailyffotal (ECU) Rounded (ECU) total 135 W7 450 50 000 The amounts represent the total cost for the duration of the operation, if it is of fixed duration, or for one year if it is open-ended. H } ISSN 0254-1475 COM(96) 259 final DOCUMENTS EN H Catalogue number : CB-CO-96-269-EN-C ISBN 92-78-05246-9 Office for Official Publications of the European Communities L-298S Luxembourg

Proposal for a COUNCIL DECISION concerning the conclusion of the framework cooperation Agreement in preparation for the eventual establishment of a political and economic association between the European Community and its Members States, of the one part, and the Republic of Chile, of the other part

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* ** * ' "* * * * ** I COMMISSION OF THE EUROPEAN COMMUNITIES j I I Brussels, 11. 06. 1996 COM(%)259 final 96/ 0149 (ACC) 96/0150 (ACC) Proposal for a COUNCIL DECISION concerning the conclusion of the framework cooperation Agreement in preparation for the eventual establishment of a political and economic association between the European Community and its Members States, of the one part, and the Republic of Chile, of the other part (presented by the Commission). mm mum • • • n. — —— ni • — i- i • ,. — » • •• Proposal for a COUNCIL DECISION on the exchange of letters between the European Community and Chile concerning the provisional application of certain provisions of the framework cooperation Agreement in preparation for the eventual establishment of a political and economic association between the European Community and its Members States, of the one part, and the Republic of Chile, of the other part (presented by the Commission) EXPLANATORY MEMORANDUM 1. By means of a decision of 29 January, the Council authorized the Commission to open negotiations with Chile with a view to concluding a framework cooperation agreement in preparation for the eventual establishment of a political and economic association between the European Community and its Member States, of the one part, and the Republic of Chile, of the other part, and adopted directives to that end. Two negotiating sessions were held in Brussels, the first on 25 and 26 March and 2. the second on 25 and 26 April at which the Agreement was initialled. A meeting was held between those two sessions between Mr Prat and the representatives of the Troika and the Chilean negotiators in Santiago, Chile, on 19 April. The text of this Agreement has now been submitted to the Council for signature and conclusion. 3. In consultation with the special committee appointed by the Council to oversee negotiations, when the Agreement was initialled, the negotiators agreed to adopt the arrangements for the provisional application of the Agreement, and in particular those provisions relating to Community responsibility on trade cooperation under Title III of the Agreement and the institutional framework for such cooperation. The Commission also proposes that the Council approve and sign an exchange of letters on the provisional application of the Agreement's provisions. The Agreement between the European Community and Chile signed on 20 December 1990 will remain in force until the new Agreement comes into force. However, in order to ensure continuity between the two Agreements, the Joint Committee set up under the new Agreement will assume the duties of the 1990 Agreement's Joint Committee. The Commission considers that the initialled Agreement conforms 4. negotiating directives adopted by the Council. to the 5. With a view to signing and concluding the framework cooperation Agreement in preparation for the eventual establishment of a political and economic association between the European Community and its Member States, of the one part, and the Republic of Chile, of the other part, the Commission proposes that the Council adopt the proposals for Decisions in the Annex. i- ? Proposal for a ^ /. Î5 J H^ (fc^O COUNCIL DECISION (EC) No concerning the conclusion of the framework cooperation Agreement in preparation for the eventual establishment of a political and economic association between the European Community and its Members States, of the one part, and the Republic of Chile, of the other part (presented by the Commission to the Council) 7 THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Articles 113 and 130y thereof, in conjunction with the first sentence of Article 228(2) and the first subparagraph of paragraph 3 thereof, Having regard to the proposal from the Commission, Having regard to the opinion of the European Parliament, Whereas Article 13 Ou of the Treaty provides that Community policy in the sphere of development cooperation should foster the sustainable economic and social development of the developing countries, the smooth and gradual integration of those countries into the world economy and the combating of poverty in those countries; the eventual Whereas the framework cooperation Agreement establishment of a political and economic association between the Community and its Member States, of the one part, and the Republic of Chile, of the other part, should be approved, in preparation for HAS DECIDED AS FOLLOWS: Article 1 The framework cooperation Agreement in preparation for the eventual establishment of a political and economic association between the European Community and its Member States, of the one part, and the Republic of Chile, of the other part, is hereby approved on behalf of the European Community. The text of the Agreement is attached to this Decision. Article 2 In accordance with Article 33 of the framework cooperation Agreement, the President of the Council shall chair the Joint Cooperation Council and shall represent the Community on that Council. A representative of the Commission shall chair the Joint Cooperation Committee and the Joint Subcommittee on Trade in accordance with their rules of procedure and, assisted by the representatives of the Member States, shall represent the Community on those committees. Article 3 The President of the Council shall give the notification provided for in Article 42 of the Agreement on behalf of the European Community. Article 4 This Decision shall be published in the Official Journal of the European Communities. Done at Brussels, For the Council The President / DRAFT FRAMEWORK COOPERATION AGREEMENT IN PREPARATION FOR THE EVENTUAL ESTABLISHMENT OF A POLITICAL AND ECONOMIC ASSOCIATION BETWEEN THE EUROPEAN COMMUNITY AND ITS MEMBER STATES, OF THE ONE PART, AND THE REPUBLIC OF CHILE, OF THE OTHER PART * THE KINGDOM OF BELGIUM, THE KINGDOM OF DENMARK, THE FEDERAL REPUBLIC OF GERMANY, THE HELLENIC REPUBLIC, THE KINGDOM OF SPAIN, THE FRENCH REPUBLIC, IRELAND, THE ITALIAN REPUBLIC, THE GRAND DUCHY OF LUXEMBOURG, THE KINGDOM OF THE NETHERLANDS, THE REPUBLIC OF AUSTRIA, THE PORTUGUESE REPUBLIC, THE REPUBLIC OF FINLAND, THE KINGDOM OF SPAIN, THE UNITED KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND, Parties to the Treaty establishing the European Community and the Treaty on European Union, hereinafter referred to as the "European Community Member States", t THE EUROPEAN COMMUNITY, hereinafter referred to as the "Community" THE REPUBLIC OF CHILE hereinafter referred to as "Chile", of the one part, and of the other part, CONSIDERING their common cultural heritage and the deep historical, political and economic ties which unite them; CONSIDERING the significant contribution made by the Framework Agreement for Cooperation between the Community and Chile signed on 20 December 1990 to strengthening all these ties; CONSIDERING their full commitment fundamental human rights as set out in the Universal Declaration of Human Rights; to respect for democratic principles and CONSIDERING the importance which both Parties attach to the principles and values set out in the final Declaration of the World Summit for Social Development in Copenhagen in March 1995; MINDFUL of both Parties' desire to ensure sustainable development and also to conserve and protect the environment; CONSIDERING their attachment to the market economy and reaffirming their willingness to maintain and strengthen the rules of free international trade in compliance with the rules of the World Trade Organization (WTO) and emphasizing, in particular, the importance of open regionalism; CONSIDERING their mutual interest in establishing new contractual links in order to develop closer and more extensive cooperation, to expand and diversify trade and to increase investment; CONSIDERING the political will of both Parties to achieve the ultimate objective of a political and economic association between the European Community and its Member States and Chile founded on greater political cooperation and progressive and reciprocal liberalization of all trade, with due allowance for the sensitivity of certain products and in compliance with the rules of the World Trade Organization, and on investment promotion and closer cooperation; J MINDFUL of the terms of the Joint Solemn Declaration on political dialogue in which both Parties have agreed on closer political dialogue to promote more intensive consultation on matter of mutual interest, with a view to basing their relations on the above long-term aim, HAVE DECIDED to conclude this Agreement: cyCo TITLE I NATURE AND SCOPE ARTICLE 1 Basis of the Agreement Respect for democratic principles and fundamental human rights as set out in the Universal Declaration of Human Rights is at the heart of both Parties' domestic and external policies and constitutes an essential element of this Agreement. ARTICLE 2 Nature and scope 1. This Agreement shall be aimed at strengthening existing relations between the Parties on the basis of reciprocity and mutual interest, paving the way for the progressive and reciprocal liberalization of trade, ultimately leading to the establishment of a political and economic association between the European Community and its Member States and Chile in conformity with the rules of the World Trade Organization (WTO) and with due allowance for the sensitivity of certain products. 2. To this end, the Agreement covers political dialogue, trade and economic matters, cooperation and other matters of mutual interest, its objective being to forge closer relations between the Parties and their respective institutions. TITLE II Political dialogue ARTICLE 3 1. 2. The Parties agree to institute regular political dialogue on bilateral and international matters of mutual interest. Such dialogue shall be conducted in accordance with the Joint Declaration, which shall form an integral part of the Agreement. The ministerial dialogue provided for in the Joint Declaration shall take place within the Council established by Article 33 of this Agreement or within other agreed forums of an equivalent level. SA TITLE III TRADE COOPERATION AND PREPARATION FOR LIBERALIZATION OF TRADE ARTICLE 4 Objectives The Parties undertake to forge closer relations with the aim of increasing and diversifying trade, preparing for progressive and reciprocal liberalization of trade and creating conditions conducive to the eventual establishment of a political and economic association, in conformity with WTO rules and with due allowance for the sensitivity of certain products. ARTICLE 5 Dialogue on trade and economic matters 1. The Parties undertake to hold regular dialogue on trade and economic matters, within the institutional framework established by Title VII of the Agreement, in order to meet the Agreement's trade objectives and prepare the ground for the eventual liberalization of trade. 2. The Parties shall agree on the areas to be covered by trade cooperation without excluding any sector. 3. Such cooperation shall in particular focus on the following: (a) market access and liberalization of trade, the study and establishment of programmes for the reciprocal liberalization of trade (timetable and structure of negotiations, transitional periods, etc. ); (b) tariff and non-tariff barriers, quantitative restrictions on imports and exports and measures having equivalent effect: analyses, studies and management, including quotas, administrative standards applied to external trade, anti-dumping duties, safeguard clauses, technical standards, health and plant health legislation, mutual recognition of certification systems, etc; (c) the Parties' tariff structure; (d) compatibility of trade liberalization with WTO rules; (e) identification of potential tariff reductions and elimination of quasi-tariff measures; (f) definition of sensitive products and products given priority by the Parties;. ^2- (g) cooperation and exchange of information, within the Parties' respective areas of responsibility on transport, insurance and financial services, (h) monitoring of restrictive practices; (i) rules of origin which promote the use of regional inputs with a view to encouraging integration. ARTICLE 6 Cooperation on standardization, accreditation, certification, metrology and conformity evaluation 1. The Parties agree to cooperate on standardization, accreditation, certification, metrology and conformity evaluation. Such cooperation shall take the form in particular of: (a) provision of technical assistance for Chile on standardization, accreditation, certification and metrology to develop an appropriate system and structures compatible: - with international standards; - with the basic requirements of health and safety protection, plant and animal protection, consumer protection and environmental conservation; (b) negotiation of a mutual recognition framework agreement once an appropriate level of technology has been reached in the sectors concerned; (c) cooperation between the Parties on technical standards to facilitate market access. ARTICLE 7 Customs cooperation 1. The Parties shall promote customs cooperation, acting within their respective areas of responsibility, with a view to improving and consolidating the legal framework for their trade relations. A further objective of customs cooperation shall be to strengthen the Parties' customs arrangements and improve their operation within the framework of interinstitutional cooperation. 2. Such cooperation may take the form in particular of: (a) exchanges of information, taking into account the need to protect personal data; (b) development of new training techniques and coordination of activities within the relevant international organizations; (c) exchanges of officials and senior personnel from customs and tax departments; (d) simplification of customs procedures; (e) technical assistance. The Parties affirm their intent to give future consideration, within the institutional framework established by this Agreement, to the conclusion of a customs mutual assistance protocol. k ARTICLE 8 Temporary importation of goods The Contracting Parties undertake to take account of relief from duties and taxes on temporary importation into their territory of goods covered international agreements on such matters. ARTICLE 9 Cooperation on statistics The Parties agree to promote the approximation of statistical methods with a view to using, on a mutually acceptable basis, statistics on trade in goods and services and, in general, statistics in any area which lends itself to statistical processing. ARTICLE 10 Cooperation on intellectual property 1. The Parties agree to cooperate on intellectual property matters in order to promote trade in goods and services, investment, technology transfer, dissemination of information, cultural and creative activities and related economic activities. M 2. For the purposes of this Article, intellectual property shall in particular encompass copyright, including copyright for computer programmes and databases, and related rights, trade or service marks, geographical indications, including designations of origin, industrial designs and models, patents and integrated circuit topographies, data protection and prevention of unfair competition as defined in Article lObis of the Paris Convention for the Protection of Industrial Property. 3. The Parties agree to guarantee, within their respective laws, regulations and policies, adequate and effective protection of intellectual property rights in accordance with the highest international standards laid down in the Agreement on aspects of trade- related intellectual property rights (TRIPS) concluded in the framework of the WTO, and, where necessary, to consider strengthening it, for example by concluding an agreement on the reciprocal protection and recognition of geographical indications and designations of origin. 4. Cooperation in this area may include technical assistance between the Parties in the form of joint programmes and projects. 5. 6. In the event of trade disputes connected with the protection of intellectual property, the Parties may hold consultations in order to settle any doubt or difficulty relating to the application of their respective rules on the protection of intellectual property rights. In research and other joint scientific activities undertaken in the field of science and technology, the Parties shall agree on the intellectual property rules to be applied to their results. ARTICLE 11 Cooperation on public procurement 1. The Parties agree to ensure, on a reciprocal basis, open, non-discriminatory and transparent procedures for their respective government and public sector procurement at central, federal, regional, provincial and local level. to cooperate 2. In order to attain this objective, the Parties agree to consider the possibility of concluding an agreement on access in these sectors of procurement, generating transparent, fair conditions subject to clear complaint procedures. 3. Cooperation between the Parties in this area shall include technical assistance in matters connected with the Agreement on Government Procurement. 4. The Parties shall consider the possibility of holding annual consultations on this sector. ^ TITLE IV ECONOMIC COOPERATION ARTICLE 12 Objectives 1. In the light of the achievements of the Framework Agreement for Cooperation between the Community and Chile of December 1990, both Parties undertake, under this Agreement, to consolidate and expand all areas of economic cooperation by cultivating synergies in productive activities, creating new opportunities and increasing economic competitiveness. 2. Economic cooperation between the Parties shall be as broad-based as possible. No sector shall be excluded from the outset, and account shall be taken of the Parties' respective priorities, mutual interests and areas of responsibility. 3. The Parties shall focus on cooperation which will foster economic and social relations and networks between companies (trade, investment, technology, information or communication systems). 4. Within the framework of this cooperation the Parties shall promote the exchange of regular monitoring of information which will serve as a basis macro-economic policies and balances and efficient market operation. the for 5. In view of the degree of liberalization achieved by Chile in the area of services, investment and scientific, technological and industrial cooperation, the Parties undertake to make a special effort to expand and consolidate cooperation in these areas. 6. The need to conserve the environment and ecological balances shall be taken into account by the Parties in any economic cooperation measures they undertake. 7. Any measures sponsored by the Parties in this field shall be guided by the principle of social development, and the promotion of fundamental social rights in particular. yU ARTICLE 13 Industrial and business cooperation 1. The Parties shall promote industrial and business cooperation with the aim of establishing a climate conducive to economic development taking account of their mutual interests. 2. Such cooperation shall focus in particular on: (a) increasing trade flows, investment, industrial cooperation and technology transfer; (b) supporting industrial modernization and diversification; (c) identifying and eliminating obstacles to industrial cooperation between the Parties by means of measures which encourage respect for competition laws and help gear industry to market requirements, allowing for the participation and consultation of operators; (d) encouraging cooperation between economic operators on both sides, particularly small and medium-sized enterprises (SME); (e) promoting industrial innovation by developing an integrated and decentralized approach to cooperation among operators on both sides; (f) ensuring the overall consistency of measures which may have a positive influence on cooperation between businesses on both sides. 3. Such cooperation, which shall be based on a dynamic, integrated and decentralized approach, shall take the form in particular of: (a) encouraging closer organized contacts between businesses, particularly small and medium-sized enterprises (SME), and economic operators on both sides which will provide them with an opportunity to identify and exploit areas of mutual interest, paving the way for increased trade, investment and industrial and business cooperation projects in general, particularly by promoting joint ventures, (b) promoting business initiatives and cooperation projects which shall be identified through closer dialogue between Chilean and European operators' networks; (c) undertaking measures to support business cooperation, notably regarding industrial quality policies and industrial innovation, training and applied research, development and technology transfer. ^ ARTICLE 14 Cooperation on services 1. The Parties recognize the growing importance of services for their economic development. To this end they shall consolidate and step up cooperation in this sector, within their respective areas of responsibility and in accordance with the rules of the General Agreement on Trade in Services (GATS). 2. In terms of practical implementation the Parties shall identify the priority sectors in this area in order to ensure efficient use of available instruments. Measures shall focus mainly on: (a) helping SME gain access to capital resources and market technologies; (b) promoting trade between the Parties and with the markets of third countries; (c) encouraging better and diversified productivity and competitiveness in this sector; (d) exchanging information on the rules, laws and regulations which govern trade in services; (e) exchanging information on the procedure for granting: - licences and certificates to professional service providers and - recognition of professional qualifications. (f) developing the tourism sector, with a view to improving the exchange of information and know-how in order to promote a sustainable and ordered development of the tourist amenity. To this end human resources development and joint operations in the tourist promotion and marketing fields will be encouraged. ARTICLE 15 Investment promotion The Parties shall help create, within their respective areas of responsibility, an attractive and stable environment for reciprocal investment. Such cooperation shall take the form inter alia of: (a) arrangements for information, identification and dissemination relating to investment legislation and opportunities; (b) promoting the development of a legal environment conducive to investment between if necessary, Chile and Community Member States could conclude the Parties; bilateral agreements to promote and protect investment and bilateral agreements to prevent double taxation; (c) developing harmonized and simplified administrative procedures; (d) developing joint investment, in particular with SME on both sides. ARTICLE 16 Scientific and technical cooperation 1. The Parties agree to cooperate in the field of science and technology in areas of mutual interest, taking account of their respective policies. 2. The aims of such cooperation shall be: (a) to encourage exchanges of information and know-how on science and technology, especially on the implementation of policies and programmes, (b) to promote sustainable relations between communities; the two Parties' scientific (c) to foster innovation in Chilean and European businesses; (d) to promote technology transfer; 3. Cooperation shall take the form in particular of: (a) joint research projects in areas of mutual interest, with the active participation of business where appropriate; (b) exchanges of scientists to promote research, project preparation and high-level training; (c) joint scientific meetings to promote the exchange of information, encourage interaction and identify areas where joint research might be undertaken; (d) dissemination of results and development of links between the public and private sectors; (e) exchanges of know-how on standardization; (f) evaluation of the activities concerned. 4. In terms of practical implementation, the Parties shall encourage their respective higher education institutions, research centres and industrial sectors, in particular SME, to play an active role. sV 5. The Parties shall agree, without excluding any sector from the outset, on the areas, scope, nature and priorities of this cooperation, by establishing a multiannual programme which can be adapted to circumstances. ARTICLE 17 Energy cooperation Cooperation between the Parties shall focus on fostering closer links between their economies in the sectors of renewable and non-renewable, conventional and non- conventional energies, and energy-saving technologies. Cooperation shall in particular take the following forms: (a) exchanges of information in all appropriate forms, including the development of databanks to be shared by economic operators on both sides, training and joint conferences; (b) technology transfer; (c) preparatory studies and project implementation by the relevant institutions of both Parties; (d) the participation of economic operators from the two Parties in joint technological development or infrastructure projects; (e) where appropriate the conclusion of specific agreements in key areas of mutual interest; (f) aid for Chilean institutions dealing with energy matters and the formulation of energy policy; (g) technical training programmes. 2x> ARTICLE 18 Cooperation on transport 1. Cooperation in this area shall be aimed essentially at: (a) support for the modernization of Chile's transport systems; (b) efforts to increase personal mobility, the movement of goods and access to the transport market; (c) promotion of operating standards. 2. Cooperation shall take the form in particular of: (a) exchanges of information on respective transport policies and on other topics of mutual interest; (b) training programmes for economic operators and senior public officials; (c) exchange of information on the installation of monitoring stations forming part of the infrastructure of the Global Navigation Satellite System (GNSS). 3. Acting within their respective areas of responsibility, international undertakings, the Parties shall look at all aspects relating to international maritime transport services to ensure that they do not hamper the mutual expansion of trade, paying particular attention to the maintenance of unrestricted access to markets on a commercial and non-discriminatory basis. laws and ARTICLE 19 Cooperation on the information society and telecommunications 1. The Parties recognize that advanced information and communication technologies are a key sector in modern society and are vital to economic and social development and the smooth transition to an information society. 2. Cooperation between the Community and Chile in this area shall focus in particular on: (a) dialogue on all aspects of the information society including telecommunications policy; (b) exchanges of information and any technical assistance required on regulations and standardization, conformity testing and certification for information and telecommunication technologies; (c) dissemination of new telecommunications and information technology and development of new advanced communication, services and information technology facilities; (d) promoting and undertaking joint research and technological or industrial development projects in the field of new information, communication, telematics and information society technologies; (e) providing an opportunity for Chilean institutions to take part in pilot projects and Community programmes, especially in the regional field, under the arrangements pertaining to the areas concerned; (f) interconnection and interoperability of telematic networks and services in the Community and Chile. ARTICLE 20 Cooperation on environmental protection 1. The Parties undertake to develop cooperation to protect, improve and prevent degradation of the environment, control pollution and encourage the rational use of natural resources, in the interests of sustainable development. The emphasis shall be on conservation of ecosystems, the integrated management of natural resources, the environmental impact of economic activities, the urban environment and depollution programmes. 2. Cooperation shall focus on: (a) projects to strengthen environmental structures and policies in Chile; (b) exchange of information and know-how covering various areas including the Parties' respective rules and standards; (c) environmental training and education; (d) technical assistance and the establishment of joint research programmes. 12- ARTICLE 21 Cooperation on the agricultural and rural sector 1. The Parties shall promote mutual cooperation in the agricultural and rural sector. To this end they shall examine: (a) measures to promote mutual trade in agricultural products; (b) environmental health and plant health measures and other related aspects, taking account of the legislation in force for both parties, in compliance with WTO rules. 2. The Parties shall take measures such as the mutual exchange of information, technical assistance and scientific and technological experiments to promote agricultural development cooperation. TITLE V OTHER AREAS OF COOPERATION ARTICLE 22 Objectives and scope The Parties will maintain cooperation on social development, public administration, information and communication, training and regional integration with particular emphasis on areas likely to contribute to the process of cooperation and to the eventual establishment of a political and economic association between the Parties. ARTICLE 23 Financial and technical cooperation and cooperation on social development 1. The Parties reaffirm the importance of their financial and technical cooperation, which should be geared towards combating extreme poverty and generally assisting the most deprived sections of the community. 2. Such cooperation may take the form of pilot programmes in the following areas: (a) job creation and vocational training; (b) management and administration of social services; (c) rural development and housing and regional planning; (d) health and primary education; (e) support for the grassroots organizations in civil society; (f) programmes and projects to create business and employment opportunities and thereby help to combat poverty. (g) programmes to improve the quality of life, notably of the most deprived sections of the community. ARTICLE 24 Cooperation on public administration and regional integration 1. The Parties shall support cooperation on public administration to promote the adjustment of Chilean administrative systems to open trading in goods and services with Europe. 2. In this context the Parties shall work together to promote the administrative changes deriving from Latin American integration. 3. To this end, in support of Chile's objectives of administrative modernization, decentralization and regionalization, the Parties shall encourage cooperation within all institutions, drawing lessons from the instruments and policies of the European Community. 4. Cooperation shall be undertaken in particular through: (a) (b) technical assistance to Chilean policy-making and executive bodies, including their Chilean contacts between staff of the European counterparts; institutions and regular exchange of information taking whatever form is appropriate, including the use of computer networks; personal data protection shall be guaranteed in all areas where data are to be exchanged; (c) transfers of know-how; (d) preliminary studies and implementation of joint projects; (e) training and institutional support. if ARTICLE 25 Inter-institutional cooperation 1. The Parties agree on the need to promote closer administrative cooperation between the institutions concerned. 2. Such cooperation shall be as broad-based as possible and shall focus in particular on: (a) any means of fostering regular exchanges of information, including joint development of computerized communication networks; (b) advice and information; (c) transfer of know-how. ARTICLE 26 Cooperation on communication, information and culture 1. In view of Chile's very close cultural ties with Community Member States, the Parties will intensify cooperation in this area and on communication and information. 2. Within the Parties' respective areas of responsibility, the aim of such cooperation shall be to promote: (a) meetings between senior information and communication representatives and, where appropriate, technical assistance; (b) greater exchanges of information on matters of mutual interest; (c) organization of cultural events. (d) activities - studies and training schemes - aimed at protecting the cultural heritage. 3. The parties agree to promote the broadest possible cooperation in the audiovisual and press sector. K ARTICLE 27 Cooperation on training and education 1. The Parties shall identify, within their respective areas of responsibility, ways of improving primary education, youth training, vocational training and inter-university and inter-business cooperation. Particular emphasis shall be given to vocational training for the most deprived sections of the community. 2. The Parties shall place emphasis on measures designed to create permanent links between Community and Chilean specialized agencies which will encourage the pooling of technical resources and exchanges of know-how. 3. These projects shall be undertaken mainly through: (a) agreements between educational and training institutions; (b) meetings between bodies responsible for education and training. 4. A further objective of cooperation in this area shall be the conclusion of sectoral agreements on education, training and youth-related matters. ARTICLE 28 Cooperation on combating drug trafficking 1. Within their respective areas of responsibility, the Parties shall coordinate their efforts and intensify their cooperation to prevent drug abuse and illegal trafficking in drugs, the misuse of chemical precursors and the laundering of profits from drug-trafficking. To this end the Parties shall coordinate their cooperation activities and areas at bilateral level and in international organizations and forums. 2. Such cooperation, which shall make use of specialized agencies, shall focus on: (a) projects to train, educate, treat and rehabilitate drug addicts and programmes to prevent the illegal consumption of drugs; (b) joint research programmes; (c) training programmes for public officials on preventing and controlling drug trafficking, money laundering and on monitoring trade in essential chemical precursors etc; (d) exchange of relevant information and adoption of appropriate measures to combat drug trafficking and money laundering, in the framework of multilateral agreements in force and the recommendations of the Financial Action Task Force on Money Laundering (FATF); 24 (e) prevention of the diversion of chemical precursors and other essential substances used for the illegal production of drugs and psychotropic substances. This prevention is based on the 1988 United Nations Convention, the principles adopted by the Community and the relevant international authorities and on the recommendations of the Chemical Action Task Force (CATF). 3. The Parties may agree to extend such cooperation to other areas. ARTICLE 29 Cooperation on consumer protection 1. The Parties agree that cooperation in this area should be aimed at refining their consumer protection systems and seeking, within their respective legislations, to make their systems compatible. 2. Cooperation shall focus mainly on: (a) exchange of information and experts; (b) organization of training schemes and provision of technical assistance. ARTICLE 30 Cooperation on fishing 1. The Parties agree that, acting trade and environmental undertakings, cooperation in this area shall take the form of a regular dialogue to examine the possibility of establishing closer cooperation in the fisheries sector which could lead to a fisheries agreement. in compliance with international ARTICLE 31 Triangular cooperation The Parties, acknowledging the value of international cooperation for promoting equitable and sustainable development, agree to encourage triangular cooperation programmes with other countries in areas and sectors of mutual interest. TITLE VI MEANS 2. ? ARTICLE 32 In order to help attain the cooperation aims set out in this Agreement, the Parties undertake to make available, within the limit of their abilities and through their own channels, the appropriate resources, including financial resources. The Parties shall call on the European Investment Bank to step up its activities in Chile in accordance with its own procedures and financing criteria. TITLE VI INSTITUTIONAL FRAMEWORK ARTICLE 33 1. A Joint Council of the Framework Cooperation Agreement, hereinafter referred to as the Joint Council, is hereby established. It shall supervise the implementation of this Agreement and shall meet at ministerial level periodically and whenever circumstances require. 2. The Joint Council shall discuss important matters arising in connection with the Agreement and any other bilateral or international issues of mutual interest, with the aim of fulfilling the Agreement's objectives. 3. The Council may also make appropriate proposals by agreement with both Parties. In carrying out its duties, the Cooperation Council shall be responsible in particular for making recommendations which contribute to the ultimate objective of political and economic association. ARTICLE 34 1. The Joint Council shall be composed of members of the Council of the European Union and Members of the European Commission on the one hand, and Chilean representatives, on the other. 2. The Council shall adopt its own rules of procedure. 3. The Council shall be chaired in turn by a Community representative and a Chilean representative. ARTICLE 35 The Joint Council shall be assisted in the performance of its duties by a Joint Committee composed of members of the Council of the European Union and tt Members of the European Commission, on the one hand, and of Chilean representatives, on the other. 2. The Joint Committee shall generally meet once a year, on a date and with an agenda agreed in advance by the Parties, in Brussels one year and Chile the next. Special meetings may be convened by mutual agreement. The office of chairman of the Joint Committee shall be held alternately by a representative of each of the Parties. 3. The Joint Council shall set out the Joint Committee's operating procedures in its own rules of procedure. 4. The Council may delegate all or part of its powers to the Joint Committee. The latter shall provide continuity between its meetings. 5. The Joint Committee shall assist the Council in the performance of its duties In fulfilling these functions, the Joint Committee shall in particular: (a) (b) (c) foster trade relations in accordance with the objectives of this Agreement and in accordance with the provisions of Title III; exchange opinions on future cooperation programmes and the resources available for their implementation and on any matter of mutual interest which relates to progressive and reciprocal liberalization of trade; submit to the Joint Council proposals made by the Subcommittee on Trade with the aim of cultivating preparations for the progressive and reciprocal liberalization of trade and proposals intended to bring about closer cooperation in this area; and (d) in general, make proposals to the Joint Council which will contribute to the ultimate aim of an EU-Chile political and economic association. ARTICLE 36 The Joint Council may decide to set up any other body to assist it in the performance of its duties and shall determine the body's composition, objectives and operating procedures. tî ARTICLE 37 1. The Parties agree to establish a Joint Subcommittee on Trade which shall ensure that the trade-related objectives set out in Article 5 of the Agreement are fulfilled and shall undertake the preparatory work for the progressive and reciprocal liberalization of trade. 2. The Joint Subcommittee on Trade shall be composed of members of the Council of the European Union and Members of the European Commission, on the one hand, and Chilean representatives, on the other. ^ It may commission any studies or technical analyses which it deems necessary. i\ The Joint Subcommittee on Trade shall report at least once a year to the Joint Committee set up under Article 35 of the Agreement on the development of its work, and shall make proposals regarding the subsequent liberalization of trade. 5", The Joint Subcommittee on Trade shall submit its rules of procedure to the Joint Committee for approval. ARTICLE 38 Consultation Within their respective areas of responsibility, the Parties undertake to hold consultations on any matter covered by this Agreement. The procedure for the consultations referred to above shall be laid down in the rules of procedure of the Joint Committee. TITLE VIII FINAL PROVISIONS ARTICLE 39 Definition of the Parties For the purposes of this Agreement, "the Parties" shall mean the Community, its Member States or the Community and its Member States, within their respective areas of responsibility, as defined in the Treaty establishing the European Community, on the one hand, and Chile, on the other. J •o ARTICLE 40 Future developments The Parties may agree to extend the Agreement with the aim of broadening and supplementing the scope and level of cooperation in accordance with their respective legislation, by concluding agreements on specific sectors or activities in the light of the experience gained during its implementation. ARTICLE 41 Territorial application This Agreement shall apply to the territories in which the Treaty establishing the European Community is applied under the conditions laid down in that Treaty, on the one hand, and to the territory of the Republic of Chile, on the other. ARTICLE 42 Duration and entry into force l. This Agreement shall be valid indefinitely. 2. The Parties shall determine the suitability and timing of transition to political and economic association in the light of progress made under the Agreement in accordance with their own procedures and in the light of the work carried out and the proposals made within the institutional framework of this Agreement. 3. This Agreement shall enter into force on the first day of the month following the date on which the Parties notify each other of the completion of the procedures necessary for this purpose. 4. Notification shall be sent to the Secretariat-General of the Council of the European Union which shall be the depositary for the Agreement. 5. On its entry into force the Agreement shall replace the Framework Agreement for Cooperation between the European Community and the Republic of Chile signed on 20 December 1990. yi ARTICLE 43 Non-execution l. The Parties shall adopt any general or specific measure required for them to fulfil their obligations under this Agreement and shall ensure that they comply with the objectives laid down in the Agreement. If one of the Parties considers that another Party has failed to fulfil an obligation under this Agreement it may take appropriate measures. Before doing so, except in cases of special urgency, it must supply the Joint Committee with all the relevant information required for a thorough examination of the situation with a view to seeking a solution acceptable to the Parties. In this selection of measures, priority must be given to those which least disturb the functioning of this Agreement. These measures shall be notified immediately to the Joint Committee and shall be the subject of consultation in that Committee if the other Party so requests. 2. The Parties agree that the term "cases of special urgency" in paragraph 1 of this Article means a case of material breach of the Agreement by one of the Parties. A material breach of the Agreement consists of: (a) repudiation of the Agreement not sanctioned by the general rules of international law; (b) violation of the essential elements of the Agreement referred to in Article 1. 3. The Parties agree that the "appropriate measures" referred to in this Article are measures taken in accordance with international law. If a Party takes a measure in a case of special urgency as provided for under this Article, another Party may ask that an urgent meeting be called to bring the Parties together within 15 days. ARTICLE 44 Authentic text This Agreement is drawn up in duplicate in the Danish, Dutch, English, Finnish, French, German, Greek, Italian, Portuguese, Spanish and Swedish languages, each of these texts being equally authentic. 3L JOINT DECLARATION ON POLITICAL DIALOGUE BETWEEN THE EUROPEAN UNION AND CHILE Annex I 1. Preamble The European Union and Chile, Conscious of their common cultural heritage and the deep historical, political and economic ties which unite them, Guided by their attachment to democratic values, and reiterating the fact that respect for human rights, the freedom of the individual and the principles of the rule of law, as the foundations of a democratic society, lie at the root of their domestic and foreign policies and of their joint undertaking, Wishing to consolidate international peace and security in accordance with the principles set out in the United Nations Charter, and determined to apply the principles of preventing and peacefully resolving international disputes, Declaring their interest in using regional integration to promote sustainable and harmonious development for their inhabitants, using as a foundation the principles of social progress and solidarity between their members, Taking as a basis the special ties established by the Framework Cooperation Agreement between the European Community and Chile, Have decided to give relations between them a long-term perspective. 2. Aims Mindful of the conclusions adopted by the Council of the European Union on 17 July 1995 in the wake of the communication on the strengthening of relations between the European Union and Chile, the Parties reiterate their intention to enter into an agreement which will express their political will to achieve their ultimate goal of political and economic association. To that end, the Parties have agreed to step up political dialogue in order to ensure that there is closer consultation in areas of common interest, primarily through coordination of the Parties' positions in the appropriate multilateral forums. Such dialogue could include other participants from the region or, where possible, be conducted simultaneously with other established forms of political dialogue. 33 3 Procedures The Parties have agreed that political dialogue on bilateral and international issues of common interest should take the form of: (a) periodic meetings between the President of Chile and the highest authorities of the European Union; the Parties should decide on the procedure to be used; (b) periodic meetings between Foreign Ministers; the Parties should decide on the procedure to be used; (c) periodic meetings between other ministers to discuss matters of common interest in cases in which the Parties consider that such meetings will result in closer relations; (d) periodic meetings between senior officials of both Parties. 4. The European Union and Chile agree that this Joint Declaration should signal the beginning of closer and deeper relations. W [Annex II] JOINT DECLARATION ON THE DIALOGUE AT PARLIAMENTARY LEVEL The Parties support the initiative put forward by the European Parliament and the Chilean Parliament to institutionalize a dialogue between them and state their willingness to foster the establishment and development of this Parliamentary dialogue. jr Annex III JOINT DECLARATION ON INTER-REGIONAL ECONOMIC COOPERATION 1. By common accord the Parties will seek ways of linking their methods of preparing for the liberalization of trade with the methods they employ in connection with other individual countries or regional entities, and particularly with the Southern Cone Common Market (Mercosur). Such activities will depend on how regional integration has progressed and on the degree to which they help to achieve the aims of the Agreement. 2. In that connection, the Parties will examine the possibility of Chile becoming involved in the cooperation programmes provided for in the Agreement between the European Community and its Member States and the Southern Cone Common Market and its member countries, and of Mercosur becoming involved in the cooperation programmes provided for in this Agreement. Procedures will be determined on a case-by-case basis by all interested Parties. fcf Proposal for a g Q [^ ^^ r > < ^ >) COUNCIL DECISION (EC) No on the exchange of letters between the European Community and Chile concerning the provisional application of certain provisions of the framework cooperation Agreement in preparation for the eventual establishment of a political and economic association between the European Community and its Members States, of the one part, and the Republic of Chile, of the other part (presented by the Commission to the Council). U THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular' Articles 113 thereof, in conjunction with the first sentence of Article 228(2) thereof, Having regard to the proposal from the Commission, Whereas the framework cooperation Agreement in preparation for the eventual establishment of a political and economic association between the European Community and its Member States, of the one part, and the Republic of Chile, of the other part, was signed by the Community and its Member States on ; Whereas the European Community and Chile undertook to establish procedures for the early application of certain provisions of that Agreement which deal with trade cooperation between the parties and the institutional framework for such cooperation; Whereas the provisional application of the provisions in question will facilitate and promote closer trade relations between the European Community and Chile, pending the completion of the procedures required to bring the Agreement into force, HAS DECIDED AS FOLLOWS: Article 1 The attached exchange of letters between the Community and Chile, which provides for the provisional application of certain provisions of the framework cooperation Agreement in preparation for the eventual establishment of a political and economic association between the European Community and its Member States, of the one part, and the Republic of Chile, of the other part, is hereby approved on behalf of the European Community. Article 2 The Commission shall represent the Community within the bodies referred to in Articles 35 and 37 of the Agreement. Article 3 This Decision shall be published in the Official Journal of the European Communities. Done at Brussels, For the Council The President 3? Annex EXCHANGE OF LETTERS concerning the provisional application of certain provisions of the framework cooperation Agreement in preparation for the eventual establishment of a political and economic association between the European Community and its Members States, of the one part, and the Republic of Chile, of the other part Brussels, 1996 Sir, Letter No 1 I have the honour to refer to the framework cooperation Agreement in preparation for the eventual establishment of a political and economic association between the European Community and its Member States, of the one part, and the Republic of Chile, of the other part, signed on 22 June 1996. Pending the entry into force of that Agreement, I would propose that the European Community and the Republic of Chile, if the legal system of the latter so permits, apply provisionally the provisions of that trade cooperation Agreement as set out in Articles 4 to 7 and 9 of Title III of the Agreement. During the period of provisional application, the relevant provisions of the framework cooperation Agreement between the European Community and the Republic of Chile, signed on 20 December 1990, will remain in force provided that they do not replicate or conflict with the provisions of the Agreement signed on 22 June 1996 which are applied provisionally. I would propose, in addition, the provisional application of certain provisions concerning the setting-up of bodies to supervise the implementation of the cooperation Agreement as set out in Articles 35, 37 and 38 of the Agreement signed on 22 June 1996. The Joint Committee specified in Article 35 of that Agreement will be responsible for matters which fell within the scope of the Joint Cooperation Committee set up under Article 17 of the Agreement signed on 20 December 1990. 3? The subcommittees and working groups set up under the 1990 Agreement will continue to perform the functions which fall within their scope. Finally, I have the honour to propose that, if the foregoing points are accepted by Chile, this letter and its confirmation should together constitute an agreement between the European Community and Chile which would enter into force with effect from the date of your letter of confirmation. Please, accept, Sir, the assurance of my highest consideration. For the Council of the European Community Ho Letter No 2 Sir, I have the honour to acknowledge receipt of your letter of today's date concerning the provisional application of certain provisions of the framework cooperation Agreement in preparation for the eventual establishment of a political and economic association between the European Community and its Member States, of the one part, and the Republic of Chile, of the other part, signed on 22 June 1996, which reads as follows: "Pending the entry into force of that Agreement, I would propose that the European Community and the Republic of Chile, if the legal system of the latter so permits, apply provisionally the provisions of that trade cooperation Agreement as set out in Articles 4 to 7 and 9 of Title III of the Agreement. During the period of provisional application, the relevant provisions of the framework cooperation Agreement between the European Community and the Republic of Chile, signed on 20 December 1990, will remain in force provided that they do not replicate or conflict with the provisions of the Agreement signed on 22 June 1996 which are applied provisionally. I would propose, in addition, the provisional application of certain provisions concerning the setting-up of bodies to supervise the implementation of the cooperation Agreement as set out in Articles 35, 37 and 38 of the Agreement signed on 22 June 1996. The Joint Committee specified in Article 35 of that Agreement will be responsible for matters which fell within the scope of the Joint Cooperation Committee set up under Article 17 of the Agreement signed on 20 December 1990. The subcommittees and working groups set up under the 1990 Agreement will continue to perform the functions which fall within their scope. Finally, I have the honour to propose that, if the foregoing points are accepted by Chile, this letter and its confirmation should together constitute an agreement between the European Community and Chile which would enter into force with effect from the date of your letter of confirmation. " I have the honour to confirm that the Government of Chile is in agreement with the contents of your letter. Please accept, Sir, the assurance of my highest consideration. For the Republic of Chile 7/ FINANCIAL STATEMENT 1. TITLE OF OPERATION: Framework cooperation agreement with Chile Recommendation for a Council Decision authorizing the Commission to negotiate a framework cooperation agreement with Chile. 2. BUDGET HEADING INVOLVED (a) Implementation of the agreement will directly involve the following items: B7-310: B7-311 B7-870 B7-872 B7-6200: B7-6201: B7-611: B7-6210: B7-703: B7-6211: B7-6000: B7-643: B7-651: B7-653: B7-650: Financial and technical cooperation with Latin American developing countries Economic cooperation with Latin American developing countries Commercial and economic cooperation agreements with third countries Promotion of Community investment in developing countries in Asia, Latin America and the Mediterranean and in South Africa by economic cooperation and trade agreements Environment in the developing countries Tropical forests Women in development North-South cooperation schemes in the context of the campaign against drug abuse Democratization process in Latin America Health programmes and the fight against HIV/AIDS in developing countries Community contributions towards schemes concerning developing countries carried out by non-governmental organizations Decentralized cooperation in the developing countries Coordination of development policy, evaluation of the results of Community aid and practical follow-up measures Development cooperation inspectorate Measures to combat fraud in the cooperation sector (b) Other items that may be used: B6-7211: B4-1041: B4-1000: B7-631: international third countries and International cooperation with organizations European Energy Charter and cooperation with third countries in the energy field Thermie II (Community programme of financial support for the promotion of energy technology in Europe) Aid for population policies and programmes in developing countries, and follow-up of the Conference on population and development Hi- 3. LEGAL BASIS Bilateral framework agreement on trade and economic cooperation. 4. DESCRIPTION OF OPERATION 4. 1 General objective Conclusion of a framework cooperation agreement with Chile. 4. 2 Period covered and arrangements for renewal or extension This is an interim agreement intended to pave the way for a political and economic association between the Union and Chile. 5. CLASSIFICATION OF EXPENDITURE OR REVENUE 5. 1 Non-compulsory expenditure 5. 2 Differentiated appropriations 5. 3 Type of revenue involved Not applicable 6. TYPE OF EXPENDITURE OR REVENUE Expenditure will usually take the form of a 100% grant, though operations may sometimes be cofinanced by other donors (Member States). The recipients will systematically be required to contribute according to their means. 7. FINANCIAL IMPACT 7. 1 Method of calculating total cost of operation (definition of unit costs) This agreement establishes a framework for new measures to reflect the changing content and methods of Community cooperation/relations with Chile in the light both of recent social and economic developments in the country and of the process of strengthening ties between the parties. Although the quality and quantity of cooperation with Chile will be improved, there will be no specific budget for new operations. 8. FRAUD PREVENTION MEASURES; RESULTS OF MEASURES TAKEN In order to ensure maximum accountability in the management of budget resources, projects are subject to the following procedures: committee for the assessment of restricted invitations to tender (technical assistance); system of co-directors (one local and one Community); project administration involving analytical accounts; supervisory missions by desk officers and/or technical and/or financial units, if necessary, evaluation by independent experts; if necessary, ad hoc evaluation in conjunction with the relevant units of DG VIII. For projects of above-average duration and involving large budgets, there will be annual audits by internationally recognized firms, e. g. Price Waterhouse or Ernst & Young. 9. ELEMENTS OF COST-EFFECTIVENESS ANALYSIS 9. 1 Specific and quantified objectives; target population The specific objectives of each project worth over ECU 1 million are set out in the relevant financing proposal approved by the ALA Committee, which includes an economic and financial analysis. For all other projects, specific objectives are set out in the detailed commitment form that accompanies each one. The target population is everyone in Chile, but more particularly: - - the manufacturing and service sectors, especially SME; the most disadvantaged groups. 9. 2 Grounds for the operation The projects launched will be financed under existing budget items and are therefore underpinned by the financial statements accompanying those items in thePDB. 10 ADMINISTRATIVE EXPENDITURE (PART A OF SECTION m OF THE BUDGET) 10. 1 Extra staff The administrative the Commission's annual decision on resource allocation depending on the staff and finance approved by the budgetary authority. resources needed will be mobilized through Staffing Relations with Chile have so far been handled by an A official assisted by a part-time C official. They are unable to cope with the steady increase in political contacts, cooperation programmes and the day-to-day workload of the desk office generated by the stepping-up of relations over the past year. The objective of the framework agreement is to strengthen relations between Chile and the Union in all areas with a view to a future political and economic association. if The agreement will therefore bring with it qualitative requirements quite distinct from the volume of aid granted. This agreement has to reflect the Union's will to maintain closer relations not only in the context of cooperation but in the form of deeper political dialogue and trade cooperation geared to the future liberalization of trade. It is estimated, therefore, that the following extra staff will be needed: one new A official, one B official and one part-time C official. Their tasks will be as follows. Grade A official and temporary member of staff * * Overall direction, general consistency, coordination of activities, in-house coordination, dealings with Chile, information and dissemination, overall administration; technical monitoring of trade relations, supervision of the working parties that will be set up, coordination of trade-related issues with other departments, day- to-day handling of trade questions, preparations for meetings of the joint trade subcommittee, drawing-up of reports, studies and analyses on trade aspects of the future bilateral association agreement; cooperation: identification, implementation, management, monitoring, etc. * Grade B official * Support for A officials, particularly data searches, processing of statistics, data processing, administration and accounting. Grade C officials * Secretarial back-up. The above estimates do not include extra staff that might be needed by other Directorates General as a result of closer ties with Chile. yr Posts to be allocated Staff administering operation to Source Period Permanent Temporary Additional resources Existing resources within DG or department 1 0. 5 1 1 0. 5 Indefinite, starting 1996 2 1 1 or A B C (Officials temporary staff) Other resources TOTAL 4 1. 5 2. 5 The above remarks concerning the need for additional resources are subject to a Commission decision. The allocation of the additional posts will have to be considered in terms of the Commission's priorities when it examines the 1996 budget. 10. 2 Total financial implications of extra staffing A officials B C TOTAL Amounts 100 000 90 000 64 000 254 000 Calculation method Gross salary. List of average annual cost of existing posts The amounts represent the total cost of extra staff for the duration of the operation, if it is of fixed duration, or for one year if it is open-ended. 11. MISSION EXPENSES From its very first contacts with the EC, Chile has expressed a desire for technical assistance from the EC in a number of fields in which Community institutions have acquired experience. To this end, it has expressly asked to be allowed to work directly with the officials of the institutions concerned. u In response to these requests, the Commission has attempted to involve its various DGs and departments in one-off projects to impart the benefits of its experience of integration. While a number of DGs have expressed a desire to take part in this type of project, they have been seriously hampered in financing the relevant missions and many of Chile's requests have had to be turned down for want of a specific budget for such assistance. If appropriate machinery is not set up to facilitate these specific projects, the situation will become even more serious with the advent of the framework cooperation agreement, which seeks to expand the scope of technical assistance. Since it is impossible to predict how much extra will be needed for each DG in the absence of agreements between DGs on mission authorizations, a budget of an extra ECU 50 000 a year from 1996 should be planned to finance projects solely in this field. The budget should be initiated and coordinated by the relevant departments of the DG responsible for relations with Chile. An extra allocation is therefore requested for EC-Chile know-how transfer projects concerned specifically with the Community institutions. The amounts requested represent the cost of organizing missions averaging one week for 10 officials. Budget heading Amount (ECU) Calculation method A-1300 TOTAL 50 000 50 000. See table below No of missions Average cost trip 3 800 10 oflA verage expenses dailyffotal (ECU) Rounded (ECU) total 135 W7 450 50 000 The amounts represent the total cost for the duration of the operation, if it is of fixed duration, or for one year if it is open-ended. H } ISSN 0254-1475 COM(96) 259 final DOCUMENTS EN H Catalogue number : CB-CO-96-269-EN-C ISBN 92-78-05246-9 Office for Official Publications of the European Communities L-298S Luxembourg

Proposal for a COUNCIL REGULATION (EC) amending Regulation (EEC) No 3905/88 as regards definitive anti- dumping duties on imports of polyester yarn originating in Taiwan and Turkey

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 11. 06. 1996 COM(96) 228 final Proposal for a COUNCIL REGULATION (EC) amending Regulation (EEC) No 3905/88 as regards definitive anti-dumping duties on imports of polyester yarn originating in Taiwan and Turkey (presented by the Commission) EXPLANATORY MEMORANDUM In December 1988, by Regulation (EEC) No 3905/88, the Council imposed a definitive anti-dumping duty on imports of polyester yarn originating in the Republic of Korea. Mexico, Taiwan and Turkey. the In October 1991, the Council amended, by Regulation (EEC) No 2899/91, abovementioned Regulation and repealed the definitive anti-dumping duty imposed on imports into the Community of polyester yarn originating in Mexico. for a review, which was the In June 1994, following a request International Rayon and Synthetic Fibres Committee (CIRFS), representing the majority of Community polyester yarn producers, the Commission announced, with a notice published in the Official Journal of the European Communities, the initiation of a review of Council Regulation (EEC) No 3905/88 concerning imports of polyester yarn from Turkey and Taiwan, pursuant to Article 15 of Regulation (EEC) No 2423/88, the regulation applicable (EC) No 384/96. Imports from the Republic of Korea were excluded from the review of the measures, which consequently lapsed. to Article 23 of Regulation in this review pursuant lodged by The investigation covered two products: partially oriented polyester yarn (POY) and polyester textured filament yarn (PTY). (a) The investigation on POY showed that imports from Taiwan had remained at a the negligible de minimis three major Taiwanese producers and exporters Consequently, there is no reasonable indication that the expiry of the anti-dumping measures on imports of POY originating in Taiwan would lead to a recurrence of injury or threat of injury to the Community industry'; the measures in force should therefore be repealed though no measures were applicable for level, However, for Turkey, substantially increased imports of POY at consistently low prices during the investigation period, as well as the simultaneous decline in the Community industry's performance, leads to the conclusion that the expiry of the measures could only worsen the situation of the Community industry through a recurrence of injury. Therefore, the measures in force for imports of POY originating in Turkey had to be maintained and, in the light of the findings on dumping in the current investigation, to be duly adjusted (b) As far as imports of PTY originating in Taiwan and Turkey were concerned, it was found that although the anti-dumping measures in force have had a somewhat positive effect in terms of the volume of the Turkish and Taiwanese imports, they did not prevent the pressure on Community prices from continuing Therefore, even if imports from other third countries subject to anti-dumping investigations may have had some injurious effect on the situation of the Community industry, the fact remains that, taken in isolation, the dumped imports from Taiwan and Turkey, notwithstanding the existence of protective measures, have continued to materially contribute to the precarious situation of the Community industry, and that in these circumstances, to allow the measures to expire is likely to further weaken the Community industry through a recurrence of injury to this industry. Hence, the measures in force for imports of PTY originating in Taiwan and Turkey had to be maintained and, in the light of the findings on dumping in the current investigation, to be adjusted. 5. It is therefore proposed that the Council adopts the Regulation annexed, amending Council Regulation (EEC) No 3905/88 as last amended by Council Regulation (EEC) No 2899/91, imposing definitive anti-dumping duties on imports of polyester yarn originating in the Republic of Korea, Taiwan and Turkey. Proposal for a COUNCIL REGULATION (EC) amending Regulation (EEC) No 3905/88 as regards definitive anti-dumping duties on imports of polyester yarn originating in Taiwan and Turkey THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, Having regard to Council Regulation (EC) No 384/96 of 22 December 1995 on protection against dumped imports from countries not members of the European Community(1), and in particular Article 23 thereof, Having regard to Council Regulation (EEC) No 2423/88 of 11 July 1988 on protection against dumped or the European Economic Community(2), as last amended by Regulation (EC) No 522/94(3) and in particular Article 15 thereof, countries not members of subsidized imports from Having regard the Advisory Committee, to the proposal submitted by the Commission after consulting Whereas: A. PREVIOUS PROCEDURE (1) (2) B. (3) (i) (2) (3) (4) (5) (6) In December 1988, by Regulation (EEC) No 3905/88(4), the Council imposed a definitive anti-dumping duty on imports of polyester yarn originating in the Republic of Korea, Mexico, Taiwan and Turkey. On 1 October 1991, the Council adopted Regulation (EEC) No 2899/91(5), amending the abovementioned Regulation and repealing the definitive anti-dumping duty imposed on imports into the Community of polyester yarn originating in Mexico. REVIEW PROCEDURE Following the publication in June 1993 of a notice(6) of the impending expiry of the measures in force, the Commission received a request for a review lodged by the International Rayon and Synthetic Fibres Committee (CIRFS) representing the producers of allegedly 85% of Community polyester yarn output. O J N oL 56, 6. 3. 1996, p. 1. O J N oL 209, 2. 8. 1988, p. 1. O J N oL 66, 10. 3. 1994, p. 10. OJ No L 347, 16. 12. 1988, p. 10. O J N oL 275, 2. 10. 1991, p. 21. O J N oC 175, 26. 6. 1993, p. 9. (1) (5) (6) (7) (8) In December 1993, a notice of intention to carry out a review of the anti-dumping measures in force on imports of polyester yarn originating in the Republic of Korea, Taiwan and Turkey was published'7'. in a notice(X), the Commission announced the review of On 16 June 1994, Regulation (EEC) No 3905/88, pursuant (EEC) No 2423/88, being the Regulation applicable in this review pursuant to Article 23 of Regulation (EC) No 384/96, and hereinafter referred to as "the Basic Regulation". to Article 15 of Regulation Given the virtual absence of Korean imports on the Community market, it had not been shown in the view of the Commission that the expiry of the measures would have led to a recurrence of injury. It was therefore decided to exclude from the review the measures concerning imports originating in the Republic of Korea, which consequently lapsed<9). The Commission officially advised the producers, exporters and importers known to be concerned, the representatives of the exporting countries and the complainant, and gave the parties directly concerned the opportunity to make their views known in writing and to request a hearing. It also sent questionnaires to all parties known to be concerned. All complainant producers and another producer in the Community replied to the questionnaire and made their views known in writing. Some Turkish and Taiwanese exporters replied to the questionnaire and made their views known in writing. No importer replied to the Commission's questionnaire. The Commission sought and verified all information it deemed necessary for the purposes of a determination and carried out investigations at the premises of the following companies: (a) Community producers Rhône Poulenc, France Iloechst AG, Germany Nylstar, Germany Unifi, Ireland Montefibre Spa, Italy Akzo Fibres and Polymers Division, Netherlands La Seda de Barcelona S A, Spain Nurel S A, Spain Exsa, United Kingdom O. I No C 340, 17 12. 1993, p. 15 O. I No C 164, 16. 6. 1994, p 4 O. I No C 165, 17. 6. 1994, p. 10. (b) Producers/exporters in the countries of origin Taiwan Chung Shing Textile Co. Ltd, Taipei Far Eastern Textiles Ltd, Taipei Hsin Pao Textile Co. Ltd, Taipei Lanfa Textile Co. , Taipei Lea Lea Entreprise Co. Ltd, Taipei Nan Ya Plastics Corporation, Taipei Shingkong Synthetic Fibres Corp. , Taipei Tuntex Distinct Corp. , Taipei Zig Sheng Ind. Co. Ltd, Taipei Turkey Korteks-Mensucat Sanayi ve Ticaret A. S. , Bursa Nergis-Tekstil Sanayi ve Ticaret A. S. , Bursa Sasa-Artificial and Synthetic Fibres Inc. , Adana Sifas-Sentetik Iplik Fabrikalari A S. , Bursa (9) (10) (11) C. 1. (12) The investigation of dumping covered the period from 1 July 1993 to 30 June 1994 (the "investigation period"). All parties concerned were informed of the essential facts and considerations on the basis of which it was intended to recommend the amendment of existing definitive measures. They were also granted a period within which to make representations subsequent to these disclosures. Because of the large number of interested parties, the volume of data gathered and analysed, and the complexity of certain issues, in particular the difficulties inherent in the fact that, as described in recitals (12) and (13), POY is a semi-finished product destined for the PTY production, the investigation has exceeded the normal period of one year as provided for in Article 7(9) of the Basic Regulation. PRODUCT UNDER CONSIDERATION AND LIKE PRODUCT DESCRIPTION OF THE PRODUCT CONCERNED The products which are covered by the complaint and for which the review investigation was initiated are partially oriented polyester yarn (POY) falling within CN code 5402 42 00 and polyester textured filament yarn (PTY) falling within CN codes 5402 33 10 and 5402 33 90. They are identical to the products which were the subject of the previous investigation. POY is a feeder yarn used mainly to produce PTY, which is in turn used in both the weaving and knitting sectors to make polyester or polyester-and-cotton fabrics There are different types of POY as well as PTY, depending on the denier (weight), the number of filaments and the lustre. There are also different qualities, depending on the efficiency of the production process. (13) The original investigation was concluded by measures imposed by Regulation (EEC) No 3905/88, on POY and PTY separately. In this respect, the present investigation has confirmed that the essential process for obtaining PTY is texturization, consisting mainly of twisting and drawing POY, which imparts to PTY its essential characteristics. However, the necessity for and costs of further processing indicates that POY does not belong to the same category of product as PTY, since the added-value required to produce PTY from POY is substantial. In addition, the end-use of POY and PTY is different and the two products are not interchangeable. Consequently, different markets for each product exist. It is worth noting that the manufacturing processes described above can sometimes be integrated in one company or group, or can be undertaken by two independent companies. Both situations (integrated or independent manufacturing) exist in Taiwan and Turkey and in the Community. Part of the Community production of POY is sold on the Community market to independent texturizers (see recital (22)). (14) In view of the above, it has been concluded that POY and PTY do not belong to the same category of product and thus have to be regarded as two distinct products. These findings have not been contested by any interested party. Consequently, the two products have been dealt with separately in the framework of this review. II. LIKE PRODUCT POY (15) The investigation showed that POY products sold on the domestic markets of Turkey and Taiwan were "like products" relative to those exported from those countries to the Community. Similarly, the POY manufactured by the Community industry and sold on the Community market and those exported to the Community from the countries in question are alike in all respects as regards their physical, chemical and technical characteristics and end-uses. PTY (16) The same findings were made with regard to PTY respectively sold on the domestic markets of Turkey and Taiwan, produced and sold in the Community, and exported to the Community from the countries in question. (17) Consequently, in each case the products sold on the domestic market of the exporting countries, those exported from these countries to the Community and those produced and sold in the Community are "like products" within the meaning of Article 2(12) of the Basic Regulation. D. I. (18) PARTIALLY ORIENTED POLYESTER YARN (POY) THE SCOPE OF THE REVIEW In Regulation (EEC) No 3905/88, three Taiwanese producers, Far Eastern Textile Ltd, Nan Ya Plastics Corporation and Tuntex Distinct Corp. , were not subject to the anti-dumping duty imposed on imports of POY from Taiwan. These Taiwanese exporters claimed that the present review investigation could not cover producers expressly exempted from the anti-dumping measures, because no dumping was found in their case, and that the absence of existing anti-dumping measures*led to the conclusion that there were no grounds for including them in its scope. (19) Since the review request was made under the provisions of Article 15 of the Basic Regulation, it has to be examined whether the expiry of the measures in force would lead again to injury. On this basis, and given that the three Taiwanese producers concerned were exempted from the measures on the grounds that no dumping had been found in their case, they should be kept outside the scope of this review investigation. (20) Consequently, this review does not cover imports of POY from Tuntex Distinct Corp. , Far Eastern Textile Ltd, or Nan Ya Plastics Corporation. H. COMMUNITY INDUSTRY (21) In defining the Community industry, data obtained from information received in the replies to the questionnaires, from EUROSTAT figures and from CIRFS concerning output of Community-produced POY were used, since not all the producers active in the Community POY market cooperated in the investigation. (22) The complaining Community producers were found to represent 76% of the total Community POY production intended for sale and thus a major proportion of that production. (23) On this basis, the complaining Community producers constitute the Community industry within the meaning of Article 4(5) of the Basic Regulation. in. THE SITUATION OF THE COMMUNITY INDUSTRY (a) Community consumption (24) The apparent Community consumption increased from 119 000 tonnes in 1991 to 122 000 tonnes in 1992, fell back to 119 000 tonnes in 1993, to increase again to 125 000 tonnes in the investigation period. (b) Production, production capacity and capacity utilization (25) The Community industry's production for sale increased from 58 000 tonnes in 1991 to 77 000 tonnes in 1992, fell back to 72 000 tonnes in 1993, to increase again to 76 000 tonnes during the investigation period. (26) Over the last three years, the production capacity has remained the same and the capacity utilization rate has been stable at 80%. (27) (28) (29) (c) Sales volume and market share The quantity of POY sold on the Community market by the Community industry dropped from 50 000 tonnes in 1991 to 49 000 tonnes in 1992 to 47 000 tonnes in 1993 and 46 000 tonnes in the investigation period, despite the increase in apparent Community consumption, noted in recital (24). The Community industry's market share changed as follows: 42% in 1991, 40% in 1992, 39% in 1993 and 36. 5% during the investigation period. Overall, the market share has declined by 5. 5 percentage points while the apparent consumption increased by around 5 percentage points. (d) Price movements Prices of the Community industry for POY have fluctuated in line with the prices of the raw materials PTA (Pure Terephthalic Acid), DMT (Dimethylterephthalate) and Glycol. The upward price trend of POY recorded at the end of the investigation period (first half of 1994) is the result of the worldwide shortage of raw materials and their subsequent price increases. These price increases occurred consequently for all operators in the market at the same time, but should not hide the fact that the Community industry's prices remained consistently undercut by the exporters' prices during the investigation period (see recital (38)). (e) Profitability (30) The Commission found that, overall and from 1991 onwards, the POY Community industry has recorded poor financial results. The situation has deteriorated considerably from 1992 with an average loss of 22% on turnover during the suffered investigation period. All complaining Community producers have heavy losses. (f) Employment and investment (31) Given the integrated nature of the polyester yarn industry, it has not been possible to isolate employment and investment data for POY production only. Data available concerning the industry globally indicates that there has been a steady curtailment in the is not labour-intensive. labour force of about 15% since 1991, even industry though Investments by the complaining Community producers have been reduced in some cases to a level below that needed to ensure optimal production. (g) Conclusion (32) In spite of the measures in force, an overall assessment of the main economic indicators leads to the conclusion that the Community industry producing POY continues to show signs of economic difficulties. Its situation has constantly deteriorated since 1991, as is demonstrated in particular by a loss in market share of up to 5. 5% over four years, notwithstanding an increase in Community consumption the same period, by a reduction of employment and by substantial over financial losses. IV. RECURRENCE OF INJURY (33) In accordance with Article 15 of the Basic Regulation, the Commission examined whether the expiry of the measures in force would lead again to injury or threat of injury to the Community industry. TAIWAN (34) Imports of Taiwanese POY regressed from 2 812 tonnes in 1991 (2. 4% market share) to 1 117 tonnes in 1992 (0. 9% market share), to 551 tonnes in 1993 (0. 5% market share) and to 448 tonnes during the investigation period (0. 4% market share). It should be noted in this respect that the three major Taiwanese producers were not subject to any anti-dumping duty. Apart from the imports from these three producers, which are not concerned by the review investigation, the Community market share held by the remaining imports from Taiwan amounts to 0. 1% only. Information available suggests that the Taiwanese producers have re-oriented their exports to other third countries which are geographically closer, where a steady growth for POY is being registered. Furthermore, these producers have apparently moved to a greater extent into the downstream product, PTY. Consequently, there is no reasonable indication that the expiry of the anti-dumping measures on imports of POY originating in Taiwan would lead to a recurrence of injury or threat of injury to the Community industry. TURKEY (a) Volume and Community market share of imports from Turkey (35) (36) It was found that imports of POY from Turkey have increased substantially between 1991 and the investigation period, from 7 933 tonnes to 22 436 tonnes. This corresponds to an increase in market share over the same period from 6. 7% to 17. 9%. This development has to be seen in the context of the setting-up of a PTY production facility in the Community by the largest Turkish producer and exporter of POY and PTY. Nevertheless, a significant part of the exports of POY to the Community by this Turkish producer were destined to unrelated customers. (37) It was claimed that Turkish imports of POY merely filled the gap left by the decreasing exports of POY yarn from Taiwan. This is factually incorrect since the Taiwanese imports have continuously decreased from less than 3 000 tonnes in 1991, while Turkish imports increased from around 8 000 tonnes in 1991 to 22 400 tonnes during the investigation period. (b) Prices of the imports (38) On the basis of price information available, a comparison has been made between the weighted average Community industry's selling price and the weighted average price of the imports concerned at the same level of trade. The Community industry's price was at ex-works and, the prices of the imports were at free-at-Community frontier, customs cleared. This comparison showed in the case of Turkey an undercutting margin, persisting throughout the entire investigation period, higher than that established in the original investigation. (c) Impact of other factors on the situation of the Community industry (39) Among all imports of POY in the Community from other third countries, only those from the USA and Switzerland were of significant volume, all others taken together being negligible. However, the sales volume and market share in the Community of the US imports have steadily decreased between 1991 (6. 9% market share) and the investigation period (1. 9% market share). Imports from Switzerland remained relatively stable (around 13% market share) at very high prices, and the main Swiss exporter concerned is a subsidiary of a complaining Community producer. It was alleged that the Community industry did not make the investments needed in order to remain competitive. In this regard, an industrial rationalization process has been in operation for some years among several Community producers. This process, however, requires financial resources which have been limited due to the existence of low-priced dumped imports on the Community market. The claim was made that, like other industrial sectors in the Community, the producers of POY suffered from the recession and not from the Turkish imports and, in particular that, because of the recession, the Community producers were not in a position to reflect the increasing costs of raw materials in their prices of POY. Here, it has to be noted that the development of the apparent Community consumption described in recital (24) above does not reflect any recession in the POY market. Finally, it was asserted by the Turkish exporter that a capacity utilization rate of 70% allows any "fibres-business" to achieve a breakeven point. This statement has not been substantiated by the information gathered in Taiwan and among the Community industry's producers. According to this information, capacity utilization for this industry should normally reach a rate of 90% in order to achieve breakeven. Indeed, the majority of Taiwanese producers report utilization rates above 95%. The (40) (41) (42) 11 Community industry's utilization rate was, throughout the period under consideration, around 80%. In any event, the capacity utilization factor has to be examined in conjunction with other injury factors such as prices and volumes at which production is sold before any decisive conclusions can be drawn. It is clear that, in cases such as this, even a 90% utilization rate could result in a loss-making situation if prices of the Community producers were severely depressed by the low-priced imports concerned. (d) Conclusion (43) In these circumstances, it appears that there are no other factors but the imports of POY originating in Turkey which may explain the difficult situation of the Community industry, notwithstanding the anti-dumping measures in force. It is therefore concluded that the expiry of these measures as regards Turkey could only worsen the situation of the Community industry through a recurrence of injury to this industry. V. DUMPING (44) The continued existence of dumping was verified, to ascertain firstly whether there were grounds for the continuation of measures against POY from Turkey and, if so, whether any change in the dumping margin required the existing measures to be amended accordingly. (a) Normal value (45) (46) It was first examined whether the volume of sales of the sole Turkish producer which had exported to the Community during the investigation period on the domestic market had attained at least 5% of the volume of the exports of the like product to the Community - a percentage which has consistently been considered to constitute sales in sufficient quantities to permit a proper comparison. This producer achieved domestic sales representing only 2. 6% of the quantity exported to the Community. Accordingly, those sales were considered insufficient to establish a representative domestic price, and normal value had to be constructed in accordance with Article 2(3)(b)(ii) of the Basic Regulation. For all the types of the product sold for export to the Community by the Turkish producer, a constructed normal value was calculated, by adding to the manufacturing costs of the exported types, a reasonable amount for selling, general and administrative expenses (SG&A) and a profit. Since there were insufficient sales of POY by the producer concerned on the domestic market, and since this was the only producer/exporter involved in the investigation which sold POY on that market, the amount for SG&A and profit was calculated by reference to the sales made by this producer in the same business sector, in Turkey, in the polyester yarn sector, in accordance with Article 2(3)(b)(ii) of the Basic Regulation. 12 (b) Export prices (47) (48) The Turkish producer shipped POY to independent importers in the Community and to one related importer in the Community. Since the POY imported by the related company was transformed into PTY by the same company and sold to the first independent buyer as such, it would have been necessary to construct an export price for POY from the resale price of PTY. Given the inherent difficulties of such an exercise and taking into consideration the large quantities sold by the Turkish exporter to independent importers (more than 60% of its exports to the Community) it was considered that the transactions between related parties should be disregarded altogether; export prices were determined exclusively on the basis of the prices relating to transactions with independent importers. (c) Comparison (49) Normal value by product type was compared with the export price for the corresponding type, on a transaction-by-transaction basis at the ex-works stage and at the same level of trade. (50) (51) (52) (53) For the purpose of a fair comparison, normal value was adjusted in accordance with the provisions of Article 2(9) and (10) of the Basic Regulation to take account of differences directly affecting price comparability. The adjustments concerned import charges and indirect taxes and differences in selling expenses arising from sales made under different conditions and terms of sale, namely credit terms and transport costs. (d) Dumping margins The above comparison revealed the existence of dumping, the margins of dumping being equal to the amount by which the normal value, as established, exceeds the price for export to the Community. The weighted average dumping margin for the Turkish producer concerned, expressed as a percentage of the free-at-Community-frontier price, customs duty unpaid, is as follows: Sasa-Artificial and Synthetic Fibres Inc. 3. 3%. In the case of Turkish companies which cooperated in the investigation but were found neither to have sold POY on their domestic market nor to have exported it during the investigation period, the weighted average dumping margin found for the sole company which did export during the investigation period is considered appropriate, since it takes into account the cooperation of the companies concerned by distinguishing them from those which did not cooperate in the investigation. the dumping margin of 3. 3% Accordingly, following companies: Korteks-Mensucat Nergis-Tekstil Sanayi ve Ticaret A. S. is also applicable to Sanayi ve Ticaret A. S. the and 13 (54) In the case of those Turkish producers which failed to make themselves known or did not reply satisfactorily to the Commission's questionnaire, the dumping margin was determined on the basis of the facts available in accordance with Article 7(7)(b) of the Basic Regulation. It was considered that the most reasonable facts were those established during the investigation and that, in order to avoid giving a premium for non-cooperation and to ensure that the anti-dumping measures introduced afforded effective protection from unfair trade, the dumping margin attributable to those producers should be based on the POY type with the highest dumping margin found for the sole cooperating Turkish producer which had exported to the Community during the investigation period. On that basis, the POY type chosen represented around 10% of all exports to the Community by the Turkish producer concerned, and the dumping margin established for Turkish non-cooperating companies amounts to 6. 8%. VI. COMMUNITY INTEREST (55) A determination as to whether the Community interest calls for intervention needs to be based on an assessment of all the various interests taken as a whole, including those of the producers, users and consumers in the Community. In such an examination, the need to eliminate the trade-distorting effects of injurious dumping and to restore effective competition needs to be given special consideration. (56) (57) It has to be recalled that in the previous investigation, the adoption of measures was considered to be in the interest of the Community. It was stated that the measures would have a fairly negligible effect on the production costs of the user industry and no serious consequences for consumers. These considerations remain valid in considering the extent to which it would be in the Community interest to maintain measures in force. No arguments were submitted by the users as concerns the impact of the price of POY in the end product, although questionnaires were sent to those users made known to the Commission. In any event, given the range of the measures proposed and the figures available with regard to the weight of POY in the manufacturing of PTY, the impact of the reviewed measure on the prices for the end product appears to be negligible. (58) On the contrary, to allow the measures to expire would put the Community industry at a risk, since it would suffer increasingly from the dumped low prices of the Turkish imports, being thus prevented from redressing its precarious financial situation. It appears therefore that the interests of the Community industry far outweigh the possible, and in any case limited, disadvantages for users and final consumers. (59) On that basis it is concluded that Community interest calls for the maintenance in force of the anti-dumping measures, duly amended to eliminate the injurious effects of dumped imports originating in Turkey. 14 VIL MEASURES Taiwan (60) By virtue of the reasons given in recital (34) with regard to Taiwanese imports, the existing anti-dumping measures on those imports should be allowed to lapse. Turkey (61) In order to prevent the recurrence of injury and to provide adequate protection from the continuing injurious dumping by Turkish imports, it is considered anti-dumping duty should be established in such a way as to allow the Community industry to realize the reasonable profit it has been deprived of through the negative impact of the dumped imports. that (62) When calculating an adequate level of duty, the Council had to consider that the precarious situation of the Community industry consists mainly in a steady loss of market share and substantial financial losses due to depressed prices resulting from price undercutting. It is thus necessary that the measures taken allow the Community industry to make a reasonable profit in the future. (63) E. I. (64) In this respect, the Council has calculated the price level considered adequate to remove injury on the basis of the weighted average cost of production of the Community industry, adding a profit of 6% considered reasonable for guaranteeing the industry productive investment on a long-term basis. This price level was then compared to the average import prices on a free-at-Community frontier basis, duty paid. Since the result of this comparison shows an injury margin higher than the dumping margin established, the duty should be based on the dumping margin found. POLYESTER TEXTURED FILAMENT YARN (PTY) THE SCOPE OF THE REVIEW In Regulation (EEC) No 3905/88, one Taiwanese producer, Tuntex Distinct Corp, was exempted from the anti-dumping duty of 6. 2% on imports of PTY originating in for Taiwan because an this company. insignificant dumping margin (0. 31%) was found (65) For the same reasons as those set out in recital (19), this Taiwanese company, Tuntex Distinct Corp. , has to be excluded from the scope of. the review as far as PTY is concerned. U. COMMUNITY INDUSTRY (66) to represent 50% of the The production of PTY by companies on behalf of which the complaint was lodged was found in the Community during the investigation period (1 July 1993 to 30 June 1994) and hence a major proportion of this output. Therefore, the complaining companies constitute the "Community industry" within the meaning of Article 4(5) of the Basic Regulation. Those complaining companies produced PTY from in-house POY production, with the exception of one company which purchased POY on the market. total PTY output 15 (67) A producer in the Community was found to be a wholly-owned subsidiary of a Turkish exporter of POY, the upstream product. Although not cited in the initial complaint, this producer cooperated in the investigation. It was considered whether this producer operating in the Community should be excluded from the definition of the Community industry within the meaning of Article 4(5) of the Basic Regulation In this respect, it should be recalled that the provisions of that Article do not provide for the automatic exclusion of Community producers related to the exporters or producers located in exporting countries, or producers which are themselves importing the allegedly dumped product, but rather impose on the Community institutions the obligation to consider on a case-by-case basis whether the exclusion of any producer is warranted. (68) Following the previous practice of the Community institutions, it was considered that this Community producer, through its relationship with the producer/exporter concerned in Turkey, was shielded from the injurious effects of the dumped imports. It was further considered, in accordance with that practice, that to include this producer in the definition of the Community industry would distort the assessment of those effects. Indeed, the fact that the Community producer concerned produces PTY from POY bought at transfer prices from the related Turkish exporter found to have been dumping and causing injury to the complainants renders the production cost data for the product concerned unreliable. On those grounds, it was considered that the producer in the Community concerned had to be excluded from the definition of the Community industry. For the remainder of Chapter E, the term "Community industry" therefore, refers to the complaining Community producers of PTY only. HI. THE SITUATION OF THE COMMUNITY INDUSTRY (a) Community consumption (69) The total apparent Community consumption of PTY had increased from 230 000 tonnes in 1991 to 237 000 tonnes in 1992 and, after a decline to 221 000 tonnes in 1993, increased again to 241 000 tonnes in the investigation period. This represents an overall increase of consumption of around 5% over the period considered. (b) Production, production capacity, utilization rate (70) The Community industry's production of PTY dropped steadily from 104 000 tonnes in 1991 to 92 000 tonnes in 1993 and recovered to 95 000 tonnes during the investigation period. This represents an overall decrease in the Community industry's production of 8. 6%, while Community consumption increased by 5% over the same period. 16 (71) (72) (73) (74) (75) (76) (77) The PTY production capacity of the Community industry has increased over the last three years by about 7%, from 114 000 tonnes in 1991 to 122 000 tonnes during the investigation period. This increase in PTY production capacity is specifically the result of significant investment in 1992 and 1993 by one company, related to a third-country producer. This company reduced drastically its imports of POY from the parent company and extended its production of POY and consequently its PTY capacity in the Community. The utilization rate of production capacity of the Community industry as a whole decreased from 91% in 1991 to 78% in the investigation period. Given the fact that the polyester yarn industry is very capital-intensive (up to 90% utilization rate being considered to be normal), the decreasing utilization rate has a significant effect on the allocation of fixed costs. (c) Sales volume and market share The quantity of PTY sold in the Community by the complaining Community producers declined from about 87 000 tonnes in 1991 and 1992 to 83 000 tonnes in 1993, to increase again to 87 000 tonnes during the investigation period, in a context of growing demand. The Community industry's share of the Community market moved as follows: 37. 7% in 1991, 36. 8% in 1992, 37. 7% in 1993 and 36% during the investigation period. The overall relative stability of sales led, however, to a slight decrease of the market share due to the increase in Community consumption. (d) Price evolution Prices of PTY have fluctuated in line with the prices of the raw materials used for producing the upstream product POY, namely PTA, DMT, and glycol. The increasing price trend of PTY recorded at the end of the investigation period (first half of 1994) as compared with 1993 (second half), is the result of the worldwide shortage of those raw materials and their consequent price increases. These price increases thus occurred for all operators in the market at the same time. (e) Profitability It was found that, generally from 1992 onwards, the Community industry has recorded deteriorating financial results. The overall profitable situation in 1991 has turned into losses and has particularly worsened during the investigation period, reaching average losses of around 10% on turn-over. All complaining Community producers suffered heavy losses, or decreasing profitability. (0 Employment and investment It should be noted that though the polyester yarn industry is not labour-intensive, the since 1991 Community industry. there has been a steady curtailment in employment by Investments by the Community industry were reduced in most cases to levels not allowing optimal production. 17 (g) Conclusion (78) In spite of the measures in force on imports of PTY originating in Turkey and Taiwan, an overall assessment of the main economic indicators leads to the conclusion that the PTY Community industry continues to show clear signs of economic difficulties. Its situation has constantly deteriorated since 1991, as is demonstrated in particular by a decline of production capacity utilization and market share, notwithstanding a certain increase of consumption of PTY in the Community, and also by increasing financial losses. IV. RECURRENCE OF INJURY (79) In accordance with Article 15 of the Basic Regulation, the question was examined whether the expiry of the measures in force would lead again to injury or threat of injury to the Community industry. (80) (81) (82) (a) Volume and market share of imports from the exporting countries concerned Imports of PTY from Taiwan have remained stable since 1991 at an annual level of around 7 000 tonnes. The assessment of these imports in the light of the development of Community consumption shows a market share of 3% in 1991, 2. 9% in 1992, 3. 2% in 1993 and 2. 9% during the investigation period. Imports of PTY originating in Turkey decreased from 4 504 tonnes in 1991 (1. 9% market share) to 3 406 tonnes in 1992 (1. 4% market share) and to 1 546 tonnes in 1993 (0. 7%) market share), but increased to 2 348 tonnes during the investigation period (0. 98% market share). The changes in these imports and market shares appears to have been somewhat influenced by the setting-up of a PTY production facility in the Community by the largest producer and exporter of PTY in Turkey. (b) Prices of the dumped imports In order to examine whether price undercutting was in evidence, all the types manufactured by the Community industry and those imported into the Community from the countries concerned have been divided into three groups according to their denier. A weighted average Community-industry selling price for each group was then compared with a weighted average price of each exporter concerned for the comparable group at the same level of trade. The undercutting margins thus obtained per group were then weighted in order to reach one margin per exporting company. The Community industry's prices were taken at an ex-works basis and the exporters' prices were expressed as free-at-Community frontier, customs cleared. As far as Turkey is concerned, this comparison showed an overall weighted average undercutting margin for the entire investigation period of 33. 7%. As regards Taiwan, an overall weighted average undercutting margin of 23. 6% for the entire investigation period was found, ranging from 0. 9% to 34. 6% according to the exporter. (c) Impact of other factors on the situation of the Community industry Other imports (83) Imports of PTY from other third countries, namely Indonesia, India, Malaysia, Thailand, the USA, South Africa and Slovakia were claimed to have influenced the situation of the Community industry. (84) Anti-dumping investigations concerning imports from India, Indonesia, Thailand and Malaysia are currently being carried out. With the exception of imports from India, which have decreased continuously since 1992 to reach during the investigation period a volume considered to be negligible, Community market share of the other three countries, taken together, increased significantly from 1. 7% in 1991 to 9. 6% during the investigation period. Prices of these imports into the Community appear to be higher than Turkish prices but lower than Taiwanese prices. However, no conclusions can be drawn yet as to the prices and the possibility of dumping by these imports, since the anti-dumping investigations are in progress. (85) Imports of PTY from the USA, although still significant (4. 1% market share in the investigation period) dropped by 16% in volume between 1991 and the investigation period. As to imports of PTY from South Africa, they increased in terms of Community market share from 1. 07% in 1991 to 1. 47% during the investigation period. Eurostat figures, however, do not provide information on the types of PTY imported and, therefore, no conclusions can be drawn with regard to the prices at which imports of PTY from the USA and South Africa were made. (86) As far as Slovakia is concerned, imports of PTY into the Community reached a market share in the investigation period of 3. 1%. However, it appeared that since 1993, owing to an investment of a Community producer in Slovakia, a major part of imports into the Community originating in that country was made at transfer prices between related parties. It may reasonably be assumed that such imports cannot have been made by the Community producer in question with a view to adversely affect its own profitability. Consequently, it is concluded that the Slovakian imports cannot have had a significant impact on the situation of the Community industry. (87) It can therefore be concluded that imports of PTY from countries other than Taiwan and Turkey, for which injurious dumping is being investigated following evidence presented by the complainants, namely from Indonesia, Thailand and Malaysia, may have exacerbated the already unfavourable situation of the Community industry. For the other abovementioned countries, for which no anti-dumping investigation is in course, any contribution to the injury suffered by the Community industry cannot be substantiated. Other Community producers (88) Since the Community industry represents 50% of the total Community production of PTY, it was considered necessary to examine the behaviour of the other Community producers of PTY in the Community and their possible impact on the situation of the Community industry. The estimated production capacity of Community producers not included in the Community industry has remained stable over the last four years. The same applies to their actual production, which showed a slight increase similar to the Community industry's production, in the first half of 1994 only. As to the Community market share of those other Community producers, it showed during the investigation period a slight decrease similar to that of the Community industry. (89) Therefore, it does not appear that those producers' behaviour had injurious effects on the precarious situation of the Community industry, other than that resulting from normal competition. Investment level and recession (90) The same arguments as in the case of POY relating to the influence of insufficient investment and of the recession on the situation of the Community industry were made by the Turkish exporter with regard to PTY. The reasoning set out in recitals (40) and (41) for POY also applies to PTY. Investments by the Community industry have been limited by the lack of the necessary financial resources, due to the low-priced dumped imports of PTY, and the development of apparent Community consumption of PTY does not reflect any recession. (d) Conclusion (91) Although the anti-dumping measures in force have had a somewhat positive effect, in terms of the volume of the Turkish and Taiwanese imports of PTY into the Community, they have not prevented the pressure on Community prices from to continuing. Therefore, even if imports from other third countries subject anti-dumping investigations may have had some injurious effect on the situation of the Community industry, the fact remains that, taken in isolation, the dumped imports from Taiwan and Turkey, notwithstanding the existence of protective measures, have continued the Community industry. the precarious situation of to contribute materially to (92) In these circumstances, to allow the measures to expire is likely to waken further the Community industry through a recurrence of injury to this industry. V. DUMPING (93) The continuance of dumping was verified, to ascertain firstly whether there were grounds for the continuation of measures against PTY from Turkey and Taiwan and, if so, whether any change in the dumping margins required the existing measures to be amended accordingly. 20 (a) Normal value Turkey (94) As far as the determination of normal value for the Turkish producers is concerned, it was first established, for each producer, whether its total domestic PTY sales had been made in sufficient quantities to allow a proper comparison with its total PTY exports to the Community. (95) Only two out of the three Turkish producers which cooperated in the investigation exported PTY to the Community during the investigation period. These two producers were found to have sold PTY in their domestic market as well during that period. For each producer, the total domestic PTY sales volume was higher than 5% of its total export sales volume to the Community. Accordingly, those domestic sales were considered to have been made in sufficient quantities. (96) For each of the PTY types sold by the two Turkish producers on the domestic market and found to be identical or directly comparable to types sold for export to the Community, it was also considered whether domestic sales per type were made in sufficient quantities. (97) Domestic sales of each particular type were found to have been made in sufficient quantities, as the volume of each type of PTY sold in Turkey during the investigation- period represented 5% or more of the volume of the comparable type sold for export to the Community. (98) It was subsequently examined for both producers whether the domestic sales of each type of PTY could be considered to have been effected in the ordinary course of trade, by looking at the proportion of profitable sales of the type in question. (99) Given the high inflation rate in Turkey, the methodology for assessing the ordinary course of trade in domestic sales was applied on a monthly basis, as follows: - - In cases where the monthly volume of a type of PTY sold at a net sales price equal to or above the calculated monthly cost of production, as defined in Article 2(3)(b)(ii) of the Basic Regulation, represented more than 80% of the total monthly sales volume of that type, the normal value was established as a monthly weighted average of all domestic sales transactions of the type concerned made in each month of the investigation period, whether profitable or not. In cases where the monthly volume of a type of PTY sold at a net sales price equal to or above the calculated monthly cost of production represented less than 80% but still a sufficient quantity of the total monthly sales volume of that type, the normal value was established as a monthly weighted average of the profitable domestic sales transactions only for the type concerned in each month of the investigation period. 21 - In cases where the monthly volume of a type of PTY sold at a net sales price equal to or above the calculated monthly cost of production represented an insufficient quantity of the total monthly sales volume of that type, it was considered that the type in question was not sold in the ordinary course of trade and that the monthly normal value had therefore to be constructed. (100) As a result of the methodology referred to above for one Turkish producer, the monthly normal value for the type of PTY exported to the Community has been based on the monthly domestic price of the comparable type, after deducting from the sales price all discounts and rebates directly linked to the sales under consideration, in accordance with Article 2(3)(a) of the Basic Regulation. For the types exported by the other Turkish producer, the monthly normal value was based for the first seven months of the investigation period on a monthly constructed normal value, as more than 80% of the monthly domestic sales were made at a loss, and for the last five months of the investigation period, normal value was based on the monthly domestic sales price of the comparable types, since domestic sales in these latter months were found to have been made in the ordinary course of trade. (101) The constructed normal value was determined by adding to the manufacturing costs of the product types concerned, a reasonable amount for selling, general and administrative expenses (SG&A) and profit. (102) This amount was established for the Turkish producer concerned by reference to the expenses incurred and the profit realized by each producer on profitable sales of the like product on the domestic market. Taiwan (103) (104) In assessing whether domestic sales of the product concerned by the Taiwanese cooperating producers were made in sufficient quantities to allow a proper comparison and in the ordinary course of trade, the Commission applied the same methodology followed with regard to the Turkish producers (see recitals (94) to (98)) but for the whole investigation period instead of on a monthly basis. It was found that, for each of the Taiwanese producers concerned, both the total volume of domestic sales of PTY and the domestic sales volume of each type of PTY, were higher than 5% of the corresponding volumes of the like product sold for export to the Community. As a consequence, total domestic sales and domestic sales of each product type were considered to have been made in sufficient quantities to allow a proper comparison. (105) It was also found that out of a total of 32 types of PTY sold for export to the Community by the Taiwanese producers concerned, only for 16 types had the corresponding like product been sold on the domestic market in the ordinary course of trade. Normal value was therefore established for these types on the basis of the domestic price of comparable types, after deducting all discounts and rebates directly linked to the sales under consideration, in accordance with Article 2(3)(a) of the Basic Regulation. 22 (106) For the remaining 16 types of PTY sold for export to the Community, normal value needed to be constructed. (107) For each of the Taiwanese producers concerned, the constructed normal value was determined by adding to the manufacturing costs of the product types in question a reasonable amount for SG&A and profit. This amount was established by reference to the expenses incurred and the profit realized by each producer on the profitable sales of the like products on the domestic market. (b) Export prices (108) Since all imports of PTY originating in Taiwan and Turkey into the Community were made directly by independent importers, export prices were determined on the basis of the prices actually paid or payable for the product sold for export to the Community, in accordance with Article 2(8) of the Basic Regulation. ( 109) In the case of one of the Taiwanese producers concerned, the Commission was unable to use its reply to the questionnaire as the basis for establishing export prices. The reply was deemed unreliable because information supplied concerned one sales transaction only which could not be satisfactorily verified. It was therefore considered that this company did not export the product concerned to the Community during the investigation period. (c) Comparison (110) Weighted average normal value by product type was compared with the export price for the corresponding type, on a transaction-by-transaction basis at an ex-works level and at the same level of trade. (111) For the purpose of a fair comparison, normal value was adjusted in accordance with the provisions of Article 2(9) and (10) of the Basic Regulation to take account of differences directly affecting price comparability. These adjustments concerned selling expenses arising from sales made under different conditions and terms of sale. Adjustments claimed for the above differences were limited to those for which satisfactory evidence was submitted that they had a direct relationship to the sales under consideration. (d) Dumping margins (112) The above comparison revealed the existence of dumping, the margins of dumping being equal to the amount by which the normal value, as established, exceeds the price for export to the Community. The weighted average dumping margins by producer, expressed as a percentage of the free-at-Community frontier prices, customs duty unpaid, are as follows. 23 Turkey Korteks-Mensucat Sanayi ve Ticaret A. S. Sasa-Artificial and Synthetic Fibres Inc. Taiwan Chung Shing Textile Co. Ltd Far Eastern Textile Hsin Pao Textile Co. Ltd Nan Ya Plastics Corporation Lea Lea Entreprise Co. Ltd Lanfa Textile Co. 7. 6% 8. 7% 5. 5% 6. 6% 0% 10. 6% 12. 9% 16. 1% (113) For the reasons given in recital (53), for producers which cooperated in the investigation but were found not to have exported during the investigation period, the weighted average dumping margin found for the cooperating producers which did export was considered appropriate. In the case of the Turkish producers hereby concerned, the margin amounts to 8. 3% and should apply to the company "Nergis-Tekstil Sanayi ve Ticaret". In the case of the Taiwanese producers hereby concerned, the margin amounts to 7% and is applicable to the following companies: Shingkong Synthetic Taiwanese Fibres Corp. and Zig Sheng Ind. Co. Ltd. (114) For those producers in the exporting countries concerned which neither replied satisfactorily to the Commission's questionnaire nor otherwise made themselves known, the dumping margin was determined on the basis of the facts available in accordance with Article 7(7)(b) of the Basic Regulation. In this respect, the most reasonable facts available were considered to be those established during the investigation. In order to avoid giving a premium for non-cooperation and to ensure that the measures introduced afford effective protection for the Community industry from unfair trade, it is considered appropriate to establish the dumping margin for the non-cooperating producers in each of the countries concerned at the level of the highest dumping margin found for the cooperating producers in the country in question. the low in view of is 8. 7%. However, On this basis, for Turkey, the highest dumping margin found for a cooperating level of cooperation of producer Turkish producers, evidenced by the fact that imports of non-cooperating producers represent 40% of total imports from Turkey during the investigation period, this dumping margin would constitute a bonus for non-cooperation in this proceeding. Accordingly, it is considered appropriate to calculate the dumping margin for non-cooperating producers in Turkey by reference to the highest dumping found for a type of PTY sold for export to the Community by the cooperating producers in that country. This dumping margin is 15. 2% and corresponds to a PTY type which represented more than 3% of total exports to the Community during the investigation period by one of the cooperating Turkish producers. Consequently, the dumping margin for non-cooperating producers in Turkey amounts to 15. 2%. 24 With regard to Taiwan, the highest dumping margin found for a cooperating producer in that country is 16 1%. This dumping margin is considered appropriate in the light of the high level of cooperation shown by Taiwanese producers. Indeed, exports of PTY by these producers represent 90% of total Taiwanese exports to the Community during the investigation period. Consequently, the dumping margin for non-cooperating producers in Taiwan amounts to 16. 1%. VI. COMMUNITY INTEREST (115) A determination as to whether the Community interest calls for intervention should be based on an appreciation of all the various interests taken as a whole, including those of the producers, users and consumers in the Community. In such an examination, the need to eliminate the trade distorting effects of injurious dumping and to restore effective competition should be given special consideration. (116) It has to be recalled that in the previous investigation, the adoption of measures was considered to be in the interest of the Community. It was stated that the measures would have a negligible effect on the production costs of the user industry and no serious consequences for consumers. (117) Those considerations remain valid in considering the extent to which it would be in the Community interest to maintain measures in force. No arguments were submitted by the users as to the impact of the price of PTY on the end product. Nevertheless, given the range of the measures proposed, the impact of the reviewed measures on the prices for the end products - mainly fabrics and carpets - has been estimated to be moderate. (118) On the contrary, to allow the measures to expire would put the Community industry at a risk since it would suffer increasingly from the dumped low prices of Taiwanese and Turkish imports without being able to redress its precarious financial situation. It thus appears that the interests of the Community industry by far outweigh the possible, and in any case limited, disadvantages for users and final consumers. (119) It is therefore concluded that Community interest calls for maintenance of the anti-dumping measures in force, duly amended to eliminate the injurious effects of dumped imports originating in Turkey and Taiwan and that those measures should continue to take the form of anti-dumping duties. VII. MEASURES (120) In order to provide adequate protection from continued injurious dumping by Turkish and Taiwanese imports and to prevent the recurrence of injury, it is considered that anti-dumping duties should be established in such a way as to allow the Community industry to realize the reasonable profit of which it has been deprived through the negative effects of the dumped imports. 25 (121) When calculating the adequate amount of duty, consideration was given to the precarious situation of the Community industry, which consisted mainly in loss of market share and substantial financial losses due to depressed prices resulting from price undercutting. It is thus necessary that the measures taken allow the Community industry to make a reasonable profit in the future. (122) In this regard, the price level considered adequate to remove injury was calculated on the basis of the weighted average cost of production of the Community industry, adding a profit of 6% regarded as reasonable for guaranteeing the industry productive investment on a long-term basis. This price level was then compared to the average import prices on a free-at-Community-frontier basis, duty paid. ( 123) Since the result of this comparison, for all producers in the countries concerned, shows higher injury margins than the respective dumping margins established, the duties should be based on the dumping margins found, HAS ADOPTED THIS REGULATION: Article Articles 1 and 2 of Regulation (EEC) No 3905/88 are replaced by the following: "Article 1 1. 2. A definitive anti-dumping duty is hereby imposed on imports of partially oriented polyester yarn (POY) falling within CN code 5402 42 00 and originating in Turkey. The rate of the duty applicable to the net, free-at-Community-frontier price, before customs clearance, shall be as follows: COUNTRY MANUFACTURER RATE OF DUTY ADDITIONAL TARIC CODE Turkey Sasa Artificial and Synthetic Fibres Inc. , Adana 3. 3% 8895 Korteks-Mensucat Sanayi ve Ticaret A S. , Bursa Nergis-Tekstil Sanayi ve Ticaret A S. , Bursa Others 3. 3% 3. 3% 6. 8% 8895 8895 8536 26 3 4. 1. 2. Definitive anti-dumping duties on imports of partially oriented polyester yarn (POY) falling within CN code 5402 42 00 and originating in Taiwan shall no longer apply. Unless otherwise specified, the provisions in force concerning customs duties shall apply. Article 2 A definitive anti-dumping duty is hereby imposed on imports of polyester textured filament yarn (PTY) falling within CN codes 5402 33 10 and 5402 33 90 and originating in Turkey and Taiwan. The rate of the duty applicable to the net, free-at-Community-frontier price, before customs clearance, shall be as follows: COUNTRY MANUFACTURER RATE OF DUTY ADDITIONAL TARIC CODE Taiwan Turkey 12. 9% 10. 6% 7% 7% 6. 6% 5. 5% 16. 1% 8. 7% 8. 3% 7. 6% 8893 8162 8163 8163 8894 8161 8164 8166 8167 8892 15. 2% 8170 Lea Lea Enterprise Co. Ltd, Taipei Nan-Ya Plastics Corporation, Taipei Shingkong Synthetic Fibres Corp. , Taipei Zig Sheng Ind. Co Ltd, Taipei Far Eastern Textile Ltd, Taipei Chung Shing Textile Co. Ltd, Taipei Others Sasa-Artificial and Synthetic Fibres Inc. , Adana Nergis-Tekstil Sanayi ve Ticaret. A. S. , Bursa Korteks-Mensucat Sanayi ve Ticaret. AS. , Bursa Others 27 with the exception of imports which are manufactured and sold for export to the Community by the following Taiwanese companies, which shall not be subject to any anti-dumping duty: TAIWAN MANUFACTURER Tuntex Distinct Corp. , Taipei Hsin Pao Textile Co. Ltd, Taipei RATE OF DUTY 0% ADDITIONAL TARIC CODE 8160 0% 8160 3. Unless otherwise specified, the provisions in force concerning customs duties shall apply. " Article 2 This Regulation shall enter into force on the day following that of its publication in the Official Journal of the European Communities. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Brussels, For the Council The President 28 ISSN 0254-1475 COM(96) 228 final DOCUMENTS EN 02 il Catalogue number : CB-CO-96-239-EN-C ISBN 92-78-04451-2 Office for Official PubHcations of the European Communities L-2985 Luxembourg

Proposal for a Council Regulation (EC) introducing specific measures for live plants and floricultural products

http://publications.europa.eu/resource/cellar/c51df330-767d-491a-8404-d1fa384df525

eng

COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 11. 06. 1996 COM(%) 261 final 96/0155(CNS) Proposal lor a COUNCIL REGULATION (EC) introducing specific measures for live plants and floricultural products (presented by the Commission) EXPLANATORY MEMORANDUM It is proposed that the Council should adopt this proposal for a Regulation establishing specific measures for live plants and floricultural products. The measures are designed to stimulate the disposal of Community products by stimulating their consumption. Both the Council and operators from the sector concerned meeting within the Advisory Committee for Live Plants have requested the development of Community promotion measures. At the moment, promotion measures are being conducted in certain Member States, in particular the Netherlands and Germany, and are financed by contributions from operators in the sector. Although these measures are very useful and effective, they are not adequate because of the high degree of commercial interdependence in the sector, both within the Community and at international level. In this context, there is an urgent need to coordinate existing national measures and to supplement them with appropriate measures covering all the Member States. This measure will be an indirect measure to be financed up to a maximum of 60% from the Community budget. The estimated cost of this proposal, to be financed by the EAGGF Guarantee Section is ECU 10 million per year. t Proposal for a COUNCIL REGULATION (EC) No of introducing specific measures for live plants and floricultural products THE COUNCIL OF THE EUROPEAN UNION Having regard to the Treaty establishing the European Community, and in particular Article 43 thereof, Having regard to the proposal from the Commission1, Having regard to the opinion of the European Parliament2, Whereas the production of live plants and floricultural products is a very important economic activity in a large number of countries of the European Union; Whereas, following an increase in production within the European Community and growth in imports from third countries, supply of such products is rising fast; whereas consumption should therefore be stimulated; Whereas there is potential for increasing consumption of Community products both within the Community and abroad, in particular by improving awareness among existing and potential users and by bringing production more closely into line with consumer requirements; Whereas the various groups working in the sector have a special role to play in implementing measures to encourage consumption; Whereas a Community financial contribution should be provided for to encourage specific measures to increase consumption, whereas provision should be made for the regular evaluation of the measures financed in order to monitor the achievement of their objectives; 1 OJ No C 2 OJ No C. Whereas the measures thus provided for are intended to stabilize the market in live plants and floricultural products; whereas, therefore, the expenditure arising from Community part- financing thereof should be deemed intervention within the meaning of Article 3 of Council Regulation (EEC) No 729/70 of 21 April 1970 on the financing of the common agricultural policy , HAS ADOPTED THIS REGULATION: Article 1 The Community may contribute to the financing of measures put forward and implemented by groups representing the sector to promote the consumption of Community live plants and floricultural products falling within CN code 06. Article 2 1. The measures referred to in Article 1 shall cover advertising and public-awareness measures, including the organization of and participation in fairs and other trade events, both within the Community and abroad. Where deemed necessary, such measures may be preceded by market studies of consumer attitudes and behaviour and may be accompanied, where appropriate, by the provision of marketing advice to operators in the sector. 2. The measures referred to in Article 1 shall not be designed to promote commercial brands or to favour products from a particular Member State. OJ No L 94, 28. 4. 1970, p. 13. Regulation last amended by Regulation (EC) No 1287/95 (OJ No L 125, 8. 6. 1995, p. 1). H Article 3 1. Contributions to the financing of the measures provided for in this Regulation shall be deemed intervention intended to stabilize the agricultural markets within the meaning of Article 3(1) of Regulation (EEC) No 729/70. 2 Such contributions may not exceed 60% of the actual cost of the measures. Article 4 The measures referred to in Article 1 may be granted Community funding for an period of no more than three years. An evaluation study shall be carried out in the final year. The study shall assess the extent to which the objectives referred to in Article 1 have been achieved and the advisability of pursuing the measure concerned. Article 5 The measures provided for in this Regulation shall be defined and the rules of application thereof shall be adopted in accordance with the procedure provided for in Article 14 of Council Regulation (EEC) No 234/68 of 27 February 1968 on the establishment of a common organization of the market in live trees and other plants, bulbs, roots and the like, cut flowers and ornamental foliage4. Article 6 This Regulation shall enter into force on the third day following its publication in the Official Journal of the European Communities. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at For the Council 4 OJNoL55, 2 3. 1968, p. 1. Regulation last amended by Regulation (EC) No 3290/94 (OJ No L 349, 31 12. 1994, p. 105). $ FINANCIAL STATEMENT Date BUDGET HEADING: Bl-38 (new heading planned for 1997 budget) APPROPRIATIONS: / 2 TITLE: Council Regulation introducing specific measures for live plants and floricultural products. LEGAL BASIS: Article 43 of the Treaty. AIMS: To promote the consumption of floriculture products. 5. FINANCIAL IMPLICATIONS: 5. 0. EXPENDITURE - CHARGED TO THE EC BUDGET (RBFyNBS/INTERVENTJON) - NATIONAL AUTHOR-fflES -OTHER 5. 1. REVENUE - OWN RESOURCES OF THE EC (LEVIES/CUSTOMS DUTIES) - NATIONAL 5. 0. 1. 5. 1. 1. ESTIMATED EXPENDITURE ESTIMATED REVENUE 5. 2. METHOD OF CALCULATION: PERIOD OF 12 MONTHS (ECU million) CURRENT FINANCIAL YEAR (96) (ECU million) FOLLOWING FINANCIAL YEAR (97) (ECU million) 10 (*) 1998 10 1999 10 2000 10 2001 10 Foreseeable expenditure: ECU 16. 67 million, of which 60% borne by the EAGGF: 10 million, divided as follows: Publicity. Public relations, fairs, etc. : Market studies: 6 million 3 million 1 million 6. 0 ! 6. 1. 6. 2. 6. 3. CAN THE PROJECT BE FINANCED FROM APPROPRIATIONS ENTERED IN THE RELEVANT CHAPTER OF THE CURRENT BUDGET? CAN THE PROJECT BE FINANCED BY TRANSFER BETWEEN CHAPTERS OF THE CURRENT BUDGET? WILL A SUPPLEMENTARY BUDGET BE NECESSARY? WILL FUTURE BUDGET APPROPRIATIONS BE NECESSARY? YES/NO YES/NO YES/NO YES/NO OBSERVATIONS (*) The purpose of the proposal is to establish the legal basis for a commitment given by the Commission to the Council. Appropriations have not as yet been provided for in the 1997 PDB. The proposal will therefore be implemented provided that appropriations are made available for 1997. ( FINANCIAL STATEMENT B1-380: Live plants and floricultural products 1. TITLE OF OPERATION Specific measures for live plants and floricultural products: promotion measures 2. BUDGET HEADING INVOLVED Bl-380 3. LEGAL BASIS Article 43 of the Treaty 4. DESCRIPTION OF OPERATION 4. 1 General objective To increase consumption of Community products by better informing consumers and by developing closer approximation between production (quality, presentation, packaging) and consumer requirements. 4. 2 Period covered and arrangements for renewal or extension The measures will apply for three-year periods (se Article 4 of the Regulation) 5. CLASSIFICATION OF EXPENDITURE OR REVENUE 5. 1 Compulsory expenditure 5. 2 Non-differentiated appropriations 6. TYPE OF EXPENDITURE OR REVENUE 60% Community financing for joint measures concerning two or more Member States. ? 7. FINANCIAL IMPACT 7. 1 Method of calculating total cost of operation (a) Community contribution: 60% of total budget = ECU 10 million; 0. 1% of production value, this figure being the average of the percentages calculated for the other agricultural sectors which have a promotion budget. (b) Member States contribution = 40% of total budget = ECU 6. 67 million. 7. 2 Itemized breakdown of cost in ECU million Breakdown 1997 1998 1999 2000 2001 TOTAL (a) Publicity (b) Public relations, including the organization of and participation in fairs, and other trade events (c) Market studies and advice [6,0] (60%) [3,0] (30%) [1,0] (10%) 6,0 6,0 6,0 6,0 30,0 3,0 3,0 3,0 3,0 15,0 1,0 1,0 1,0 1,0 5,0 TOTAL p. m. (*) 10,0 10,0 10,0 10,0 50,0 (*) The purpose of the proposal is to establish the legal basis for a commitment given by the Commission to the Council. Appropriations have not as yet been provided for in the 1997 PDB. The proposal will therefore be implemented provided that appropriations are made available for 1997 8. FRAUD PREVENTION MEASURES; RESULTS OF MEASURES TAKEN The fraud prevention measures will be laid down in the implementing Regulation which will have to be adopted. ELEMENTS OF COST-EFFECTIVENESS ANALYSIS 9. 1 Specific and quantifiable objectives; target population specific objectives: to encourage consumers to purchase more frequently live plants and floricultural products as presents but also and above all for their own use throughout the year. target population, existing and potential consumers of all ages and average income. & 9. 2 Grounds for the operation Promotion measures are currently being undertaken in certain Member States, in particular in the Netherlands and in Germany, financed by contributions from operators. Albeit very useful and effective, these are no longer adequate because of the close commercial interdependence of the sector at intra-Community and international levels. It is therefore vital to coordinate existing national measures and to supplement them with appropriate measures covering all Member States 9. 3 Monitoring and evaluation of the operation Tenders must contain an ex-ante evaluation of the cost-effectiveness of the proposed measures. An evaluation will be carried out during the third year (see Article 4 of the Regulation). A report evaluating the results obtained must be presented by the contracting party when the balance is requested (conditions to be fixed in the implementing regulation mentioned in point 8). 10. ADMINISTRATIVE EXPENDITURE p. m. 3 ISSN 0254-1475 COM(96) 261 final DOCUMENTS EN 03 Catalogue number : CB-CO-96-271-EN-C ISBN 92-78-05268-X Office for Official Publications of the European Communities L-2985 Luxembourg yl*>

96/366/EC: Council Decision of 11 June 1996 on the implementation of Article 8 of the Agreement in the form of an Exchange of Letters between the European Economic Community and the Principality of Andorra

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L_1996145EN. 01001601. xml 19. 6. 1996    EN Official Journal of the European Communities L 145/16 COUNCIL DECISION of 11 June 1996 on the implementation of Article 8 of the Agreement in the form of an Exchange of Letters between the European Economic Community and the Principality of Andorra (96/366/EC) THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 113 thereof, Having regard to the proposal from the Commission, Whereas Article 8 (1)(a) of the Agreement in the form of an Exchange of Letters between the European Economic Community and the Principality of Andorra (1), signed in Luxembourg on 28 June 1990, stipulates that over a period of five years and beyond that period if no agreement can be reached in accordance with 1 (b), the Principality of Andorra authorizes the Community, acting on behalf of and for the Principality of Andorra, to enter goods sent from third countries to the Principality of Andorra for free circulation; Whereas Article 8 (1)(b) stipulates that at the end of that period, and pursuant to Article 20 thereof, the Principality of Andorra may exercise right of entry for free circulation, following agreement by the Contracting Parties; Whereas the Principality of Andorra has requested to exercise such right of entry for free circulation; Whereas in a statement of 30 October 1995 the Council agreed in principle to the Principality of Andorra's request to exercise that right; Whereas it is for the Council to establish the Community's official position as a Contracting Party; Whereas a period of time should be allowed for the preparations for exercising the said right, HAS DECIDED AS FOLLOWS: Sole Article From 1 July 1996, the European Community, acting on behalf of and for the Principality of Andorra, shall cease to ensure entry for free circulation of goods sent from third countries to the Principality of Andorra. Done at Luxembourg, 11 June 1996. For the Council The President W. VELTRONI (1)  OJ No L 374, 31. 12. 1990, p. 16

Re-examined proposal for a COUNCIL DIRECTIVE on the interoperability of the trans-European high-speed railway system

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 10 06 1996 COM(%) 249 final 94/0112 (SYN) Re-examined proposal for a COUNCIL DIRECTIVE on the Interoperability of the trans-European high-speed railway system (presented by the Commission pursuant to Article 189 c (d) of the EC Treaty) A. EXPLANATORY MEMORANDUM On 8 December 1995, the Council unanimously adopted a common position [(EC) No 36/95 (1)] on the adoption of a Council Directive on the interoperability of the trans-European high-speed railway system. This Directive is based on the Com mission proposal [COM(94)0107 of 15 April 1994(2)], as modified, following first reading by the European Parliament, by the amended proposal [COM(95)0271 of 15 June 1995(3)]. At its plenary session of 15 - 19 April 1996, the European Parliament adopted, on second reading, eight amendments to the text of the Council's common position, numbered 1 to 4 and 9 to 12. Amendment No 1 adds to the first recital, stressing, in line with Article 129b of the Treaty, the aim of the interoperability of the entire European rail network. The Commission approved this amendment, as progressive convergence toward the interoperability of the European rail network as a whole will further the develop ment of the railway sector. Amendment No 2 adds to the third recital, opening up a global vision of the rail transport network schemes and indicating that, in future, proposals for the inter operability of the conventional rail network will be submitted by the Commission. The Commission approved this amendment, while making the requisite editing alterations, as it accords with the aims it set out in the explanatory memoran dum to its "proposal for a European Parliament and Council Decision on Com munity guidelines for the development of the trans-European transport network" [COM(94)0106 of 7 April 1994 W]. Amendment No 3 modifies the fifth recital, specifying that, beyond passenger transport, ways and means need gradually to be found for the network to carry ra pid goods services. The Commission approved this amendment, especially as the whole area of the high-speed transportation of rapid services or urgent or pe rishable goods is under study in a number of Member States. <1) (2) (3) W OJ No C 356 of 30. 12. 1995, p. 43. OJ No C 134 of 17. 05. 1994, p. 6. OJ No C 203 of 08. 08. 1995, p. 13. OJ No C 220 of 08. 08. 1994, p. 1. -2 Amendment No 4 adds to the fifth recital, specifying that access to the European high-speed train network must be rendered easier. The Commission approved this amendment as it accords with its vision of a "citizens' network". It is also in line with the opinion delivered by the Economic and Social Committee, which was approved on 23 November 1994 [ESC 1297/94 (5)]. Amendments No's 9 and 12 relate to Article 7, which deals with derogations from the Directive. They propose, in view of the major economic considerations invol ved, the application of one and the same vetting procedure for all four derogations allowed under this Article. The Commission approved these amendments, while making the requisite editing alterations, as it sees them as recognition of the fact that all the derogations under this Article relate to economic considerations. Amendment No 10 overhauls Article 21. It replaces the advisory committee pro cedure contained in the Council's common position by the consultative committee procedure advocated by the Commission in its original proposal. The Commis sion approved this amendment, while making the requisite editing alterations, as it makes for a simpler and faster procedure. Amendment No 11 adds an essential requirement to Annex III aimed at the con sumer protection. The Commission approved this amendment, as it sees inter operability of the trans-European high-speed rail system as an urgent necessity, not just for technical reasons but also to meet the needs of citizens. « OJ No C 3*7 of 31. 12. 1994, p. 8. • 3- B. RE-EXAMINED PROPOSAL /. Preamble 1. The following recital is added following the first recital : "Whereas, with a view to making a people's Europe a reality, this Di rective represents the first step towards the interoperability of the entire European railway network ;" 2. The following recital is added following the third recital : "Whereas in April 1994 the Commission submitted a proposal for a European Parliament and Council Decision on Community guidelines for the development of the trans-European transport network (6), which also includes network schemes for the conventional railway network ; whereas, therefore, once this decision enters into force, the Commis sion retains the option of submitting proposals for the interoperability of the conventional rail network, in particular with a view to removing obstacles to trans-frontier local and regional traffic ;" 3. The fifth recital is replaced by the following : "Whereas the commercial operation of high-speed trains requires ex cellent compatibility between the characteristics of the infrastructure and those of the rolling stock ; whereas performance levels, safety, quality of service and cost depend upon such compatibility as does, in particular, the interoperability of the European high-speed rail system ; whereas, although the high-speed network is designed primarily for passengers, the intention is that ways and means should gradually be found of enabling the network to carry rapid goods services ; Whereas passengers must have easy access to the whole European high-speed railway network ; whereas, therefore, the interoperability of the ticketing, reservation and information systems of the European high-speed railway network must also be guaranteed ;" <6> COM(94)0106 of 07. 04. 1994 (OJ No C 220 of 08. 08. 1994, p. 1. ) - 4- //. The text proper 1. The text of the introductory part to Article 7, and paragraphs (a), (b) and (c) thereof remain unchanged. 2. The text of paragraph (d) of Article 7 is replaced by the following : "(d) in the case of a project for upgrading an existing line for high-speed, where application of these TSIs compromises the economic viability of the project. The Member State concerned shall notify its intended de rogation to the Commission in advance and shall forward to it a file setting out the technical specifications or parts of specifications for interoperability which it wishes not to apply. " 3. The following paragraph 2 is added to Article 7 : "2. In the cases referred to under (a) to (d) the Commission shali exa mine whether the measures envisaged by the Member State are justified and shall take a decision in accordance with the proce dure in Article 21 (2). " 4. The text of Article 21 is replaced by the following : " 1. The Commission shall be assisted by an advisory committee for rail transport, composed of the representatives of the Member States and chaired by the representative of the Commission. 2. The representative of the Commission shall submit to the standing committee a draft of the measures to be taken. The committee shall deliver its opinion on the draft - if necessary, by taking a vote - within a time limit which the chairman may lay down accor ding to the urgency of the matter. The opinion shall be recorded in the minutes; in addition, any Member State may request that its position be recorded in the minutes. The Commission shall take account of the committee's opinion as far as possible. It shall inform the committee how it has taken ac count of its opinion. - S~ 3. The committee may discuss any matter concerning the interopera bility of the European high-speed rail system. 4. Should it prove necessary, the committee may set up working par ties to aid it in carrying out its tasks, in particular with a view to contributing to the coordination of the notified bodies. " ///. Annexes The text of Annex III is supplemented, after § 2. 7. 3. , by the following text : "2. 8. Users 2. 8. 1. Consumer protection Information and offers concerning services must be transparent and guaranteed throughout the European high-speed rail network. " - 6- ISSN 0254-1475 COM(96) 249 final DOCUMENTS EN 07 Catalogue number : CB-CO-96-257-EN-C ISBN 92-78-04827-5 Office for Official Publications of the European Communities L-2985 Luxembourg *}

OPINION OF THE COMMISSION pursuant to Article 189 b (2) (d) of the EC Treaty, on the European Parliament' s amendments to the Council' s common position regarding the proposal for a EUROPEAN PARLIAMENT AND COUNCIL REGULATION (EC) laying down a Community procedure for flavouring substances used or intended for use in foodstuffs

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 10 06 1996 COM(96) 270 final - COD 478 OPINION OF THE COMMISSION pursuant to Article 189 b (2) (d) of the EC Treaty, on the European Parliament's amendments to the Council's common position regarding the proposal for a EUROPEAN PARLIAMENT AND COUNCIL REGULATION (EC) laying down a Community procedure for flavouring substances used or intended for use in foodstuffs. AMENDING THE PROPOSAL OF THE COMMISSION pursuant to Article 189 a (2) of the EC Treaty On 22 May 1996 the European Parliament adopted 2 amendments to the common position adopted by the Council on 22 December 1995 in respect of the Commission proposal for a Regulation of the European Parliament and the Council laying down a Community procedure for flavouring substances used or intended for use in foodstuffs1. In accordance with paragraph 2 (d) of Article 189b of the EC Treaty, the Commission is able to give a favourable opinion on the 2 amendments adopted by Parliament for the following reasons: the Commission can accept the addition of a recital on the re-evaluation by the Scientific Committee for Food of already authorised flavounng substances, produced by different methods. This principle is already applied in the directive on purity criteria for food additives recently adopted by the Commission. the Commission can accept the amendment concerning the designation of substances in the positive list. The Commission agrees that intellectual property shall be protected. It will however be necessary to elaborate an appropriate and transparent procedure which at the same time protects intellectual properties and the interests of the consumer. 1 COM (93) 609 final; COD 478; O J. N °C 1„ 4. 1. 1994. COM (94) 236 final; O. J. N° C 171. 24. 6. 1994, p. I 1 Amended proposal for a EUROPEAN PARLIAMENT AND COUNCIL REGULATION (EC) laying down a Community procedure for flavouring substances used or intended for use in foodstuffs. (presented by the Commission pursuant to Article 189 A (2) of the EC Treaty) - 3- Current Proposal Amended Proposal Recital 9 Whereas this list must be open-ended and Whereas this list must be open-ended and capable of being amended in the light of capable of being amended in the light of scientific and technical developements scientific and technical developements. flavouring Whereas already authorised substances, which are to be produced in processes or with primary substances which were not the basis for the Scientific Committee for Food's assessment, shall be resubmitted to the Scientific Committe for Food for a complete assessment. Article 3(2) 1, and in paragraph On the basis of the notification provided for following Commission scrutiny of the notification, in the light of subparagraph (c), flavouring substances, the legal use of which in one Member State must be recognized by the other Member States shall be entered in a register which in accordance with the procedure laid down in Article 7 within a year of the end of the notification in paragraph 1. If necessary, this register may comprise conditions of use. shall be adopted provided period for 1, and in paragraph On the basis of the notification provided for following Commission scrutiny of the notification, in the light of subparagraph (c), flavouring substances, the legal use of which in one Member State must be recognized by the other Member States shall be entered in a register which in accordance with the procedure laid down in Article 7 within a year of the end of the notification in paragraph 1. If necessary, this register may comprise conditions of use. shall be adopted provided period for Flavouring substances shall be designated in such a way as to protect the intellectual flavouring of property substances' producer. rights the ISSN 0254-1475 COM(96) 270 final DOCUMENTS EN m Catalogue number : CB-CO-96-280-EN-C ISBN 92-78-05358-9 Office for Official Publications of the European Communities L-2985 Luxembourg

Amended proposal for a EUROPEAN PARLIAMENT AND COUNCIL REGULATION (EC) laying down a Community procedure for flavouring substances used or intended for use in foodstuffs

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 10 06 1996 COM(96) 270 final - COD 478 OPINION OF THE COMMISSION pursuant to Article 189 b (2) (d) of the EC Treaty, on the European Parliament's amendments to the Council's common position regarding the proposal for a EUROPEAN PARLIAMENT AND COUNCIL REGULATION (EC) laying down a Community procedure for flavouring substances used or intended for use in foodstuffs. AMENDING THE PROPOSAL OF THE COMMISSION pursuant to Article 189 a (2) of the EC Treaty On 22 May 1996 the European Parliament adopted 2 amendments to the common position adopted by the Council on 22 December 1995 in respect of the Commission proposal for a Regulation of the European Parliament and the Council laying down a Community procedure for flavouring substances used or intended for use in foodstuffs1. In accordance with paragraph 2 (d) of Article 189b of the EC Treaty, the Commission is able to give a favourable opinion on the 2 amendments adopted by Parliament for the following reasons: the Commission can accept the addition of a recital on the re-evaluation by the Scientific Committee for Food of already authorised flavounng substances, produced by different methods. This principle is already applied in the directive on purity criteria for food additives recently adopted by the Commission. the Commission can accept the amendment concerning the designation of substances in the positive list. The Commission agrees that intellectual property shall be protected. It will however be necessary to elaborate an appropriate and transparent procedure which at the same time protects intellectual properties and the interests of the consumer. 1 COM (93) 609 final; COD 478; O J. N °C 1„ 4. 1. 1994. COM (94) 236 final; O. J. N° C 171. 24. 6. 1994, p. I 1 Amended proposal for a EUROPEAN PARLIAMENT AND COUNCIL REGULATION (EC) laying down a Community procedure for flavouring substances used or intended for use in foodstuffs. (presented by the Commission pursuant to Article 189 A (2) of the EC Treaty) - 3- Current Proposal Amended Proposal Recital 9 Whereas this list must be open-ended and Whereas this list must be open-ended and capable of being amended in the light of capable of being amended in the light of scientific and technical developements scientific and technical developements. flavouring Whereas already authorised substances, which are to be produced in processes or with primary substances which were not the basis for the Scientific Committee for Food's assessment, shall be resubmitted to the Scientific Committe for Food for a complete assessment. Article 3(2) 1, and in paragraph On the basis of the notification provided for following Commission scrutiny of the notification, in the light of subparagraph (c), flavouring substances, the legal use of which in one Member State must be recognized by the other Member States shall be entered in a register which in accordance with the procedure laid down in Article 7 within a year of the end of the notification in paragraph 1. If necessary, this register may comprise conditions of use. shall be adopted provided period for 1, and in paragraph On the basis of the notification provided for following Commission scrutiny of the notification, in the light of subparagraph (c), flavouring substances, the legal use of which in one Member State must be recognized by the other Member States shall be entered in a register which in accordance with the procedure laid down in Article 7 within a year of the end of the notification in paragraph 1. If necessary, this register may comprise conditions of use. shall be adopted provided period for Flavouring substances shall be designated in such a way as to protect the intellectual flavouring of property substances' producer. rights the ISSN 0254-1475 COM(96) 270 final DOCUMENTS EN m Catalogue number : CB-CO-96-280-EN-C ISBN 92-78-05358-9 Office for Official Publications of the European Communities L-2985 Luxembourg

REPORT FROM THE COMMISSION TO THE COUNCIL - THE TOMATO MARKET IN THE EUROPEAN UNION

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 10. 06. 1996 COM(96) 247 final REPORT FROM THE COMMISSION TO THE COUNCIL THE TOMATO MARKET TN THE EUROPEAN TJNTON EXPLANATORY MEMORANDUM At the Council meeting on agriculture on 19 and 22 June 1995 and during discussion of the 1995/96 price package, the Council asked the Commission to present a report on the situation in the tomato sector in the European Union. The Commission is now in a position to send the Council this report, which was written on the basis of a survey carried out by the Commission in the Member States to compare and confirm existing information and gather information which it did not then have at its disposal. This report confines itself to an analysis of the market for fresh tomatoes and does not deal with tomatoes for processing. There have been difficulties on the tomato market in recent years, particularly for greenhouse tomatoes, which are faced with market reorganization resulting from the new situation which has pertained since 1993, when Spain's transitional accession period for this product ended. This report also analyses Community assistance to production and marketing structures, which does not seem to have had a significant impact on production trends. It also covers national aid schemes entirely financed by Member States and granted specifically to the tomato sector. One conclusion of the report is that natural market development should reestablish sufficient equilibrium without Community intervention. However, in the past the Commission has not objected to national aid to dismantle production potential, and such aid could be applied in the case of greenhouse production. I INTRODUCTION SUMMARY I. ANALYSIS OF THE COMMUNITY TOMATO MARKET 1. -The world market 2. -The European market 2. 1 relative importance of the tomato sector in horticulture 2. 2 Community production 2. 3 Situation and development of production structures consumption and marketing 2. 4 2. 5 Producer prices 3. -Trade trade within the EC imports to the EC 3. 1 3. 2 3. 3 Community exports II. COMMUNITY AID 1. 2. Structural aid National aid CONCLUSIONS ANNEXES: 1. Production regions: -Belgium -the Netherlands -Spain -France 2. Statistics 3. Structural annex V4 INTRODUCTION At the Council meeting on agriculture of 19 and 22 June 1995, and in the context of discussion of the 1995/96 price package, the Council asked the Commission to present a report on the situation in the tomato sector in the European Union. This report was written on the basis of a survey carried out by the Commission in the Member States to compare and confirm existing information and gather information which it did not then have at its disposal. The period analysed covers the five years from 1990 to 1994. This period includes three marketing years during which Spain was still subject to the transitional accession rules for this product, and therefore subject to offer prices, and two marketing years, 1993 and 1994, during which Spain only retained a statistical system for monitoring consignments (supplementary trade mechanism). This report confines itself to an analysis of the market for fresh tomatoes and does not deal with tomatoes for processing, which are considered to be a different product as regards both production and marketing conditions. SUMMARY The tomato has increasingly become a staple vegetable in the European diet. It occupies an important place in the Community's agricultural economy (14. 7% of the total volume of vegetables). It accounts for ECU 9. 4 million of the Community budget, which are used for Community intervention on the market. Since 1990, Community production and the area planted with tomatoes have been falling. Yields, on the other hand, have been increasing at a remarkable pace because of developments in growing techniques. The trend in future will be towards more specialised production and a reduced number of enterprises. The increase in consumption that started in 1990 seems to have reached a plateau. Nevertheless, the trend in consumption is towards variety and quality, with demand for new types and varieties, with a more "open air" flavour. Adapting production to this new demand appears to be one of the ways in which production in the northern countries can be made more dynamic and better face the strong competition of the southern countries. Major seasonal fluctuations continue to be a key feature of this sector. Overall the price trend on wholesale markets is falling; however, there was a relative increase in rates for 1994. Although definitive figures are not available, it seems that prices have again fallen in 1995, in particular for greenhouse tomatoes produced in the north of the Community. This fall is due primarily to a fall in prices for the "traditional round" tomato, whereas for new "high value-added" varieties (tomatoes on the stalk and cherry tomatoes), producer prices are very attractive. The volume of production of these new varieties is rising. There is no indication that the fluctuations in value of certain weak currencies have any significant impact on the price of tomatoes coming from countries where devaluation has taken place (Spain, in particular). Community assistance, which has fallen overall since 1990, has been used only as a safety net for the market and in no instance as a source of income, since very little recourse has been taken to that option (1. 6% on average). Community trade has increased by 27% since 1990. This is mainly as a result of the increase in Spanish consignments. The restructuring of production calendars is at the root of certain seasonal difficulties experienced by the sector between the northern and southern regions. Until 1994, the winter period (January, February, March) was almost entirely covered by Spanish (including the Canaries) and Moroccan production, while summer corresponded to the production season of the northern Member States ( Belgium, the Netherlands and, to some extent, France). When the transitional accession period finished for Spain in 1993, restrictions on that country's prices also stopped, and the Spaniards now have full rights to sell their products to other countries during the so-called sensitive months (April, May and June), which has led to substantial overlapping with marketing of northern tomatoes. On the other hand, greenhouse producers are trying to secure part of the "winter market" using new cultivation techniques and high value-added varieties which require major investments. Imports from third countries, in particular Morocco, are sold principally on the French market. These imports do not seem to be disturbing the market. Moreover, since 1995 they have taken place in the context of the bilateral agreement with Morocco. Community aid for production and marketing structures does not seem to be having a significant effect on production trends. These have been much more influenced by normal market fluctuations, and in particular changing trends in intra- Community trade. On the other hand, the Commission does not have information on aid schemes entirely financed by Member States and specifically granted to the tomato sector. In the overall context of national aid, the sector has benefited from general aid schemes for agriculture and regional development. 1. THE WORLD MARKET World production of tomatoes is 18% of the volume of world vegetable production. According to FAO figures, world tomato production (including tomatoes for processing) rose from 50 million tonnes in 1990 to 74. 3 million tonnes in 1993. International trade in fresh tomatoes accounts for less than 4% of world production, while tomatoes for processing account for about 30%. The low volume of exports of tomatoes for consumption unprocessed shows that the bulk of tomatoes produced in the world are intended for consumption on domestic markets. Indeed, certain characteristics of tomatoes mean that they are not very well adapted to international trade: they are very perishable and the production periods in importing and exporting countries overlap, while prices vary greatly according to season. The main producers are the European Union, the United States, the former Soviet Union, China and Turkey. The European Union is the leading producer, accounting for 13. 4 million tonnes, of which 6. 9 million, or 48. 5% of total production, are for sale on the fresh tomatoes market. 1 Trade in fresh tomatoes is highly developed in Europe, which also contains the world's biggest exporters, namely the Netherlands, Spain and Belgium, and its biggest importers, namely Germany, France and the United Kingdom. 2. THE COMMUNITY MARKET 2. 1. Importance of the tomato sector in horticulture Fresh tomatoes are an important product in the horticultural sector. The fact that they are consumed by Europeans throughout the year means that they can be considered a "staple vegetable". They account for 14. 7% of all vegetables produced in the Union. On average, 13% of the Union's horticultural area is devoted to tomatoes. 1 for the period 1990 to 1994. The average cost to the Community budget is ECU 9. 4 million2 for market intervention measures, accounting for 1. 2% of the budget for the fresh fruit and vegetables sector. The quantities withdrawn from the market have fallen overall since 1990 and on average make up 1. 6 % of tomatoes produced for eating fresh from 1990 to 1994 Over that period, France withdrew 3% of its production, followed by the Netherlands (2. 8%) and Italy (2. 6%). 2. 2. Community production On average, 48. 5% of Community tomato production is for consumption unprocessed. Italy (29. 8%) leads among Europe's fresh tomato producers, followed by Spain (27. 4%), Greece (10%) and the Netherlands ( 9%). Until 1990 production was increasing, but it then fell from 7 million tonnes that year to 6. 3 million tonnes in 1994. Production fell substantially from the 1993 marketing year, in particular in Spain, Italy and the Netherlands. On the other hand, in Belgium and Greece production has increased since 1990. Table 1: Tomato production trends (tonnes) 1988 1989 1990 1991 1992 1993 1994 Belgium 205030 225 220 268 400 313960 329 500 346 779 309 334 Greece Spain France Italy 666910 728 050 665790 710700 754 940 784 850 757 250 1 834 893 1 987 763 2 024 695 1 793832 1 880143 1 912 300 1 786 807 417500 421 700 461 100 527 300 516 900 643 400 492 600 1 594 916 2 018 230 2 657 083 2 759 091 2 712 099 1 984 572 2 149 074 Netherlands 567 029 620 782 640 725 636149 651 994 606 612 540 577 Portugal 63 893 80 835 86 706 72 625 64 267 n. a. 75 000 EUR-15 5. 530. 068 6. 265. 710 6. 987. 534 6. 993. 597 7. 098. 801 6. 651. 347 6. 262. 412 2average for the years 1990 to 1994. In 1994 the cost to the budget was ECU 4. 46 million, or 0. 5 % of the budget for the fresh fruit and vegetables sector. Table 2: Trends in production as a proportion of total EUR production (%) 1988 1989 1990 1991 1992 1993 1994 Belgium Greece Spain France Italy Netherlands 3. 7 12 33 7. 5 28. 7 10. 2 3. 6 11. 5 31. 4 6. 7 31. 9 9. 8 3. 8 9. 4 28. 7 6. 5 37. 7 9. 1 4. 5 10. 1 25. 4 7. 5 39. 1 9 4. 6 10. 5 26. 3 7. 2 37. 9 9. 1 5. 2 11. 7 28. 5 9. 6 29. 6 9 4. 9 12 28. 2 7. 8 33. 9 8. 5 2. 3. Situation and development of production structures Open-air cultivation is practised in the southern countries, in particular in Italy, Spain, Greece, the south of France and Portugal. Growing under plastic is a recent variation on open-air production, consisting in protecting the crops under plastic tunnels. These are used principally to protect the crops from wind and optimise production quality. Greenhouse cultivation is practised in the northern countries, in particular in the Netherlands, Belgium and part of France. This type of cultivation allows crops to be kept warm artificially during the coldest periods. The total Community area devoted to tomato production has been falling since 1990 (from 255 000 ha in 1990 to 217 000 ha in 1994). This reduction is partly the result of a fall in the area used for traditional "open air" production in the southern countries, and coincides with an increase in yields and the introduction of new varieties. The largest area devoted to tomato growing is in Italy, which accounts for 50. 6% of the total area, followed by Spain with 25. 5% and Greece with 14. 9%. The total area devoted to production under cover in the Community accounts for only 9% of the total area used for fresh tomato production. In Belgium and the Netherlands, all production area is under glass. That area has been falling steadily in the Netherlands since 1990, while in Belgium it has increased slightly. In Spain 16. 6% of total production area is under cover, in Italy 5. 3% and in France 60%. The overall area fell by around 17. 7% from 1990 to 1994. The decrease was greatest in France (-38. 9%), followed by the Netherlands (-29. 2%), Greece (-20%) and Spain (-13. 4%). 10 Table 3: Trends in area devoted to tomato production (hectares) 1990 1991 1992 1993 1994- Belgium 940 945 963 946 954 Greece Spain France Italy 38 513 39 015 36 657 33 110 32 083 69 884 59 913 55 802 57 111 61 613 6 600 6 650 5 960 6 060 4 750 136 378 129 669 117 595 113 426 115 248 Netherlands 1 603 1 570 1 505. 1 390 1 241 The different production techniques practised lead to enormous differences in yield between each type of holding. The tables below show the difference between "open-air" yields - 50 tonnes/ hectare - and "greenhouse" yields - 400 tonnes/hectare. Overall, between 1990 and 1994 yields increased by 2% per year for both types of production. These major increases in yield are the result principally of improved understanding of growing techniques, new, more productive varieties now on the market and new technologies that have come into use for crops under cover. Table 4: Trends in tomato yields (tonnes/ha) Belgium Greece Spain France Italy 1988 1989 1990 1991 1992 1993 1994 238. 8 246. 1 285. 5 332. 2 342. 2 366. 6 324. 2 45. 5 42. 8 108. 2 41 53. 2 44. 9 113 45. 5 45. 6 45. 2 48. 4 44. 5 51. 2 47. 4 52. 4 49. 1 119. 3 127. 7 128. 2 145. 4 45. 7 47. 7 50. 5 48. 4 52. 6 49. 8 162 50. 4 Netherlands 330. 6 368 399. 7 405. 2 433. 2 436. 4 435. 6 2. 4. Consumption and marketing According to the information supplied by the Member States, consumption has increased since 1990. However, this trend is not necessarily indicative for the future, for which tomato farmers tend to predict a levelling off of consumption. 11 The average per-capita consumption of fresh tomatoes in the European Union is 24. 6 kg3. This is far below the per-capita consumption level of 31 kg recorded for the OECD countries. Greece is the biggest consumer of fresh tomatoes, followed by Italy and Spain. It should, however, be noted that fresh tomato consumption fell sharply in Spain in 1994. The above table also shows that consumption is not uniform across the Community, quite the contrary. The differences between Member States are considerable. There is a ratio of 1:15 between the lowest and the highest Member State consumption levels. There is a fairly marked growth in consumer preference for new varieties such as tomatoes on the stalk, cherry tomatoes or varieties with the most "open-air" flavours. As a rule, Member States with high production levels also have high consumption levels, but the latter remain more or less constant. Member State Belgium Denmark Germany Greece Spain France Ireland Italy Luxembourg Netherlands Portugal United Kingdom Austria Finland Sweden Table 5: Consumption of fresh tomatoes (kg per capita) 1988 1989 1990 1991 1992 1993 10. 9 5. 9 13. 9 66. 0 37. 0 10. 0 6. 0 59. 4 / 6. 1 / 6. 4 / 8. 3 1 9. 5 / 14. 8 72. 0 40. 8 10. 3 6. 0 62. 1 / 6. 2 / 6. 6 / 8. 5 / 11. 8 5. 5 15. 4 65. 0 43. 6 10. 4 6. 0 64. 4 / 6. 5 / 6. 4 / 9. 1 / 14. 0 / 15. 3 69. 0 37. 2 10. 6 6. 0 63. 3 / 6. 7 / 5. 9 / 8. 7 / 11. 7 / 15. 7 73. 0 36. 5 / 6. 0 57. 6 / 6. 6 / 6. 0 / 9. 0 / 13. 5 5. 0 16. 0 76. 0 35. 3 / / 57. 1 / 6. 7 / 4. 5 / 9. 0 'I 1994 / / 14. 1 73. 0 28. 3 / / 55. 6 / 6. 0 / 5. 5 / 9. 7 ' Different varieties of tomatoes are used to satisfy demand from European consumers, who are increasingly seeking a wide range of differentiated products. This means that producers have to work harder to adapt to this segmentation of the market by growing new varieties. average for 1990 to 1994. 12 Over recent years the number of varieties has increased, and includes the "cherry" tomato and tomatoes on the stalk which have been very successful because of their flavour and the visible evidence that they are fresh. The production of tomatoes to be consumed fresh, as opposed to production for processing, is spread over the entire year, which has been made possible by new production techniques and new varieties of tomato. 2. 5 Producer prices The most striking feature of prices for fresh tomatoes is their variation according to season. Producer prices vary greatly according to the month of production and the Member State in which the tomatoes are produced. As a rule, prices are higher in winter than from May to November and remain at stable levels throughout the winter. Overall, prices for fresh tomatoes fell from 1990 to 1994, when they recovered slightly. In the 1991 marketing year, prices rose above 1990 levels. However, they fell in Spain, Italy and Portugal. In this year production, the area planted with tomatoes and yield also rose overall. The 1992 marketing year was the first in which prices fell. They did so most sharply in Spain, Belgium, the Netherlands and the United Kingdom. In 1993 the downward price trend continued. Production fell despite an increase in the area planted. In 1994 prices were up on the preceding year. The rise was particularly marked in the Netherlands and France, where prices recovered very well, even going beyond 1990 levels. In Italy, Belgium and Portugal, on the other hand, prices recovered slightly without reaching 1990 rates. In Spain and the United Kingdom, price quotations remained at very low levels. 13 Table 6 on price trends by month shows a deviation from the main trend, whereby for Spain, the Netherlands and Belgium May and June prices have risen since 1990, while March and April prices have fallen. However, in 1994, March and April prices recovered substantially. Table 6: Development of monthly prices in relation to 1990 I. Spain 1990 1991 1992 1993 1994 March April May June 2. Netherlands 100 100 100 100 44 79 189 133 64 72 160 101 70 116 181 105 March April May June 3. Belgium March April May June 1990 1991 1992 1993 1994 100 100 100 100 77 110 94 159 68 79 126 123 53 74 96 109 1990 1991 1992 1993 1994 100 100 100 100 73 106 92 128 67 85 130 110 59 77 101 96 88 95 132 146 77 91 104 148 78 86 99 123 Source: Drawn up by DG VI using figures from the Ministry of Agriculture (Spain), the CBT and the VBT. Producers in the North complained of falls in prices in 1995 which made businesses unprofitable. This situation appears to have affected all greenhouse production, and is therefore not exclusively associated with the tomato sector. An illustration of this problem is provided by the following figures for traditional round tomatoes in Belgium: costs (investments, production and labour): 1 400 to 1 500 BFR/m2. Normal yield is around 55 kg/m2, a high yield around 60 kg/m2; this means that in order to obtain a financial result sufficient to cover costs, a price level of at least 23 BFR/kg must be reached (1 400 BFR costs and 60 kg production) for the very good enterprises. The average price in Belgium was apparently 20 BFR/kg for 1995. 4 4Figures provided by the Member State. 14 "Belgian" tomatoes are in competition with "Spanish" tomatoes, which load price trends on the French market (55% of Belgian exports). An examination of Spanish prices in pesetas shows that there have been major changes, independently of monetary problems. In terms of trends, the regression line from January 1992 to April 1995 shows that developments in peseta prices run almost parallel to currency devaluations. On average over 40 months, the ecu/Pta rate increased fairly steadily by a total of 32%, while prices in pesetas increased, with major variations, by 51 %. This means that the price of Spanish tomatoes in ecus increased by around 14% over that period. There is, therefore, no indication that devaluations of the peseta have had an impact on the price in ecus, or, therefore in Belgian francs, of Spanish tomatoes. Spanish tomatoes Influence of monetary changes on prices • 1ecu=. PTA <• Prix Pte/Kg 1 2 3 4 5 6 7 89 10 11 12 1 2 3 4 5 6 7 89 10 11 12 1 2 3 4 5 6 7 89 10 11 12 1 2 34 January 1992/ April 1995 15 3. ANALYSIS QF TRADÇ 3. 1 Trade within the Community Community trade (including the Canaries) has increased in volume by 27% since 1990. The volume of trade is 1. 3 million tonnes, or 2 1% of total production. Spain accounted for the bulk of intra-Community trade in 1994, with 618 000 tonnes of consignments (of which 306 000 came from the Canaries); it should also be noted that this country has doubled its consignments since 1990. The runners-up were the Netherlands with 410 000 tonnes and Belgium with 160 800 tonnes5. The main Community markets receiving these consignments are in Germany, the United Kingdom and France. Consignments from the Netherlands and Belgium have fallen since 1990, particularly during the 1993 marketing year, after which there was a slight recovery in 1994. French and Italian consignments, on the other hand, maintained their levels, increased in 1993, and had a "record" year in 1994. Table 7: Volume of intra-Community trade (tonnes) 1990 1991 1992 1993 1994 Spain 291. 885 331. 391 414. 630 433. 167 618. 426 Netherlands 545. 958 559. 175 545. 010 387. 053 409. 669 Belgium Italy France 154. 667 172. 437 187. 831 150. 403 160. 779 17. 196 31. 568 23. 884 43. 317 28. 883 46. 682 38. 832 46. 758 64. 655 62. 051 EUR-12 1. 238. 824 Source:Eurostat-Cronos. The figures for Spain include the Canaries 1. 051. 777 1. 142. 113 1. 068. 907 1. 332. 080 The increase in Spanish consignments is undoubtedly related to the end of the transitional period at the beginning of the 1993 marketing year and the accompanying removal of restrictions. The increase was consolidated in 1994, a year in which production and consumption fell in Spain. It may be concluded that for that year consignments to other countries were made at the cost of sales on the domestic market. Consignments from the mainland (Almeria and Murcia) also increased more than did those from the Canaries. 5Figures for 1994. 16 Market calendars Intra-Community consignments were traditionally made over two different periods: Between November and March (winter tomatoes), Spanish tomatoes coming from the Canaries and Murcia/Almeria. Between April and September (summer tomatoes), from the Netherlands and Belgium. During this period tomatoes produced in Spain went onto the domestic market. However, two recent trends have disrupted the traditional pattern: Firstly, consignments originating in Spain have increased in April, May and June (see table below), while the high volume in January, February and March has been maintained. This heralds a Spanish commercial strategy aimed at sharing the marketing season traditionally reserved for northern producers. Secondly, there has also been an opposite trend in consignments from the Netherlands: in 1994 consignments increased in January, February and March. By contrast, consignments in May and June have fallen. In Belgium, consignments have increased in April and May, but also in February and March. These changes show competition between "northern" consignments and those of Spanish origin during the winter season. Since 1993, the Community market has been in upheaval as regards traditional trade calendars. New marketing strategies are being established. In the Netherlands, for example, diversification has made it possible to put tomatoes on the stalk on the market in February. On the other hand, Spanish production potential is enabling certain regions to produce for 11 months out of 12. This has been one of the key problems on the tomato market in recent years. Natural market development should find a satisfactory balance without Community assistance being called for. Table 8: Development of trade calendars January February March 1992 1993 1994 1992 1993 1994 1992 1993 1994 Belgium 1170 527 1076 317 462 1862 869 2221 2182 Netherlands 22762 16510 22830 18125 14760 24694 27301 24878 36776 Spain 105219 76099 95013 50741 108644 97027 68795 89203 88256 17 April May June Belgium Netherlands Spain 1992 1993 1994 1992 1993 1994 1992 1993 1994 11478 15248 81333 23562 29100 26637 30050 34558 34204 46343 43828 43487 74566 72308 65076 93469 86330 77578 43801 39099 49114 8428 29671 50601 5078 11230 50601 3. 2 Trade outside the Community Imports The principal supplier is currently Morocco, which distributed 148 000 tonnes between November and March. The second largest supplier, with 4 000 tonnes in 1994, is Israel. The total volume of Community imports was 162 114 tonnes in 1994. Table 9: Community Imports 1990 1991 1992 1993 1994 MOROCCO 106 319 135808 131920 164360 148 297 TURKEY ISRAEL TOTAL 3 014 7 217 - 3 230 5 707 - 3 926 5 033 1 820 3 860 2 829 4 073 152066 179572 162114 Morocco The area planted with tomatoes in Morocco has fallen since 1990 (from 5500 ha in 1990 to 4000 ha in 1994), with a shift towards protected crops. Production has remained stable overall, despite a fall in 1994. The principal destination of imports from Morocco is France, which in 1994 absorbed 85% of tomato imports from Morocco. Germany is the end market for 6. 4% of the total volume and Belgium and the Netherlands absorb 2% each of Moroccan imports. Spain and Italy take less than 400 tonnes each. Protocol No 1 to the association agreement concluded with Morocco provides for a fresh tomato quota of 150 676 tonnes benefiting from a zero acf valorem duty and, from October to March, from a preferential entry price. 18 The agreement has not yet been implemented as far as the reduction in ad valorem duty is concerned: imports continue to benefit from zero a£[ valorem duty under the old agreement, which is still in force, within the limit of a Community quota of 96 208 tonnes for 15 November 1995 to 30 April 1996, 16 800 tonnes of this during the period 1 to 30 April 1996. In addition, Morocco benefits from a bilateral French quota at zero ad valorem duty of 120 000 tonnes. When the new agreement finally enters into force, the Community quota at zero ad valorem duty will be 150 676 tonnes and the bilateral Franco- Moroccan quota will be abolished. The new quota will therefore be equivalent to the sum of the old Community quota, the bilateral quota taken over by the Community and the quantities allocated as a result of the enlargement by three new Member States. The provision relating to the annual increase in the quota in the old agreement has been retained: each year from 1 January 1997 to 1 January 2000 the quantity will be increased in four equal instalments amounting to 3% of the amount. Lastly, outside the quota the ad valorem duty will be reduced by 60%. The agreement has already been implemented where the preferential entry price is concerned: it was introduced on 1 November 1995 by Council Regulation (EC) No 3057/95 of 22 December 1995 (OJ No L 326). In the period 1 November 1995 to 30 March 1996 Morocco benefited from an entry price of ECU 500/t for a maximum quantity of 145 676 tonnes. The Common Customs Tariffs entry price, applicable to all other origins, was ECU 688/t from 1 November to 20 December 1995, ECU 738/t from 21 to 31 December 1995 and ECU 895/t from 1 January to 31 March 1996. In accordance with Article 3 of Protocol 1 to the association agreement with Morocco, for each period subsequent to 1 October to 31 March the country will benefit from the reduced entry price for a fixed maximum quantity of 150 676 tonnes. That quantity is staggered per month as follows: Periods October November to March of which: November December January February March Total: Quantities 5 000 145 676 18 601 36 170 30 749 33 091 27 065 150676 19 The entry price - ECU 500/t for 1995/96 - is reduced in the same proportions and at the same rate as the entry price consolidated under the WTO. Tolerances - 20% monthly overrun and the ability to catch up on 20% of monthly quantities not used - are provided for the period November to March within the limit of the overall quantity. Lastly, Morocco notifies the Commission of weekly exports to the Community. These preferential arrangements relating to the additional special duty retained and refined the provisions introduced in the first quarter of 1995 which were intended to guarantee that Morocco maintained its traditional trade flows. For the first year of application of the new entry price arrangements, for tomatoes from 1 January 1995, an agreement in the form of an exchange of letters between the European Community and the Kingdom of Morocco6 fixed a preferential entry price for tomatoes at ECU 560/t. That agreement was applied for the first time to the period 1 January to 31 March 1996 for a maximum 81 006 tonnes based on traditional trade flows to the Community of 12. Morocco undertook not to exceed that quantity and to distribute it monthly: 27 756, 29 594 and 23 656 tonnes in January, February and March 1995 respectively within a tolerance of 10%, and to notify weekly quantities exported to the Community. Analysis of that period shows that the agreement was applied correctly: quantities were strictly complied with and the various information sources tallied (see table below). In addition, prices were satisfactory, except during a critical period in February 1995. Information sources/periods (quantities in tonnes) Communication from Morocco: exports to the EU Counted against quota 11. 0990: quantities imported Comext database: actual imports: January 1995 February 1995 March 1995 Totals: 28 697 26 063 24463 79 223 28 884 25 985 26106 80 975 26189 25 319 25 971 77 479 Council Decision of 20 December 1994 (OJ No L 48, 3. 3. 1995, p. 22). The Commission implemented that agreement by Regulation (EC) No 298/95 of 14 February 1995 (OJ No L 35, 25. 2. 1995, p. 6). 20 Figures available for the year in progress indicate that Morocco is under- using the preferential entry price quota. On the other hand, prices have been maintained: the standard import value has always been higher than the "Morocco" entry price except during two critical periods in mid- November 1995 and mid-January 1996. Table 10: Development of Community Imports from Morocco Tomato*» CN code 0702 00 in tonnes Trade outside the Community imports from Morocco into the European Union 93 482 93194 80 968 91874 106319 135808 131 920 164360 148 297 84 491 21 Exports Community tomato exports have been increasing constantly since 1990 for all Member States except the United Kingdom, going from 107 000 tonnes to 278 000 tonnes in 1994, an average annual increase of 24. 1%. Table 11: Exports from the Community of 12 (in tonnes) 1990 1991 1992 1993 1994 2 009 425 25 891 2 070 131 3 0 0 0 0 4106 1769 29 549 22 260 189 24 0 0 0 0 3 862 1067 29 239 29 959 1 782 15 84 577 111 0 12782 1 978 34 267 43 570 4 668 0 648 5 051 1 481 6 950 12 549 2 891 39 816 32 020 4 463 4 056 35 759 7 548 6 602 12 865 Partners EU Canada Switzerland Poland Hungary Israel Russia Slovenia Croatia Czech Republic From EU 12. 106 904 131 591 147 383 211207 278 089 Generally speaking, exports have opened up towards the eastern European countries such as Russia, Poland, the Czech Republic and certain parts of the former Yugoslavia, a trade flow which should continue in the future. 22 //. COMMUNITY AID 1- Structural aids (a) Aid to production structures Until 1993, EAGGF Guidance Section contributions to such aid were not programmed. The aid was granted as required under a system set up in each Member State and theEAGGF reimbursed expenditure notified by the Member States. Expenditure was eligible provided it complied with the provisions of Council Regulation (EEC) No 2328/91 on improving the efficiency of agricultural structures. Under that Regulation, there was no specific prohibition on aid to glasshouses or tomatoes. After 1994, a financial guideline existed for Objective 5(a) (together with programming, confined to aid granted in Objective 1 regions). However, despite the Commission's attempt to introduce specific programming for Regulation (EEC) No 2328/91 as a whole, the Council did not accept this approach. Under the present regulations, there is an indicative financial forecast only and, as regards investments, aid to glasshouses and tomatoes can continue to be granted. In view of this situation and the ensuing difficulties when it comes to considering the possible impact of such aid on tomato production, the Member States were requested to undertake an analysis of aid granted to the latter. All Member States claimed it was impossible to provide accurate information on aid to this area. In addition, sight should not be lost of the fact that production structures for fruit and vegetables vary greatly (depending on whether they are protected by plastic, netting, glass, etc. ) and may be used for the production of several products depending on the season, the climate, consumer taste, the market, etc. , which makes an accurate analysis under Objective 5(a) even more difficult. However, under the Operational Programmes, this type of investment is easier to identify. Thus, despite requests from a certain number of Member States regarding the construction of glasshouses for tomatoes, the reply has always been negative. The most recent case concerns Spain. The only cases where part-financing has been agreed to for glasshouses have involved highly specific measures and products such as flowers and out-of- season production. Outside such Operational Programmes and in the absence of precise indicators, one can only venture an analysis. Since the regulations do not provide for a discriminating approach, some information was collected from the Member States to give an approximate idea of the situation. On the basis of data received, 5. 5% of aid for investments under Regulation (EEC) No 2328/91 during the period 1990-94 was used for the construction and 23 modernization of glasshouses for all sorts of products, i. e. fruit, vegetables, flowers and nursery products. Such investments represent an overall burden of ECU 347. 65 million on the EAGGF in 1990-94 for the Community as a whole. Using that overall figure as a basis and extrapolating therefrom, one can attempt to identify aid to tomatoes since this product accounts for around 14% of total fruit and vegetable production only (excluding flowers and nursery products). By applying that percentage to the total aid to such investments, a figure of ECU 48. 67 million is arrived at for the EAGGF contribution for 1990-94, giving an annual average of ECU 9. 73 million for the Community of Twelve. One may conclude that while some marginal utilization of glasshouses for tomato production cannot be ruled out, the impact of structural aid to such investments on Community production is negligible. (b) Aid to processing and marketing structures To gain a comprehensive idea of the situation, aid for the processing and marketing of agricultural products should also be considered. In this area aid is permitted subject to precise selection criteria [see Annex]. Thus investments in the processing of tomatoes are prohibited or are subject to highly restrictive conditions, such as a 20% reduction in processing capacity. However, aid to marketing (fruit and vegetable markets and packaging) is generally permitted with the aim of facilitating the disposal of products on the market and is consequently beneficial for the production chain. For information, the table below summarizes aid for the processing and marketing of fruit and vegetables as a whole for 1991-93. In view of the restrictive approach in selection criteria and the relative importance of tomatoes in the fruit and vegetable industry as a whole, one may conclude that tomatoes have barely benefited from aid to processing and marketing. Regulation (EEC) No 866/90 - FRUIT AND VEGETABLES 1991-93 (ECU million) B. DK D GR E F IRL I L NL P UK Total EUR-12 5. 78 0. 11 29. 10 22. 06 56. 95 31. 40 2. 37 74. 17 0 4. 59 26. 2 6. 64 259. 37 1. 45 0. 03 7. 28 5. 52 14. 24 7. 85 0. 59 18. 54 0 1. 15 6. 55 1. 66 64. 84 Member State Total for 1991-93 Annual average 24 2. National aids 2. 1 State aid cases in the tomato sector The Commission has no information about national aid schemes, solely financed by Member States, which are specificaly destined for the tomato sector. The only known case which is linked with the actual situation in the tomato market is a Belgian request for an an aid scheme. This scheme concerns rescue aid in the form of interest relief and state guarantee on credits for producers of tomatoes, paprika and cucumbers, who are in financial difficulties. According to current Commission policy the main condition for accepting such rescue aid is that it concerns investments made in the past and that the rescue aid in cumulation with investment aid already granted does not go beyond the maximum aid levels which are normally applied for investment aid. Further conditions for accepting rescue aid are that the financial difficulties of the enterprises concerned are caused by external factors or that the aided enterprises present proof of their future viability. tomato It has to be pointed out that the current market problems of the only conditions which may trigger the producers in Belgium are granting of such rescue aid. Granting this such aid could equally be possible as a consequence of other events such as a rise in interest rates. The main reason however for the Commission not to raise any objection to such aid is the fact that the investment aid granted in the past has not reached the limits normally accepted by the Commission. On this basis such aid can be considered as an additional investment aid "ex posteriori". 2. 2 Aid for the tomato sector in the context of general aid schemes Even if no specific national aid schemes for tomato producers are known to the Commission, the tomato sector can benefit from general State aid schemes for horticulture or indeed for regional schemes which do not exclude the agricultural sector. The possibilities for such aid are however rather limited for the reasons laid out below: 25 2. 2. 1 The Commission considers that national aid in the form of operating support (aid per unit of input or output, or per ha) is normally incompatible with the common market because this aid has no lasting effect on the development of the sector concerned. Furthermore in the case of products subject to common market organisation these aids risk disturbing Community support mechanisms and are consequently considered as infringements to the market organisations concerned. The CMO are considered as complete and exhaustive regulations for the products concerned which exclude any additional national aid. So if such aid were to exist it would as a general rule be granted on illegal terms. In the context of the discussion on the tomato market of the European Union two Dutch measures for the horticultural sector which might be thought to constitute operating aid (but which do not necessarily fulfil the conditions of Article 92 (1)) have to be mentioned: The gas tariff system for Dutch horticulture actually applied is considered by the Commission as not giving an economic advantage towards horticulture vis-à-vis other sectors of the Dutch economy because they can obtain the same tariff if they use quantities of gas to the same extent as in horticulture. Consequently no State aid falls under Article 92 (1) in this tariff The gas price in the Netherlands is for all sectors indexed to the oil price. Furthermore the Commission has no information about any possible aid in the form of tax relief for Dutch horticulture. This applies as well for the energy tax which has recently been approved by the Commission. This tax foresees a partial exemption of horticulture from the tax on energy. The main reason for the Commission accepting this exception for horticulture under glass was that "full taxation would not allow full rechannelling of the yield of the tax which is a precondition of this scheme" and "on the contrary, it would result in a substantial increase of the tax burden" for the horticultural sector (Commission decision of 20 December 1995). 2. 2. 2 The only kind of operating aid fulfilling Aricle 92(1) which is possible as cofinanced aid under Council Regulation (EEC) No 2078/92 and as State aid is aid for environmentally compatible production methods in agriculture. This aid, normally granted in form of per ha aid, is destined to compensate for incurred as consequence of the undertakings for environmental protection given by the beneficiary plus an incentive element. It has to be mentioned that in current Commission policy on State aid the scale of incentive is not circumscribed. loss of income 26 Aid for environmentally compatible farming practices is often granted in form of cofinanced aid under the terms of the abovementioned Council regulation: As this regulation does not exclude State aid granted under differing conditions or exceeding the limits set in the regulation, supplementary State aid schemes exist in several Member States. 2. 2. 3 As concerns investment aid this aid can be granted to tomato producers in the context of general aid schemes. These aid schemes aid fall to a great extent within the scope of Council Regulation (EEC) No 2328/91. This regulation allows supplementary State aid for investments only for specific purposes as e. g. aid for environmental protection not linked with an increase in production capacity. 27 CONCLUSIONS 1. On the basis of this Community-wide analysis it can be stated that the Community market for fresh tomatoes seems to be balanced overall, with the normal fluctuations that characterise a dynamic market. 2. 3. 4. Despite the increase in consumption since 1990, which appears to be setting in for the future, Community production and areas planted are falling. There have, however, been remarkable innovations in cultivation techniques, which have greatly increased yields. There is a gradual trend towards demand for greater diversity and higher quality. The adjustment of supply to demand is one of the key requirements for keeping the market dynamic. There is an overall trend towards falling wholesale prices, despite a relative increase in 1994. The trend in 1995 seems also to be towards falling prices. This reduction is not uniform, and "traditional" varieties have been more affected by it than new varieties and forms of presentation, for which producer prices have been very attractive. There has been very little recourse to Community assistance measures. There is no indication that the devaluation of certain currencies (the peseta and the lira) has affected the ecu price of tomatoes from countries with a weak currency (Spain in particular). The growing volume of intra-Community trade indicates that the sector is operating satisfactorily. However, there has been a redistribution of the traditional winter/summer consignment calendars. To resolve the north- south conflict, it will be essential to find a balance for the 1. 3 million tonnes involved in this trade. Imports from third countries, in particular Morocco, are not disturbing the Community market. Community aid for production and marketing structures does not seem to be having a significant effect on production trends. These have been much more influenced by normal market fluctuations, and in particular changing trends in intra-Community trade. The results of the analysis do not show general problems at structural level. The sector is proving dynamic, production cannot be said to be excessive, and fluctuations in trade may be considered a normal part of the operation of single market forces. 5. The Commission does not have any information on national aids financed solely by Member States and intended specifically for the tomato sector. One aid of the "rescue" type has been applied for in the sector and it is currently being examined by the Commission. 28 RECOMMENDATIONS On the basis of these conclusions, the Commission considers that: 1. 2. 3. The Community market is in the process of reorganization in response to the new situation which has pertained since 1993. The challenges to be faced are, firstly, the new requirements of the market and, secondly, the rescheduling of intra-Community trade calendars. Natural market developments should establish sufficient equilibrium without Community assistance being called for. The lack of profitability of certain "greenhouse" enterprises in the northern Member States does not affect only the tomato sector. These difficulties appear to be the result of temporary factors concerning the advisability of investment rather than of real changes in the balance of the market. Solutions should be studied on an appropriate case-by-case basis without, however, disturbing the proper operation of the single market. In the past, the Commission has not objected to national aid intended to dismantle production potential which could be applied in the particular case of greenhouses. This type of aid should be reserved exclusively for compensating for the loss of value of means of production and granted to unprofitable enterprises wishing to abandon horticulture. 29 ANNEXES 30 THE KEY PRODUCTION REGIONS ANNEX I 1. Belgium Belgian production has increased by 13% since 1990. It is concentrated in the province of Antwerp, in particular at Mechelen and Hoogstraten, as well as in western Flanders. The most common method of disposal is via cooperatives which organize marketing of the products. Turnover on the wholesale tomato market in 1994 accounted for 23. 3% of the total value of vegetables produced in Belgium. Overall turnover for greenhouse-grown vegetables in 1994 was 6. 1% higher than in 1993, with tomatoes accounting for the most significant growth. The number of enterprises, mostly family businesses, with an average area of 1 hectare, has fallen since 1990, but the overall area planted has remained practically the same, with an increase in yield. The proportion of heated greenhouses has grown over the last two years at the cost of non-heated production. The overall trend in the sector is towards a decreasing number of enterprises and an increase in specialization and in the average area per enterprise. Average production prices (all varieties taken together) fell during the 1992 and 1993 marketing years and recovered in 1994, which did not, however, quite bring prices back to 1990 levels. A more detailed analysis by variety shows that in 1993 prices for the traditional round tomatoes fell in relation to 1990, with a recovery in 1994. By contrast, the volume of tomatoes on the stalk rose sharply, from 430 tonnes in 1993 to 2 752 tonnes in 1994 marketed from February onwards, accompanied by a net increase in prices for this type of presentation. The production of tomatoes on the stalk further increased in 1995 and the trend is expected to continue. After traditional tomato cultivation stabilized in Belgium in 1992 and 1993, Belgian producers decided to move towards diversification of that crop. This seems to have led to a recovery in price levels in 1994. Since 1990 Belgium has increased its total volume of consignments to other Member States, in particular France and the United Kingdom, while consignments to Germany are falling. 31 2. The Netherlands Production has fallen by 19% since 1990. The number of enterprises has fallen by 34% over the last five years, as has the area used for tomato production. Yields are still rising. The bulk of production is in the Westland region. Tomato production accounts for 37% of the total value of vegetable production. Since 1990 sweet pepper production has increased at the cost of tomato production. By variety, the area devoted to production of round and beef tomatoes is falling, while there has been a correspondingly sharp increase (from 30 ha in 1993 to 150 ha in 1994) in the area devoted to the production of small tomatoes, tomatoes on the stalk and cherry tomatoes. Overall, prices (all varieties taken together) have held up at 1990 levels. During the 1992 and 1993 marketing years they fell by 15% but recovered to 1990 levels in 1994. By variety, the prices for "beef tomatoes have fallen and those for tomatoes on the stalk and cherry tomatoes have held up. Traditionally, the bulk of produce in the Netherlands is sold by cooperatives who are also responsible for quality control and marketing. Over the last few years new strategies have focused more on market demand, leading to a policy of diversification In order to develop new "value-added opportunities". One example of this policy is the introduction of tomatoes on the stalk and "special flavour" tomatoes, which have been very successful on the market. More than 85% of tomatoes produced in the Netherlands are for external markets. These sales are carried out Dutch auction centres. Around fifteen major supermarket chains sell more than 50% of Dutch tomatoes in the countries of destination. The main destinations are Germany, the United Kingdom and Sweden. Since 1990 consignments to Germany have been increasing, while those to the United Kingdom are falling. 32 3. France While production in France has increased since 1990, there was a sharp fall in harvests in 1994. Greenhouse production has led to a reduction in the area used and an increase in average yields. Greenhouse production in France currently accounts for 75% of the volume harvested. The average area of the enterprises, mostly family businesses, is less than 1 hectare. The market of almost 70% of production volume is concentrated in the hands of 45 producer organizations. French production is concentrated in the regions of the south-east, south-west and north-west. In the south, Bouches-du-Rhône is the department with the highest production, accounting for 20% of total production. French production does not fully cover domestic demand, and its principal suppliers are Spain and Belgium. Imports from Spain have risen substantially, particularly for the winter season. Purchases of Belgian and Dutch tomatoes in the summer season are in direct competition with the French product. France provides the main market for imports from Morocco, absorbing more than 85% of them. 33 A. Soain The tomato, which is eaten more than any other vegetable in Spain, accounts for 25% of total horticultural production and is on the market all the year round. Since 1990 production and areas used for tomato production have fallen by 13%, while yields have continued to rise. Spanish production is carried on throughout the year, though winter production (October - June) has different characteristics to those of summer production (June- September). The bulk of summer tomatoes, which are principally for the domestic market, are farmed in the open by small family businesses. Winter tomatoes, on the other hand, the production of which is concentrated in the south-east on the Mediterranean coast and in the Canaries, account for more than 85% of all Spanish tomato production. Production is intensive with large and medium-sized enterprises which have developed very technically specialized methods and have very dynamic and effective marketing structures. All Spanish tomato exports come from the winter production regions. -The mainland: The main production areas are in Almeria and Murcia which account for 22% of Spanish fresh tomato production. Since 1990 production in that region has increased, as has, to a limited extent, the area used for the production of tomatoes under cover. Almost 60% of enterprises grow tomatoes under plastic covers, which makes it possible to obtain a better temperature in winter and ventilation during the hot periods of the year. The introduction of new varieties has made it possible to produce tomatoes of uniform quality 11 months out of 12 in this region. Over the last few years a model of efficient Mediterranean production has been established, integrating marketing (and thus export) structures around production areas. -The Canaries: The principal outlet for Canaries tomatoes is export, which currently accounts for 80% of the islands' total production. There are almost a hundred enterprises producing tomatoes, which account for 75% of the total value of horticultural production in the Canaries. The area planted and production, which have increased since 1990, now seem to have reached a plateau, as does the volume of consignments to the European Union. Since 1990 the sector has undergone structural modernization, based largely on the expectations of the European market, which is still continuing with modernization of packaging and marketing strategies. This process has undoubtedly been intensified by competition with Morocco. The opening up of competition in international transport nevertheless made it possible to achieve transport costs in 1994 that were 15% lower than in the preceding years. Consignments from the Canaries to the European Union increased by 29% in 1994; this increase was accounted for specifically by the United Kingdom market. The principal markets for consignments from the Canaries are in the United Kingdom (33. 5%) and the Netherlands (63%), where a large proportion of the tomatoes are forwarded via Rotterdam to other destinations, within the Union or in third countries. 34 ANNEX II STATISTICS 35 Member State BELGIQUE DANMARK DEUTSCHLAND ELLAS ESPANA FRANCE IRELAND ITALIA LUXEMBOURG NEDERLAND PORTUGAL UNITED KINGD EUR 12 production area yield production area yield production area yield production area yield production area yield production area yield production area yield production area yield production area yield production area yield production area yield production area yield production area yield 1988 205. 030 859 239 15. 167 47 323 19. 100 255 75 666. 910 36. 720 46 1. 834. 893 60. 350 43 417. 500 6. 420 108 13. 500 81 167 1. 594. 916 116. 013 41 30 2 15 567. 029 1. 715 331 63. 893 132. 100 624 212 5. 530. 068 223. 086 133 Tomato farming in EUR 15 1989 225. 220 915 246 17. 000 21. 500 267 81 728. 050 37. 691 53 1. 987. 763 66. 066 45 421. 700 6. 600 113 10. 600 57 186 2. 018. 230 133. 601 46 30 2 15 620. 782 1. 687 368 80. 835 134. 000 595 225 6. 265. 710 247. 481 115 1990 298. 400 940 286 19. 300 00 322 14. 500. ". " 685. 790 38. 513 48 2. 024. 895 89. 884 45 461. 100 6. 600 119 10. 500 54 194 2. 657. 083 136. 378 46 35 2 18 640. 725 1. 603 400 86. 706 : : 138. 700 580 239 6. 987. 534 254. 614 143 1991 313. 960 945 332 17. 500 16. 000 710. 700 39. 015 48 1. 793. 832 59. 913 44 527. 300 6. 650 128 9. 100 43 212 2. 759. 091 129. 669 48 40 3 13 636. 149 1. 570 405 72. 625 1992 329. 500 963 342 20. 000 31. 306 479 65 754. 940 36. 657 51 1. 880. 143 55. 802 47 516. 900 5. 960 128 11. 700 55 213 2. 712. 099 117. 595 50 52 3 17 651. 994 1. 505 433 64. 267 137. 300 556 247 6. 993. 597 238. 364 123 125. 900 476 264 7. 098. 801 219. 495 134 1993 346. 779 946 367 14. 666 55 267 24. 100 1994 309. 334 954 324 20. 000 20. 700 784. 850 33. 110 52 1. 912. 300 57. 111 49 643. 400 6. 060 145 0 1. 984. 572 113. 426 48 65 4 19 606. 612 1. 390 436 221. 103 34. 694 21 112. 900 401 282 6. 651. 347 247. 197 140 757. 250 32. 083 53 1. 786. 807 61. 613 50 492. 600 4. 750 162 0 2. 149. 074 115. 248 50 70 4 20 540. 577 1. 241 436 75. 000 111. 000 388 286 6. 262. 412 216. 281 115 Source: Member states datas and EUROSTAT, table drawn up by DG VI. E. 1 & Tomato farming in EUR 15 - total production for consumption as fresh tomatoes Member State BELGIQUE DANMARK (*) DEUTSCHLAND ELLAS ESPANA FRANCE IRELAND ITALIA LUXEMBOURG NEDERLAND PORTUGAL UNITED KINGDOM ÔSTERREICH FINLAND SVERIGE (**) EUR15 1988 (tonnes) 205. 030 15. 167 19. 100 666. 910 1. 834. 893 417. 500 13. 500 1. 594. 916 30 567. 029 63. 893 132. 100 30. 145 5. 560. 213 (%) 3,7 0,3 0,3 12,0 33,0 7. 5 0,2 28,7 0,0 10,2 1,1 2,4 0,0 0,5 0,0 100,0 1989 (tonnes) 225. 220 17. 000 21. 500 728. 050 1. 987. 763 421. 700 10. 600 2. 018. 230 30 620. 782 80. 835 134. 000 18. 395 28. 822 15. 540 6. 328. 467 (%) 3,6 0,3 0,3 11,5 31,4 6,7 0,2 31,9 0,0 9,8 1,3 2,1 0,3 0,5 0,2 100,0 1990 (tonnes) 268. 400 19. 300 14. 500 665. 790 2. 024. 695 461. 100 10. 500 2. 657. 083 35 640. 725 86. 706 138. 700 18. 045 31. 857 17. 887 7. 055. 323 (%) 3,8 0,3 0,2 9,4 28,7 6,5 0,1 37,7 0,0 9,1 1,2 2,0 0,3 0,5 0,3 100,0 1991 (tonnes) 313. 960 17. 500 16. 000 710. 700 1. 793. 832 527. 300 9. 100 2. 759. 091 40 636. 149 72. 625 137. 300 13. 768 30. 014 17. 890 7. 055. 269 (%) 4,5 0,2 0,2 10,1 25,4 7,5 0,1 39,1 0,0 9,0 1,0 1,9 0,2 0,4 0,3 100,0 1992 (tonnes) 329. 500 20. 000 31. 306 754. 940 1. 880. 143 516. 900 11. 700 2. 712. 099 52 651. 994 64. 267 125. 900 12. 330 30. 346 17. 890 7. 159. 367 (%) 4,6 0. 3 0,4 10,5 26,3 7,2 0,2 37,9 0,0 9,1 0,9 1. 8 0,2 0,4 0,2 100,0 1993 (tonnes) 346. 779 14. 666 24. 100 784. 850 1. 912. 300 643. 400 1. 984. 572 65 606. 612 221. 103 112. 900 13. 620 30. 778 18. 889 6. 714. 634 (%) 5,2 0,2 0,4 11. 7 28,5 9,6 29,6 0,0 9. 0 3. 3 1. 7 0,2 0. 5 0,3 100,0 1994 (tonnes) 309. 334 20. 000 20. 700 757. 250 1. 786. 807 492. 600 2. 149. 074 70 540. 577 75. 000 111. 000 14. 524 34. 608 19. 000 6. 330. 544 (%) 4. 9 0,3 0,3 12,0 28,2 7. 8 33,9 0. 0 8. 5 1,2 1,8 0. 2 0. 5 0. 3 100,0 (*): EUROSTAT - CRONOS figures for 1989, 1991,1992,1994 (**): EUROSTAT - CRONOS figures for 1989, 1991, 1992 'e;\. - s Withdrawals trends from 1990 to 1994 1991 1990 withdrawals 18 (%) 0,01 8 62 7783 BELGIQUE DANMARK DEUTSCHLAND ELLAS ESPAGNE FRANCE IRELAND ITALIA LUXEMBOURG NEDERLAND PORTUGAL U. KINGDOM EUR-12 Source: Member states balance sheets, table drawn up by DG VI. E. 1 withdrawals production 313960 17500 16000 710700 1793832 527300 9100 2759091 40 636149 72625 137300 60273 6993597 production 268400 19300 14500 665790 2024695 461100 10500 2657083 35 640725 86706 138700 135361 6987534 312 0 46 19091 71 26407 47 9072 0 5227 0 0 0,00 0,00 1,69 116367 11123 4,38 1,74 1,94 | (%) 0,1 1992 withdrawals 6543 0 312 3169 49 25528 120 175792 0 41181 0 3 production 329500 20000 31306 754940 1880143 516900 11700 2712099 52 651994 221103 112900 252697 7242637 2,7 0,00 5,01 0,33 0,82 0,86 Uo OS P<. -e 1993 withdrawals 5444 (%) 2,0 production 346779 14666 24100 784850 1912300 643400 99 5006 2613 11964 89 5852 1984572 65 606612 221103 112900 50091 6651347 18894 130 0 1994 (%) 1,57 7531 withd rawalsj prod uction 309334 20000 20700 757250 1786807 492600 59 2977 9996 6644 97 13820 2149074 70 540577 75000 111000 50220 6262412 8958 138 0,4 0,6 0,1 1,9 0,3 3,1 0,1 0,8 (%) 2,4 0,3 0,4 0,6 1,3 0,6 1,7 0,2 0,8 0,4 0,0 4,9 6,5 6,3 3,5 Production and intra-Community trade - EUR 12 - 8 000 -, 7 000 4 V) 0) c c o o o o $ oproduction o Trade 990 1991 1992 1993 1994 Yield trends e- 25 000 20 000 15 000 4— o SI 5 000 4 - M— WRk Area of tomato production under cover in the EU [•UE jgBE I DES; QFR^ ; BIT QNL 1990 1991 1992 1993 til!! wm 994 Consumption of fresh tomatoes in the EU (estimates) 30 T 25 •; a— 20. c 15 £ 10 1990 1991 1992 1993 1CC4 i *S V ** Variations in monthly prices in comparison with 1990 - Spain - o o I! o X o £" 1990 1991 1992 1993 1994 Variations in monthly prices in comparison with 1990 - Belgium 1990 1991 1992 1993 1994 200 40 20 ( W K ^V j i p i ^i H 200 T Variations in monthly prices in comparison with 1990 - Netheriands- G O O un • 1990 • • - 1 9 91 ; - * - 1 9 92 : • • - 1 9 93 * - 1 9 9 4; ItvviL Variations in average Community prices from March to June in comparison with 1990 140 T 130 4 ES «NIL B5; 1990 1991 1992 1993 CC4 Scale of withdrawals of tomatoes from the market by Member State as a proportion of domestic production between 1990 et 1994 Production, intra-Community Trade and investment aid - Belgium - production ~- trade" • - aid 2 000 1 500 4 o o o DUU • 1990 1991 1992 1993 1994 Production, intra-Community trade and investment aid - Netherlands - production ES. trade ; - • -. - aid 2 000 4 1 500 o c Do I 8 1 ooo 4 500 4 1990 1991 1992 1993 1994 2 000 1 500 SP» o o o 1 000 Production, intra-Community trade and investment aid - Spain - g 40 o. à i CZZ3 production \^m j — •— - trade I ! - aid 990 1991 1992 1993 1994 Production, intra-Community trade and investment aid - France - 2 000 1 500 £:. O C i i —' production BB -trade [ •-•Tijd"" 1990 1991 1992 1993 1994 Imports to the EU of tomatoes from Morocco £ o o o 1SS0 1991 1992 1993 1994 ANNEX III Selection criteria for investments in the processing and marketing of agricultural products under Regulation (EEC) No 866/90 The selection criteria (Decision 94/342/EEC) relating to fruit and vegetables rule out the following investments: investments to increase marketing capacity for products where major withdrawals (attendant on surplus production) have been recorded in the areas concerned over the last three years; all investments resulting in an increase in processing capacity, except where equal capacity is abandoned in the same enterprise or in other specified enterprises, or in the case of special products where a significant growth in outlets has been shown. This ban does not apply in Objective 1 regions where insufficient capacity has been demonstrated; investments in the production of tomato concentrate, peeled tomatoes, citrus juice, peaches in syrup and pears in syrup, except where they cover new processing capacity which is at least 20% below the total pre-existing capacity abandoned in the region concerned. Investments qualifying for assistance from the EAGGF Guidance Section under the Regulation must seek to achieve the following: the rationalization and development of packaging, preserving, treatment, processing and recycling of by-products or manufacturing residues; better procedure for placing on the market, including greater transparency in price formation; the application of new processing techniques, including the development of new products and by-products or the opening-up of new markets and innovative investments; improvement in the quality of products. 55 ISSN 0254-1475 COM(96) 247 final DOCUMENTS EN 03 Catalogue number : CB-CO-96-256-EN-C ISBN92-78-04816-X Office for Official Publications of the European Communities L-2985 Luxembourg 51

Proposal for a COUNCIL DECISION to approve the text of a ninth EC-UNRWA Convention covering the years 1996-98 prior to signature of the Convention by the Commission and the United Nations Relief and Works Agency for Palestine refugees

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COMMISSION OF THE EUROPEAN COMMUNITIES * * * ** * * * ** Brussels, 10. 06. 1996 COM(96) 257 final 96/0154 (CNS) Proposal for a COUNCIL DECISION to approve the text of a ninth EC-UNRWA Convention covering the years 1996-98 prior to signature of the Convention by the Commission and the United Nations Relief and Works Agency for Palestine refugees (presented by the Commission) EXPLANATORY MEMORANDUM The Commission has taken up contact with officials of UNRWA in order to negotiate a ninth EC-UNRWA convention to govern the Community contribution to UNRWA for the years 1996-98, on the basis of the negotiating directives approved by the Council on 6th October 1995. I POLITICAL BACKGROUND Final status negotiations between the Government of Israel and the Palestine Liberation Organisation of the issue of Palestinian refugees are not due to commence until May 1996 at the earliest. According to the Declaration of Principles signed between the two parties in October 1993, the issue will not be settled until the end of the 'interim period', that is, until 1998. The European Union position on the Middle East Peace Process has been one of supporting the efforts of the parties to reach a peaceful resolution of their differences by means of bilateral and multilateral negotiation. A key element of this strategy has been that of reassuring the Palestinian side that the international community believes that the Declaration of Principles should be fully respected, and that the refugee issue should not be put to one side during final status negotiations. The continuing support of the Community for the United Nations Relief and Works Agency for Palestine Refugees (UNRWA)1 is a key element in this strategy. As for the size of the Community contribution under the convention, throughout negotiations the Commission has borne in mind the feeling amongst donors, including member states, that donor contributions to UNRWA should take into account the increased burdens placed on the Agency by the rate of increase in the Palestinian population, and of inflation The Community contribution should at any rate be maintained at a minimum consistent with the maintenance of provision to the refugees of services at reasonable levels. Notwithstanding, the Commission has required justification by UNRWA of the increases proposed to the Community contribution to its programmes, in relation to contributions made under the eighth Convention, and indeed of the changing emphasis in the use of the Community contribution away from its health programmes and towards education. It is a possibility, however remote, that during the life of the convention some of the services provided by UNRWA to the refugees will be passed to the Palestinian Council. Indeed, UNRWA convoked its major donors to Amman in mid-1995 to explain and discuss its plans for eventual handover of its functions to the Council; UNRWA is already making efforts to harmonise its services with those of the Council, and its officials liaise ever more closely with those of the Council. UNRWA officials are adamant that UNRWA as an organisation must have a finite life, and look forward to a settlement of the refugee issue. Handover, and the timing of handover, is an issue ultimately between the Palestinian Council and UNRWA. UNRWA does need to be assured of the financial stability In 1995 the Community, under the eighth Convention between the European Community and UNRWA, was the second largest contributor to the budget of UNRWA its contribution making up 19% of total contributions (the European Union, counting both member states' bilateral contributions and the Community contribution, was the largest donor - 43% of total contributions). X offered by a three-year convention. This handover is unlikely in the period 1996-98 Nevertheless, handover, even partial or phased handover, however unlikely, naturally could have implications for the Community contribution to the regular budget of the Agency, and it is right that the convention make allowance for this. It is appropriate to make contingent provision under the convention for a workable mechanism for altering the Community contribution. II GENERAL COVERAGE OF THE CONVENTION Since 1972 the EC and UNRWA have signed eight conventions2 governing the EC contribution to the regular and food aid budgets of the Agency. Each convention has: • set out the contribution to the regular (education, health and relief and social services) programme budget for the forthcoming three year period; and • allowed for the annual negotiation of the contribution to the food aid budget. The proposed appropriations under the new convention are thus intended as a contribution towards the financing of UNRWA's regular programme for some 2. 8 million Palestine refugees in five fields of operation: Jordan, Syria, Lebanon, the West Bank and the Gaza Strip It would also allow for the annual negotiation of the Community contribution to the food aid programme. The Commission has nonetheless been conscious, during negotiations, that at some point UNRWA will hand over its functions to the Palestinian Council, and even other administrations in the region. UNRWA has indeed already begun to formulate plans for a gradual handover. A review of political developments and an evaluation of progress made by UNRWA towards putting handover plans into operation, has been incorporated into the convention, to take place two years following signature. Such a review will enable the Commission to foresee the order of magnitude of the Agency's financial requirements beyond 1998, and thus to keep member states appraised of the level of contribution UNRWA may request the Community to make beyond the life of a ninth convention. It is therefore possible, if not likely, that UNRWA's financial requirements fall even during the 1996-98 period. This could be the case, for example, if any of the Agency's functions were during the life of the convention to be handed over, thus reducing UNRWA's recurrent costs. An article has therefore been included in the text to allow for reductions in the Community contribution under this convention, should this be appropriate. EEC-UNRWA Convention 1972-74, OJ No L 304 of 31. 12. 1972, p. 24 EEC-UNRWA Convention 1975-78, OJ No L 203 of 28. 07. 1976, p. 40 EEC-UNRWA Convention 1979-80, OJ No L 108 of 26. 04. 1980, p. 56 EEC-UNRWA Convention 1981-83, OJ No L 392 of 31. 12. 1981, pp. 3-6 EEC-UNRWA Convention 1984-86, OJ No L 188 of 16. 07. 1984, pp. 18-1 EEC-UNRWA Convention 1987-89, OJ No L 136 of 26. 05. 1987, p. 43 EEC-UNRWA Convention 1990-92, OJ No L 118 of 09. 05. 1990, p. 36 EC-UNRWA Convention 1993-95, OJ No L 9/16 of 13. 01. 94 3 Ill CONTRIBUTIONS UNDER THB NINTH CONVENTION UNRWA's regular programmes include its education programme, health programme, and relief and social services programme. UNRWA has argued in general terms the reasons for the annual increases in its budgetary needs, leading to increases in Community contributions under a ninth convention as compared to those under the eighth. A natural rate of growth of 3. 5% per annum in the beneficiary population increases the costs of providing basic services, as does inflation. With almost 21,000 employees (including over 13,000 teachers), staff costs account for over two thirds of UNRWA's budget. The inevitable increase in such costs creates the heaviest additional demand on the Agency's budget. Alone the award to staff of the annual salary increment to which they are entitled (not a salary increase) requires a 2% increase in the total salary budget. A Community contribution under the ninth convention would be made towards UNRWA's education and health programmes: 34. 1 MECU in 1996; 35. 3 MECU in 1997; and 36. 5 MECU in 1998. These overall figures break down as follows. 1. Education programme Under its education programme, UNRWA provides education to over 400,000 pupils. The objective of this programme to meet the basic educational needs of Palestine refugees, and to enhance their educational opportunities at all levels of the educational system. This objective is met by means of a general education sub- programme, teacher education, and vocational and technical education. UNRWA schools operate economically, with an average of 40. 3 pupils per teacher at the elementary level and 30. 3 at the preparatory level. The annual cost per pupil enrolled is low by regional and international standards, averaging $266 per pupil at the elementary level and $371 per pupil at the preparatory level. Education is nevertheless UNRWA's largest programme, accounting for almost half of its total budget. Refugee population growth of about of about 3. 5% per annum creates a requirement for substantial increases in teaching staff to keep pace with school population. This is expected to grow from 408,861 pupils in 1994-95 to 426,816 by the end of the 1996-97 biennium. (The programme must cope with an average annual increase in elementary school enrolment of 2. 42%, and in preparatory enrolment of 2. 2%) A new factor in the growth of the school population is the influx into the West Bank and Gaza Strip of returning refugee families since the establishment of the Palestinian Authority (now Council) in Gaza, and of its police force. It is also possible that those displaced in 1967 may start to opt for return. In the school year 1994-95 UNRWA admitted 4,358 children of returning refugee families into its Gaza Strip schools. 4- • Thus the Community contribution for the education programme will amount under this convention to: ECU 28 million in 1996; ECU 29. 4 million in 1997; and ECU 30. 9 million in 1998. 2. General health programme UNRWA's health programme is community-based, with the emphasis placed on primary health care, complemented, to the extent financially possible, by some secondary and tertiary care. The numbers of refugees living in camps has doubled over the last 25 years, from 492,000 in December 1970 to 983,000 in March 1995. The high population density associated with the camps increases the need for environmental health services, provided by UNRWA in the camps in cooperation with host Governments and municipalities. The growth in the refugee population, in particular the growing number of infants and elderly people who place the greatest demands on the health programme, increases the cost of providing basic health care, as does the cost of and high demand for hospitalisation. The Agency is making strenuous efforts to contain its expenditure on secondary and tertiary care. • Thus the convention allows for contributions to the general health programme of: ECU 3. 4 million in 1996; ECU 3. 6 million in 1997; and ECU 3. 8 million in 1998. 3. Other contributions to the health programme However, as well as the continuation of general health services, the health programme will place emphasis on an expanded sub-programme of maternal and child health including family planning, the development of programmes for control of non- communicable diseases, the containment of hospital services costs, environmental health, and the nutrition and supplementary feeding sub-programme. • Under the convention, the Community will contribute to specific components of this health programme: ECU 2. 7 million in 1996 ( 0. 9 MECU for the running costs of the family planning programme; 1. 1 MECU for the expansion of this programme1, and for other improvements (mainly by means of helping to cover staff costs) in the health programme, plus other support staff, 0. 7 MECU); Note that the family planning programme was funded under the eighth EC-UNRWA Convention. S" ECU 2. 3 million in 1997 (0. 9 MECU for the running costs of the family planning programme; 0. 7 MECU for the expansion of this programmé*; and for other improvements (mainly by means of helping to cover staff costs) in the health programme, plus other support staff, 0. 7 MECU); and ECU 1. 8 million in 1998 (0. 9 MECU for the running costs of the family planning programme; 0 7 MECU for the expansion of this programme3; and for other improvements (mainly by means of helping to cover staff costs) in the health programme, plus other support staff, 0. 2 MECU). 4. Food aid programme UNRWA is requesting that the new convention, as has been customary, allow for the annual negotiation of the Community contribution in kind to UNRWA's programme of food aid. The financial implications of the proposed action are specified at the financial annex. IV ACTION PROPOSED The Commission therefore recommends that the Council approve, after consultation of the Parliament, the text of the ninth convention with UNRWA and authorises the Commission to sign it on behalf of the EC. Proposal for a COUNCIL DECISION to approve the text of a ninth EC-UNRWA Convention covering the years 1996-98 prior to signature of the Convention by the Commission and the United Nations Relief and Works Agency for Palestine refugees (presented by the Commission) "3 THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 130y in conjunction with Article 228 (3) first subparagraph thereof, and with Article 228 (4), Having regard to the proposal from the Commission, Having regard to the opinion of the European Parliament *), Whereas the Convention concluded with the United Nations Relief and Works Agency for Palestine Refugees (UNRWA) concerning aid to refugees in the countries of the Near East, approved on 16th December 1993(2), expired on 31st December 1995; Whereas the Community assistance to UNRWA forms part of the campaign against poverty in the developing countries and thereby contributes to the sustainable economic and social development of the population concerned and the host countries in which that population lives; Whereas a new Convention should be concluded with UNRWA so that the Community's aid can continue to be provided as part Of a comprehensive programme offering a measure of continuity; Whereas continued support of UNRWA operations would be likely to contribute to the attainment of the Community objectives described in the above paragraph; Whereas the new Convention provides for simplified procedures allowing, as necessary, for either the withdrawal of the Community contribution to certain programmes of UNRWA or, in agreement with UNRWA, adjustments to the Community contribution; Whereas, as a consequence, the Commission should be authorized to approve such modifications under certain specific conditions; HAS DECIDED AS FOLLOWS; Article 1 The Convention between the European Community and the United Nations Relief and Works Agency for Palestine Refugees (UNRWA) concerning aid to refugees in the countries of the Near East is hereby approved on behalf of the Community. The text of the Convention is attached to this Decision. Article 2 The execution of the Community programme of food aid to UNRWA shall be governed by the procedure defined in Regulation (EEC) No 3972/86(3) or, if appropriate, by any regulation on food aid repealing and replacing it. 1 2 3 O J No XXXXX OJ No L 9/16, 13. 01. 94, p. XXXXX OJ No L 370, 30. 12. 1986, p. 1 Article 3 The Commission, after consultation of the committee designated for this purpose by the Council, shall proceed as necessary to notify UNRWA of the withdrawal of its contribution according to Article 2 (4) of the Convention Following the same procedure, the Commission will agree, as necessary, with UNRWA the appropriate adjustments foreseen at Article 5 of the Convention. Article 4 The President of the Council is hereby authorised to designate the persons empowered to sign the Convention in order to bind the Community. Done at Brussels, For the Council The President CONVENTION between the European Community and the United Nations Relief and Works Agency for Palestine Refugees (UNRWA) concerning aid to refugees in the countries of the Near East Article 1 The European Community (hereinafter referred to as 'the Community') hereby concludes this Convention with the United Nations Relief and Works Agency for Palestine Refugees (hereinafter referred to as 'UNRWA') in order to confirm its commitment to a programme of aid to UNRWA. This aid shall take the form of contributions in kind or in cash extending over a three-year period for use under the UNRWA education, health and feeding programmes. Article 2 1. The Community shall pay to UNRWA annually a cash contribution towards the cost of the education and health programmes. The size of this contribution shall be ECU 28 million in 1996, ECU 29. 4 million in 1997 and ECU 30. 9 million in 1998 for the education programme; ECU 3 4 million in 1996, ECU 3 6 million in 1997 and ECU 3. 8 million in 1998 for the general health programme; and ECU 2. 7 million in 1996, ECU 2. 3 million in 1997 and ECU 1. 8 million in 1998 for various specific components of the health programme (including the operation and expansion of the family planning programme, and for other support staff). The distribution of these amounts between the three headings stipulated will be amenable to adjustment by UNRWA each year, according to its needs, and on condition that the Commission is informed accordingly. 2. UNRWA shall send the Community each year a report on the use made of the Community contribution. UNRWA shall also provide the Community with any documentation that it may require relating to the execution of the education and health programmes, including the supplementary feeding programme; as well as any documents that will give detailed accounts of expenditure and budgetary estimates of future expenditure and the annual statistics of the UNRWA departments of education and health. 3. UNRWA shall inform the Community of any significant changes that may be planned in the education or health services provided by the Agency. 4. In the event of any significant changes in the education or health services provided by UNRWA during the period of validity of this Convention, the Community reserves the right to withdraw its agreement on the use of the funds made available to UNRWA under the Convention for these purposes. In such a case or cases the Community would notify UNRWA accordingly. Article 3 Aid for UNRWA's food aid programmes 1. Other Community resources can also be mobilised to meet the specific needs of vulnerable groups. [a 2. The amounts and characteristics of the commodities and services provided will be subject to separately agreed financing conditions, based on annual requests from UNRWA 3. UNRWA shall send the Community, each year, a report on the operation of the feeding programmes, indicating in particular the number, category and location of recipients and the services provided, the cost of the programmes and the use made of Community contributions in kind and in cash. Article 4 Review By end 1997, political developments regarding the refugees will be reviewed by the parties, and an evaluation made of any plans UNRWA has formulated, and, if this is the case, put into effect, for the handover of its functions to the Palestinian Council and/or any other body. Article 5 Adjustments If, during the life of the Convention, any or all of the functions of UNRWA are transferred to the Palestinian Council or to any other body, adjustments will be made, as appropriate, to those parts of the Community contribution to UNRWA under the Convention which are otherwise fixed under Article 2 paragraph 1, on the basis of an exchange of letters between the Community and UNRWA. Article 6 Financial control, and visits 1. UNRWA shall: i. keep financial and accounting documents concerning the activities financed by the Community; and ii. make available to the competent bodies of the Community, upon request, all relevant financial information including statements of accounts concerning the programme/project, whether they are executed by UNRWA or by subcontracting. In conformity with the Financial Regulation of the Community, the Commission and the Court of Auditors may undertake, including on the spot, check related to the operations financed by the Community. 2. UNRWA will facilitate the visits of representatives of the Community to the sites of UNRWA operations. \\ Ai Article 7 Any dispute arising out of this Convention shall be settled by consultation between the two parties at the request of either party. Article 8 Duration of the Convention This Convention shall cover a period of three calendar years (1996, 1997 and 1998). Article 9 This Convention shall be drawn up in duplicate in the Danish, Dutch, English, Finnish, French, German, Greek, Italian, Portuguese, Spanish and Swedish languages, each version being equally authentic. il FINANCIAL ANNEX Relevant articles of the Community budget Contributions to the regular programme: B7-421 (Aid to the United Nations Relief and Works Agency for Palestine Refugees in the Near East) Food aid: B7-200 (Food aid and support operations), B7-201 (alternative operations in place of food aid deliveries), B7-202 (Transport, distribution, storage and support operations) Description of action Conclusion of a new convention between the EC and UNRWA for the Community contribution to UNRWA's regular programme of education and health services, and its extraordinary programme of food aid. Legal base Articles 130u, 130w, 228§3 and 228§4 of the Treaty Establishing the European Community Financial implications Regular programmes UNRWA are requesting support to its regular programmes of 34. 1 MECU in 1996, 35. 3 MECU in 1997 and 36. 5 MECU in 1998 (a total of 105 9 MECU over the three year period, representing a year-on-year increase in the Commumty contribution of 6. 6%, 3. 5% and 3. 4%, and an average annual increase of 4. 5% in the Community contribution over the three year period). More specifically, the amounts proposed for the education programme are: 28 MECU in 1996; 29. 4 MECU in 1997; 30. 9 MECU in 1998. These figures would represent a year-on-year increase in the Community contribution, from 1995, of 5% each year The amounts proposed for the regular health care programme are: 3. 4 MECU in 1996; 3. 6 MECU in 1997; 3. 8 MECU in 1998. Also as part of the overall health programme, the amounts proposed for the cash component of the supplementary feeding programme, and for improvements in health care (including family planning and its expansion) are: 2. 7 MECU in 1996; 2 3 MECU in 1997; and 1. 8 MECU in 1998. Taken together, the Community contributions for the health programme as a whole would increase by an average of 2. 3% This increase reflects the costs of the family planning programme, not under previous conventions charged to the Community budget, and to the expansion of this programme. Contribution to feeding programmes The size and content of the annual contribution to UNRWA for the feeding programmes will be decided according to the procedure laid down in Regulation (EEC) No 3972/86. \3> Table I EC contribution to UNRWA's regular programme for 1996, 1997 and 1998, as proposed by UNRWA in its initial approach to the Commission Programme Education Health programme Other contributions (particularly family planning) TOTAL to the health programme 1996 1997 1998 28 3. 4 2. 7 34. 1 29. 4 3. 6 2. 3 35. 3 30. 9 3. 8 1. 8 36. 5 Table 11 EC contributions under the 1993-95 EC-UNRWA Convention to UNRWA's regular and food aid programmes Programme Education Health programme Cash component of supplementary feeding programme Sub-total - regular programme Food products (in value, at world prices, delivered free at destination) Costs of distribution and supervision Sub-total - food aid programme TOTAL 1993 1994 1995 24. 2 5 0. 8 30 19. 38 2. 24 21. 62 51. 62 25. 4 4. 9 0. 7 31 11. 69 1. 2 12. 89 43. 89 26. 7 4. 7 0. 6 32 7. 2 0. 81 8. 01 40. 01 n ISSN 0254-1475 COM(96) 257 final DOCUMENTS EN H Catalogue number : CB-CO-96-277-EN-C ISBN 92-78-05325-2 Office for Official Publications of the European Communities L-2985 Luxembourg IS

Decision of the EEA Joint Committee No 37/96 of 5 June 1996 amending Annex XX (Environment) to the EEA Agreement

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L_1996237EN. 01004601. xml 19. 9. 1996    EN Official Journal of the European Communities L 237/46 DECISION OF THE EEA JOINT COMMITTEE No 37/96 of 5 June 1996 amending Annex XX (Environment) to the EEA Agreement THE EEA JOINT COMMITTEE, Having regard to the Agreement on the European Economic Area, as adjusted by the Protocol adjusting the Agreement on the European Economic Area, hereinafter referred to as the Agreement, and in particular Article 98 thereof, Whereas Annex XX to the Agreement was amended by Decision of the EEA Joint Committee No 75/95 (1); Whereas Commission Decision 96/13/EC of 15 December 1995 establishing the ecological criteria for the award of the Community eco-label to indoor paints and varnishes (2) is to be incorporated into the Agreement, HAS DECIDED AS FOLLOWS: Article 1 The following point shall be inserted after point 2eg (Commission Decision 95/533/EC) in Annex XX to the Agreement: ‘2eh. 396 D 0013: Commission Decision 96/13/EC of 15 December 1995 establishing the ecologial criteria for the award of the Community eco-label to indoor paints and varnishes (OJ No L 4, 6. 1. 1996, p. 8). ’ Article 2 The texts of Decision 96/13/EC in the Icelandic and Norwegian languages, which are annexed to the respective language versions of this Decision, are authentic. Article 3 This Decision shall enter into force on 6 June 1996, provided that all the notifications under Article 103 (1) of the Agreement have been made to the EEA Joint Committee. Article 4 This Decision shall be published in the EEA Section of, and in the EEA Supplement to, the Official Journal of the European Communities. Done at Brussels, 5 June 1996. For the EEA Joint Committee The President P. BENAVIDES (1)  OJ No L 57, 7. 3. 1996, p. 41. (2)  OJ No L 4, 6. 1. 1996, p. 8

REPORT FROM THE COMMISSION TO THE BUDGETARY AUTHORITY ON GUARANTEES COVERED BY THE GENERAL BUDGET-SITUATION AT 31 DECEMBER 1995

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COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 05. 06. 1996 COM(96) 243 final REPORT FROM THE COMMISSION TO THE BUDGETARY AUTHORITY ON GUARANTEES COVERED BY THE GENERAL BUDGET SITUATION AT 31 DECEMBER 1995 This report describes the situation as regards budget guarantees at 31 December 1995. It is in response to the statement made by the Commission, when the vote was taken on supplementary and amending budget No 1/91, that it would report to the budgetary authority twice a year on budget guarantees and the corresponding risks. The Commission has already presented nine reports to the budgetary authority. The report is in three parts: 1. 2. 3. Events since the last report, the risk situation and the activation of budget guarantees. Description of operations entered in the budget. Assessment of the economic and financial situation of non-Community countries benefiting from the most important operations. A Contents PART ONE: EVENTS SINCE THE REPORT AT 30 JUNE 1995, THE RISK SITUATION AND ACTIVATION OF BUDGET GUARANTEES EVENTS SINCE THE REPORT AT 30 JUNE 1995. I. LA. Macrofinancial assistance to Ukraine I. B. European Investment Bank loans to the Mediterranean countries guaranteed by the general budget RISK SITUATION n. n. A. Total risk II. B. Risk in respect of the Member States U. C. Risk in respect of non-member countries IE. III. A. EIB loans to non-member countries III. B. ACTIVATION OF BUDGET GUARANTEES BORROWING/LENDING OPERATIONS OR LOAN GUARANTEES FOR NON-MEMBER COUNTRIES PART TWO: OPERATIONS ALREADY ENTERED IN THE BUDGET I. LA. LB. LC. II. BORROWINGS TO BE ON-LENT WITHIN THE COMMUNITY Community borrowing operations to provide balance-of-payments support Euratom borrowing operations Borrowing operations for the promotion of investment in the Community LOANS RAISED COUNTRIES FOR ON-LENDING TO NON-COMMUNITY II. A. Euratom borrowings for certain non-Community countries II. B. Programme of borrowings contracted by macrofinancial assistance to the countries of Central and Eastern Europe ILC. Borrowings contracted by the Community to grant macrofinancial assistance to the Community to provide the new independent States of the former Soviet Union II. D. Borrowings contracted by the Community to grant macrofinancial assistance to the Baltic States ILE. Borrowings contracted by the Community to grant macrofinancial assistance to the Mediterranean countries COMMUNITY GUARANTEE TO NON-COMMUNITY COUNTRIES III. III. A. European Investment Bank loans to Mediterranean countries guaranteed by the general budget III. B. Loans granted by the European Investment Bank in countries of Central and^ Eastern Europe IILC. Loans granted by the European Investment Bank in non-member countries. III. D. Loans granted by the European Investment Bank in South Africa PART THREE: CHANGES IN POTENTIAL RISKS I. LA. I. B. IL TYPES OF OPERATION Operations with macroeconomic objectives Operations with microeconomic objectives GENERAL ECONOMIC COUNTRIES. SITUATION OF THE NON-MEMBER 1 1 1 1 1 2 2 3 4 4 4 6 6 6 6 6 7 7 8 11 13 14 15 15 16 17 17 18 18 18 18 19 W A STATISTICAL ANNEX TABLES OF STATISTICS EXPLANATORY NOTES ANNEX: DEFINITION OF FIGURES USED IN THE REPORT iir ^ PART ONE: EVENTS SINCE THE REPORT AT 30 JUNE 1995, THE RISK SITUATION AND ACTIVATION OF BUDGET GUARANTEES I. EVENTS SINCE THE REPORT AT 30 JUNE 1995 I. A. Macrofinancial assistance to Ukraine As part of an overall aid programme for Ukraine, the Council Decision of 23 October 1995 empowered the Commission, on behalf of the Community, to borrow ECU 200 million for a maximum period often years. The proceeds of this operation are to be on-lent to Ukraine in two tranches. At 31 December 1995 the first tranche had not yet been paid. I. B. European Investment Bank loans to the Mediterranean countries guaranteed by the general budget Council Decisions of 30 October 1995 on the conclusion of protocols on financial and technical cooperation between the Community and the Republics of Malta and Cyprus. Under these protocols, the EIB may commit ECU 30 million and ECU 50 million respectively for a three-year period in the form of loans from its own resources. II. RISK SITUATION There are two possible methods for evaluating the risks borne by the Community budget: the method, often used by bankers, of the total amount of capital outstanding for the operations concerned on a given date; the more budgetary approach of calculating the maximum amount which the Community could have to pay out in each financial year. The second approach itself has been applied in two different ways: by reference only to actual disbursements at 31 December 1995, giving the minimum level of risk to the Community assuming that there are no early repayments (see Table 2 on page 2 of the statistical annex); on a more forward-looking basis, by'reference to all the operations decided-by the Council or proposed by the Commission in order to estimate the impact on future budgets, giving the maximum risk borne by the Community assuming that the Commission's proposals are accepted (see Table 3 on page 3 of the statistical annex). For the latter exercise a number of assumptions have to be made about dates of disbursement, terms of repayment, interest and exchange rates; details are given in the annex. However, this method does give some idea about the future level of risks connected with the proposals made. The results are shown in the tables in the annex (pages 1 to 3), which assess the risk relating to countries inside the Community and countries outside the Community. The overall figures quoted cover risks of different types; loans to one country in the case of macrofinancial assistance and loans for projects guaranteed by the borrowers in the case of NCI and EIB operations, for example. lc A The following analysis distinguishes between total risk, the risk in respect of Member States and the risk in respect of non-member countries. H. A. Total risk II. A. 1. Amount outstanding at 31 December 1995 (see Table 1 on page 1 of the statistical annex) The total risk at 31 December 1995 came to ECU 13 114 million, the same as at 30 June 1995. II. A. 2. Maximum annual risk borne by the community budget: operations disbursed at 31 December 1995 (see Table 2 on page 2 of the statistical annex) The total risk, which comes to ECU 3 149 million in 1996, will develop as follows: Year 1997 1998 1999* 2000 2001 2002 2003 Annual risk (ECU million) % change 3049 3238 994 3481 776 600 360 -3% +6% -69% +250% -78% -23% ^ 0% * No capital repayments for the balance-of-payments loans to the Member States; capital repayments on loans to Hungary, the Czech and Slovak Republics and Bulgaria end in 1998. II. A. 3. Maximum theoretical annual risk borne by the community budget (see Table 3 on page 3 of the statistical annex) This risk comes to ECU 3 500 million in 1996 and will increase regularly until 2000 (except in 1999 when it will total ECU 2 508 million) as follows: Years Annual risk (ECU million) % change 1997 3858 1998 4425 1999 2508 2000 5267 2001 2716 2002 4617 2003 4783 + 10% + 15% -43% + 110% -48% +70% +4% II. B. Risk in respect of the Member States II. B. l. Amount outstanding at 31 December 1995 (see Table 1 on page 1 of the statistical annex) The capital outstanding in respect of operations in the Member States was ECU 7 263 million at 31 December 1995, a fall of 3. 7% compared with 30 June 1995. This fall is mainly due to the reduction in outstanding Euratom loans and NCI loans. The amount outstanding from the other operations has remained stable. A ILB. 2. Maximum annual risk borne by the Community budget: operations disbursed at 31 December 1995 (see Table 2 on page 2 of the statistical annex) The risk for 1996 comes to ECU 2 068 million. The total maximum annual risk to the Community budget in relation to disbursements. (Table 2) changes in line with the capital repayments (every two years) on balance-of-payment loans to Greece and Italy. The maximum risk is highest in the even years up to 2000 when it will reach ECU 2 821 million. II. B. 3. Maximum theoretical annual risk borne by the Community budget (see Table 3 on page 3 of the statistical annex) The trend is much the same as in Table 2 up to 2000 when the risk will amount to ECU 3 215 million. It will fall to ECU 2 370 million in 2002 and ECU 2 196 million in 2003. n. C. Risk in respect of non-member countries //. C. l. Amount outstanding at 31 December 1995 (see Table 1 on page 1 of the statistical annex) The capital outstanding at 31 December 1995 was ECU 5 851 million, an increase of 5. % compared with 30 June 1995-. II. C. 2. Maximum annual. risk borne by the Community budget: operations disbursed at 31 December 1995 (see Table 2 on page 2'of the statistical annex) The risk for 1996 comes to ECU 1 081 million. The risk will increase in 1997 to ECU 1 586 million as the following payments fall due: ECU 80" million from Hungary; ECU 127 million from the Czech Republic; ECU 63 million from the Slovak Republic; ECU 140 million from Bulgaria; ECU 250 million from Algeria; ECU 160 million from Israel. ECU 143 million from the Republics of the former Soviet Union. Years Annual risk (ECU million) 1997 1586 1998 1178 1999 695 2000 660 2001 670 2002 570 2003 334 A //. C. 3. Maximum theoretical annual risk borne by the Community budget (see Table 3 on page 3 of the statistical annex)) The risk will rise from ECU 1 263 million in 1996 to ECU 2 057 million in 1997. Years Annual risk (ECU million) 1997 2057 1998 1942 1999 1817 2000 2053 2001 2269 2002 2247 2003 2587 m. ACTIVATION OF BUDGET GUARANTEES III. A. EIB loans to non-member countries On 5 July 1995, the EIB called on the budget guarantee in respect of loans of around ECU 8. 6 million to the Republics of former Yugoslavia (the Former Yugoslav Republic of Macedonia - FYROM - and Serbia). The payment was made to the EIB on 11 October 1995. On 18 October 1995, the EIB again called on the budget guarantee in respect of loans of around ECU 5. 2 million to the Republics of former Yugoslavia (FYROM, Serbia and Bosnia- Hercegovina). The payment was made to the EIB on 26 January 1996. At 31 December 1995 the total amount of debts settled by the Community and not yet repaid by the defaulting debtors came to ECU 68. 2 million. These debts were owed by all the Republics of former Yugoslavia with the exception of Slovenia and Croatia, which have no payments overdue. Of the ECU 68. 2 million due but not paid, ECU 28. 6 million was entered in the budget in respect of the amount owed from before 1994 and a total of ECU 39. 6 million was called in from the Guarantee Fund on 11 January 1995 (ECU 5. 3 million), on 30 January 1995 (ECU 6. 08 million), on 11 October 1995 (ECU 14. 3 million), on 24 May 1995 (ECU 8. 6 million) and on 26 January 1996 (ECU 5. 2 million). in. B. BORROWING/LENDING OPERATIONS OR LOAN GUARANTEES FOR NON-MEMBER COUNTRIES III. B. 1. Payments from cash resources The Commission draws on its cash resources under Article 12 of Council Regulation No-4552/89 of 29 May 1989 implementing Decision 88/376/EEC, Euratom on the system of the Communities* own resources to avoid delays in servicing its borrowing operations when a debtor is la,te in paying. III. B. 2. Activation of the Guarantee Fund In the event of late payment by a recipient of a loan granted or guaranteed by the Community, the Guarantee Fund is called on to cover the default within three months of the date on which is payment is due. Penalty interest for the time between the date on which cash resources are made available and the date of activation of the Fund is drawn from the Fund and repaid to the cash resources. A In the last six months the Fund has been called on to honour guarantees for the following debtors: / ' Country Date I Amount (principal Tajikistan Georgia Georgia Kazakhstan Georgia Armenia Tajikistan Turkmenistan Total 20. 07. 95 20. 07. 95 17. 10. 95 17. 10. 95 21. 11. 95 21. 11. 95 21. 11. 95 21. 11. 95 J ~ +" interest) 1713 431. 10 2 182 277. 63 1471300. 30 835 614. 83 70 931 856. 06 37 996 507. 14 55 692 660. 94 45 850 146. 11 216 673 794. 11 III. B. 3. Late repayments During the period covered by this report the following country repaid debts on which it had defaulted and for which the Guarantee Fund had already been activated. The amounts recovered are repaid to the Fund under Article 2 of Council Regulation (EC) No 2728/94 of 31 October 1994 establishing a Guarantee Fund for external action. Country Repayment date Kazakhstan 15. 11. 95 Amount (principal + interest) 835 614. 83 III. B. 4. Situation as regards unpaid debts at 31 December 1995 The following amounts had not been paid at 31 December 1995: Country Tajikistan Georgia Armenia Turkmenistan Amount (principal + interest) 63 181 389. 89 81306 915. 94 37 996 507. 14 45 850 146. 11 "Total 228 334 959. 08 A PART TWO: OPERATIONS ALREADY ENTERED IN THE BUDGET The budgetary authority authorized 29 headings with token entries in the 1995 budget to cover any payment of guarantees. These headings can be divided into three categories: borrowing and lending within the Community, borrowing and lending outside the Community and guarantees given to financial institutions. I. BORROWINGS TO BE ON-LENT WITHIN THE COMMUNITY LA. Community borrowing operations to provide balance-of-payments support The Community is authorized to borrow on the capital markets or from financial institutions and make the sums raised available to Member States experiencing temporary balance-of-payments difficulties. The outstanding amount of loans granted to Member States for this purpose may not exceed ECU 14 billion in principal. At 31 December 1995 there was one operation in respect of Greece under the decision of 4 March 1991 and one operation in respect of Italy under the decision of 18 January 1993. At 31 December 1995 the amount outstanding was ECU 1 000 million in loans to Greece and ECU 4 045 million in loans to Italy (Table 1 on page 1 of the statistical annex). I. B. Euratom borrowing operations In 1977 the Commission was empowered to borrow funds to be used to help finance nuclear power stations. Loans are made to electricity producers and carry the usual guarantee demanded by banks. Recipients are often State-owned companies or companies enjoying a State guarantee. The maximum amount of borrowings authorized is ECU 4 billion, of which ECU 500 million was authorized by the 1977 decision, ECU 500 million in 1980, ECU 1 billion in 1982, ECU 1 billion in 1985 and ECU 1 billion in 1990. The amount borrowed comes to around ECU 2 900 million, leaving ECU 1 100 million which may still be raised. At 31 December 1995 the total outstanding was ECU 720 million. On 9 December 1992 the Commission proposed that the balance of borrowings not used in the Member States could be used to finance the improvement of the degree of efficiency and safety of nuclear power stations in the countries of Central and Eastern Europe and in the CIS. The Council adopted a decision to this effect on 21 March 1994 (see Part II - Loans raised for non-Community countries). I. C. Borrowing operations for the promotion of investment in the Community The Commission was empowered by a Council Decision of 16 October 1978 to borrow funds to be used to promote investment in the Community (New Community Instrument). The authorized borrowing ceiling was fixed at ECU 1 billion by the Decision of 16 October 1978 and was men raised by ECU 1 billion by the Decision of 15 March 1982. The ceiling was further A- raised by ECU 3 billion by the Decision of 19 April 1983 and by ECU 750 million by the Decision of 9 March 1987. The proceeds of the operations are paid out in the form of loans granted by the EIB, acting for the Commission, to finance investment projects which contribute to greater convergence and growing integration and are consistent with the priority Community objectives in the energy, industry and infrastructure sectors, taking account of such factors as the regional impact of the projects and the need to combat unemployment. Support for small businesses was also made a priority objective by the Decision of 26 April 1982. A Decision of 20 January 1981 also empowered the Community to contract loans in order to provide exceptional aid of ECU 1 billion to the regions of Italy affected by the earthquake of November 1980. A similar decision involving ECU 80 million was adopted on 14 December 1981 for the regions affected by the earthquakes in Greece in February/March 1981. The maximum amount of borrowings authorized thus comes to ECU 6 830 million. At 31 December 1995 the total outstanding was ECU 1 113 million, 29. 11% less than on 31 December 1994. The risk is spread over a large number of borrowers. In addition, most of the loans are global loans to financial institutions which guarantee repayment of the funds. Every year the EIB provides the Commission with a list of debtors who, according to its information, risk defaulting in the coming year. So far, no names have appeared on this list. II. LOANS RAISED FOR ON-LENDING TO NON-COMMUNITY COUNTRIES II. A. Euratom borrowings for certain non-Community countries On 21 March 1994 the Council decided to amend Decision 77/270/Euratom to authorize the Commission to contract Euratom borrowings in order to contribute to the financing required for improving the degree of safety and efficiency of nuclear power stations in certain non-member countries. This Decision will allow a considerable proportion of Euratom's available borrowing capacity (some ECU 1 100 million) to be used to finance projects. For these projects to be eligible they must relate to: nuclear power stations or installations in the nuclear fuel cycle which are in service, or under construction; or to the dismantling of installations which cannot be brought up to standard for technical or economic reasons. The following non-member countries qualify: Republic of Bulgaria Republic of Hungary Republic of Lithuania Romania Republic of Slovenia A Czech Republic Slovak Republic Russian Federation Republic of Armenia Ukraine The idea of international financial aid for the closure of the Chernobyl nuclear power plant was entered in the conclusions of both the Corfu European Council of 24 and 25 June 1994 and the G7 summit at Naples on 7 and 8 July 1994. II. B. Programme of borrowings contracted by the Community to provide macrofinancial assistance to the countries of Central and Eastern Europe II. B. l. Hungary Hungary I n. B. l(a) In 1990 the Community granted Hungary a medium-term loan of up to ECU 870 million in principal for a maximum of five years. The loan is intended to facilitate the adjustment of the Hungarian economy in a way which will enable it to derive all the benefits of a market-based economy. It is being made available in tranches. The first tranche of ECU 350 million was paid on 20 April 1990. A second tranche of ECU 260 million was paid on 14 February 1991. The third tranche, which is not to exceed ECU 260 million, was planned for 1992 but has not been paid out as Hungary's balance of payments has been more favourable than expected. The tranches will be repaid in one instalment after five years and interest, which is at variable rates, is payable half-yearly. Hungary repaid the first tranche of ECU 350 million in full on 20 April 1995. n. B. l(b) Hungary II As me break-up of the Council for Mutual Economic Assistance (Comecon) and the Gulf crisis threatened to compromise the initial encouraging results of the reforms undertaken, the Council decided to grant additional macrofinancial assistance to Hungary in the form of a loan of ECU 180 million under a general G-24 programme of financial assistance. The first tranche of ECU 100 million was paid on 14 August 1991. It will be repaid, in one instalment after seven years, and interest, which is at variable rates, is payable half-yearly. The second tranche of ECU 80 million was paid on 15 January 1993. It will be repaid in January 1997 and interest, which is at a fixed rate, is payable annually. At 31 December 1995 the amount outstanding on borrowings for Hungary came to ECU 440 million. ILB. 2. Czech Republic and Slovak Republic As part of G-24's overall financial assistance, the Commission, on behalf of the Community, was empowered to borrow, in two tranches, ECU 375 million for a period of seven years. The proceeds of this operation were to be on-lent on the same terms to the Czech and Slovak Federal Republic. A The first tranche of ECU 185 million was paid on 14 August 1991. It will be repaid in one instalment after seven years, and interest, which is at variable rates, is payable half-yearly. The second tranche of ECU 190 million was paid on 2 March 1992 and will be repaid in one instalment after six years. Following the division of Czechoslovakia into the Czech Republic and the Slovak Republic on 1 January 1993, the Commission proposed that the loan be divided between the two Republics. Under the Council decision of 24 January 1994, two thirds of the loan - ECU 250 million - will be for the Czech Republic and one third - ECU 125 million - for the Slovak Republic. At 31 December 1995 the amount outstanding on borrowings for the two republics came to ECU 375 million. Slovak Republic As part of the new financial assistance to the Slovak Republic, the Commission, on behalf of the Community, was empowered by a Council decision of 22 December 1994 to borrow, in two tranches, ECU 130 million for a period of seven years. The proceeds of this operation were to be on-lent on the same terms to Slovakia. This assistance has not been implemented because of the delay in structural reforms in these countries. Furthermore, there has been a distinct improvement in the Slovak Republic's balance of payments and currency reserves since October 1995. The Commission has therefore submitted to the Council a proposal to cancel the medium-term loan authorized by Decision 94/939/EC of 22 October 1994. II. B J. Bulgaria II. B. 3(a) Bulgaria I As part of G-24's overall financial assistance, the Commission, on behalf of the Community, was empowered to borrow, in two tranches, ECU 290 million for a period of seven years. The proceeds of this operation were to be on-lent on the same terms to Bulgaria. The first tranche of ECU 150 million was paid to Bulgaria on 14 August 1991. It will be repaid in one instalment after seven years, and interest, which is at variable rates, is payable half-yearly. The second tranche of ECU 140 million was paid on 2 March 1992 and will be repaid in one instalment after five years. Interest, which is at variable rates, is payable half-yearly. II. B. 3(b) Bulgaria II As part of G-24's new aid for 1992 and 1993, the Commission, on behalf of the Community, was empowered to borrow ECU 110 million in two tranches for a maximum period of seven years. The proceeds of this operation were to be on-lent to Bulgaria. Because of delays in the process of economic reform in Bulgaria, implementation of this operation was deferred until December 1994 when the first tranche of ECU 70 million was finally paid. It will be repaid in A one instalment on 7 December 2001 and the interest, which is at variable rates, is payable half- yearly. At 31 December 1995 the amount outstanding on borrowings for Bulgaria came to ECU 360 million. II. B. 4. Romania II. B. 4(a) Romania I As part of G-24's overall financial assistance, the Commission, on behalf of the Community, was empowered to borrow ECU 375 million in two tranches for a maximum period of seven years. The proceeds of this operation were to be on-lent on the same terms to Romania. The first tranche of ECU 190 million for a term of seven years was paid on 22 January 1992. It will be repaid in one instalment on 1 February 1999, and interest, which is at variable rates, is payable half-yearly. The second tranche of ECU 185 million for a term of six years was paid in April 1992 and will be repaid in one instalment on 18 March 1998. Interest, which is at variable rates, is payable half-yearly. II. B. 4(b) Romania II As part of G-24's new aid, the Commission, on behalf of the Community, was empowered to borrow ECU 80 million for a maximum period of seven years. The proceeds of this operation were to be on-lent on the same terms to Romania. The loan was paid out in a single tranche on 26 February 1993. It will be repaid in one instalment on 26 February 2000, and interest is payable half-yearly. II. B. 4(c) Romania HI As part of G-24's new overall macrofinancial aid, the Commission, on behalf of the Community, was empowered by the Council Decision of 20 June 1994 to borrow ECU 125 million in two tranches of ECU 90 million and ECU 35 million for a maximum period of seven years. The proceeds of this operation are to be on-lent on the same terms to Romania. The first tranche of ECU 55 million for a term of seven years was paid on 20 November 1995. It will be repaid in one instalment on 20 November 2002, and interest, which is at variable rates, is payable half-yearly. The second tranche had not yet been paid at 31 December 1995. 10 A At 31 December 1995 the amount outstanding on borrowings for Romania came to ECU 510 million. n. C. Borrowings contracted by the Community to grant macrofinancial assistance to the new independent States of the former Soviet Union. II. C. l Medium-term loan of ECU 1 250 million In December 1991 the Council decided to grant a credit facility of up to ECU 1 250 million for the Soviet Union and its Republics in order to finance imports of agricultural products, foodstuffs and medicines from the Community and Eastern Europe for a maximum period of three years. After the Soviet Union broke up, the loan was divided between the various new independent States at the beginning of 1992. U. C. 1(a) Loan contracts signed on the basis of the original breakdown Most of the loan contracts were signed in the course of 1992: (ECU 38 million), Kyrgyzstan with Armenia (ECU 32 million), Turkmenistan (ECU 45 million) and Moldova (ECU 27 million) on 10 July 1992; the amount for Kyrgyzstan has since been reduced to ECU 23. 7 million at the request of the Kyrgyzstan authorities; with Ukraine (ECU 130 million) on 13 July 1992; with Belarus (ECU 70 million) on 24 July 1992; with Russia (ECU 150 million) on 9 September 1992; with Russia (ECU 349 million) on 9 December 1992; with Kazakhstan (ECU 25 million) on 15 December 1992; (ECU 55 million) and Georgia (ECU 102 million), Tajikistan n. C. 1(b) Loan contracts signed on the basis of the amended breakdown Some loan contracts were also signed in 1993 after the initial breakdown of the total amount of the loan had been changed: On 5 May 1993 two further contracts were signed with Armenia (ECU 20 million) and Georgia (ECU 10 million). The amount represented by these two loans had originally been allocated to Kazakhstan. On 6 December 1993 a further loan contract of ECU 40 million was signed with Georgia. This loan was financed by reducing Uzbekistan's allocation. On 14 September 1994 a contract for ECU 59 million was signed with Uzbekistan. On 12 October 1994 a contract for ECU 68 million was signed with Azerbaijan. 11 A n. C. 1(c) Utilization of the ECU 1 250 million loan Loans Initial breakdown (1992) Breakdown at 31. 12. 1995 Actual utilization at 31. 12. 1995 Armenia a Armenia b Azerbaijan Belarus Georgia a Georgia b Georgia c Kazakhstan a Kazakhstan b Kyrgyzstan Moldova Russia a Russia b Tajikistan Turkmenistan Ukraine Uzbekistan Total 38 68 102 70 55 32 27 150 349 55 45 130 129 38 20 68 100. 5 70 10 40 25 0 23. 7 27 72. 9 349 55 45 129. 8 59 37. 9 19. 6 50. 3 100. 5 69. 4 9. 8 34. 1 24. 9 22. 7 27. 0 70. 0 299. 7 54. 5 44. 9 129. 8 58. 8 1250 1132. 9 1053. 9 At 31 December 1995 the amount of loans actually being used came to ECU 1053. 9 million. n. C. 1(d) Capital repayment and interest payment dates The capital repayment and interest payment dates for this operation vary depending on the date on which the loan contract was signed and the amount of the loan: Armenia (ECU 38 million), Belarus, Georgia (ECU 70 million), Kyrgyzstan, Moldova, Tajikistan, Turkmenistan, Ukraine, Russia (ECU 150 million): interest on 20 April and 20 October capital on 20 August 1995 (half on 20 August 1994 and half on 20 August 1995 for Belarus, Ukraine and Russia) Armenia (ECU 20 million), Kazakhstan, Russia (ECU 349 million), Georgia-(ECU 10 million and ECU 40 million): interest on 15 January and 15 July (half on 15 January 1995 and half on capital on 15 January 1996 15 January 1996 for Russia and 15 January 1997 for Georgia (ECU 40 million)). Azerbaijan and Uzbekistan: interest on 28 March and 28 September capital on 28 September 1997. At 31 December 1995 Georgia, Armenia, Turkmenistan and Tajikistan had defaulted on principal and interest totalling ECU 228. 33 million (see Part One, Section III - Activation of budget guarantees). 12 A ILC. 2 Macrofinancial assistance for Moldova As part of the Community's contribution to the international aid scheme for Moldova, the Commission, on behalf of the Community, was empowered by a decision of 13 June 1994 to borrow ECU 45 million in two tranches for a maximum period often years. The proceeds of this operation were to be on-lent on the same terms to Moldova. The first tranche of ECU 25 million was paid to Moldova in December 1994. The loan is to be repaid in five equal annual instalments from the sixth year onwards. The full loan will have been paid by 7 December 2004. The interest, which is at variable rates, is payable half-yearly. The second tranche of ECU 20 million for a term of 10 years was paid on 8 August 1995. The loan is to be repaid in five equal annual instalments from the sixth year onwards. The full loan will have been paid by 8 August 2005. The interest, which is at variable rates, is payable half- yearly. At 31 December 1995 the amount outstanding on borrowings for Moldova came to ECU 45 million. IL C. 3 Macrofinancial assistance for Ukraine As part of the overall aid programme for Ukraine, the Commission, on behalf of the Community, was empowered by the Council Decision of 22 December 1994 to borrow ECU 85 million for a maximum period often years. The proceeds of this operation are to be on-lent to Ukraine in one tranche. The loan was paid in one tranche on 28 December 1995. The loan is to be repaid in five equal annual instalments from the sixth year onwards. The full loan will have been paid by 28 December 2005. The interest, which is at variable rates, is payable half-yearly. At 31 December 1995 the amount outstanding on borrowings for Ukraine came to ECU 85 million. //. C. 4 Macrofinancial assistance for Belarus As part of the overall aid programme for Belarus, the Commission, on behalf of the Community, was empowered by a Council decision of 10 April 1995 to borrow up to ECU 75 million for a maximum period often years. The proceeds of this operation were to be on-lent in twojtranches The first tranche of ECU 30 million was paid on 28 December 1995 and is to be repaid in five equal annual instalments from the sixth year onwards. The full loan will have been paid by 28 December 2005. The interest, which is at variable rates, is payable half-yearly. At 31 December 1995 the amount outstanding on borrowings for Belarus came to ECU 30 million. II. D. Borrowings contracted by the Community to grant macrofinancial assistance to the Baltic States As part of the G-24's overall programme of financial assistance for these three countries, the Commission, on behalf of the Community, was empowered to borrow ECU 220 million for a 13 f\ period of seven years. The proceeds of this operation were to be on-lent on similar terms in two tranches: ECU 40 million for Estonia; ECU 80 million for Latvia; ECU 100 million for Lithuania. The first tranches of the loan for Estonia (ECU 20 million) and for Latvia (ECU 40 million) were paid on 31 March 1993. The loans are to be repaid in one instalment on 31 March 2000 and interest, which is at variable rates, is payable half-yearly every 31 March and 30 September. The first tranche of ECU 50 million for Lithuania was paid on 27 July 1993; it is to be repaid in one instalment on 27 July 2000 and interest, which is at a fixed rate, is payable annually every 27 July. Half of the second tranche, ie. ECU 25 million of the ECU 50 million planned, was paid to Lithuania on 16 August 1995; it is to be repaid in one instalment on 16 August 2002 and interest, which is at a variable rate, is payable half-yearly every 16 February and 16 August. At 31 December 1995 the amount outstanding on the borrowings for the Baltic States came to ECU 135 million. ILE. Borrowings contracted by the Community to grant macrofinancial assistance to the Mediterranean countries ILEA. Israel As part of the financial assistance agreed for Israel and the population of the occupied territories, the Commission was empowered in June 1991 to borrow, on behalf of the Community, ECU 160 million in one tranche for a period of seven years. The proceeds were to be paid out to Israel on the same terms and are accompanied by an interest subsidy of ECU 27. 5 million paid from the Community budget. This operation started on 2 March 1992. The borrowing is to be repaid in full on 15 December 1997. At 31 December 1995 the amount outstanding on the borrowings for Israel came to ECU 160 million. _ II. E. 2. Algeria In September 1991 the Commission, on behalf of the Community, was empowered to borrow ECU 400 million in two tranches for a maximum period of seven years. The proceeds of this operation were to be on-lent on the same terms to Algeria. A bridging loan was granted on 23 December 1991 to cover the first tranche of ECU 250 million and was repaid from the net proceeds of the borrowing contracted on 14 January 1992 for a period of six years. The loan is to be repaid in one instalment on 15 December 1997 and interest is payable annually every 15 December. 14 A: Payment of the second tranche of ECU 150 million was deferred because of delays in AJgeria's economic reform programme and was not made until August 1994 when the process of structural adjustment resumed. The loan is to be repaid in full on 17 August 2001 and interest is payable annually every 17 August. In December 1994 the Council decided to grant Algeria further macrofinancial assistance. The Commission, on behalf of the Community, was empowered to borrow ECU 200 million for a maximum period of seven years. The proceeds of this operation are to be on-lent to Algeria in two tranches. The first tranche of ECU 100 million for a term of seven years was paid on 27 November 1995. It is to be repaid in one instalment on 27 November 2002 and interest, which is at a variable rate, is payable half-yearly. At 31 December 1995 the amount outstanding on the borrowings for Algeria came to ECU 500 million. III. COMMUNITY GUARANTEE TO NON-COMMUNITY COUNTRIES m. A. European Investment Bank loans to Mediterranean countries guaranteed by the general budget Under the terms of the Council Decision of 8 March 1977, the Community guarantees loans to be granted by the European Investment Bank as part of the Community's financial commitments towards the Mediterranean countries. This decision was the basis for the contract of guarantee signed by the European Economic Community and the European Investment Bank on 30 October 1978 in Brussels and 10 November 1978 in Luxembourg introducing a global guarantee of 75% on all credit lines made available for loans in the following countries: Portugal (Financial Protocol, pre-accession aid), Greece, Spain (financial cooperation), Malta, Tunisia, Algeria, Morocco, Turkey, Cyprus, Egypt, Jordan, Syria, Israel, Yugoslavia and Lebanon. In addition, by way of exception, a 100% guarantee covers loans allocated for emergency aid to Portugal in accordance with the Council Decision of 7 October 1975. A new extension of the contract of guarantee is established for each new Financial Protocol. loans authorized at 31 December 1995 The total ECU 7 862 million, of which ECU 1 500 million is for Spain, Greece and Portugal and ECU 6 362 million for the non-member Mediterranean countries. At 31 December 1995 the total of outstanding loans came to ECU 2 167 million (taking account of the 75% limit), of which ECU 385 million was accounted for by Spain, Greece and Portugal and ECU 1 782 million by the non-member Mediterranean countries. There is also provision for EIB loans outside these protocols under Council Regulation (EEC) No 1763/92 of 29 June 1992 concerning financial cooperation in respect of all Mediterranean non-member countries. EIB loans under this operation must not exceed ECU 1 800 million. A 75% overall guarantee is provided. 15 A At 31 December 1995 ECU 1 239 million had been made available; of this total, ECU 98 million had been paid; this figure corresponds to the amount currently outstanding. At 31 December 1995, the breakdown of authorizations by country (non-member countries only) was as follows: ECU Million Algeria Cyprus Egypt Israel Jordan Lebanon Malta Morocco Slovenia Syria Tunisia Turkey Yugoslavia1 Loans authorized 640 142 802 215 198 222 85 517 150 323 418 90 760 Protocols - Total Horizontal financial cooperation Mediterranean - Total 4 562 1 800 6 362 The loans are generally for 15 years with 3 to 4-year periods of grace on capital repayments. III. B. Loans granted by the European Investment Bank in countries of Central and Eastern Europe In response to a call made by the Council on 9 October 1989, the Board of Governors of the European Investment Bank decided on 29 November 1989 to authorize the Bank to provide loans from its own resources to finance investment projects in Hungary and Poland for a total amount not exceeding ECU 1 billion. These loans are granted to finance investment projects which satisfy the Bank's usual requirements for loans from its own resources. The contract of guarantee covering 100% of the lending operations was signed on 24 April 1990 in Brussels and 14 May 1990 in Luxembourg. On 14 May 1991 the budgetary authority extended this 100% guarantee to loans_made in Czechoslovakia, Bulgaria and Romania up to a maximum of ECU 700 million. The extension of the contract of guarantee was signed on 31 July 1991. On 23 October 1992 the Commission presented a proposal for a Council Decision extending this 100% Community guarantee to losses incurred by the EIB as a result of loans granted to Estonia, Latvia and Lithuania; this was approved by the budgetary authority in its decision of 15 March 1993. The overall ceiling on loans which the EIB may grant in these countries was set at ECU 200 million for a period of three years. The second protocol with Yugoslavia was suspended when ECU 100 million of credits could still be granted. 16 ft On 18 December 1992 the Commission also proposed the extension of this 100% guarantee to losses incurred by the EIB as a result of loans granted in Albania. On 13 December 1993 the budgetary authority renewed the 100% Community guarantee for a period of three years for loans granted by the EEB in the countries of Central and Eastern Europe (including the Baltic States and Albania) up to a maximum of ECU 3 billion. The contract of guarantee was signed on 22 July 1994 in Brussels and on 12 August 1994 in Luxembourg. The loans are generally long-term: 15 years on average with 3 to 4-year periods of grace on capital repayments. At 31 December 1995, ECU 3 541 million had been made available in the Central and Eastern European countries but only ECU 952 million had been disbursed. III. C. Loans granted by the European Investment Bank in non-member countries At its meeting of 19 May 1992 the Council (Economic and Financial Affairs) adopted the guidelines proposed by the Commission for the extension of EIB activities outside the Community and asked it to grant loans in accordance with its Statute and its usual criteria to projects of mutual interest in certain non-member countries (the developing countries of Asia and Latin America) with which the Community has concluded cooperation agreements. An overall limit of ECU 250 million per year has been set for a 3-year period; this ceiling will be reviewed at the end of the period. These loans benefit from 100% Community budget guarantees. The Commission presented a proposal for a decision to this effect on 3 June 1992. The formal Council Decision followed on 15 February 1993. The contract of guarantee between the Community and the EIB was signed on 4 November 1993 in Brussels and on 17 November 1993 in Luxembourg. At 31 December 1995 credit lines of ECU 607 million had been signed but only ECU 149 million had been disbursed. III. D. Loans granted by the European Investment Bank in South Africa At its meeting of 1 June 1995 the Council adopted the guidelines proposed by the Commission for the extension of EIB activities to South Africa and asked it to grant loans in accordance with its Statute and its usual criteria to projects of mutual interest in that country. An overall limit of ECU 300 million has been set for a two-year period which could be extended to two and a half years. These loans benefit from 100% Community budget guarantees. The Commission presented a proposal for a decision to this effect on 5 December 1994. The formal Council Decision followed on 1 June 1995. The contract of guarantee between the Community and the EIB was signed on 4 October 1995 in Brussels and on 16 October 1995 in Luxembourg. At 31 December 1995 credit lines of ECU 45 million had been signed but no amounts had been disbursed. 17 f\ PART THREE: CHANGES IN POTENTIAL RISKS The figures given in the previous parts provide information on the quantitative aspects of the risks borne by the general budget. However, these data should be weighted in accordance with aspects relating to the quality of the risk, which depend on the type of operation and the standing of the borrower. I. TYPES OF OPERATION The risks to which the above figures relate derive from a variety of operations which can be divided into two categories: operations with macroeconomic objectives and those with microeconomic objectives. I. A. Operations with macroeconomic objectives The first of these are the balance of payments loans for Member States, normally carrying strict economic conditions and undertakings. Macrofinancial assistance operations are similar in nature but are intended for non-member countries. Finally, this category includes the credit guarantee of ECU 500 million and the loan of ECU 1 250 million to finance imports of agricultural products and foodstuffs into the former Soviet Union, since the risk involved in these two operations depends to a large extent on macroeconomic and political developments in the recipient countries. I. B. Operations with microeconomic objectives These are loans to finance specific projects which are usually repaid over the long term from funds which these projects are expected to generate; as a rule, they are granted to State companies or financial institutions and, in addition to the Community guarantee, are covered by the usual guarantees demanded by banks. They are the Euratom and NCI loans in Member States and the Euratom and EIB loans outside the Community (Mediterranean and Central and Eastern Europe, certain non-member countries - developing countries of Asia and Latin America and South Africa). A IL GENERAL ECONOMIC SITUATION OF THE NON-MEMBER COUNTRIES A. ALGERIA 1. GENERAL ECONOMIC SITUATION Despite some progress accomplished in the field of stabilization and structural adjustment in both 1994 and 1995, Algeria's general social and economic situation remained difficult. The future pace of economic growth, output recovery, expansion in domestic and foreign investment, structural reforms and the implementation of effective social and labour policies would critically depend upon the on-going democratizatization process, associated with a positive outcome of current civil strife. In 1994 real GDP increased by a modest 1. 1% (which, however, favourably compares with a 2% decline in 1993). According to preliminary estimates, in 1995 real GDP increased by 5. 3%. In 1994/95, Algerian economy witnessed new, relevant inflationary pressures (year-on- year CPI inflation was 34% in April 1995), reflecting the previous implementation of price liberalization policies, associated with subsidy reduction and the dinars' sharp depreciation (40. 17%) decided in April 1994. The inflation rate is projected to decline to 10. 3% by the end of March 1996. The overall budget deficit sharply contracted from 8. 7% in 1993 to 2. 8% in 1995 and it is expected to further decline to 1. 3% of GDP in 1996, reflecting higher revenue from indirect taxation and custom duties, the enlargement of the tax base, and further cuts in public wages and salaries, food subsidies, agricultural price support, Treasury's financing of the Industrial Rehabilitation Fund and cash transfer to the poor. In 1994/1995, the Algerian authorities implemented tight monetary and fiscal policies, in the framework of a policy programme supported by an IMF Stand-by arrangement approved in May 1994, followed by a three-year Extended Financing Facility approved in May 1995. Economic policies also emphasised wage restraint. Market-based instruments for the management of domestic liquidity are being adopted. These policies were complemented by a large depreciation of the Algerian dinar, the introduction of an exchange rate regime based upon a managed floating mechanism, the strengthening of the external reserve position, price liberalization and subsidy reduction. Imports have been completely liberalized and State import monopolies are being gradually dismantled. Progress was also made in structural adjustment, in particular, and banking reform. A new Code on Foreign Investment has been approved and a new agency aimed at promoting foreign and domestic private investment has been established. 2. BALANCE OF PAYMENTS The adoption of import liberalization policies associated with a free access to foreign currency for current account transactions by residents led to a sharp deterioration of 19 A Algeria's current account balance which shifted from a surplus of 1. 6% of GDP in 1993 to a deficit of 6. 9% in the 1994/1995 programme year. The current account situation is expected to remain precarious with a projected deficit of 5. 7% of GDP in 1995/96. While imports have been buoyant, thus contributing to alleviate the scarcity of industrial spare parts, raw materials and basic and intermediate consumption goods, export revenue declined somewhat in both 1994 and during the first quarter of 1995 reflecting the unsatisfactory performance of hydrocarbon exports (both in terms of quantities and prices). The sharp nominal devaluation of the dinar has improved Algerian exports' competitiveness and will encourage export diversification towards new products and new markets. The overall balance of payments situation in 1995 is estimated to have sharply deteriorated if compared to the previous year, reflecting a growing trade deficit and the" residual" (after Paris and London Club arrangements) servicing of medium-long term external debt. In this respect, new Paris and London Club reschedulings are envisaged as well as new financing by the IMF, other IFIs, the European Union and other bilaterals (Japan in particular). In 1995, FDI is expected to remain low. By September 1995, the country's foreign currency reserves decreased to US$ 1. 9 bn, equivalent to 2 months of imports (against US$ 2. 6 bn by end of 1994, or 2,9 months of imports). 3. EXTERNAL DEBT The amount of external debt (some US$ 33. 8 bn as of end of 1995) still represents a heavy burden for Algeria's public finances and balance of payments. Rescheduling arrangements with Paris Club official bilateral creditors were reached in 1994 and 1995. These arrangements are expected to continue in the framework of the IMF three-year policy programme. Algerian authorities reached also an arrangement with commercial creditor banks (London Club) which implies a rescheduling of debt service obligations falling due from March 1, 1994 to December 31, 1997 (US$ 3. 2 bn). The foreign debt/GDP ratio (which was around 78% at end of 1995) is expected to remain relatively stable in the foreseeable future. Debt service/exports ratio (which declined dramatically from 82% in 1993 to around 50% in 1995) is projected tojiirther slim down to about 40%» in 1996, reflecting the positive impact of London and Paris Club debt relief arrangements. 20 A B. BELARUS 1. GENERAL ECONOMIC SITUATION Owing to conservatism and doubts on the nature of future ties with Russia Belarus went through a period of high uncertainty after it became independent in 1992. The country embarked on reforms after most countries in the region and left the Russian ruble zone only in April 1994. A considerable drop of production (-20%) was recorded in 1994, and in 1995 real GDP is estimated to have declined by 7%. Price increases, owing to central bank unlimited refinancing of the banking system, reached hyper- inflationary levels in 1993 and 1994. Stringent stabilisation policies were implemented as of early 1995, with a tight control of monetary expansion. As a result, inflation dropped down from 40% per month in January to 3% in August. Market mechanisms for the allocation of central bank credits were introduced. The authorities pursued a flexible interest rates policy aimed at maintaining positive and attractive real interest rates, so as to mobilise ruble deposits within the banking system. The budget deficit, which remained below 2% in 1993 and 1994, is estimated at 3. 2% of GDP for 1995. Progress in the area of structural reforms remains the weak point in Belarus, as the initial steps have been undertaken only recently. Significant price adjustments took place in late 1994 and early 1995 and most prices have now been freed. Most import licences and the surrender requirements on exports have now been abolished. External trade however remains subject to some limitations. The banking sector is burdened with bad loans and remains globally inefficient. Inter-enterprises arrears account for more than 50% of GDP. Privatisation is only at the very initial stage, with enterprises representing only 6% of the total asset value earmarked for privatization having already been privatised. The process of reforms in agriculture has been particularly slow and land privatisation has not yet started. On 12 September 1995, the IMF board approved the first Stand-By Arrangement with Belarus, to support the country's programme of reforms and external financing needs. 2. BALANCE OF PAYMENTS The current account was in deficit in 1993 and 1994 (about -10% of GDP). Initial figures for 1995 show a significant growth of exports over the first half of the year. The real appreciation of the ruble, combined with a loss of competitiveness due to the rise in import tariffs, is however expected to hamper export growth over the short term, and a current account deficit of -4% of GDP is still estimated for 1995 and expected in 1996. Owing to hard currency inflows the capital account was in surplus in the first half of 1995 but, on account of high amortisation needs on the external debt, it is estimated to have again been in deficit in the second half of the year. Hard currency international reserves remain tight, representing only about 1. 5 months of imports by end-1995. 21 A Despite a law on foreign investment enacted in 1992 which ensures the free repatriation of profits, foreign direct investment remains extremely scarce (estimated at only 20 mio dollars in 1995). The positive real interest rates contributed to stabilise the Belarus ruble in nominal terms and led to a significant appreciation in real terms against the dollar and the Russian ruble in 1995. Under a two digit inflation rate, the present exchange rate would however be difficult to hold without serously damaging the country's competitiveness. By lifting restrictions on foreign exchange transactions, Belarus progressively moved in 1995 to current account convertibility. By end-1995, however, the authorities gave confusing signals on a reintroduction of limitations on inter-bank hard currency transactions. 3. FOREIGN DEBT Belarus has abandoned to Russia its relative share of assets and liabilities of the FSU. Thus, the country's only external debts are those contracted after 1 January 1992. The total external debt was estimated at US$ 2. 1 bn by end-1995 (i. e. 22% of GDP). The country's main creditor is Russia, on account of gas arrears which accumulated until end-1994 and which are now subject to a US$ 419 mio ceiling under the current IMF programme, which was however exceeded by end-1995. They are expected to be phased out under a long-term framework currently under discussion between the Russian and Belarus authorities. Debt service increased significantly in 1995 owing to the repayment of German and EC credits, but remained nevertheless moderate (7. 6% of exports, without including the settlement of the gas arrears). 22 A C. BULGARIA 1. GENERAL ECONOMIC SITUATION In 1995, the Bulgarian economy consolidated the recovery which had started in 1994. Real GDP increased by 2. 5% and this positive real trend essentially reflected a favourable export performance, despite the steady real appreciation of the lev. In September 1995, the unemployment rate further declined to 11. 1% (which favourably compares with a rate of around 13% as of end of 1994). In 1995, inflation fell to an annual rate of 33%, despite the increase of some administered prices (energy in particular). Implementing a tight monetary policy in 1995 was made more difficult by large capital inflows which exerted upward pressures on the lev exchange rate. The Bulgarian National Bank (BNB) intervened with a view to preventing a nominal currency appreciation. Official interest rates were cut in order to contain interest-sensitive (short -term) capital inflows. However, despite efforts to keep monetary aggregates under control, the 1995 monetary targets were exceeded. The BNB's room for manoeuvre was also limited by the still huge liquidity requirements of the State budget, ailing banks and loss-making, state-owned enterprises. A moderately restrictive incomes policy helped the government in its effort to subdue inflation. As regards fiscal policy, in May 1995, the government adopted a new budget law which implied a budget deficit of 5. 5% of GDP for 1995. However, preliminary indications suggest that the deficit reached 6. 7% of GDP last year, a level virtually unchanged from 1994 (6. 6%). As for sectoral adjustment and reform, achievements in 1995 were mixed. On the negative side, some restrictions on agricultural land sales to private owners and new price controls have been introduced. On the other hand, some administered prices have been increased, action has been taken to reform two ailing banks and a list of more than 1200 state owned enterprises (SOEs) has been prepared in view of their subsequent mass privatization (via issuing vouchers) due to start in March 1996. Some further 200 medium-large SOEs have been selected for privatization (via direct sales) in 1996. Current policies aimed at coping with financial problems of the banking system do not seem to have produced tangible results yet. As regards official forecasts for 1996, real GDP is projected to expand by 3%, inflation to decline to 20-25%, the budget deficit is envisaged to contract somewhat to around 5-5. 5%) and the country's external position (trade and current account, foreign exchange reserves etc. ) is expected to improve. However both the inflation target and the projected trade and current account improvements appear to be rather uncertain and probably are unrealistic. 23 \ 2. B A L A N CE OF P A Y M E N TS By September 1995, Bulgaria's trade balance recorded a surplus of US$ 300 mio. The country continued to benefit from increased access to EU market, the economic recovery in Western Europe, the resumption of trade with eastern European partners and the positive effects of the real exchange rate adjustments occurred in 1994. By the same date, current account recorded a small surplus of around SU$ 100 mio. In 1995, FDI gave some signs of expansion (US$ 165 mio against 105 mio in 1994). By end-October 1995 gross official reserves amounted to US$ 1. 8 bn, equivalent to around 3. 6 months of imports (which compares to 3 months of imports as of end of 1994). 3. FOREIGN DEBT The agreement in principle reached in November 1993 with the London Club commercial creditors on a debt and debt service reduction programme (DDSR) was finalized in July 1994. Overall, it is estimated that the agreement reduced Bulgaria's US$ 8. 2 bn eligible debt to western commercial banks by around 46%. In April 1994, a third Paris Club debt rescheduling arrangement was reached between Bulgaria and its official creditors, covering all obligations falling due from the previous rescheduling until April 30, 1995. By restoring Bulgaria's external viability, these debt agreements should help the country attract further FDI and regain access to the international financial markets. At end-1995 the external debt/GDP ratio was 83. 0% (against 109. 3% in 1994) and the debt service ratio was reduced to 17. 5% (18. 4% in 1994). 24 A CENTRAL ASIAN NEWLY INDEPENDENT STATES (NIS) 1. GENERAL ECONOMIC SITUATION In 1995, Kazakhstan's GDP is estimated to have declined by more than 10 %, but the recovery in industrial production has continued and exports have rebounded. In early October, the budget was nearly balanced. Monetary and credit policies have been geared towards the fight against inflation. As a result, monthly inflation fell to around 2. 4 % in September and all IMF program targets under the current Stand-By arrangement were met with large margins. Important progress have been made in the structural transformation of the economy, in particular in liberalizing external trade. In 1994, Tajikistan's GDP contracted by 12 % and it is tentatively estimated to have declined again in 1995, though at a lower rate than in 1994. The budget deficit (13. 8 % of GDP in 1994) should be lower in 1995-96. In 1995, the positive effects of the tight budgetary control were jeopardized by the excessive banking credit, which led to a very sharp acceleration of monthly inflation (70 % in August) and to a continued depreciation of the Tajik ruble. In 1995, simultaneously with the introduction of the Tajik ruble, interest rates were deregulated, restrictions on bank deposits eliminated, bread prices adjusted and foreign trade liberalized. to curtail During 1994, Turkmenistan, which was forced its gas exports to neighbouring countries because of recurrent non-payments, suffered a 15% contraction in GDP. In 1995, non-payment of gas exports reached critical levels, industrial output fell by 20% (year-on-year) and cotton and grain harvests failed to meet their targets. In 1994, Turkmenistan had an inflation rate of over 2,000%, reflecting a strong expansion of money and credit. Inflation is estimated to have accelerated to around 2. 500% in 1995. In 1995, the authorities made strenuous efforts to keep the budget deficit from rising but not enough to alleviate the inflation problems. With regard to the reform process, progress has been very slow. Uzbekistan's real GDP is estimated to have declined by about 2 % in 1995 and is expected to decline again moderately in 1996. In 1995, the authorities tightened significantly financial policies, and as a result, year-on-year inflation declined from 1. 280 % in 1994 to about 250 % in September 1995, and seems to have declined further in the final months of the year. In the first half of 1995, the budget deficit was very low (1 % of GDP), but rose to about 4 % of GDP in late 1995 because of significant increases in public wages and social benefits. This, however, still represents an important improvement with respect to the 1994 deficit (7 % of GDP). The 1996 budget deficit is likely to be limited (4 % of GDP). Despite a large increase in net foreign assets, reserve money and broad money were approximately in line with the programmed levels, reflecting tight domestic credit policies. In the area of structural reform, a fast liberalization of prices and a major liberalization of the foreign exchange system were implemented, while delays were experienced in banking sector reform and in the privatization of medium-and large-scale enterprises. 25 A 2. T HE BALANCE OF PAYMENTS The current account of Kazakhstan is estimated to have recorded a deficit of about US$ 600 mio (3 % of GDP) in 1995. Reflecting a large capital account surplus, gross official reserves increased from US$ 1. 2 bn at end-1994 to about 1. 7 bn in September 1995. Net official reserves represented 2. 7 months of imports in September 1995. Despite a nominal depreciation of 16 % in 1995, the real exchange rate of the tenge vis-à-vis the dollar appreciated by some 20 %, reflecting the higher rate of inflation. Kazakhstan is benefiting from a World Bank Structural Adjustment Loan and from an IMF Stand-By arrangement. A recent comprehensive medium-term economic and financial program could be supported in early 1996 by an arrangement under the IMF's Extended Facility. Despite an improvement in the terms of trade and a sharp decline in import volume, the current account deficit of Tajikistan remained very high in 1994 (15 % of GDP). Together with a slight deficit of the capital account, this left an overall balance of payments deficit of 16% of GDP and gross official reserves were practically depleted. In 1995, the current account experienced an impressive correction, reflecting the improvement in the terms of trade and a sharp contraction in import volumes. Nevertheless, the external financing needs remain very high since. The current account deficit is expected to reach 9 % of GDP in 1996 because of a deteriorated trade balance and large interest payments falling due. The resulting financing gap is expected to be partly covered by a substantial debt service relief and by IMF and World Bank disbursements. In early 1996, the IMF board could approve a first credit tranche under a new Stand-By arrangement which would require complementary financing from the official donors. In recent years, the inadequate financial policies and the nonpayment for gas deliveries put strong pressure on Turkmenistan's current account. As a result, the Turkmen authorities restricted severely the access to foreign exchange to compress imports. In spite of these measures, the current account on a cash basis weakened further from a deficit of 8 % of GDP in 1993 to a deficit of 14 % of GDP in 1994. In 1995, gas exports have shown an extremely weak performance. Nevertheless, gross official reserves have continued to grow and stand at a very high level (1. 2 bn of US$ or 10 months of imports at end-1995). The manat has dropped by 2,500 % in nominal terms in the two years since its introduction in November 1993. The official exchange rate has been kept significantly overvalued with respect to the parallel market rate in order to keep import costs low. There is not an IMF agreement in place but on-going discussions between the authorities and the IMF could lead to an IMF-supported stabilization programme. In 1995, Uzbekistan's trade balance is estimated to have been balanced and the current account deficit was low (about 2. 5 % of GDP). New loan agreements, foreign direct investments and significant unexpected inflows allowed a substantial increase in gross official reserves (of about US$ 500 mio) to US$ 1. 8 bn (6 months of imports). In infrastructure 1996, the current account could deteriorate owing to growing investments. The resulting financing gap would be largely filled by purchases from the 26 A IMF and from the World Bank. In 1995, the exchange rate for the sum depreciated significantly in nominal terms, but appreciated in real terms against the US dollar, 3. FOREIGN DEBT At end-September 1995, Kazakhstan's stock of external debt was estimated at US$ 3. 3 bn (around 19 % of GDP), of which US$ 1. 4 bn was owed to Russia, and the external debt service ratio was estimated to represent about 10 % of exports. In 1995, difficulties continued to be experienced with respect to the timely servicing of this debt. However, a recent redefinition of responsibilities among the institutions in charge of debt management should prevent this from recurring. The total amount of arrears has been reduced to US$ 6 mio at end-October 1995. At end 1995, the external debt of Tajikistan (US$ 800 mio) exceeded the country's GDP, most of it contracted on non-concessional terms with relatively short maturities. Most of it was due to FSU countries. The external payments situation is likely to be very difficult in 1996, when large principal repayments fall due and when grace periods expire on deferred payments. In 1994, Turkmenistan's total external debt rose sharply to 18 % of GDP, mainly reflecting loans aiming at financing the current account deficit, and debt service represented 23 % of exports. The short-term maturity of most loans is a source of particular concern. In 1995, Uzbekistan's external debt stock represented slightly more than 15 % of GDP (about US$ 1. 3 bn) and debt service slightly more than 15 % of exports. Under the current IMF programmes (SBA and STF), the authorities have committed themselves to observe cumulative quarterly ceilings on the amount of new loans contracted or guaranteed. 27 A D. THE CZECH REPUBLIC 1. GENERAL ECONOMIC SITUATION The recovery of the Czech economy that started in 1994 strengthened markedly in 1995, with year-on-year real GDP growth accelerating to 5. 2%. This stronger growth is being led by domestic demand, and in particular by investment. Industrial output posted a 12. 9% year-on-year increase in November 1995. The unemployment rate, at 2. 9% in December 1995, remains very low. Real GDP growth is projected to reach 5- 6% in 1996. Despite the strength of the recovery, CPI inflation declined from 10. 2% at end-1994 to 7. 9% in November 1995. The Czech National Bank (CNB), however, expects the year's average inflation rate to be about 9. 5%, which means that the official target of bringing average inflation below 9% in 1995 is unlikely to be attained. Furthermore, the boom in domestic demand, the destabilising effects of the capital inflow surge on the money supply and the tightness of the labour market (which has contributed to an acceleration of real wage growth to around 7. 5% in 1995) will make it difficult for the authorities to meet that target in the coming two years. Money supply grew by 20. 2% in 1995, compared to an original official target of 14- 17%. This rapid growth of liquidity reflects the impact of the strong foreign capital inflows, which the CNB has only been able to sterilize partially through open market operations, the increase in the banks' minimum reserve requirements and the transfer of deposits of the National Property Fund from commercial banks to the central bank. Regarding fiscal policy, preliminary figures show that the state budget ended 1995 with a surplus of Kc 8. 6 bn (about US$ 331 mn). In December 1995, the Parliament approved a balanced budget for 1996. As far as structural reform is concerned, the second wave of large-scale voucher privatization was concluded in November 1994. The privatization of the remaining enterprises controlled by the state has gathered momentum in 1995 with the sale of a 27% stake in the country's telephone monopoly SPT, worth US$ 1. 32 bn, to a Dutch- Swiss telecommunications consortium, the decision to sell a 49% stake in Czech Refineries, and the announcement by the government of a plan to privatize additional stakes in 53 big state enterprises. — 2. THE BALANCE OF PAYMENTS The current account surplus (2. 2% of GDP in 1993) disappeared in 1994 and is expected to turn into a 3. 5% of GDP (about US$ 1. 5 bn) deficit in 1995. This deterioration in the current account reflects the acceleration of domestic demand, the real appreciation of the Czech crown and trade restrictions introduced by Slovakia. Between January and September 1995, the trade and current account balances reached deficits of, respectively, US$ 2. 7 bn and US$ 1 bn. The current account deficit, however, is being amply financed by a huge inflow of foreign capital. The capital account showed a US$ 6 bn surplus in January-September 1995. This figure includes almost US$ 2 bn in net FDI, US$ 0. 7 bn in portfolio 28 A investment, US$ 2. 1 bn in other long-term capital and US$ 1. 2 bn in short-term capital. The record amount of FDI largely reflects the SPT operation. The high inflow of short- term capital, for its part, mostly reflects arbitrage operations to take advantage of the combination of a relatively high differential between domestic and foreign interest rates and the strength of the Czech crown. The Czech Republic's access to the international capital markets has been reinforced by successive upgradings of its ratings. In August 1995, the London agency IBCA assigned to the Czech Republic an A" rating; in September 1995, Moody's upgraded the country's rating from Baa2 to Baal; and, in November 1995, Standard & Poor's upgraded its rating from BBB+ to A. The Czech Republic has, therefore, become one of the few non-developed countries that can boast a "A" level rating. The official integration of the Czech Republic into the OECD as of 21 December 1995 should contribute to a further improvement of the foreign perception of the country. The surge in capital inflows has put upward pressure on the nominal exchange rate and has resulted in a rapid growth of official foreign exchange reserves, which stood at US$ 12. 9 bn (or about 8 months of imports) in November 1995, up from US$ 6. 2 bn at end-1994. In order to offset or restrict part of the capital inflows, the authorities have repaid ahead of schedule all the remaining IMF debts (worth US$ 1. 1 bn) and imposed in late June 1995 limits on the total amount of short-term foreign credits Czech banks may take. Also, a new Foreign Exchange Law entered into force on 1 October 1995 making the Czech crown fully convertible for current account transactions (including the immediate termination of the Czech-Slovak clearing system) and providing for a gradual introduction of full capital account convertibility. Finally, the CNB is considering possible options to increase the flexibility of their exchange rate policy, including the widening of the fluctuation band around the D-mark/US$ peg and the revaluation of the central rate. No decision regarding exchange rate policy however is expected to be taken before the June 1996 general elections. 3. FOREIGN DEBT Mostly reflecting strong foreign borrowing by Czech enterprises and banks, foreign debt has risen substantially since 1993, with the pace of increase accelerating in 1995. Nonetheless, the Czech Republic continues to enjoy a low foreign debt burden. Total convertible debt increased from US$ 6. 9 bn at end-1992 to US$ 15 bn in June 1995, but this still implied a relatively moderate debt/GDP ratio of 31%. The debt service- over-exports ratio, at below 15%, remains low. While projections for 1995 and 1996 point towards a continued increase in the debt and debt service indicators, these ratios are expected to remain at reasonable levels. 29 A E. ESTONIA 1. GENERAL ECONOMIC SITUATION After a sharp decline in 1992 and early 1993, the Estonian economy emerged from recession by the end of 1993. GDP grew by 4% in 1994 and probably at a similar rate in 1995. Unemployment, at about 5. 4% of the labour force, remains moderate. Macro-economic stabilisation was to a large extent achieved after the introduction in June 1992 of a currency board arrangement under which the growth of the monetary base is limited by the amount of hard currencies and gold detained by the central bank. A new currency, the Estonian kroon, was introduced at the same time. This proved successful in stabilising the economy: inflation continued to decline in 1995, reaching 29% at year-end compared to 47% at end-1994. Under the currency board arrangement, central bank lending to the state is prohibited, which contributes to budgetary discipline. In 1995 the financial balance was in surplus (0. 8% of GDP). Increased government deposits in the banking sector resulted in a slightly lower fiscal balance surplus (0. 3% of GDP). The 1996 budget envisages an almost balanced budget. Estonia has already implemented the bulk of structural reforms leading to a market economy. Prices and foreign trade have been liberalised. The small scale privatisation covering some 1000 small enterprises is now virtually completed. Out of the 500 medium and large scale enterprises, about 100 remain in the state's hands. Land privatisation, which was slow to initiate, is being accelerated. Financial sector reform appears as the most sensitive area. The Bank of Estonia has increased its supervision capacities and reduced its share of assets in the Savings Bank to 25% of the capital. The state also reduced below 10% its minority shareholding in commercial banks. Capital adequacy requirements are being gradually increased. Estonia maintains liberal foreign investment laws. The Free Trade Agreement with the European Union entered into force on 1 January 1995. 2. THE BALANCE OF PAYMENTS trade with the European Union External trade continued to grow at a high pace, particularly imports (including^ large share of investment-related goods) which increased in 1995 by 33% over 1994. increased markedly after Estonia's external independence. However, it is characterised by a large deficit on the Estonian side. In 1994, the bilateral trade deficit amounted to US$ 1. 3 bn, and increased even faster in 1995, when it amounted to US$ 1. 2 bn over the first seven months1. The overall trade deficit considerably increased to an estimated US$ 620 mio, or 17% of GDP in 1995. The current account also deteriorated sharply, reaching a deficit of about 10% of GDP (excluding official transfers). Data between 1994 and 1995 arc not strictly comparable. 1995 trade with the EU includes Sweden and Finland, tAvo very significant commercial partners of Estonia. 30 A Under the currency board arrangement, the Estonian kroon is pegged to the DM at a fixed 8 to 1 rate. This has led, given the remaining two digit inflation, to a relative loss of external competitiveness which will have to be assessed against future developments in the external trade. In March 1995, the IMF approved a new fifteen-month Stand-By arrangement in the amount of SDR 14 mio (US$ 21 mio), but the authorities do not intend to make purchases under it unless the balance of payments weakens unexpectedly. For the third consecutive year, the capital account was in surplus, mainly owing to high inflows of foreign direct investment of about US$ 200 mio (approximately 5. 9% of GDP). Official foreign exchange reserves continued to grow and, at US dollars 580 mio at end-1995, covered approximately 3 months of imports. 3. FOREIGN DEBT Estonia has no legacy of foreign debts from the FSU. In 1995, the stock of external debts increased from US$ 271 mio to an estimated US$ 353 mio level (or 9. 9% of GDP). Debt service remained low with a ratio to exports of goods and non-factor services of about 1%. A substantial part of Estonia's foreign debt is owed to international financial institutions. The IMF has awarded Estonia a US$ 35 mio STF and disbursed US$ 59 mio under the successive Stand-By programmes since 1992. 31 A F. HUNGARY 1. GENERAL ECONOMIC SITUATION Despite the stabilization measures adopted by the Hungarian government in March 1995, real GDP is estimated to have expanded by about 2% in 1995, only slightly below the 2. 9%» rate recorded in 1994. Although economic growth decelerated in the second half of 1995, GDP is projected to remain within the 2-3% range in 1996. After reaching a peak of 11. 8% in early 1993, the unemployment rate has declined to 10. 4% at end-1995. Largely reflecting the faster devaluation of the forint, the introduction of an 8% import surcharge and the increase in indirect taxes as part of the government's March 1995 "austerity package", inflation worsened significantly in 1995. CPI inflation has risen from 21. 2% in December 1994 to 28. 5% in December 1995. Wages, however, grew at a relatively moderate pace (19%) in 1995 and, as a result, real wages fell by about 10%. For 1996, the authorities aim at bringing inflation back to around 20%, an ambitious target. Thanks to higher than expected income from privatization (see below) and from the year corporate and custom taxes, the central government deficit finished significantly below the targets contained in the March 1995 supplementary budget. However, the fiscal performance of social security funds seems to have been worse than programmed and the general government deficit excluding privatization revenues remains high (6% of GDP). Disagreements within the government coalition that took office in July 1994 initially resulted in a deadlock in the privatization process. Privatization, however, accelerated in the second half of 1995, and particularly at the end of the year. The sale of important parts of the electricity, gas supply, banking and telecommunication and chemical sectors, mostly involving foreign investors, has resulted in privatization revenues of about US$ 3. 3 bn, largely exceeding the initial government target. 2. THE BALANCE OF PAYMENTS After reaching US$ 3. 9 bn (9. 5% of GDP) in 1994 and further widening in earjy 1995, the current account deficit responded favourably to the March 1995 package. The current account is estimated to have finished 1995 with a deficit of about US$ 2. 3-2. 5 bn (about 6% of GDP) and to have been in balance in the final months of the year. The capital account also strengthened markedly in 1995. The National Bank of Hungary (NBH) continued to place a substantial amount of international bonds in the first half of 1995 (US$ 1. 8 bn), resident enterprises and banks borrowed abroad heavily, and FDI is estimated to have increased from US$ 1. 2 bn in 1994 to a record of more than US$ 3 bn in 1995. In the fourth quarter of 1995, a significant part of the capital inflows has consisted of short-term arbitrage operations through which investors seek to take advantage of the combination of a high differential between domestic and foreign interest rates and a relatively moderate rate of pre-announced monthly devaluation of the forint within the crawling-peg system. 32 A The surge in capital inflows has not only allowed Hungary to finance its still high current account deficit but has also resulted in a sharp increase in foreign exchange reserves. Official reserves have risen from US$ 6. 8 bn at end-1993 to almost US$ 12 bn at end-1995, representing about 12 months of imports. After more than a year of difficult discussions, the Hungarian authorities reached in December 1995 a preliminary agreement with the IMF on the terms of a 18-month Stand-By arrangement. This arrangement, however, will be of a "precautionary nature", that is, the authorities do not intend to make in principle any purchases under it. In fact, Hungary decided in November 1995 to repay ahead of schedule about US$ 600 mio of IMF debt maturing before end-1998. As a result of the new foreign exchange law and accompanying regulations that came into effect on 1 January 1996, the Hungarian currency has become fully convertible for current account transactions. In March 1995, the forint was devalued by 8. 3% and a crawling peg system was introduced whereby the currency is devalued each month at a pre-announced rate. The monthly rate of devaluation was reduced from 1. 9% to 1. 3% in the second half of 1995 and again to 1. 2% in January 1996. The exchange rate of the forint is defined against a basket of currencies comprising the ECU (70%) and the US dollar (30%). 3. FOREIGN DEBT With the current account deficit considerably exceeding the net inflow of FDI, both gross and net foreign debt rose rapidly between end-1992 and the third quarter of 1995, and from already high levels. Gross convertible foreign debt increased from US$ 21. 5 at end-1992 to US$ 31. 7 bn (74. 1% of GDP) in November 1995. Net foreign debt, for its part, increased from US$ 13. 1 bn to US$ 20. 4 bn over the same period. Debt service (including early repayments) has also risen since 1992 and is estimated to have represented about 50% of annual exports in 1995. On the positive side, the maturity structure of the debt has substantially improved since 1992 and is at present very favourable (medium- and long-term debt accounts for about 90% of total debt). Also, the reduction in the current account deficit and the sharp increase in privatization-related FDI should have resulted in a substantiaLdecline in net foreign debt in the second half of 1995. The NBH has announced that it will use its high reserves to repay some US$ 3 bn in foreign debts (including US$ 1 bn of early repayments) in the first four months of 1996, which should ensure a decline in total gross debt during that period. 33 A G. ISRAEL 1. GENERAL ECONOMIC SITUATION According to the first estimates, Israel's economy grew by 6. 9 % in 1995, the highest growth rate in 23 years. The acceleration in growth has been fuelled by investment. The peace process also enhanced economic growth, triggering a partial lifting of the Arab boycott against conducting business with Israel. Unemployment fell to an estimated 6. 3 % from 7. 8 % in 1994. Nevertheless, Israel's economy faces some serious problems, especially on the trade front. The inflation in 1995 is expected to have reached about 8. 0 %, the lowest level in a generation and at the bottom end of the government's initial 8-11 % target. However, the Bank of Israel considers that economic conditions still require a very prudent monetary policy because of strong domestic demand, declining unemployment and the large current account deficit. Business complained the strong shekel has hurt the exports and widened the current account deficit. However, in the last weeks of the year, the shekel started weakening after talks on budget cuts, likely to be announced in January, which would prompt the central bank to ease up on interest rates. The government budget deficit increased from 2 % of GDP in 1994 to 3. 5 % in 1995, reflecting lower than expected state revenues mainly as a consequence of tax reform and greater than anticipated transfers to the Palestinian Authority. Revenue from privatisation totalled US$ 600 mio in 1995 against a target of US$ 1. 5 bn. There is a plan for tradable vouchers to be used to subsidise privatisation investments and increase public support for the privatisation process. This scheme would aim at achieving an equitable distribution of the benefits across the general population, which should contribute to overcome the interference of influential lobbies and the reluctance of some political groups. Moreover, it should contribute to the development of the Israeli capital market. 2. THE BALANCE OF PAYMENTS The estimated deficit in the balance of goods and services, excluding defence imports, jumped to US$ 10. 2 bn in 1995 from US$ 7. 9 bn in 1994. The current account deficit also worsened sharply. While Israel is still expecting US$ 1 bn in US civilian aid, delayed by the budget crisis in Washington, the Central Bureau of Statistics estimated that without this aid, the current account deficit would total US$ 5. 2 bn, or about 6 % of GDP. This represent a sharp rise from US$ 2. 5 bn (3 % of GDP) in 1994. Foreign investment in Israel soared to US$ 1. 5 bn in the first nine months of 1995, almost double the figure for the whole year 1994. Foreign direct investment totalled US$ 826 mio, financial investment by foreigners US$ 358 mio and foreigners investment in Israeli shares traded abroad US$ 329 mio, compared respectively with US$ 241, 146, and 242 mio in the same period in 1994. 34 A Official foreign exchange reserves increased substantially over the last year and reached a satisfying level of US$ 8. 2 bn (equivalent to 2. 6 months of imports) at the end of 1995. The Bank of Israel maintains a "crawling peg" exchange rate regime, with an annual rate of crawl (currently set at 6%) and a fluctuation band of 7 percentage points on either side of the central rate. 3. FOREIGN DEBT Israel's net foreign debt grew to US$ 18. 5 bn at end-1995 from US$ 16. 5 bn at end- 1994. However, as a percentage of GDP, net external liabilities continued to decline, reaching 22 % in 1995 compared to 28. 6 % at the beginning of the decade. In November 1995, the US Administration approved Israel's request to use the whole 1996 financial guarantees, totalling US$ 2 bn, to fund the national budget deficit. Previously, a clause had restricted budget financing to US$ 900 mio, the remaining being used for infrastructure projects, such as water, roads, schools and hospitals. In November 1995, Moody's awarded the country's debt an A3 rating and in December, Standard and Poor's upgraded Israel's debt to A- from BBB+. Both Moody's and S&P said that these improved ratings reflect an increased political domestic consensus behind fiscal restraint solid enough to ensure that the government debt's burden, estimated at 114 % GDP this year, will continue to trend downwards. Israel's long-term growth prospects, and high per capita GDP (estimated at US$ 15,000 this year, a level similar to that of a number of European countries) also support the upgrade. increasingly secure geopolitical position, improving In December 1995, Israel issued for the first time international debt without a US government guarantee. The deal, which was finally oversubscribed 3. 5 times, is widely seen as indicative of Israel's determination to establish a sovereign presence in the international capital markets ahead of the ending of the US-sponsored guarantee programme in 1998. Other issues without the use of US loan guarantees are planned for the first half of 1996. 35 A H. LATVIA 1. G E N E R AL E C O N O M IC S I T U A T I ON After a sharp output drop in 1992 and 1993, Latvia's overall economic situation had strengthened in 1994 with a 2% growth of GDP. In April 1995, the IMF confirmed its support for the authorities' policies by approving a second Stand-By arrangement for a 13-month period. In 1995, the budget deficit had initially been programmed to remain at 2% of GDP as in 1994, to be financed mainly by issuing treasury bills. However, Latvia's budget situation deteriorated in early 1995 and the budget deficit rose to 92 mio lats (US$ 184 mio) in 1995, or 4% of GDP. Additionally, a major crisis in the banking sector blew up in April 1995, with the main Latvian commercial bank, Banka Baltija (which alone accounted for 20% of the country's deposits), being declared insolvent. By mid-1995, eight other banks had been declared insolvent. As a result of the financial crisis, broad money dropped by 10% over the second quarter, which is expected to have had a contractionary effect on the economy (there is a lack of comprehensive figures to assess the real impact of the crisis). However, the its in cash high percentage of savings held contractionary effect. Unemployment remained stable, standing at about 6. 3% by end- 1995. The present estimate is that Latvia went through a zero growth over 1995. The Bank of Latvia maintained its conservative monetary policy stance, and inflation thus continued to slow down, falling from 26% in 1994 to about 23% in 1995. in foreign currencies dampened The authorities have adopted a package of measures to address immediate and long term needs of the financial sector, by enhancing prudential regulations and setting up a deposit in 1995. The Privatisation Agency is now fully operational and 230 additional firms were privatised in 1995. The sale of shares of the Universal Bank, one of the three main public banks, started in the third quarter of the year. insurance scheme. Other structural reforms continued The Free Trade Agreement signed with the European Union came into force on 1 January 1995. 2. THE BALANCE OF PAYMENTS Imports and exports increased by about 200 mios dollars in 1995, while the shift in the country's trade to the West continued. After a sharp deterioration in 1994, the current account stabilized at about 4% of GDP. This deficit reflects a trade balance deficit of about 8%> of GDP partly offset by a surplus in services, mainly in the transport sector. The authorities have successfully pursued a policy of stable exchange rate with an informal peg to the SDR. Despite speculative attacks, which led to a loss of foreign exchange in the amount of 90 mio US dollars in Spring, the exchange rate of the lats remained in 1995 broadly at its previous level with a two-digit inflation rate. This translated into a real appreciation in the exchange rate. The overall competitiveness of the economy however seems to remain at an acceptable level. 36 A In order to cover its current account deficit, Latvia is dependent upon private capital inflows, which remained substantial in 1995 in spite of the financial crisis. Thus, the damage of the crisis could be limited and Latvia's reserves position remained relatively strong, with approximately US$ 600 mio net reserves at year-end, which covers almost 5 months of imports. 3. FOREIGN DEBT Latvia has no legacy of foreign debts from the FSU, and the country's external debt is thus recent. In 1994, the external debt stock increased from US$ 360 mio to about US$ 540 mio, or 12% of GDP. The debt service ratio (debt service on exports), with a 2. 6% level, remains very low. About half of Latvia's foreign debt is owed to the international financial institutions. Latvia owes the IMF 163 mio dollars (95 mio under the 1992 and 1993 Stand-By arrangements, and 68 mio under the 1993-1994 Systemic Transformation Facility). In August 1995, the authorities borrowed the equivalent of US$ 45 mio on the Japanese market, to finance the increasing needs of the budget. 37 A I. LITHUANIA 1. GENERAL ECONOMIC SITUATION After four years of recession, Lithuania's economy began to show signs of Growth for 1995, despite a drop in recovery in 1994, with a 2% GDP increase. GDP in the first quarter of the year, is estimated at roughly 3%. Unemployment, however, is reported to have significantly risen in 1995. It reached about 7% of the labour force at the end of the year, against 4% at end-1994. Inflation, which had peaked in 1992 at hyper-inflationary levels, slowed down in 1993 and early 1994. On April 1, 1994, a currency board arrangement was introduced under which the growth of the monetary base is kept in line with the increase in the market value of gold and hard currencies detained by the Bank of Lithuania. The reduction in inflation after the introduction of the currency board has been striking: price increases fell substantially in 1994, finishing the year at a rate of 45%. Inflationary pressures however remained in 1995, fuelled by the low foreign exchange rate of the litas, increases of public prices and capital inflows. As a result inflation, with an estimated 35% (year-end), was in 1995 above the authorities' initial 25% target. The fiscal deficit target for 1995 (3. 4% of GDP) was broadly met. Structural reforms have been further implemented. The only items with prices remaining under government control relate to cases of monopolistic situations. Housing and small-scale privatisation are now virtually completed but, owing to delays in the establishment of the Privatisation Agency, large scale privatisation will only effectively start in 1996. The financial sector reform is the most sensitive area. After the enactment of the Central Bank and Commercial Bank laws in early 1995 and the subsequent tightening of prudential regulations, the banking sector went through drastic adjustments in 1995 when 14 small banks out of 28 (however representing only 1. 6% of the total banking sector assets) were declared insolvent and will probably in most cases be liquidated. In December two private banks, Litimpeks and Innovative Bank, were also declared insolvent. The authorities are now preparing, with IMF and World Bank support, a new set of measures to consolidate the sector. On 1 January 1995, the Free Trade Agreement with the European Union entered into force. Lithuania maintains liberal foreign trade and investment laws. 2. THE BALANCE OF PAYMENTS The share of the west in the country's external trade continues to increase. About 50% of Lithuania's exports were directed to western markets in 1994. In the first half of 1995 exports are reported to have increased by 19. 7%, against a stable level of imports. This contributed to stabilise the current account deficit near the level of 1994 (US$ 278 mio, or about 4% of GDP, excluding official transfers). Under the currency board arrangement the litas is pegged to the US dollar at a rate of 4 to 1. Growing confidence in the currency board, fuelled by the low exchange rate of the litas, translated inflows until end-November. Additionally, significant medium- and long-term borrowings allowed in 1995 for a into growing private capital 38 A significant capital account surplus, in the amount of about US$ 300 mio. In December however, the declared insolvency of two banks (Litimpeks and Innovative Banks) lead to significant foreign exchange reserves losses, in the amount of US$ 45 mio. At year- end, official reserves were estimated at about US$ 800 mio, or 3. 5 months of imports. In October 1994, the IMF approved an SDR 134. 55 mio three-year Extended Facility, of which SDR 51. 75 mio (US$ 75 mio) have already been purchased. This should contribute to consolidate the reserves and help finance key energy and investment related imports. 3. FOREIGN DEBT Lithuania has no legacy from sovereign debts from the FSU. In 1995, the stock of external debts increased by more than 300 mio US$, reaching a level of US$ 860 mio. Despite this sharp increase, this level of debt remains moderate relatively to GDP (14%). The country's debt service over exports ratio also remains low (about 2%). In December 1995, Lithuania borrowed on the private capital market for the first time, in the ajnount of US$ 60 mio. A J. MOLDOVA 1. GENERAL ECONOMIC SITUATION After a 31% decline in 1994, due to severe weather conditions and to the continuing disruptions to output and trade associated with the collapse of central planning, Moldova's GDP is estimated to have grown slightly - around 1% - in 1995. This improvement is partly due to a recovery in the important agricultural sector with the return of normal climatic conditions, but also to a reduction in the rate of decline of industrial production, estimated to have dropped by "only" 10%. The official unemployment rate remains rather low (2%) by end-1995, but a lot of workers are on unpaid leave and the actual unemployment figure may exceed 10%. After six months of low inflation - with monthly rates below 0. 75%, compared to annual inflation of about 800% in 1993 and 120% in 1994 -, inflationary pressures re- emerged in the autumn 1995, owing to strong capital inflows. With an average monthly rate of 3. 5% between September and December, inflation reached 24% for the whole year. In the fourth quarter, the central bank tightened the monetary policy, which was reflected in upward pressure on interest rates. The fiscal deficit is expected to have declined from 8% in 1994 to an estimated 4% in 1995, not far from the 3. 5% official target. Only a severe control of expenditures made this reduction possible. Revenue collection remained insufficient and privatisation receipts were far below expectations, because of a lack of domestic capital. indeed Concerning structural reforms, important measures were initiated in 1995. The privatisation process slowed in early 1995, but gathered momentum after the adoption by Parliament, in March, of the new 1995/96 Privatisation Programme. The government estimates the private sector's share of the economy to have risen to about 2/3 by November 1995 (end of the voucher programme). Important progress was recorded in enterprise restructuring with the liquidation of a series of state enterprises in difficulty and the revision of the bankruptcy legislation. 2. THE BALANCE OF PAYMENTS ~~ The balance of payments remained under severe pressure in the first half of 1995, primarily because of the continued impact of the terms-of-trade shock caused by the increase in imported energy prices to world market levels. In the second half of the year, however, a better-than-expected export performance coupled with an important reduction in imports, principally energy, led to a quasi-equilibrium in the trade balance. Consequently, the current account deficit is projected to have sharply declined from a revised 13% of GDP in 1994 to 3. 5% in 1995. Medium- and long-term loans still represented the main part of capital inflows in 1995. Direct investment remained low. Gross reserves of the central bank had reached some US$ 265 mio by end-1995, or the equivalent of 4. 8 months of imports, compared to 3 months at end-1994 and 1. 4 months at end-93. 40 A 3. FOREIGN DEBT Moldova agreed to the zero option with the Russian Federation and so has no responsibility for the external debt of the FSU. Foreign debt of the country is estimated to have reached some US$ 650 mio by end 1995 (or around 42 % of GDP), and is owed mainly to Russia, the IMF and the World Bank. Debt service as a percentage of exports is projected to have increased from 2% in 1994 to some 13 % in 1995. A K. ROMANIA 1. GENERAL ECONOMIC SITUATION The marked improvement in Romania's economic growth and performance that had started in 1994 continued well into 1995, driven mainly by exports, the resumption in domestic consumption and investment. Real GDP growth accelerated to some 5% (as compared to 3. 9% in 1994), owing to a better performance of the agricultural sector and an impressive recovery in industrial output (+ 14% during the first eleven months of 1995). Also investment recovered fast, expanding during the first nine months of 1995 by 6. 3% over the same period of the previous year. Particularly encouraging appears the increase in the private investment (+ 9. 3% during the same period). Inflation slowed down from an annual rate of 62% in 1994 to 24. 3% by October 1995. In 1995 the budget deficit was 2. 8% of GDP. The unemployment rate progressively slowed down from around 11% at end of 1994 to around 9% in October 1995. The tight monetary, fiscal and income policies implemented in 1994 were somewhat relaxed during the second and third quarter of 1995, reflecting positive achievements with regard to inflation and probably also in view of the parliamentary elections in 1996. In 1996, real GDP is expected to increase by 4% and investment by 8. 8%; unemployment is projected to soar to 11. 2%; the budget deficit/GDP ratio will further decrease to 2. 2-2. 4%; and annual inflation is forecasted to decline to 20%. Structural reforms are progressing with mixed results. The parliamentary approval of the long-overdue bankruptcy law in March 1995 should now enable the government to speed up closure and liquidation of inefficient enterprises. In 1995, the authorities started the implementation of a mass privatization programme by issuing privatization vouchers. On the basis of current legislation, some 3900 state-owned enterprises are to be sold off. Share dealing will be eased by the establishment of the Stock Exchange on November 20, 1995. Draft legislation dealing with the privatization of banks is currently before parliament. 2. THE BALANCE OF PAYMENTS The upturn in economic activity witnessed in 1995 led to a sharp rise in imports and this, combined with a slightly lower export growth, resulted in the deterioration of the current account. By September 1995, the current account deficit reached nearly US$ 1 bn, against a deficit of US$ 430 mio recorded in 1994. The authorities are expressing a growing concern as regards the deterioration of the external position and are considering new and more effective export promotion plans. In this respect, some improvement in trade balance is expected to come from exports of agricultural products, which were liberalized in the second half of 1994. Instruments for export support being considered would include interest rate subsidies and tax breaks. The Romanian Trade Centre for export promotion is due to start its operations 42 A at the beginning of 1996. The Association agreement with the EU, facilitating Romania's access to EU market, came into force on 1 February 1995. As for the capital account, FDI and portfolio investment slowed down to US$ 306 mio in the first ten months on 1995 (against US$ 341 mio in 1994). By mid-1995, the cumulative FDI amounted to a total of US$ 1. 4 bn. Official loan disbursements remain the principal source of external finance. In this respect, in December 1995, the IMF approved the extension of the current Stand-By arrangement through April 1997 and decided to augment the amount available under it by SDR 188. 5 mio (to SDR 320. 5 mio, or about US$ 475 mio). The World Bank's FESAL (US$ 280 mio) could be made available soon. After an absence of some 15 years, Romania returned to the international capital markets in 1995 with two syndicated loans to the Romanian Central Bank, amounting to US$ 150 mio and US$ 110 mio respectively. The central bank has been authorized to borrow up to US$ 1 bn in 1996 and, as creditworthiness improves, banks and companies may also gain access to the international capital market. By October 1995, total foreign exchange reserves of the banking system amounted to US$ 2. 5 bn, equivalent to 2 months of imports. Slightly more than US$ 695 mio were held with the Central Bank. This was equivalent to 0. 6 months of imports. Presently, Romania has a floating exchange rate regime and an interbank foreign exchange market which has been developed since 1994. In 1995, the leu was put under pressure, reflecting the deterioration of the country's external balance. This eventually led to a further 10% depreciation in the reference exchange rate reported by the National Bank. The difference between the reference rate and exchange rate offered by the private exchange bureaus increased by up to 20% by November 1995, from its normal deviation level of 3-5%, which shows a renewed segmentation in the exchange market. 3. EXTERNAL DEBT By October 1995, total foreign ( medium- and long-term) debt was stabilized at the level of US$ 4. 8 bn, or 18. 7% of GDP (18. 9% in 1994). The external debt service ratio increased to 13% (8. 9% in 1994) and is expected to further rise to close to 22% in 1996. Despite this rapid increase, debt and debt service ratios remain relatively manageable. 43 A L. RUSSIA 1. GENERAL ECONOMIC SITUATION After several years of sharp recession, output continued to decline in 1995, although at a less sharp pace (-4% of GDP). Industrial production decreased by only 3% over the previous year, against a drop of 24% in 1994. The unemployment rate increased to 8. 2% at year-end, compared with 7% by end-1994. Price increases, which had peaked at hyper-inflationary levels in 1992-1993, had remained high in 1994 and until early 1995, with a 18% monthly increase in January. 1995 was a turning point for macro-economic stabilisation. In March, the Duma passed the 1995 budget with a target deficit of 5. 5% of GDP (compared with 11% in 1994). In April, the IMF board approved a twelve-month Stand-By arrangement with Russia, initially aiming at a reduction in monthly inflation to 1% by year-end, principally by means of tight monetary policies. The monetary base grew monthly by 7% in the first half of 1995 and by 6% over the second half of the year. The budget deficit, at about 4% of GDP, remained within the 5. 5% target. Revenue performance, despite growing tax arrears, improved, whereas expenditure was cut by about 17% in 1994. Inflation, however, declined only slowly down to a 3. 2% monthly level in December, down from its high level of the beginning of the year but still well over the initial target. In December, the Parliament approved the 1996 budget which envisages a 3. 85% deficit. Foreign trade, which had been subject to administrative distortions until early 1995, was liberalised. Import exemptions were restricted to a few cases. After the completion of the voucher mass privatisation scheme which, by end-1994, had transferred the ownership of 112,000 enterprises to private hands, privatisation advanced in 1995 at a slower pace than in the previous years. 2. THE BALANCE OF PAYMENTS After a significant depreciation against the dollar over the first quarter, the rouble stabilised in June well below the level of 5000 roubles per dollar and appreciated in real terms over the remaining of the year. This strong performance of the rouble, a result of the tight monetary policies implemented in the context of the Stand-By arrangement, was encouraged by the high level of interest rates on the treasury bills market and was accompanied by significant hard currency inflows (including the sale of dollars held in cash by residents). In July, in order to cut inflationary expectations, the authorities established an exchange rate corridor between 4,300 r/US$ and 4,900 r/US$ which performed successfully until year-end. In November, a new exchange rate band for the first half of 1996 was announced with a range of 4550 r/US$ to 5150 r/US$. Owing to increasing export earnings, which showed a 23% growth in dollars over the first three quarters of the year, the trade balance recorded a significant surplus in 1995, estimated US$17. 4 bn, compared with US$ 14 bn in 1994. This suggests an initially undervalued level of the rouble which was only partially compensated by this year's appreciation (+ 72% on a year-end basis) in real terms. The current account, at about US$ 6 bn (or 1. 5% of GDP), remained in surplus despite a negative balance of services. 44 A The capital account, burdened with significant amortization payments (about US$ 12 bn) was in deficit in spite of important purchases from the IMF (US$ 5. 4 mio). The deferral of private debt payments and a rescheduling in the Paris Club provided exceptional relief in the amount of US$ 24 bn. The foreign exchange reserve position substantially improved. By the end of the year, net international reserves amounted to about US$ 8 bn, or 1. 2 months of imports, against only US$ 2. 3 bn a year before. 3. FOREIGN DEBT According to the agreements reached with the New Independent States, Russia is the successor state for the external assets and liabilities of the former Soviet Union. The level of the Russian debt, which includes the capitalisation of accumulated arrears, represents, in a context of recession, an increasing burden for the country. By end- 1995, foreign debt, at an estimated US $ 130 bn, represented about 33% of GDP. Most of this debt is owed to official bilaterals (about US$ 80 bn), a substantial part to commercial banks (about US$ 33 bn), and a smaller but rapidly growing part to the international financial institutions. The bulk of Russian debt represents the debt inherited from the FSU (about US dollars 115 bn). Russia's inability to service its debts has triggered several Paris Club rounds since 1992. On 3 June 1995, Russia reached an agreement with its Paris Club creditors on a new rescheduling for debt maturities falling due in 1995. Subsequently, the total debt service in 1995 amounted to about US$ 17. 6 bn (including US$ 5 bn interest payments), or 22% of estimated exports. Paris Club creditors also agreed to start discussions on a wider rescheduling of the Russian debt as soon as an agreement can be reached, in early 1996, on a three-year extended fund facility (EFF). This should allow to bring debt service down to sustainable levels in the coming years. An agreement in principle was also reached in November with London Club creditors on a wide scale restructuring of the private debt. The reconciliation of the exact terms of this agreement with some 600 banks is now taking place with the objective of a final agreement by the end of June 1996. 45 A M. THE SLOVAK REPUBLIC 1. GENERAL ECONOMIC SITUATION After growing by 4. 8% in 1994, the Slovak economy continued to strengthen in 1995. GDP growth accelerated to 7. 4% in January-September (year-on-year) and industrial production rose by 10. 1% in November (year-on-year). Domestic demand has replaced net exports as the force driving economic expansion. The unemployment rate is on a downward trend, having declined from 15. 2% in January 1995 to 12. 8% last November. Despite this strong growth performance, inflation has continued to decelerate, reaching 7. 2%) at end-1995, compared to 11. 7% at end-1994. Slovakia has thus become one of the few transition countries that can boast a single-digit inflation rate. Real wage growth accelerated to about 5% in 1995 but this, it seems, is being offset to an important extent by productivity gains. The reduction in inflation has continued to be supported by restrictive macroeconomic policies. Reflecting larger than anticipated revenues from the VAT and income tax, the state budget deficit finished 1995 with a deficit of Sk 8. 3 bn, well below the Sk 21 bn deficit that had been programmed. Monetary policy was kept tight in 1995, with broad money expanding by 7. 9% in the first 9 months of the year, only slightly above inflation. For 1996, the monetary programme of the National Bank of Slovakia (NBS) targets broad money growth of 13. 2%, consistent with a reduction of inflation to 6- 7. 5% and real GDP growth of 5. 8%. The new government formed in December 1994 decided in June 1995 to cancel the voucher privatization scheme. Instead of shares in state enterprises, the 3. 5 mio Slovak citizens that bought vouchers in 1994 have been given 5-year interest-bearing bonds issued by the National Property Fund. Privatization through standard methods (often in the form of direct sales to managers and employees) has gathered momentum since mid-1995 but is being criticized for lack of transparency. 2. THE BALANCE OF PAYMENTS The balance of payments has experienced a clear improvement since the second quarter of 1994. The current account swung from a deficit of US$ 0. 6 bn (5. 4% of GDP) in 1993 to surpluses of US$ 0. 7 bn (6% of GDP) in 1994 and of US$ 0. 4 bn in the first 7 months of 1995. The evolution of the trade balance at the end of the year, however, suggests that the current account surplus may have began to shrink reflecting strong domestic demand. The capital account has also improved, although net FDI inflows remain low. About US$ 300 mio of official macro-financial assistance (IMF, World Bank's Economic Recovery Loan and Japan Exim Bank) have been disbursed since mid-1994. In addition, the NBS issued in July 1994 a US$ 250 mio bond in the Samurai market, and certain companies and banks have been able to borrow abroad at relatively long maturities. Finally, the tight management of inter-bank liquidity by the NBS, in combination with the perceived stability of the Slovak crown (and, in the first half of 46 A 1995, the expectation of a revaluation against the Czech crown), has led to some short-term capital inflows. Slovakia's access to the international capital markets has been reinforced by the upgrading by Standard & Poor's of its rating from BB~ to BB+ in April 1995, and by the assignment by Moody's of an investment grade rating (Baa3) in May 1995. These favourable trends in both the current and the capital account have been translated into a substantial increase in reserves. Official foreign exchange reserves (excluding those obtained from gold swaps) have risen from US$ 416 mio at end-1993 to US$ 2. 8 bn in October 1995, or about 3. 5 months of imports. Following a 10% devaluation in July 1993, the exchange rate of the crown has been stable against a basket of Western currencies. In July 1994, the number of currencies in the basket was reduced from five to two (the Deutsche mark and the US dollar). In January 1996, the fluctuation band around the central rate was increased from +- 1. 5% to +- 3%. Despite the strengthening of the balance of payments, the Slovak authorities intend to maintain until end-1996 the import surcharge introduced in March 1994. As of October 1995, the Slovak crown was made fully convertible for current account purposes and the bilateral clearing system with the Czech Republic was terminated. The authorities also plan to liberalize some capital flows. The mid-term review of the IMF stand-by arrangement, initially scheduled for February 1995, has not been completed. In any case, the authorities announced in April 1995 that, in view of the improvement in the balance of payments and reserve position, they did not intend to make any further purchases under this IMF facility. 3. FOREIGN DEBT Slovakia inherited from the Czechoslovak federation a relatively low external debt. Although debt and debt service ratios have deteriorated since the country's independence, they remain at reasonable levels. The foreign debt/GDP ratio has increased from 25. 7% at end-1992 to 33. 7% in July 1995. Debt service as a percentage of exports has risen from 3. 3% in 1992 to an estimated 9. 5% in 1995. 47 A N. TRANSCAUCASIAN REPUBLICS 1. GENERAL ECONOMIC SITUATION After a sharp decline in 1990-93 (75%), Armenia's GDP recovered in 1994 (+5. 4%). This positive growth trend is expected to have continued in 1995 with a 5% estimated increase, due partly to better results in industrial output which grew by 10% in 1994 and by 13% in the first half of 1995. A tightening of monetary policy succeeded in halting hyperinflation in the second half of 1994. In 1995, inflation is projected to reach about 30%, down from 1900% in 1994, owing to a further tightening of monetary policy and an increase in the supply of agricultural goods. Over the last two years, Armenia has moved from a highly expansionary fiscal policy characterized by extremely large deficits financed by central bank credit to a policy featuring much smaller deficits financed primarily by external sources. The fiscal deficit after grants is estimated to have declined to some 10% of GDP in 1995, from 16% in 1994 and about 50% in 1993. Substantial progress has been made in the area of structural reform, namely in price liberalisation, enterprise restructuring and small-scale privatisation. In Azerbaijan, the GDP decline - some 20% per year between 1992 and 1994 - continued at a lower rate - 15% - in the first half of 1995 but statistics do not take into consideration the activity of an emerging informal sector, particularly in trade and services. Monetary stability was set as the primary goal of financial policies in 1995 and average monthly inflation fell to 1. 5% in the period April-October 1995, compared to a yearly rate of about 1700% in 1994. This was made possible by the fiscal consolidation started in 1995: the compression in expenditures brought the fiscal deficit to an estimated 8% of GDP, down from 11% in 1994, the main part of this deficit being financed by external funds linked to the signature of the oil contract with western companies. Regarding structural reforms, progress has been made with respect to price and trade liberalisation, but much remains to be done in enterprise restructuring and privatisation. After the sharp decline of Georgia's output between 1990 and 1994 - 70% -, the economy continued in 1995 to face severe bottlenecks, especially arising from-energy shortages. There were however signs of recovery in 1995, mainly due to an increase in agriculture output despite a lack of basic inputs and weak property rights. Official unemployment remained rather low (some 4%) in 1995, but a recent informal poll indicated a rate above 11%. Tight financial policies have succeeded in halting hyperinflation (average rate of 2. 5%) in the first eight months of 1995, compared to 66% in the first nine months of 1994) and in stabilizing the exchange rate of the coupon, replaced by the lari in October 95. The fiscal deficit after grants was reduced to an estimated 7% in 1995, mainly through sharp cuts in expenditures and the monétisation of external food assistance. Revenue performance, however, remains very weak. Several structural reforms have been introduced (price liberalisation, elimination of state order system, privatisation process). Substantial further efforts are however still needed, namely in privatisation, land reform and in the development of an appropriate legal framework for a market-based economy. 48 A 2. THE BALANCE OF PAYMENTS Reflecting an increase in imports associated with official transfers, Armenia's current account before transfers further deteriorated in dollar terms in the first half of 1995. As a percentage of GDP, however, the deficit decreased from 35% in 1994 to about 25% in the same period. Owing to purchases under IMF programmes and World Bank credits, official reserves increased in 1995 to reach about US$ 100 mio (or 2 months of imports) in November. During the first half of 1995, the exchange rate of the dram remained stable against the dollar, while the real effective exchange rate increased by about 4%>, reflecting a depreciation against FSU currencies more than offset by an appreciation against non-FSU currencies. Much of the recent deterioration in Azerbaijan's current account is due to a sharp decline in the terms of trade (increased import prices from CIS countries to world levels and increased transportation costs, owing to the war situation in neighbouring Chechnya). As a percentage of GDP, the trade and the current balances deteriorated from 7% and 8. 5% in 1994 to, respectively, 12. 5% and 16. 9% in 1995. Important inflows in the capital account were registered in 1995, reflecting the use of the EU loan for import of food and medicine, but also the effects of the signature between the government and a consortium of international oil companies of an oil production led to a sharing contract. These strengthening of international reserves which reached some US$ 140 mio - 2 months of imports - by end-June 1995 and were projected to further increase before end-1995. As a result of the tightening of credit policies in early 1995 and the associated increase in interest rates to positive real levels, the exchange rate of the manat against the US dollar remained broadly stable in 1995, following a devaluation of more than 90% in 1994. together with IMF disbursements, inflows, Partly reflecting a steep decline in gas consumption, Georgia's trade deficit is estimated to have declined by 28% in the first half of 1995. The current account balance, before transfers, has recorded a pattern similar to the trade balance, with a projected 1995 deficit of US$ 410 mio (some 16% of GDP), down from US$ 450 mio (35% of GDP) in 1994. Official transfers have been a significant source of financing for the current account deficits registered in recent years. The capital account, dominated by official transactions, has moved into deficit since 1994, due to important amounts of amortisation falling due. The resulting deficit in the overall balance of payments was largely financed through the accumulation of arrears, which reflected the near exhaustion of official reserves. These reserves, however, increased sharply in 1995 to reach US$ 165 mio or about 3 months of imports by end-November. This increase was partly due to programmed drawings on IMF credits, but also to the successful introduction of the new currency, the lari. Exchange rate developments in 1995 have been strongly influenced by the interventions of the central bank, which have served to sterilise the impact of credit expansion to central government. This led to a rather stable official exchange rate of the currency and to a substantial appreciation in the real effective exchange rate. 49 A 3. FOREIGN DEBT The three countries agreed to the zero option with the Russian Federation and so entered the independence with modest external obligations. Since then, the situation sharply deteriorated, as Armenia and Georgia are in arrears on their debt servicing, while Azerbaijan has already negotiated a debt rescheduling. Armenia's external debt increased rapidly at US$ 310 mio by end-June 95 (some 25% of GDP) and is estimated to have reached about US$ 350 mio by end-95, while total scheduled debt service could reach more than 20% of exports of goods and non-factor services. Azerbaijan had accumulated by end-1994 a US$ 230 mio external deb and could reach US$ 277 mio (about 15% of GDP) in 1995. In 1995, the country was unable to repay debts arriving to maturity but creditors - Russia, Turkmenistan and Turkey - accepted to reschedule them. The whole debt of the country is now of short or medium-term maturity and is to be repaid between 1996 and 1999. By the end of 1994, Georgia had accumulated a foreign debt of almost US$ 1 bn (80% of GDP). The bulk of this debt, mainly contracted to finance imports, has now accumulated in arrears. In the first half of 1995, debt service falling due was estimated at about US$ 119 mio (over 50% of exports of goods and non-factor services). Faced with this very heavy debt burden, the Georgian authorities have approached creditors to request financial support designed to help bringing the country's external obligations in line with its very limited debt-servicing capacity. 50 A O. UKRAINE 1. G E N E R AL E C O N O M IC S I T U A T I ON Following sharp output contractions between 1990 and 1994, GDP decline slowed down markedly in 1995 (average change of -13%, compared to -23% in 1994). Industrial production is estimated to have fallen by some 20% last year, following a 36% reduction in 1994. The official unemployment figure of 0. 4% still does not reflect the protracted fall in output; the International Labour Organization estimates that hidden unemployment has reached as much as 20%. In the first half of 1995, the Ukrainian authorities continued to implement their stabilization policies, first in the context of the IMF Systemic Transformation Facility of October 1994 and then under the IMF stand-by arrangement (SB A) of April 1995. Relatively strict monetary and credit policy led to a rapid deceleration of inflation to a monthly rate of 5% in mid-1995. However, loosening of policies in the summer months prevented a further reduction of inflation in the second half of 1995 to the target rate of 1-2%. On average, inflation fell from 401% by 1994 to 180% in 1995. The budget deficit on a cash basis was more than cut by half, from 8. 6% of GDP in 1994 to 4. 1% in 1995. The target deficit rate of 3. 3% of GDP was, however, not achieved, mainly because of the Government's decision to extend budget guarantees for Ukrainian gas imports from Russia beyond the agreed deadline of September 1995; this was an important reason for the IMF's decision in December to postpone the completion of the third quarter review under the SB A until the programme is back on track. But the overrun of public expenditures was also due to large wage increases granted to government workers and subsidies to the coal mine sector. Between fall 1994 and spring 1995, there were considerable reform achievements, in particular the liberalization of prices and the foreign exchange market, as well as a sharp reduction of government procurement in the agricultural sector. However, subsequently the reform dynamics slowed down markedly; in some areas there were even reversals of earlier achievements. Progress was particularly unsatisfactory with regard to privatization, but foreign trade policy was also not sufficiently liberalized so that it continued to impede exports, especially of agricultural products. — 2. T HE BALANCE OF PAYMENTS In 1995, Ukraine's balance of payments situation remained tight. The current account deficit stabilized at US$ 1. 4 bn (some 4. 5% of GDP). The merchandise trade deficit also remained roughly unchanged at US$ 2. 1 bn. However, the earlier contraction of trade volumes (in the order of 15% in 1994) was halted. Overall exports expanded moderately (3%), although with respect to the West the expansion was dynamic (15%>). Imports from Western countries also increased strongly (some 10%), but overall imports nevertheless contracted somewhat given a strong decline in energy imports. In the context of the IMF-supported programme, the Ukrainian authorities agreed not to accumulate any more external arrears towards Russia and Turkmenistan. This 51 A assurance was also the basis for Russia's agreement in March 1995 to reschedule Ukrainian arrears on gas supplies. However, in the course of 1995, and in particular with the beginning of the heating season, external arrears were accumulated (mostly with Russia). This has played an important role for the suspension of the stand-by arrangement. At the end of 1995, the external arrears stood at US$ 236 mio. In 1995, external financing was somewhat lower than expected mainly owing to the difficulties in the implementation of the IMF programme. Nevertheless, gross foreign reserves were accumulated to a level corresponding to 1 month of imports. 3. FOREIGN DEBT In 1995, Ukraine's external debt stock increased from US$ 7. 1 bn in 1993 to US$ 8. 1 bn. In percent of GDP, this represents a decline from 29% to 24%. The ratio of external debt service to exports of goods and services fell from 12% to 10%. The Ukrainian authorities are presently discussing the possibility of Russia rescheduling some of the recently accumulated Ukrainian debt on gas deliveries. 52 A Statistical annex TABLES OF STATISTICS EXPLANATORY NOTES ANNEX: DEFINITION OF FIGURES USED IN THE REPORT 1 18 24 o CAPITAL OUTSTANDING IN RESPECT OF OPERATIONS DISBURSED TABLE 1 Operation MEMBER STATES A. Balance of payments 1. Greece 2. Italy B. Others 3. Euratom 4. NCI and NCI earthquakes 5. EIB Mediterranean, Spain, Greece, Port. MEMBER STATES - TOTAL THIRD COUNTRIES A. Financial assistance 1. Hungary 2. Czech Republic 3. Slovak Republic 4. Bulgaria 5. Romania 6. Algeria 7. Israel 8. Baltic States 9. Moldova 10. Ukraine 11. Belarus 12. Former Soviet Union B. Other 13. EIB Mediterranean 14. EIB Central & E. Europe I 15. EIB Central & E. Europe II 16. EIB Asia, Latin America 17. EIB South Africa (ECU million) Authorized ceiling Capital outstanding 30. 06. 95 Capital outstanding 31. 12. 95 Remainder to be disbursed 31. 12. 95 2200 8000 14000 4000 6830 1500 26330 1050 250 255 400 580 600 160 220 45 285 75 1250 6362 1700 3000 750 300 1000 4071 741 1289 439 7540 440 250 125 360 455 400 160 110 25 702 1756 658 24 107 1000 4045 720 1113 385 7263 440 250 125 360 510 500 160 135 45 85 30 347 1782 837 96 149 1200 4000 0 0 0 5200 260 0 130. - 40 70 100 0 85 0 200 45 18 3647 844 2905 601 300 THIRD COUNTRIES - TOTAL 17282 5572 5851 9245 GRAND TOTAL 43612 13111 13114 14445 1) No disbursement is planned. 2) The third and fourth tranches had still not been paid at 31. 12. 95. So far, the Italian Government has not requested payment. ANNEX TO TABLE 1 SITUATION IN RESPECT OF EIB OPERATIONS (31. 12. 95) Operations EIB Mediterranean, Spain, Greece, Port. Third countries EIB Med. Central & Eastern Europe I Central & Eastern Europe II Asia, Latin America South Africa Credit line authorized Loans made available, minus cancellations Initial disbursement Amount outstanding at 31. 12. 1995 1500 6362 1700 3000 750 300 1465 4972 • 1647 1894 607 45 1576 2715 856 96 149 385 1782 837 96 149 NB: The fact that the initial disbursement sometimes exceeds the authorized ceiling is due to differences in the ecu rate between the date on which the contracts were signed and 31. 12. 95. a T A B LE 2 MAXIMUM ANNUAL RISK B O R NE BY T HE COMMUNITY BUDGET (Estimate in ECU million based on all operations disbursed at 31. 12. 1995 1996 1997 1998 1 9 99 2 0 00 2001 2002 2003 TOTAL MEMBER STATES CAPITAL A. Balance of payments 1. Greece 2. Italy B. Structural loans 3. Euratom 4. NCI and NCI EQ 5. EIB Med. Old. Prot. Sp. Gr, Port 500 500 153 306 73 500 1006 94 91 57 444 547 72 2539 13 42 45 16 42 50 Capital - subtotal 1533 1063 1747 109 2639 INTEREST A. Balance of payments 1. Greece 2. Italy B. Structural loans 3. Euratom 4. NCI and NCI EQ 5. EIB Med. Old. Prot. Sp. Gr. Port 95 255 57 95 33 48 215 42 69 27 46 215 10 20 20 160 160 3 12 15 1 10 11 Interest - subtotal 535 400 313 190 182 71 21 92 7 7 14 23 23 21 21 2 5 7 2 3 5 1000 4045 720 1100 362 7226 190 1005 113 216 123 1647 MEMBER STATES - TOTAL 2068 1463 2060 299 2821 106 30 26 8873 NON-MEMBER COUNTRIES CAPITAL A. Financial assistance 6. Hungary 7. Czech Republic 8. Slovak Republic 9. Bulgaria 10. Romania 11. Israel 12. Algeria 13. Ex USSR 14. Baltic States 15. Moldova 16. Ukraine 17. Belarus , B. Guarantees 18. EIB Mediterranean 19. E l B C + E E u r. I + II 20. EIB Asia Latin America 260 204 134 30 80 127 63 140 160 250 143 141 44 12 Capital - subtotal 628 1161 INTEREST A. Financial assistance 6. Hungary 7. Czech Republic 8. Slovak Republic 9. Bulgaria 10. Romania 11. Israel 12. Alqena 13. Ex USSR 14. Baltic States 15. Moldova 16. Ukraine 17. Belarus B. Guarantees 18. EIB Mediterranean 19. E l B C + E E u r. I + II 20 EIB Asia Latin America Interest - subtotal NON-MEMBER COUNTRIES - TOTAL 26 25 13 36 51 16 50 14 14 5 9 3 123 63 6 453 18 25 13 36 51 16 50 7 14 5 9 3 114 61 6 426 100 123 62 150 185 157 63 16 856 10 12 6 22 51 25 14 5 9 3 103 57 6 322 190 80 110 5 153 87 18 452 7 14 25 14 5 9 3 81 47 5 162 83 16 451 7 33 25 14 5 9 3 92 53 6 70 150 9 17 6 142 87 18 499 V 7 6 25 3 4 9 3 70 41 5 55 100 25 9 17 6 134 87 19 451 6 10 3 7 2 50 35 4 244 208 171 119 440 250 125 360 510 160 500 347 135 32 51 18 1155 560 105 4749 54 62 32 115 210 32 210 21 73 32 63 1 672 385 41 2004 9 17 6 133 80 6 252 2 5 2 40 29 4 82 1081 1586 1178 695 660 670 570 334 6753 GRAND TOTAL 3149 3049 3238 994 3481 776 600 360 15626 (Eastern Europe ) (Other non-member countries) 751 330 837 749 871 307 394 300 378 281 261 409 254 316 151 184 3876 2876 2- s TABLE 3 MAXIMUM THEORETICAL ANNUAL RISK BORNE BY THE COMMUNITY BUDGET (Estimate in ECU million based on all operations disbursed, adopted and proposed by the Commission) 1996 1997 1998 1999 2000 2 0 01 2002 2003 T O T AL MEMBER S T A T ES CAPITAL A. Balance of payments I. G r e e ce 2. Italy B. Structural loans 3. Euratom + NCI 4. EIB Sp. Gr. Port 500 500 459 73 500 1006 185 57 991 72 2539 55 45 58 50 Capital - subtotal 1532 1063 1748 108 2639 2000 2000 23 21 1000 8045 1820 362 2023 2021 11227 71 21 92 INTEREST A. Balance of payments 1. Greece 2. Italy B. Structural loans 3. Euratom + NCI 4. EIB Sp. Gr. Port Interest - subtotal 95 425 152 33 705 48 553 111 27 738 48 638 30 20 735 553 553 340 340 15 15 11 11 7 7 2 5 170 2 3 190 3571 329 123 583 575 354 347 175 4212 MEMBER S T A T ES - T O T AL 2237 1801 2483 691 3215 447 2370 2196 15439 NON-MEMBER COUNTRIES CAPITAL A. Financial assistance 5. Hungary 6. Czech Republic 7. Slovak Republic 8. Bulgaria 9. Romania 10. Israel 11. Algeria 12. Ex USSR 13. Baltic States 14. Moldova 15. Ukraine 16. Belarus 17. Euratom, C+E Eur. B. Guarantees 18. EIB Mediterranean 19. E l B C + E E u r. I + II 20. EIB Asia Latin America 2 1. EIB South Africa 260 204 134 30 100 123 62 150 185 80 127 63 140 160 250 161 141 44 12 157 63 16 Capital - subtotal 628 1178 856 INTEREST A. Financial assistance 5. Hungary 6. Czech Republic 7. Slovak Republic 8. Bulgaria 9. Romania 10. Israel 1 1. Algeria 12. Ex USSR 13. Baltic States 14. Moldova 15. Ukraine 16. Belarus 17. Euratom, C+E Eur. B. Guarantees 18. EIB Mediterranean 19. EIB C+E Eur. I + II 20. EIB Asia Latin America 2 1. EIB South Africa Interest - subtotal 57 25 20 40 55 16 55 14 18 5 19 5 10 168 112 15 2 635 44 25 26 44 58 16 60 7 22 6 29 8 30 262 219 33 9 897 36 12 20 30 58 35 22 6 29 8 50 374 337 52 18 190 80 110 5 327 269 48 11 850 26 13 15 21 35 22 6 29 8 88 456 395 61 29 236 164 30 3 623 26 14 15 40 35 22 6 29 8 70 447 402 62 20 70 150 9 17 6 13 420 371 65 19 55 100 25 12 37 11 27 459 399 69 25 260 80 70 100 85 12 57 11 40 473 393 69 25 700 250 125 440 580 160 600 365 220 38 111 28 80 2347 1733 309 83 1140 1219 1675 8169 26 13 15 13 35 11 6 29 8 94 436 361 56 28 26 13 8 13 20 11 5 27 7 91 408 324 50 26 26 ~8 7 10 11 3 23 6 87 376 287 45 23 912 267 62 118 175 263 32 285 21 139 43 211 55 520 2927 2437 374 155 8083 1086 1194 1203 1129 1028 NON-MEMBER COUNTRIES - T O T AL 1263 2075 1942 1817 2053 2269 2247 2587 16252 G R A ND T O T AL 3500 3876 4425 2508 5267 2716 4617 4783 31691 (Eastern Europe ) (Other non-member countries) 873 390 1132 943 1290 652 984 833 1086 967 1060 1209 1090 1157 1466 1121 8980 7272 3 • _ Country risk indicators Country: Algeria Real GDP growth rate (in %) Hydrocarbon production ( % change) Inflation ra (Dec/Dec) Exchange (end of period) Nominal el (change Q4/Q4) (- - depreciation) Real effect (change Q4/Q4) (- = depreciation) 1993 1994 1995 Latest data or estimates (E) -2,0 -0. 6 16. 1 24,0 -7. 9 12,8 1. 1 -2,5 34,9 42,9 -78. 6 -40,4 5,3 1. 5 22. 2 (E) 52. 2 -21,7 -34,5 General government balance (as % of GDP) -6. 7 -4,4 -2,8 Balance of payments Exports of G&S (in bn USD) Current account balance (in % of GDP) Net inflow of foreign direct investment (in mio USD) Official FX reserves (end of period) in bn USD in months of imports of G&S External debt External debt (in convertible currencies, in bn USD, end of period) medium and long-term (> 1 year) short-term (=< 1 year) Convertible debt service (in bn USD) principal interest External debt/GDP (%) External debt/exports of G&S (%) Debt service/exports of G&S (%) Arrears (on both interest and principal, in mio USD) Debt relief agreements and rescheduling (bin US$) IMF arrangements Type/no (Date / - ) On track/off track 11,0 1. 6 0,0 1. 5 1,9 25,7 25,0 0,7 9,1 7,2 1,9 51,8 206,8 82,2 No No No 9,5 -6,9 0,0 2,6 2,9 10,5 -5,7 100,0 1. 9 (Nov. ) 2. 0 (Nov. ) 29,6 33. 8 (E) 28,9 0,7 4. 6 (3) 3,2 1,4 67. 7 252,0 48. 7 (3) No 4,5 n. a. n. a. 3. 8 (3) 2. 2 (3) 1. 6 (3) 78. 5 (E) 264. 4 (E) 49,1 No 4,8 SBA (5. 94 - 5. 95) On-track SBA (5. 94 - 5. 95) EFF (5. 95 - 5. 98) On-track Indicators of market's perceived creditworthiness Moody's long-term foreign currency rating (end of per. ) S&P long-term foreign currency rating (end of period) Euromoney Position in the ranking (1) (number of countries) The Institutional Investor Position in the ranking (1) (number of countries) Credit rating (2) Not rated Not rated Mar Sep 68 79 (169) (170) Mar Sep 62 69 (127) (133) 28. 2 27. 1 Not rated Not rated Mar Sep 92 96 (167) (167) Mar Sep 75 78 (135) (135) 26. 3 24. 6 Not rated Not rated Mar Sep 102 107 (187) (181) Mar Sep 89 91 (135) (135) 23. 5 22. 8 (1) (2) (3) The higher the ranking number, the lower the creditworthiness of the country. Countries are rated on a scale of zero to 100, with 100 representing the least chance of default. A given country may improve its rating and still fall in the ranking if also the average global rating for all rated countries improves. After rescheduling. A 5 " " " Country risk indicators Country: Belarus Real GDP growth rate Cm %) Industrial production ( % change) Unemployment rate (end of period) rate inflation Exchange rate ( Rbs per USD) Nominal effective exchange Real effective exchange rate rate (Dec/Dec) (average) (change, Q4/Q4) (- - depreciation) (change, Q4/Q4) (- = depreciation) 1993 1994 1995 Latest data or estimates (E) -11,6 -10,0 1,5 1990 932 n. a. n. a. -20. 0 -35,0 2,0 2220 2202 n. a. n. a. -7. 0(E) -10. 0(E) n. a. 290(E) 11500 n. a. n. a. General government balance (as % of GDP) -6,3 -1,7 -3,2 Balance of payments. Merchandise exports (in mio USD) Current account balance (in % of GDP) Net inflow of foreign direct investment (in mio USD) Official FX reserves (end of period) in mio USD in months of imports 2941 -6,7 18 75,0 0,3 3138 -11,4 10 108,0 0,3 3135(E) -4. 1 (E) 20(E) 426. 0 (E) 1,5 External debt External debt (in convertible currencies, in mio USD, end of period) medium and long-term (> 1 year) short-term (=< 1 year) Convertible debt service (in mio USD) principal interest External debt/GDP (%) External debt/merchandise exports (%) Debt service/merchandise exports (%) Arrears (on both interest and principal, in bn USD) Debt rescheduling agreement IMF arrangements Type/no (Date / - ) On track/off track ( - / Date) Indicators of market's perceived creditworthiness Moody's long-term foreign currency rating (end of period) S&P long-term foreign currency rating (end of period) Euromoney Position in the ranking (1) (number of countries) The Institutional Investor Position in the ranking (1) (number of countries) Credit rating (2) 964,0 1500,0 2085. 0 (E) n. a. n. a. 14,7 n. a. n. a. 25,0 33,0 0,5 n. a. n. a. n. a. 197,0 n. a. n. a. 20,0 48,0 5,7 493 with Russia on gas arrears n. a. n. a. 239. 0 (E) 178. 0(E) 61. 0(E) 22. 0 (E) 66. 0(E) 7. 6 (E) 460 with Russia on gas arrears STF (08. 93 - 8. 94) Off track See footnote (3) Not rated Not rated Mar Sep 148 139 (169) (170) Mar Sep 100 (127) (133) STF (01. 95) See footnote (3) SBA (07. 95 - 06. 95) Off track (4) — Not rated Not rated Mar Sep 145 138 (167)(167) Mar Sep 109 109 (135) (135) 15. 5 15. 7 Not rated ~ Not rated Mar Sep 135 134 (187)(181) Mar Sep 112 112 (135) (135) 15. 2 15. 5 (1) (2) (3) (4) The higher the ranking number, the lower the creditworthiness of the country. Countries are rated on a scale of zero to 100, with 100 representing the least chance of default. A given country may improve its rating and still fall in the ranking if also the average global rating for all rated countries improves. IMF 1993 STF programme went off track in early 1994. However, IMF staff considered favourably the government programme adopted in Autumn 1994, which was supported with the second STF tranche by end-January 1995. The first quarterly review of the programme, scheduled for December 1995, could not be completed. t> B Country-risk indicators Country: Bulgaria Real GDP growth rate (in %) Industrial production ( % change) Unemployment rate (end of period) Inflation rate Exchange rate (Leva per USD) Nominal effective exchange rate Real effective exchange rate (end of period) (end of period) (change, Q4/Q4) (- = depreciation) (change, Q4/Q4) (- = depreciation) 1993 1994 1995 Latest data or estimates (E) -2,4 -8,5 16,3 63,8 32,7 -33,5 59,2 (E) (E) 1,4 4,0 12,9 121,9 66,0 -101,8 n. a. 2. 5 2,8 11. 1 33,0 69,8 -5. 7 n. a. General government balance (as % of GDP) -15,7 -6,6 -6,7 (E) Balance of payments Exports of G&S (in bn USD) Current account balance (in % of GDP) Net inflow of foreign direct investment (in mio USD) Official reserves, including gold (end of period) in bn USD in months of imports of G&S External debt External debt (in convertible currencies, in bn USD, end of period) medium and long-term (> 1 year) short-term (=< 1 year) Convertible debt service (in bn USD) principal interest External debt/GDP (%) External debt/exports of G&S (%) Debt service/exports of G&S (%) Arrears (on both interest and principal, in bn USD) Debt relief agreements and rescheduling IMF arrangements Type/no (Date / - ) On track/off track ( - / Date) Indicators of market's perceived creditworthiness Moody's long-term foreign currency rating (end of period) S&P long-term foreign currency rating (end of period) Euromoney Position in the ranking (1 ) (number of countries) The Institutional investor Position in the ranking (1 ) (number of countries) Credit rating (2) 3,7 -12,8 40 1,0 2,0 4,2 -0,2 105 1. 3 3,0 4,8 2,2 165 1,8 3,6 (E) (E) (E) (Oct) (Oct) 12,5 10,4 10,7 7,3 5,2 1,6 1,1 0,5 120,5 266,5 33,7 n. a. London Club (roll-overs, and DDSR agreed in principle) 8,9 1,5 1,0 0,5 0,5 109,3 202,2 18,4 n. a. London Club DDSR (July) Paris Club resched. (Apr) 9,2 1,5 1,1 0,5 0,6 83,0 159,6 17,5 0,0 No (E) (E) (E) (E) (E) (E) (E) (E) (E) SBA+STF (3/94-3/95) SBA suspend. in Sep 94 Not rated Not rated Mar Sep 122 125 (169) (170) Mar Sep 91 89 (127) (133) 18. 9 19. 5 Not rated Not rated Mar Sep 88 98 (167) (167) Mar Sep 91 95 (135) (135) 19. 8 20. 8 Not rated Not rated Mar Sep 90 90 (187) (181) Mar Sep 93 94 (135) (135) 21. 9 22. 2 (1 ) The higher the ranking number, the lower the creditworthiness of the country. (2) Countries are rated on a scale of zero to 100, with 100 representing the least chance of default. A given country may improve its rating and still fall in the ranking if also the average global rating for all rated countries improves. Country-risk indicators Country: Czech Republic Real GDP growth rate (in %) Industrial production ( % change) Unemployment (% of labour force) (end of period) Inflation rate Exchange rate (CK's per USD) Nominal effective exchange rate Real effective exchange rate (Dec/Dec) (end of period) (change, Q4/Q4) (- = depreciation) (change, Q4/Q4) (- = depreciation) 1993 1994 1995 Latest data or estimates (E) -0,9 -5,4 3,5 18,2 29,9 4. 2 19,3 2. 6 2,3 2. 8 10,2 28,2 0,0 6,8 5,2 12,9 2,9 7,9 26,3 n. a. n. a. (Nov) (Oct) General government balance (as % of GDP) 0,5 0,1 0,5 (E) Balance of payments Exports of G&S (in mio USD) Current account balance (in % of GDP) Net inflow of foreign direct investment (in mio USD) Official FX reserves (end of period) in bn USD in months of imports of G&S External debt (end of period) External debt (in convertible currencies, in bn USD, end of period) medium and long-term (> 1 year) short-term (=< 1 year) Convertible debt service (in bn USD) principal interest External debt/GDP (%) External debt/exports of G&S (%) Debt service/exports of G&S (%) Arrears (on both interest and principal, in mio USD) Debt relief agreements and rescheduling IMF arrangements Type/no (Date / - ) On track/off track ( - / Date) Indicators of market's perceived creditworthiness Moody's long-term foreign currency rating (end of period) S&P long-term foreign currency rating (end of period) Euromoney Position in the ranking (1 ) (number of countries) The Institutional Investor Position in the ranking (1) (number of countries) Credit rating (2) 16728 0,5 542 3. 9 2,8 18837 0,0 749 6,2 4,2 22195 -3,5 1965 (E) (E) (Jan-Sep) 12,9 8,0 (Nov) (Nov) 8,5 6,5 2,0 1,4 0,9 0,5 27,0 50,8 8,4 No No 10,7 7,8 2,9 2,5 n. a. n. a. 29,6 54,7 13,0 No No 15,0 (Jun) (Jun) (Jun) (Jun) (Jun) (Jun) (E) 9,6 5,4 3,1 n. a. n. a. 31,0 67,6 14,0 No No SBA (3/93-3/94) On-track — SBA (3/93-3/94) On-track All debts to IMF paid ahead of schedule. Baa3 BBB Mar Sep 43 48 (169) (170) Mar Sep 40 42 (127) (133) 44. 6 46. 6 Baa2 (Jun) BBB+ (Jul) Mar Sep 40 39 (167) (167) Mar Sep 40 39 (135) (135) 49. 7 52. 8 Baal (Sep) A (Nov) Mar Sep 35 41 (187) (181) Mar Sep 33 30 (135) (135) 55. 8 58. 4 (1 ) The higher the ranking number, the lower the creditworthiness of the country. (2) Countries are rated on a scale of zero to 100, with 100 representing the least chance of default. A given country may improve its rating and still fall in the ranking if also the average global rating for all rated countries improves. "7 B • - - Country-risk indicators Country: Estonia Real GDP growth rate (in %) Industrial production ( % change) Unemployment rate (end of period) Inflation rate Exchange rate (Krons per USD) Nominal effective exchange rate Real effective exchange rate (end of period) (end of period) (change, Q4/Q4) (- = depreciation) (change, Q4/Q4) (- = depreciation) General government balance (as % of GDP) Financial balance (1) Fiscal balance (1) Balance of payments Merchandise exports (in mio USD) Current account balance (in % of GDP) (excl. official transfers) Net inflow of foreign direct investment (in mio USD) Official FX reserves (end of period) in mio USD in months of goods imports External debt External debt (in convertible currencies, in mio USD, end of period) medium and long-term (> 1 year) short-term (=< 1 year) Convertible debt service (in mio USD) principal interest External debt/GDP (%) External debt/merchandise exports (%) Debt service/merchandise exports (%) Arrears (on both interest and principal, in mio USD) Debt relief agreements and rescheduling IMF arrangements Type/no (Date / - ) On track/off track ( - / Date) Indicators of market's perceived creditworthiness Moody's long-term foreign currency rating (end of period) S&P long-term foreign currency rating (end of period) Euromoney Position in the ranking (2) (number of countries) The Institutional Investor Position in the ranking (2) (number of countries) Credit rating (3) 1993 1994 1995 Latest data or estimates (E) (E) -3,5 -27,0 1. 7 35,7 13,2 n. a. n. a. 4,0 10,0 4,0 41,6 13,0 n. a. n. a. 4. 0 n. a. 5,4 28,0 11,5 25,0 1,4 -0,7 0,9 0,0 0,8 0,3 (E) (E) 801 -5,7 160,0 388 4,0 135,5 n. a. n. a. 13,5 n. a. n. a. 8,6 17,0 1,7 No No 1323 -9,0 212,0 447 3,2 271 n. a. n. a. 2,1 0 2,1 7,7 17,1 1,5 No No 1913 -10,6 190,0 584 2,8 (E) (E) (E) (E) (E) 353 (E) n. a. n. a. 23 0 23 9,9 13,5 1,2 No No (E) (E) (E) (E) (E) (E) SBA/STF (10/93-3/95 On track SBA/STF (10/93-3/95) On track SBA— (4/95-4/96) On-track Not rated Not rated Mar Sep 126 122 (169) (170) Mar Sep 81 84 (127) (133) 21. 4 20. 9 Not rated Not rated Mar Sep 105 102 (167) (167) Mar Sep 88 86 (135) (135) 20. 7 23. 6 Not rated Not rated Mar Sep 66 76 (187) (181) Mar Sep 79 79 (135) (135) 25. 4 26. 3 (1) Financial balance does not take into account government net lending, whereas fiscal balance does. (2) The higher the ranking number, the lower the creditworthiness of the country. (3) Countries are rated on a scale of zero to 100, with 100 representing the least chance of default. A given country may improve its rating and still fall in the ranking if also the average global rating for all rated countries improves. ft Country-risk indicators Country: Hungary Real GDP growth rate (in %) Industrial production ( % change) Unemployment (% of labour force) (end of period) Inflation rate Exchange rate (forints per USD) Nominal effective exchange rate Real effective exchange rate (Dec/Dec) (end of period) (change, Q4/Q4) (- = depreciation) (change, Q4/Q4) (- = depreciation) 1993 1994 -0,8 4,0 12,1 21,1 100,7 -3,1 10,2 2,9 9,0 10,9 21,2 111,0 -14,3 0,0 1995 Latest data - or estimates (E) 2,0 6,0 10,4 28,5 134,6 -25,4 -6,4 (E) (Oct) (Q3) (Q3) Consolidated state budget balance (as % of GDP) (GFS definition) -7,5 -6,1 -3,0 (E) Balance of payments Exports of G+S (in mio USD) Current account balance (in % of GDP) Net inflow of foreign direct investment (in mio USD) Official reserves (end of period) in bn USD in months of imports of merchandises External debt External debt (in convertible currencies, in bn USD, end of period) medium and long-term (> 1 year) short-term (=< 1 year) Convertible debt service (in bn USD) principal (1 ) interest External debt/GDP (%) External debt/Exports of G+S (%) Debt service/Exports of G+S (%) Arrears (on both interest and principal, in mio USD) Debt relief agreements and rescheduling IMF arrangements Type/no (Date / - ) On track/off track ( - / Date) indicators of market's perceived creditworthiness Moody's long-term foreign currency rating (end of period) S&P long-term foreign currency rating (end of period) Euromoney Position in the ranking (2) (number of countries) The Institutional Investor Position in the ranking (2) (number of countries) Credit rating (3) 10371 -9,6 2328 6,7 7,1 10219 -9,5 1100 7,0 7,4 16759 -6,0 3300 11,9 12,0 (E) (E) (E) 24,6 28,5 31,7 (Nov) 22,6 2,0 4,9 3,3 1,6 68,0 237,2 47,4 No No 26,1 2,4 6,2 4,3 1,9 69,5 278,9 60,8 No No (Nov) (Nov) (E) (E) (E) (E) 28,5 3,2 8,4 n. a. n. a. 74,1 189,2 50,0 No No SBA (9/93-12/94) On track SBA First review uncomple ted -1 Ba1 BB+ Mar Sep 47 46 (169) (170) Mar Sep 43 43 (127) (133) 44. 3 44. 8 Ba1 BB+ Mar Sep 44 46 (167) (167) Mar Sep 43 44 (135) (135) 46. 1 46. 2 Ba1 BB+ Mar Sep 50 44 (187) (181) Mar Sep 45 48 (135) (135) 46. 4 45. 0 Including early repayments. (1) (2) The higher the ranking number, the lower the creditworthiness of the country. (3) Countries are rated on a scale of zero to 100, with 100 representing the least chance of default. A given country may improve its rating and still fall in the ranking if also the average global rating for all rated countries improves. O. Country risk indicators Country: Israël Real GDP growth rate (in %) Industrial production ( % change) (at constant 1990 prices) Unemployment rate (average) Consumer Price Index Exchange rate (shekel per USD) Nominal effective exchange rate (vs the US$) Real effective exchange rate (vs the US$) (Dec/Dec) (end of period) (change, Q4/Q4) (- - deprec. ) (change, Q4/Q4) (- = deprec. ) 1993 1994 1995 Latest data or estimates (E) 3. 5 6,5 10,0 11. 3 2,986 -6,1 1. 8 6,5 7,2 7. 8 14. 5 3,018 -«,1 2,4 6. 9 (E) n. a. 6. 3 (E) 8. 0 (E) 3,140 -4. 0 (E) 0. 9 (E) Central government overall deficit (as % of GDP) -2,5 -2,0 -3. 5 (E) Balance of payments Merchandise trade (in bn USD) Current account balance (in % of GDP) Net inflow of foreign direct investment (in mio USD) Gross official FX reserves (end of period) (in months of total imports) in billions USS in months of imports of G&S External debt External debt (gross external liabilities) (in bn USD, end of period) medium and long-term (> 1 year) short-term (=< 1 year) Debt service (in bn USD) principal * interest (gross) External debt/GDP (%) External debt/exports (%) Debt service/exports of goods and services (%) Arrears (on both interest and principal, in mio USD) Debt relief agreements and rescheduling IMF arrangements Type/no (Date / - ) On track/off track ( - / Date) Indicators of market's perceived creditworthiness Moody's long-term foreign currency rating (end of period) S&P long-term foreign currency rating (end of period) Euromoney Position in the ranking (1) (number of countries) The Institutional Investor Position in the ranking (1) (number of countries) Credit rating (2) 14,9 -1,8 0 6,382 2,4 36,1 n. a. n. a. 4,1 1,9 2,2 55,8 242,3 14,0 No No 16,5 -3,0 406 6,689 2,5 17. 8(E) -6. 2 (E) 1. 350(E) 8. 158(E) 2. 6 (E) 40,0 46. 8 (E) n. a. n. a. 4,6 2,2 2,4 54,2 226,7 14,9 No No n. a. n. a. n. a. n. a. n. a. 58. 9 (E) 262. 9 (E) 13. 0(E) No No No No No Not rated BBB+ Mar Sep 29 29 (169) (170) Mar Sep 46 46 (127) (133) 39. 6 40. 5 Not rated BBB+ Mar Sep 30 33 (167) (167) Mar Sep 43 46 (135) (135) 43. 4 46. 5 A3 A- Mar Sep 31 31 (187) (181) Mar Sep 42 43 (135) (135) 47. 9 49. 2 (1) (2) The higher the ranking number, the lower the creditworthiness of the country. Countries are rated on a scale of zero to 100, with 100 representing the least chance of default. A given country may improve its rating and still fall in the ranking if also the average global rating for all rated countries improves. Excludes short-term debt. IO B Country-risk indicators Country: Latvia Real GDP growth rate (in %) Industrial production ( % change) Unemployment (end of period) Inflation rate Exchange rate (Lats per USD) Nominal effective exchange rate Real effective exchange rate (end of period) (change, Q4/Q4) (- = depreciation) (change, Q4/Q4) (- = depreciation) General government balance (as % of GDP) Financial balance (1) Fiscal balance (1) Balance of payments Exports (in mio USD) Current account balance, excl. official transfers (in % of GDP) Net inflow of foreign direct investment (in mio USD) Official FX reserves (end of period) in mio USD in months of imports of G&S External debt External debt (in convertible currencies, in mio USD, end of period) medium and long-term (> 1 year) short-term (=< 1 year) Convertible debt service (in mio USD) principal interest External debt/GDP (%) External debt/merchandise exports (%) Debt service/merchandise exports (%) Arrears (on both interest and principal, in mio USD) Debt relief agreements and rescheduling IMF arrangements Type/no (Date / - ) On track/off track ( - / Date) Indicators of market's perceived creditworthiness Moody's long-term foreign currency rating (end of period) S&P long-term foreign currency rating (end of period) Euromoney Position in the ranking (2) (number of countries) The Institutional Investor Position in the ranking (2) (number of countries) Credit rating (3) 1993 1994 1995 Latest data or estimates (E) (E) -12,0 -32,6 5,8 34,8 0,595 n. a. n. a. 2,0 -2,2 7,0 26,0 0,548 n. a. n. a. 0,0 n. a. 6,3 23,0 0,512 0,0 20,0 1,0 0,6 -1,7 -4,1 -3,8 -4,4 (E) (E) 998 4,6 51 510 5,6 225 225 0 20 n. a. n. a. 10,0 24,0 2,0 No No 951 -4,6 155 620 5,5 359 359 0 27 20 7 10,0 38,0 3,0 No No (E) (E) (E) (E) (E) (E) (E) (E) (E) (E) (E) (E) (E) (E) 1204 -4,0 153 600 4,8 540 540 0 31 16 15 12,0 45,0 2,6 No No SBA/STF (12/93-3/95 On track SBA/STF (12/93-3/95) On track SBA— (4/95-4/96) Off-track Not rated Not rated Mar Sep 133 132 (169) (170) Mar Sep 89 87 (127) (133) 19. 5 20. 0 Not rated Not rated Mar Sep 104 125 (167) (167) Mar Sep 94 92 (135) (135) 19. 6 21. 3 Not rated Not rated Mar Sep 106 116 (187) (181) Mar Sep 91 89 (135) (135) 22. 6 23. 4 (1 ) Financial balance does not take into account government net lending, whereas fiscal balance does. (2) The higher the ranking number, the lower the creditworthiness of the country. (3) Countries are rated on a scale of zero to 100, with 100 representing the least chance of default. A given country may improve its rating and still fall in the ranking if also the average global rating for all rated countries improves. I V C o u n t r y - r i sk indicators C o u n t r y: Lithuania 1993 1994 -16,2 -47,0 1,6 188,6 3,9 n. a. n. a. 0,9 -4,6 1877 -8,3 23 410 2,4 345,3 n. a. n. a. 15,0 n. a. n. a. 11,2 16,3 0,7 No No Real GDP growth rate (in %) Industrial production ( % change) Unemployment rate (end of period) Inflation rate Exchange rate (Litas per USD) Nominal effective exchange rate Real effective exchange rate (end of period) (end of period; for 1994, fixed as of 1. 4. 94 (change, Q4/Q4) (change, Q4/Q4) (- = depreciation) (- = depreciation) General g o v e r n m e nt balance (as % of GDP) Financial balance (1) Fiscal balance (1) Balance of p a y m e n ts Exports (in mio USD) Current account balance (in % of GDP), without official transfers Net inflow of foreign direct investment (in mio USD) Official FX reserves (end of period, gross foreign assets) in mio USD in months of imports of G&S External debt External debt (in convertible currencies, in mio USD, end of period) medium and long-term (> 1 year) short-term (=< 1 year) Convertible debt service (in mio USD) principal interest External debt/GDP (%) External debt/exports of G&S (%) Debt service/exports of G&S (%) Arrears (on both interest and principal, in mio USD) Debt relief agreements and rescheduling IMF a r r a n g e m e n ts Type/no (Date / - ) On track/off track ( - / D a t e) Indicators of market's perceived c r e d i t w o r t h i n e ss Moody's long-term foreign currency rating (end of period) S&P long-term foreign currency rating (end of period) Euromoney Position in the ranking (2) (number of countries) The Institutional Investor Position in the ranking (2) (number of countries) Credit rating (3) 1995 Latest data. or estimates (E) (E) (E) 3,0 15,0 6,1 35 4,0 0,0 30,0 1,5 1. 0 4,0 45 4,0 n. a. n. a. -1,5 -4,2 -1. 5 -3,4 (E) (E) 1930 -4,3 60 588 2,7 530 n. a. n. a. 25,4 n. a. n. a. 9,7 25,0 1,0 No No (E) (E) (E) 2250 -3,4 55 800 3,5 860 (E) n. a. n. a. 43,0 38 5 11,0 35,0 2,0 No No (E) (E) (E) (E) (E) (E) SBA/STF (10/93-3/94) On track STF (10/93-3/94) EFF (10/94-11/97 On track - E FF (10/94-10/97) On track Not rated Not rated Mar Sep 134 130 (169) (170) Mar Sep 91 93 (127) (133) 18. 9 19. 0 Not rated Not rated Mar Sep 110 121 (167) (167) Mar Sep 97 96 (135) (135) 18. 4 20. 0 Not rated Not rated Mar Sep 108 118 (187) (181) Mar Sep 95 90 (135) (135) 21. 7 22. 9 (1 ) Financial balance does not take into account government net lending, whereas fiscal balance does. (2) The higher the ranking number, the lower the creditworthiness of the country. (3) Countries are rated on a scale of zero to 100, with 100 representing the least chance of default. A given country may improve its rating and still fall in the ranking if also the average global rating for all rated countries improves. iz. 6 «• " - C o u n t r y - r i sk i n d i c a t o rs C o u n t r y: M o l d o va Real G DP growth rate (in %) Industrial production ( % change) Unemployment (% of labour force) (end of period) Inflation rate Exchange rate (leu per U S D) (end of period) (end of period) Nominal effective exchange rate (change, Q4/Q4) (- - depreciation) Real effective exchange rate (change, Q4/Q4) (- = depreciation) 1993 1994 -8,7 -7,2 n. a. 837 3,64 n. a. n. a. -31,2 -30,0 1,0 116 4,27 n. a. n. a. 1995 Latest data or estimates (E) 1,0 -10,0 2,0 (E) (E) (E) 24 4,50 n. a. n. a. G e n e r al g o v e r n m e nt b a l a n ce (as % of GDP) -6,8 -8,1 -4,0 (E) B a l a n ce of p a y m e n ts Merchandise exports (in mio USD) Current account balance (in % of GDP) Net inflow of foreign direct investment (in mio USD) Official FX reserves (end of period) in mio USD in months of imports of merchandises E x t e r n al d e bt External debt (in convertible currencies, in mio USD, end of period) medium and long-term (> 1 year) short-term (=< 1 year) Convertible debt service (in mio USD) principal interest External debt/GDP (%) External debt/ merchandise exports (%) Debt s e r v i c e / m e r c h a n d i se exports (%) Arrears (on both interest and principal, in mio USD) Debt relief agreements and rescheduling IMF a r r a n g e m e n ts Type/no (Date / - ) On track/off track ( - / Date) I n d i c a t o rs of m a r k e t 's p e r c e i v ed c r e d i t w o r t h i n e ss Moody's long-term foreign currency rating (end of period) S&P long-term foreign currency rating (end of period) Euromoney Position in the ranking (1 ) (number of countries) The Institutional Investor Position in the ranking (1 ) (number of countries) Credit rating (2) 451 -9,3 14,0 76,6 1,4 (E) (E) (E) 617 -12,9 23,0 178,8 3,0 • 653 -3,5 19,7 265 4,8 168,0 343,0 652,0 (E) n. a. n. a. 5,0 n. a. n. a. 23,0 37,3 1,1 No No n. a. n. a. 12,3 n. a. n. a. 26,0 55,6 2,0 No No n. a. n. a. 84,9 n. a. n. a. 42,0 99,8 13,0 No No (E) (E) (E) (E) SBA (3/93-3/94) On-track SBA (12/93-3/95) On-track __ SBA (3/95-3/96) On-track Not rated Not rated Mar Sep 159 160 (169) (170) Not rated Not rated Mar Sep 148 155 (167) (167) Not rated Not rated Mar Sep 157 141 (187) (181) Not rated Not rated Not rated (1 ) The higher the ranking number, the lower the creditworthiness of the country. (2) Countries are rated on a scale of zero to 100, with 100 representing the least chance of default. A given country may improve its rating and still fall in the ranking if also the average global rating for all rated countries improves. •V5 6 Country-risk Indicators Country: Romania Real GDP growth rate (in %) Industrial production ( % change) Unemployment rate (end of period) Inflation rate Exchange rate ( lei per USD) Nominal effective exchange rate Real effective exchange rate (Dec/Dec) (end of period) (change, Q4/Q4) (- = depreciation) (change, Q4/Q4) (- = depreciation) 1993 1994 1,3 7,7 10,2 295,5 1276 -56,9 39,7 3,9 9,9 11,0 61,7 1767 -29,4 n. a. 1995 Latest data or estimates (E) (E) (E) (E) (E) (Oct) 5,0 14,0 9,0 24,3 2547 n. a. n. a. General government balance (as % of GDP) -0,1 -1,0 -2,8 (E) Balance of payments Exports of G&S (in bn USD) Current account balance (in % of GDP) Net inflow of foreign direct investment (in mio USD) Official FX reserves (end of period) in mio USD in months of imports of G&S External debt External debt (in convertible currencies, in bn USD, end of period) medium and long-term (> 1 year) short-term (=< 1 year) Convertible debt service (in mio USD) principal interest External debt/GDP (%) External debt/exports of G&S (%) Debt service/exports of G&S (%) Arrears (on both interest and principal, in mio USD) Debt relief agreements and rescheduling IMF arrangements Type/no (Date / - ) On track/off track ( - / Date) Indicators of market's perceived creditworthiness Moody's long-term foreign currency rating (end of period) S&P long-term foreign currency rating (end of period) Euromoney Position in the ranking (1 ) (number of countries) The Institutional Investor Position in the ranking (1 ) (number of countries) Credit rating (2) 4,9 -4,8 48 52 0,1 4,4 3,4 1,0 330 147 183 21,4 81,0 6,4 No No 6,1 -1,8 416 591 1,1 5,5 4,5 1,0 586 393 193 18,9 81,0 8,9 No No (E) (E) (E) (E) (E) (E) (E) (E) (E) 7,4 -4,7 306 695 0,6 6,0 4,8 1,2 653 428 225 18,7 80,0 13,0 No No No SBA/STF (5/94-12/95) On track SBA extended through 1997 and augmented On Track Not rated Not rated Mar Sep 66 75 (169) (170) Mar Sep 73 75 (127) (133) 24. 2 24. 4 Not rated Not rated Mar Sep 74 77 (167) (167) Mar Sep 76 74 (135) (135) 25. 4 26,2 Not rated Not rated Mar Sep 68 64 (187) (181) Mar Sep 73 71 (135) (135) 28. 1 29. 7 (1 ) The higher the ranking number, the lower the creditworthiness of the country. (2) Countries are rated on a scale of zero to 100, with 100 representing the least chance of default. A given country may improve its rating and still fall in the ranking if also the average global rating for all rated countries improves. 14 S Country risk indicators , Country: Russia Real GDP growth rate On %) Industrial production ( % change) Unemployment rat© (end of period) (Dec/Dec) Inflation rate Exchange rate ( Rbs per L (end of period) Nominal exchange rate Real exchange rate (1) (change, Q4/Q4) (• = depreciation) (change, Dec/Dec. ) (- = depreciation) 1993 1994 1995 Latest data or estimates (E) -12. 0 -16,4 5. 1 840 1247 -62,5 -66,9 -15. 3 -21. 0 7. 1 315 3571 n. a. -2. 2 -4. 2 (E) -3. 0 (E) 8. 2 231 4640 -30 72,0 General government balance (as % of GDP) -7,7 -11,5 -3. 9 (E) Balance of payments Exports of G&S (in bn USD) Current account balance (in % of GDP) Net inflow of foreign direct investment (in bn USD) Official FX reserves (end of period) (excluding gold) (net figures) in mio USD in months of imports of G&S 58 1,6 0,7 6,4 1. 3 66 -0,4 -0,2 2,3 0,4 81(E) 1. 6(E) n. a. 8. 1 (E) 1. 2(E) External debt External debt (in convertible currencies, in bn USD, end of period) medium and long-term (> 1 year) short-term (=< 1 year) Convertible debt service (in bn USD) principal interest External debt/GDP (%) External debt/exports of G&S (%) Debt service/exports of G&S (%) (before rescheduling) Arrears (on both interest and principal, in bn USD) Debt relief agreements and rescheduling IMF arrangements Type/no (Date / - ) On track/off track ( - / Date) 104,0 119,0 130. 0(E) n. a. n. a. 19. 4(4) 14. 7 4,7 31,0 ' 178,0 34,0 (6) Paris Club (resched. ) n. a. n. a. 19. 6 (5) 15,3 4,3 40,0 180,0 31,0 (6) Paris Club (resched. ) n. a, n. a. 17. 6(5) 12,3 5,3 33. 0 (E) 160. 0(E) 22. 0 (E) (6) Paris Club (resched. ) STF (07. 93 - 07. 94) Off track STF (07. 93 - 07. 94) Off track SBA (04. 95 - 04. 96) On track Indicators of market's perceived creditworthiness Moody's long-term foreign currency rating (end of period) S&P long-term foreign currency rating (end of period) Euromoney Position in the ranking (2) (number of countries) The Institutional Investor Position in the ranking (2) (number of countries) Credit rating (3) Not rated Not rated Mar Sep 141 137 (169) (170) Mar Sep 87 92 (127) (133) 20. 2 19. 0 Not rated Not rated Mar Sep 138 136 (167)(167) Mar Sep 98 100 (135) (135) 18. 1 18. 4 Not rated Not rated Mar Sep 141 142 (187) (181) Mar Sep 98 97 (135) (135) 19. 4 19. 5 (1) Real exchange rale: (USD/rouble rate x US price level) / (Russian price level). (2) The higher the ranking number, the lower the creditworthiness of the country. (3) Countries are rated on a scale of zero to 100, with 100 representing the least chance of default. A given country may improve its rating and still fall in the ranking if also the average global rating for all rated countries improves. Before rescheduling. (4) (5) After rescheduling. (6) Since 1992, Russia has not been servicing private debts contracted by the FSU. AS S Country-risk indicators Country: Slovak Republic Real GDP growth rate (in %) Industrial production ( % change) Unemployment (% of labour force) (end of period) Inflation rate Exchange rate (SK's per USD) Nominal effective exchange rate Real effective exchange rate (Dec/Dec) (end of period) (change, Q4/Q4) (- = depreciation) (change, Q4/Q4) (- = depreciation) 1993 1994 -4,1 -8,6 14,4 25,1 33,2 n. a. -1,8 4,8 7,0 14,6 11,7 31,3 n. a. 2,4 1995 Latest data or estimates (E) 7,4 10,1 12,8 (Jan-Sep) (Nov) (Nov) 7,2 29,5 n. a. n. a. (Sep) General government balance (as % of GDP) -7,6 -2,7 -2,5 (E) Balance of payments Exports of G&S (in mio USD) Current account balance (in % of GDP) Net inflow of foreign direct investment (in mio USD) Official FX reserves (end of period) in mio USD in months of imports of G&S External debt External debt (in convertible currencies, in bn USD, end of period) medium and long-term (> 1 year) short-term (=< 1 year) Convertible debt service (in mio USD) principal interest External debt/GDP (%) External debt/exports of G&S (%) Debt service/exports of G&S (%) Arrears (on both interest and principal, in mio USD) Debt relief agreements and rescheduling IMF arrangements Type/no (Date / - ) On track/off track ( - / Date) Indicators of market's perceived creditworthiness Moody's long-term foreign currency rating (end of period) S&P long-term foreign currency rating (end of period) Euromoney Position in the ranking (1 ) (number of countries) The Institutional Investor Position in the ranking (1 ) (number of countries) Credit rating (2) 7568 -5,4 134 416 0,6 3,4 2,7 0,7 674 490 184 30,8 44,5 8,9 No No 8983 6,0 184 1691 2,3 3,9 3,2 0,7 791 n. a. n. a. 31,1 43,4 8,8 No No 11000 6,0 150 (E) (E) (E) 2799 3,4 (Oct) (Oct) 4,9 (Jul) n. a. n. a. 1045 n. a. n. a. 33,7 44,5 9,5 No No (E) (Jul) (Jul) STF (7/93 - 7/94) On-track STF (7/93 -7/94) SBA (7/94-3/96) SBA (7/94-3/96) (3) (May) (Apr) Not rated Not rated Mar Sep 56 63 (169) (170) Mar - Sep 57 57 (127) (133) 31 30. 6 Baa3 (May) BB- (Feb) Mar Sep 64 66 (167) (167) Mar Sep 59 59 (135) (135) 31. 6 33. 1 Baa3 BB+ Mar Sep 53 51 (187) (181) Mar Sep 61 59 (135) (135) 33. 2 35. 7 (1 ) The higher the ranking number, the lower the creditworthiness of the country. (2) Countries are rated on a scale of zero to 100, with 100 representing the least chance of default. A given country may improve its rating and still fall in the ranking if also the average global rating for all rated countries improves. (3) The mid-term review of the programme, which had been scheduled for February 1995, was not completed. 1 ^ 6 Country risk indicators Country: Ukraine Real GDP growth (% change) Industrial production ( % change) Unemployment rate (end of period) 1993 1994 1995 Latest data or estimates (E) -17. 1 -8,5 0,3 23,0 -35,6 0. 3 -13. 0(E) -20. 0 (E) 0. 4(E) Inflation rate Exchange rate (Krb per USD) (Dec/Dec) (end of period) - auction / interbank -cash Nominal effective exchange rate Real effective exchange rate (change, Q4/Q4) (• = depreciation) (change, Q4/Q4) (- - depreciation) 10155 401 180 12610 25000 n. a. n. a. 108196 128000 n. a. 2% 179400 186000 n. a. 60% General government balance (as % of GDP) -10,1 -8,6 -4,1 Balance of payments Exports of G&S (in bn USD) Current account balance (excl. transfers) (in % of GDP) Net inflow of foreign direct investment (in bn USD) Gross official FX reserves (end of period) in mio USD in months of imports of G&S External debt External debt (in convertible currencies, in bn USD, end of period) medium and long-term (> 1 year) short-term (=< 1 year) Convertible debt service paid (in mio USD) principal interest External debt/GDP (%) External debt/exports of G&S (%) Debt service/exports of G&S (%) Arrears (on both interest and principal, in mio USD) Debt relief agreements and rescheduling IMF arrangements Type/no (Date / - ) On track/off track ( - / Date) Indicators of market's perceived creditworthiness Moody's long-term foreign currency rating (end of period) S&P long-term foreign currency rating (end of period) Euromoney Position in the ranking (1) (number of countries) The Institutional Investor Position in th« ranking (1) (number of countries) Credit rating (2) 14,4 -5,9 0,2 193 0. 2 4,1 n. a. n. a. 202 n. a. n. a. 12,1 28,5 1. 3 548 14,8 -6,0 0,09 646 0,5 15. 1 (E) -4. 5 (E) 0. 12(E) 1100 1 7,1 n. a. n. a. 1794 n. a. n. a. 29,2 48,0 12,4 2722 rescheduling of debt owed to Russia/Turkm. 8,1 n. a. n. a. 1531 986 545 24. 1 (E) 53. 6 (E) 10. 2(E) 236 rescheduling of debt owed to Russia/Turkm. - STF 26 Oct 94 On track SBA Dec. 1995 Off track Not rated Not rated Mar Sep 142 146 (169) (170) Mar Sep 96 95 (127) (133) 18. 2 18. 2 Not rated Not rated Mar Sep 149 147 (167) (167) Mar Sep 111 113 (135) (135) 15. 1 14. 5 Not rated Not rated Mar Sep 145 138 (187) (181) Mar Sep 109 111 (135) (135) 15. 5 15. 7 (1) The higher the ranking number, the lower the creditworthiness of the country. (2) Countries are rated on a scale of zero to 100, with 100 representing the least chance of default. A given country may improve Its rating and still fall in the ranking if also the average global rating for all rated countries improves. j-uiiflfrf' 17 5 EXPLANATORY NOTES The purpose of the tables 1 to 3 is to show the annual repayments of capital and interest in respect of borrowing and lending operations for which the risk is covered by -the Community budget. The figures show the maximum possible risk for the Community in respect of these operations and must not be read as meaning that these amounts will actually be drawn from the budget. In the case of Table 3, it is not certain that all the operations described will actually be disbursed. No account has been taken of interest on late payment or any additional costs such as lawyers' fees. I. TYPES OF OPERATION AND PAYMENT OF THE BUDGET GUARANTEE LA. Types of operation The risk covered by the Community budget results from two types of operation: borrowing/lending operations; guarantees given to third parties. I. A. I Borrowing/lending operations In this type of operation, the Community borrows on the financial market and on-lends the proceeds (at the same rate and for the same term) to Member States (balance of payments), non-member countries (medium-term financial assistance) or firms (NCI, Euratom). The loan repayments are scheduled to match the repayments of the borrowings due from the Community. If the recipient of the loan is late in making a repayment, the Commission must draw on its resources to repay the borrowing on the due date. I. A. 2 Guarantees given to third parties The loan guarantee is in respect of loans granted by a financial institution (EIB or commercial banks in the case of the former Soviet Union). When the recipient of a guaranteed loan fails to make a payment on the due date, the EIB asks the Commission to pay the amounts owed by the defaulter in accordance with the contract of guarantee. The guarantee must be paid within three months of receiving the EIB's request. The EIB administers the loan with all the care required by banking practice and is obliged to demand the payments due after the guarantee has been activated. LB. Mobilization of funds for guarantee payments The funds needed to pay the budget guarantee in the event of late payment by the recipient of a loan granted or guaranteed by the Community are raised as follows: I. B. I. Borrowing/lending operations (a) (b) The amount required may be taken provisionally from cash resources in accordance with Article 12 of the Financial Regulation. This method is used so that the Community can immediately repay the borrowing on the date scheduled in the event of late payment by the recipient of the loan. If the delay extends to three months after the due date, the Commission draws on the Guarantee Fund to cover the default. The funds obtained are used to replenish the Commission's cash resources. 18 B (c) (d) The transfer procedure can be used to provide the budget heading with the appropriations needed to cover the default. This method is used when there are insufficient appropriations in the Guarantee Fund and must be authorized in advance by the budgetary authority. The re-use of amounts repaid by debtors who have defaulted, leading to activation of the Community guarantee, allows payments to be made within a short period of time always providing, of course, that there are recovered funds available. I. B. 2. Community guarantees for loans from the EIB's own resources Since the entry in force of the Regulation establishing a Guarantee Fund for external action, the provisions of the Agreement between the Community and the EIB on management of the Fund state that, after the EIB calls in the guarantee in the event of a default, the Commission must authorize the Bank to withdraw the corresponding amounts from the Guarantee Fund within three months. If there are insufficient resources in the Fund, the procedure used for activating the guarantee is the same as for borrowing/lending operations. H. CALCULATION Some of the amounts indicated are the result of estimates made on the basis of the following assumptions. Generally speaking, the exchange rates for loans in currencies other than the ecu are assumed to have been stable since 31 December 1995. However, borrowing and lending operations should not involve exchange risks for the Community. Unless otherwise stated, the average rate of interest is estimated at 10%. This rate is probably a little high for EIB loans, which often attract interest subsidies under the protocols. n. A. MEMBER STATES 1. 2. Greece: A balance-of-payments loan of ECU 2 200 million has been authorized. ECU 1 000 million of this amount has been disbursed in two tranches of ECU 5Q0 million to be repaid in 1996 and 1998 respectively. It is assumed that the remaining ECU 1 200 million will not be disbursed. Italy: The Council decision of 18 January 1993 granted a ECU 8 000 million balance-of-payments loan to Italy. The loan is to be made available-in four tranches amounting to ECU 2 000 million each and - with the exception of the first tranche - is conditional on the attainment of agreed targets on Italy's public debt and deficit. The first two tranches were released in 1993. The Council Decision states that the third and fourth tranches could be released as of 1 February 1994 and 1 February 1995 respectively. The Italian Government has not applied for the payment of these two tranches which it is no longer planned to implement. 3. EIB. Mediterranean, old protocols: Spain. Greece. Portugal: These are Community guarantees for EIB operations in these countries prior to accession. The amounts are now final, since all the loans authorized have been disbursed. II. B. Non-member countries 1I. B. 1 Financial assistance 19 B n. B. l(a) Hungary I The amounts of the first two tranches are final and certain. The third tranche of the macrofinancial assistance decided in 1990 will no longer be disbursed since Hungary's balance of payments is more favourable than expected. The first tranche was repaid by Hungary in full on 20 April 1995. II. B. 1(b) Hungary II ECU 180 million has been granted and paid out in full. II. B. 1(c) Czech and Slovak Republics ECU 375 million has been granted in two tranches for a maximum term of seven years (bullet), with a first tranche of ECU 190 million for a term of six years. tranche of ECU 185 million and a second ECU 130 million has been granted to the Slovak Republic in two tranches for a maximum term of seven years (bullet). The Commission has presented to the Council a proposal for a decision cancelling this loan to the Slovak Republic. II. BJ(d) Bulearia I. ECU 290 million has been granted in two tranchés for a. maximum term of seven years (bullet), with a first tranche of ECU 150 million for a term of seven years and a second tranche of ECU 140 million for a term of five years. II. B. 1(e) Bulgaria II The financial assistance of ECU 110 million over a maximum period of seven years decided in 1992 is being granted in two tranches. The first tranche of ECU 70 million was paid on 7 December 1994. For that ECU 40 million could be paid in the second half of 1996. is assumed the -second tranche, it II. B. 1(f) ' Romania I An estimated ECU 375'million in two tranches for a maximum term of seven years (bullet). The first tranché of ECU 190 million was disbursed in 1992 with a term of seven years and the second was disbursed in 1992 with a term of six years. II. B. 1(g) Romania II - The new operation involving ECU 80 million for a maximum term of seven years was disbursed in 1993. II. B. 1(h) Romania III This is a seven-year loan of ECU 125 million to be disbursed in two tranches. The first tranche of ECU 55 million was disbursed in November 1995. For the second tranche, it is assumed that ECU 75 million will be paid out in the second half of 1996. II. B. l(i) Moldova This is a ten-year loan of ECU 45 million to be disbursed in two tranches. The first tranche of ECU 25 million was disbursed on 7 December 1994. The second tranche of ECU 20 million was paid to Moldova in August 1995. 20 S H. B. l(j) Ukraine I ECU 85 million is to be lent in one tranche for a maximum term of ten years. The loan was paid out to Ukraine on 28 December 1995. II. B. l(k) Ukraine n ECU 200 million is to be lent in two tranches for a maximum term of ten years. It is assumed that the first tranche of ECU 100 million will be paid out in the second half of 1996 and the second tranche of ECU 100 million in the second half of 1997. II. B. 1(1) Belarus ECU 75 million is to be lent in two tranches for a maximum term of ten years. The first tranche of ECU 30 million was paid to Belarus in December 1995. For the second tranche, it is assumed that ECU 25 million could be paid in the first half of 1996. ILB. l(m) Baltic States The first tranche (ECU 110 million) of a seven-year loan of ECU 220 million was paid in 1993. The second tranches for Estonia and Latvia could be paid in 1996. Half of the second tranche for Lithuania - i. e. ECU 25 million of the ECU 50 million planned - was paid in August 1995. that is assumed It for Estonia and ECU 40 million for Latvia will be paid out in the second half of 1996. The second payment of ECU 25 million for the second tranche to Lithuania is expected to be disbursed in the first half of 1996. tranches of ECU 20 million the second II. B. l(n) Algeria I ECU 400 million has been granted. in ECU 150 million. The first was paid in December. 1991 for a term of six-years. tranches of ECU 250 million and two The second tranche of ECU 400 million was paid on 17 August 1994. 'ILB. l(o) Algeria II:- ' ECU 200 million has been granted in two tranches for a maximum term of seven years (bullet). The first tranche of ECU 100 million was paid out to Algeria in November 1995. It is assumed that the second tranche of ECU 100 million will be disbursed in the second half of 1996. II. B. l(p) Israel: A loan of ECU 160 million has been paid in full and is repayable in 1997. ILB. 2 Guarantees //. 5. 2(a) EIB The EIB has supplied the figures used for calculation of the assumptions made for drawing up Table 3 (EIB loans to non-member countries from its own resources). In the case of loans not disbursed, we have assumed that an average of 10% of the loan will be disbursed in the year of signature and 30% in each of the three following years. 21 6 It is estimated that the average term will be fifteen years with a three-year period of grace. II. B. 2(b) Food aid for the former Soviet Union An operation involving ECU 1 250 million for a maximum term of three years. This borrowing will be divided between the various Republics of the former Soviet Union. Loans amounting to less than ECU 100 million will be repaid in one tranche three years after the start of the period in which the funds may be drawn. Borrowings exceeding ECU 100 million will be repaid in two tranches two years and three years after the start of the period in which the funds may be drawn. Depending on the type of contract, loans are repaid on 15 January, 20 August or 28 September. The balance of ECU 13. 93 million still to be used at 31 December 1995 was for Azerbaijan. //. B. 2(c) Euratom, countries of Central and Eastern Europe Of the ECU 1 100 million involved, it is assumed that ECU 200 million will be disbursed in 1996, ECU 200 million in each of the three following years and ECU 150 million in 2000 and 2001. It is assumed that the loans will be for an average term of twenty years with a five-year period of grace. 22 •B ANNEX DEFINITION OF FIGURES USED IN THE REPORT I. AUTHORIZED CEILING This is the aggregate of the maximum amounts of capital authorized (ceilings) for each operation decided by the Council (see Table 1). In order to relate it to the risk which the budget might have to cover, account should be taken of the following factors which could affect it: factor increasing the risk: the interest on the loans must be added to the authorized ceiling; factors reducing the risk; limitation of the guarantee given to the EIB to 75 % of the loans signed in the Mediterranean countries; the amounts operations already concerned, except in the case of balance of payments support, are the maximum amount of loans granted and not outstanding amounts authorized; repaid, since the amounts authorized are not necessarily taken up in full. The breakdown of authorizations is as follows: LA Member States Balance of payments • NCI Euratom EIB; Spain, Greece, Portugal Member States - total 14 0002 6 830 4 0003 1 500 26 330 2 3 Authorized amount outstanding: once this figure is reached, further loans may be granted as previous operations are repaid. Including ECU 1 100 million which may be granted to the countries of Eastern Europe and the CIS. 23 E> I. B. Non-member countries Hungary I Hungary II Czech Republic Slovak Republic I Slovak Republic II Bulgaria I Bulgarian Romania I Romania II Romania III Israel Algeria I Algeria II former Soviet Union Baltic States Moldova Ukraine Belarus EIB, old protocols EIB, Eastern and Central Europe I EIB, Eastern and Central Europe II EIB, new protocols EIB, horizontal financial cooperation Other non-member countries South Africa Non-member countries - total Grand total H. CAPITAL OUTSTANDING 870 180 250 125 130 290 110 375 80 125 160 400 200 1 250 220 45 85 75 3 032 1 700 3 000 1 530 1 800 750 300 16 674 43 004 This is the amount of capital still to be repaid on a given date in respect of operations disbursed (see Table 1). Compared with the previous aggregate, the amount outstanding does not include loans which have not yet been disbursed nor the proportion of disbursed loans which have already been repaid. It may be described as the amount of loans which exist on a given date. _ HI. ANNUAL RISK Estimated amount of principal and interest due each financial year. This amount is calculated for: disbursements alone (Table 2), in which case the capital to be repaid corresponds to the amount outstanding; disbursements, decisions still awaiting disbursement and Commission proposals still awaiting decisions (Table 3), in which case the capital to be repaid corresponds to the ceiling on loans authorized plus, where applicable, the amounts in respect of operations proposed by the Commission and not yet decided. 2^ 13 ISSN 0254-1475 COM(96) 243 final DOCUMENTS EN 01 Catalogue number : CB-CO-96-252-EN-C ISBN 92-78-04574-8 Office for Official Publications of the European Communities L-2985 Luxembourg

Decision of the EEA Joint Committee No 31/96 of 5 June 1996 amending Annex I (Veterinary and phytosanitary matters) to the EEA Agreement

http://publications.europa.eu/resource/cellar/9874c00b-7ca1-4783-a395-093df3b8eb4e

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L_1996237EN. 01004201. xml 19. 9. 1996    EN Official Journal of the European Communities L 237/42 DECISION OF THE EEA JOINT COMMITTEE No 31/96 of 5 June 1996 amending Annex I (Veterinary and phytosanitary matters) to the EEA Agreement THE EEA JOINT COMMITTEE, Having regard to the Agreement on the European Economic Area, as adjusted by the Protocol adjusting the Agreement on the European Economic Area, hereinafter referred to as the Agreement, and in particular Article 98 thereof, Whereas Annex I to the Agreement was amended by Decision of the EEA Joint Committee No 25/96 (1); Whereas Commission Directive 95/9/EC of 7 April 1995 amending Directive 94/39/EC establishing a list of intended uses of animal feedingstuffs for particular nutritional purposes (2) is to be incorporated into the Agreement, HAS DECIDED AS FOLLOWS: Article 1 The following shall be added in point 4d (Commission Directive 94/39/EC) in Chapter II of Annex I to the Agreement: ‘, as amended by: — 395 L 0009: Commission Directive 95/9/EC of 7 April 1995 (OJ No L 91, 22. 4. 1995, p. 35). ’ Article 2 The texts of Directive 95/9/EC in the Icelandic and Norwegian languages, which are annexed to the respective language versions of this Decision, are authentic. Article 3 This Decision shall enter into force on 6 June 1996, provided that all the notifications under Article 103 (1) of the Agreement have been made to the EEA Joint Committee. Article 4 This Decision shall be published in the EEA Section of, and in the EEA Supplement to, the Official Journal of the European Communities. Done at Brussels, 5 June 1996. For the EEA Joint Committee The President P. BENAVIDES (1)  OJ No L 186, 25. 7. 1996, p. 77. (2)  OJ No L 91, 22. 4. 1995, p. 35

Decision of the EEA Joint Committee No 35/96 of 5 June 1996 amending Annex XX (Environment) to the EEA Agreement

http://publications.europa.eu/resource/cellar/eecd9f4a-9d56-4b07-a35c-d25764396d04

eng

L_1996237EN. 01004401. xml 19. 9. 1996    EN Official Journal of the European Communities L 237/44 DECISION OF THE EEA JOINT COMMITTEE No 35/96 of 5 June 1996 amending Annex XX (Environment) to the EEA Agreement THE EEA JOINT COMMITTEE, Having regard to the Agreement on the European Economic Area, as adjusted by the Protocol Adjusting the Agreement on the European Economic Area, hereinafter referred to as the Agreement, and in particular Article 98 thereof, Whereas Annex XX to the Agreement was amended by Decision of the EEA Joint Committee No 75/95 (1); Whereas Commission Decision 95/365/EC of 25 July 1995 establishing the ecological criteria for the award of the Community eco-label to laundry detergents (2) is to be incorporated into the Agreement, HAS DECIDED AS FOLLOWS: Article 1 The following point shall be inserted after point 2ee (Commission Decision 94/925/EC) in Annex XX to the Agreement: ‘2ef. 395 D 0365: Commission Decision 95/365/EC of 25 July 1995 establishing the ecological criteria for the award of the Community eco-label to laundry detergents (OJ No L 217, 13. 9. 1995, p. 14). ’ Article 2 The texts of Decision 95/365/EC in the Icelandic and Norwegian languages, which are annexed to the respective language versions of this Decision, are authentic. Article 3 This Decision shall enter into force on 6 June 1996, provided that all the notifications under Article 103 (1) of the Agreement have been made to the EEA Joint Committee. Article 4 This Decision shall be published in the EEA Section of, and in the EEA Supplement to, the Official Journal of the European Communities. Done at Brussels, 5 June 1996. For the EEA Joint Committee The President P. BENAVIDES (1)  OJ No L 57, 7. 3. 1996, p. 41. (2)  OJ No L 217, 13. 9. 1995, p. 14

Decision of the EEA Joint Committee No 32/96 of 5 June 1996 amending Annex I (Veterinary and phytosanitary matters) to the EEA Agreement

http://publications.europa.eu/resource/cellar/02637553-a75a-46b7-938d-4279547fb86a

eng

L_1996237EN. 01004301. xml 19. 9. 1996    EN Official Journal of the European Communities L 237/43 DECISION OF THE EEA JOINT COMMITTEE No 32/96 of 5 June 1996 amending Annex I (Veterinary and phytosanitary matters) to the EEA Agreement THE EEA JOINT COMMITTEE, Having regard to the Agreement on the European Economic Area, as adjusted by the Protocol adjusting the Agreement on the European Economic Area, hereinafter referred to as the Agreement, and in particular Article 98 thereof, Whereas Annex I to the Agreement was amended by Decision of the EEA Joint Committee No 25/96 (1); Whereas Commission Directive 95/10/EC of 7 April 1995 fixing the method of calculating the energy value of dog and cat food intended for particular nutritional purposes (2) is to be incorporated into the Agreement, HAS DECIDED AS FOLLOWS: Article 1 The following point shall be inserted after point 4d (Commission Directive 94/39/EC) in Chapter II of Annex I to the Agreement: ‘4e. 395 L 0010: Commission Directive 95/10/EC of 7 April 1995 fixing the method of calculating the energy value of dog and cat food intended for particular nutritional purposes (OJ No L 91, 22. 4. 1995, p. 39). ’ Article 2 The texts of Directive 95/10/EC in the Icelandic and Norwegian languages, which are annexed to the respective language versions of this Decision, are authentic. Article 3 This Decision shall enter into force on 6 June 1996, provided that all the notifications under Article 103 (1) of the Agreement have been made to the EEA Joint Committee. Article 4 This Decision shall be published in the EEA Section of, and in the EEA Supplement to, the Official Journal of the European Communities. Done at Brussels, 5 June 1996. For the EEA Joint Committee The President P. BENAVIDES (1)  OJ No L 186, 25. 7. 1996, p. 77. (2)  OJ No L 91, 22. 4. 1995, p. 39

Proposal for a Council and Commission Decision on the conclusion of the Partnership and Cooperation Agreement between the European Communities and their Member States of the one part, and the Republic of Uzbekistan, of the other part

http://publications.europa.eu/resource/cellar/4b521191-875b-4090-8e35-34446d7c9fee

eng

COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 05. 06. 1996 COM(96) 254 final 96/0151 (AVC) Proposal for a Council and Commission Decision on the conclusion of the Partnership and Cooperation Agreement between the European Communities and their Member States of the one part, and the Republic of Uzbekistan, of the other part (presented by the Commission) Explanatory memorandum 1. The attached proposal for a Council and Commission Decision constitutes the legal instrument for the conclusion of the Partnership and Cooperation Agreement between the European Communities and their Member States, on the one hand, and the Republic of Uzbekistan, on the other. 2. Following the Council's adoption of the negotiating directives on 5 October 1992, negotiations with the Republic of Uzbekistan were held in the course of 1996. After two rounds of negotiations, the Agreement was initialled on 29 April 1996. 3. The Agreement is a mixed agreement covering areas for which both the Communities and the Member States are competent, and is concluded for an initial period often years. It establishes a political dialogue. The Agreement also covers trade in goods, labour conditions, establishment and operation of companies, cross-border supply of services, payments and capital, competition, industrial and commercial property intellectual, protection, legislative cooperation, economic cooperation, cooperation on human rights and democracy, cooperation in combatting illegal activities and illegal immigration, cultural cooperation and financial cooperation. The Agreement contains a clause which allows it to be suspended, even unilaterally, if it is considered that there has been a breach of the essential elements underlying the Agreement i. e. respect for democracy, human rights and the principles of the market economy. The Agreement sets out an institutional framework for its implementation with a Cooperation Council, a Cooperation Committee and a Parliamentary Cooperation Committee. Mutual assistance in customs matters is covered by a separate protocol. 4. The Agreement will, as far as trade relations between the Community and the Republic of Uzbekistan are concerned, replace the Agreement on Trade and Commercial and Economic Cooperation between the European Economic Community and the European Atomic Energy Community, and the USSR, signed on 18 December 1989. 5. The procedures of the three Communities (EC, EAEC and ECSC) for signing and concluding the Agreement differ. In the case of the EC, account will have to be taken of Opinion 1/94 delivered by the Court of Justice on 15 November 1994 on the competence of the European Community to conclude the agreements reached during the Uruguay Round. For the purpose of concluding the Agreement: the Council will conclude the Agreement, with the assent of the European Parliament and having consulted the Economic and Social Committee, on behalf of the European Community in accordance with Article 54(2), the closing sentence of Article 57(2) and Articles 73c(2), 75, 84(2), 113 and 235 in conjunction with the second sentence of Article 228(2) and the second subparagraph of Article 228(3) of the EC Treaty by adopting the attached decision; the Commission will conclude the Agreement on behalf of the European Atomic Energy Community after the Council has approved it in accordance with the second paragraph of Article 101 of the Euratom Treaty. the Commission will conclude the Agreement on behalf of the ECSC in accordance with the ECSC Treaty, after consulting the Consultative Committee and with the unanimous assent of the Council; The conclusion of the Agreement will have to be ratified by all the Member States given the mixed nature of the Agreement. 6. In view of the above, the Commission proposes that the Council adopt the annexed decision. COUNCIL AND COMMISSION DECISION OF on the conclusion of the Partnership and Cooperation Agreement between the European Communities and their Member States and the Republic of Uzbekistan (. /. /ECSC, EC, EURATOM) THE COUNCIL OF THE EUROPEAN UNION, THE EUROPEAN COMMISSION, Having regard to the Treaty establishing the European Coal and Steel Community, Having regard to the Treaty establishing the European Community, and in particular Article 54(2), the closing sentence of Article 57(2) and Articles 73c(2), 75, 84(2), 113 and 235 in conjunction with the second sentence of Article 228(2) and the second subparagraph of Article 228(3) thereof, Having regard to the Treaty establishing the European Atomic Energy Community, and in particular the second paragraph of Article 101 thereof, Having regard to the assent of the European Parliament, Having regard to the approval of the Council given in accordance with Article 101 of the Treaty establishing the European Atomic Energy Community, Having consulted Committee, and with the unanimous assent of the Council, the ECSC Consultative Committee and the Economic and Social Whereas the conclusion of the Partnership and Cooperation Agreement between the European Communities and their Member States and Uzbekistan signed in would contribute to achieving the European Communities' objectives; on Whereas that Agreement seeks to strengthen existing links, notably those established by the Agreement on Trade and Commercial and Economic Cooperation between the European Economic Community and the European Atomic Energy Community and the USSR, signed on 18 December 1989; Whereas some of the obligations provided for in the Agreement in fields other than Community trade policy affect the arrangements established by Community acts, particularly acts relating to the right of establishment and to transport; Whereas the Agreement imposes on the Community certain obligations relating to the movement of capital and payments between the Community and Uzbekistan; Whereas in the case of certain measures provided for in the Agreement and falling within the Community's powers the EC Treaty provides no basis for action other than Article 235, HAVE DECIDED AS FOLLOWS : Article 1 The Partnership and Cooperation Agreement between the European Communities and their Member States and the Republic of Uzbekistan, together with the Protocol, the declarations and the exchange of letters, are hereby approved on behalf of the European Community, the European Coal and Steel Community and the European Atomic Energy Community. Article 2 1. The position to be adopted by the Community in the Cooperation Council shall be determined by the Council, on a proposal from the Commission, or, where appropriate, by the Commission, in each case in accordance with the relevant provisions of the Treaties establishing the European Community, the European Coal and Steel Community and the European Atomic Energy Community. 2. In accordance with Article 80 of the Partnership and Cooperation Agreement, the President of the Council shall chair the Cooperation Council and shall present the Community's position. A representative of the Commission shall chair the Cooperation Committee in accordance with its rules of procedure and shall present the Community's position. Article 3 The President of the Council shall give the notification provided for in Article 101 of the Agreement on behalf of the European Community. The President of the Commission shall give such notification on behalf of the European Coal and Steel Community and the European Atomic Energy Community. Done at Brussels, Final Act The plenipotentiaries of: THE KINGDOM OF BELGIUM, THE KINGDOM OF DENMARK, THE FEDERAL REPUBLIC OF GERMANY, THE HELLENIC REPUBLIC, THE KINGDOM OF SPAIN, THE FRENCH REPUBLIC, IRELAND, THE ITALIAN REPUBLIC, THE GRAND DUCHY OF LUXEMBOURG, THE KINGDOM OF THE NETHERLANDS, THE REPUBLIC OF AUSTRIA, THE PORTUGUESE REPUBLIC, THE REPUBLIC OF FINLAND, THE KINGDOM OF SWEDEN, THE UNITED KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND Contracting Parties to the Treaty establishing the EUROPEAN COMMUNITY, the Treaty establishing the EUROPEAN COAL AND STEEL COMMUNITY, and the Treaty establishing the EUROPEAN ATOMIC ENERGY COMMUNITY, hereinafter referred to as "the Member States", and of the EUROPEAN COMMUNITY, THE EUROPEAN ATOMIC ENERGY COMMUNITY and the EUROPEAN COAL AND STEEL COMMUNITY, hereinafter referred to as "the Community", of the one part, and the plenipotentiaries of the REPUBLIC OF UZBEKISTAN, sU- of the other part, on meeting at in the year one thousand nine hundred and ninety-six for the signature of the Partnership and Cooperation Agreement establishing a partnership between the European Communities and their Members States, of the one part, and the Republic of Uzbekistan, of the other part, hereinafter referred to as "the Partnership and Cooperation Agreement", have adopted the following text : the Partnership and Cooperation Agreement and the Protocol on mutual assistance in customs matters. The plenipotentiaries of the Member States and of the Community and the plenipotentiaries of the Republic of Uzbekistan have adopted the texts of the Joint Declarations listed below and annexed to this Final Act: Joint Declaration concerning personal data Joint Declaration concerning Article 5 of the Agreement Joint Declaration concerning Title HI of the Agreement Joint Declaration concerning Article 14 of the Agreement Joint Declaration concerning the notion of "control" in Article 24 (b) and Article 35 of the Agreement Joint Declaration concerning Article 34 of the Agreement Joint Declaration concerning Article 41 of the Agreement Joint Declaration concerning Article 95 of the Agreement The plenipotentiaries of the Member States and of the Community and the Plenipotentiaries of the Republic of Uzbekistan have also taken note of the exchange of letters listed below annexed to this Final Act: Establishment of companies The plenipotentiaries of the Member States and of the Community and the Plenipotentiaries of the Republic of Uzbekistan have also taken note of the declaration listed below annexed to this Final Act: Unilateral Declaration by the French Republic on the Overseas Countries Territories Done at in the year one thousand nine hundred and ninety six. For the Council and the Commission of the European Communities. For the Republic of Uzbekistan. 4 PARTNERSHIP AND COOPERATION AGREEMENT establishing a partnership between the European Communities and their Member States, of the one part, and the Republic of Uzbekistan, of the other part, THE KINGDOM OF BELGIUM, THE KINGDOM OF DENMARK, THE FEDERAL REPUBLIC OF GERMANY, THE HELLENIC REPUBLIC, THE KINGDOM OF SPAIN, THE FRENCH REPUBLIC, IRELAND, THE ITALIAN REPUBLIC, THE GRAND DUCHY OF LUXEMBOURG, THE KINGDOM OF THE NETHERLANDS, THE REPUBLIC OF AUSTRIA, THE PORTUGUESE REPUBLIC, THE REPUBLIC OF FINLAND, THE KINGDOM OF SWEDEN, THE UNITED KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND, Parties to the Treaty establishing the European Community, the Treaty establishing the European Coal and Steel Community, and the Treaty establishing the European Atomic Energy Community, hereinafter referred to as "Member States", and THE EUROPEAN COMMUNITY, THE EUROPEAN COAL AND STEEL COMMUNITY, AND THE EUROPEAN ATOMIC ENERGY COMMUNITY, hereinafter referred to as "the Community", of the one part, AND THE REPUBLIC OF UZBEKISTAN, of the other part, CONSIDERING the links between the Community, its Member States and the Republic of Uzbekistan and the common values that they share, RECOGNIZING that the Community and the Republic of Uzbekistan wish to strengthen these links and to establish partnership and cooperation which would strengthen and widen the relations established in the past in particular by the Agreement between the European Economic Community and the European Atomic Energy Community and the Union of Soviet Socialist Republics on Trade and Commercial and Economic Cooperation, signed on 18 December 1989, CONSIDERING the commitment of the Community and its Member States and of the Republic of Uzbekistan to strengthening the political and economic freedoms which constitute the very basis of the partnership, RECOGNIZING in that context that support of the independence, sovereignty and territorial integrity of the Republic of Uzbekistan will contribute to the safeguarding of peace and stability in Central Asia, CONSIDERING the commitment of the Parties to promote international peace and security as well as the peaceful settlement of disputes and to cooperate to this end in the framework of the United Nations and the Organisation for Security and Cooperation in Europe (OSCE), CONSIDERING the firm commitment of the Community and its Member States and of the Republic of Uzbekistan to the full implementation of all principles and provisions contained in the Final Act of the Conference on Security and Cooperation in Europe (CSCE), the Concluding Documents of the Madrid and Vienna Follow-Up Meetings, the Document of the CSCE Bonn Conference on Economic Cooperation, the Charter of Paris for a New Europe and the CSCE Helsinki Document 1992 "The Challenges of Change", and other fundamental documents of the OSCE, CONVINCED of the paramount importance of the rule of law and respect for human rights, particularly those of persons belonging to minorities, the establishment of a multiparty system with free and democratic elections and economic liberalization aimed at setting up a market economy, BELIEVING that full implementation of this Partnership and Cooperation Agreement will both depend on and contribute to continuation and accomplishment of the political, economic and legal reforms in the Republic of Uzbekistan, as well as the introduction of the factors necessary for cooperation, notably in the light of the conclusions of the CSCE Bonn Conference, DESIROUS of encouraging the process of regional cooperation in the areas covered by this agreement with neighbouring countries in order to promote the prosperity and stability of the region, 2: DESIROUS of establishing and developing regular political dialogue on bilateral and international issues of mutual interest, RECOGNIZING AND SUPPORTING the wish of Uzbekistan to establish close cooperation with European institutions, CONSIDERING the necessity of promoting investment in the Republic of Uzbekistan, including in the energy sector, and in this context the importance attached by the Community and its Member States to equitable conditions for access to and transit for export of energy products ; confirming the attachment of the Community and its Member States and of the Republic of Uzbekistan to the European Energy Charter, and to the full implementation of the Energy Charter Treaty and the Energy Charter Protocol on energy efficiency and related environmental aspects, TAKING ACCOUNT of the Community's willingness to provide for economic cooperation and technical assistance as appropriate, BEARING IN MIND the utility of the Agreement in favouring a gradual rapprochement between the Republic of Uzbekistan and a wider area of cooperation in Europe and neighbouring regions and its progressive integration into the open international trading system, CONSIDERING the commitment of the Parties to liberalize trade, in conformity with World Trade Organisation (WTO) rules, and convinced that Uzbekistan's accession to the WTO will allow the further intensification of trade relations between them, CONSCIOUS of the need to improve conditions affecting business and investment, and conditions in areas such as establishment of companies, labour, provision of services and capital movements, CONVINCED that this Agreement will create a new climate for economic relations between the Parties and in particular for the development of trade and investment, which are essential to economic restructuring and technological modernization, DESIROUS of establishing close cooperation in the area of environment protection taking into account the interdependence existing between the Parties in this field, RECOGNIZING that cooperation for the prevention and control of illegal immigration constitutes one of the primary objectives of this Agreement, DESIROUS of establishing cultural cooperation and improving the flow of information, HAVE AGREED AS FOLLOWS: A R T I C LE 1 A Partnership is hereby established between the Community and its Member States of the one part, and the Republic of Uzbekistan, of the other part. The objectives of this partnership are: to support the independence and sovereignty of the Republic of Uzbekistan, to support the Republic of Uzbekistan's efforts to consolidate its democracy, to develop its economy and to achieve transition to a market economy, to provide an appropriate framework for the political dialogue between the Parties allowing the development of political relations, to promote trade and investment and harmonious economic relations between the Parties and so to foster their sustainable economic development, to provide a basis for legislative, economic, social, financial, civil, scientific, technological and cultural cooperation, to assist in the construction of a civil society in Uzbekistan based upon the rule of law. TITLE I GENERAL PRINCIPLES ARTICLE 2. Respect for democracy, principles of international law and human rights as defined in particular in the United Nations Charter, the Helsinki Final Act and the Charter of Paris for a New Europe, as well as the principles of market economy, including those enunciated in the documents of the CSCE Bonn Conference, underpin the internal and external policies of the Parties and constitute an essential element of partnership and of this Agreement. ARTICLE 3 that the newly The Parties consider that it is essential for their future prosperity and stability independent states which have emerged from the dissolution of the Union of Soviet Socialist Republics, hereinafter called "Independent States", should maintain and develop cooperation among themselves in compliance with the principles of the Helsinki Final Act and with international law and in the spirit of good neighbourly relations, and will make every effort to encourage this process. T I T LE II POLITICAL DIALOGUE A R T I C LE 4 A regular political dialogue shall be established between the Parties which they intend to develop and intensify. It shall accompany and consolidate the rapprochement between the Community and the Republic of Uzbekistan, support the political and economic changes underway in the Republic of Uzbekistan and contribute to the establishment of new forms of cooperation. The political dialogue: - will strengthen the links of the Republic of Uzbekistan with the Community and its Member States, and thus with the community of democratic nations as a whole. The economic convergence achieved through this Agreement will lead to more intense political relations; - will bring about an increasing convergence of positions on international issues of mutual - concern thus increasing security and stability in the region, shall foresee that the Parties endeavour to cooperate on matters pertaining to the observance of the principles of democracy, and the respect, protection and promotion of human rights, including those of persons belonging to minorities and shall hold consultations, if necessary, on relevant matters. Such dialogue may take place on a regional basis. A R T I C LE 5 At ministerial level, political dialogue shall take place within the Cooperation Council established in Article 78 and on other occasions by mutual agreement. A R T I C LE 6 Other procedures and mechanisms for political dialogue shall be set up by the Parties, and in particular in the following forms: - - - regular meetings at senior official level between representatives of the Community and its Member States on the one hand, and representatives of the Republic of Uzbekistan on the other hand; taking fiill advantage of diplomatic channels between the parties including appropriate contacts in the bilateral as well as the multilateral field such as United Nations, OSCE meetings and elsewhere; any other means, including the possibility of expert meetings which would contribute to consolidating and developing this dialogue A R T I C LE 7 Political dialogue at parliamentary Parliamentary Cooperation Committee established in Article 83. level shall take place within the framework of the 6 /> TITLE HI TRADE IN GOODS ARTICLE 8 1. The Parties shall accord to one another most-favoured-nation treatment in all areas in respect of: - customs duties and charges applied to imports and exports, including the method of collecting such duties and charges; taxes and other internal charges of any kind applied directly or indirectly to imported goods; - provisions relating to customs clearance, transit, warehouses and transhipment; - - methods of payment and the transfer of such payments; - the rules relating to the sale, purchase, transport, distribution and use of goods on the domestic market. 2. The provisions of paragraph 1 shall not apply to: (a) advantages granted with the aim of creating a customs union or a free-trade area or pursuant to the creation of such a union or area; (b) advantages granted to particular countries in accordance with WTO rules and with other international arrangements in favour of developing countries; (c) advantages accorded to adjacent countries in order to facilitate frontier traffic. 3. The provisions of paragraph 1 shall not apply, during a transitional period expiring on the date of the Republic of Uzbekistan acceding to the WTO or on 31 December 1998, whichever is earlier, to advantages defined in Annex I granted by the Republic of Uzbekistan to other states which have emerged from the dissolution of the USSR. ARTICLE 9 1. The Parties agree that the principle of free transit is an essential condition of attaining the objectives of this Agreement. In this connection each Party shall secure unrestricted transit via or through its territory of goods originating in the customs territory or destined for the customs territory of the other Party. 2. 3. The rules described in Article V, paragraphs 2, 3, 4 and 5 of the GATT are applicable between the Parties. The rules contained in this Article are without prejudice to any special rules relating to specific sectors, in particular such as transport, or products agreed between the Parties. ARTICLE 10 Without prejudice to the rights and obligations stemming from international conventions on the temporary admission of goods which bind the Parties, each Party shall furthermore grant the other Party exemption from import charges and duties on goods admitted temporarily, in the instances and according to the procedures stipulated by any other international convention on this matter binding upon it, in conformity with its legislation. Account shall be taken of the conditions under which the obligations stemming from such a convention have been accepted by the Party in question. ARTICLE 11 Goods originating in the Republic of Uzbekistan shall be imported into the Community free of quantitative restrictions and measures of equivalent effect, without prejudice to the provisions of Articles 13, 16 and 17 of this Agreement. Goods originating, in the Community shall be imported into the Republic of Uzbekistan free of quantitative restrictions and measures of equivalent effect, without prejudice to the provisions of Articles 13, 16 and 17 of this Agreement. Goods shall be traded between the Parties at market-related prices. ARTICLE 12 ARTICLE 13 1. Where any product is being imported into the territory of one of the Parties in such increased quantities or under such conditions as to cause or threaten to cause injury to domestic producers of like or direct competitive products, the Community or the Republic of Uzbekistan, whichever is concerned, may take appropriate measures in accordance with the following procedures and conditions. 2. 3. Before. taking any measures, or in cases to which paragraph 4 applies as soon as possible thereafter, the Community or the Republic of Uzbekistan as the case may be shall supply relevant information with a view to seeking a solution the Cooperation Council with all acceptable to the Parties as provided for in Title XI. If, as a result of the consultations, the Parties do not reach agreement within 30 days of referral to the Cooperation Council on actions to avoid the situation, the Party which requested consultations shall be free to restrict imports of the products concerned to the extent and for such time as is necessary to prevent or remedy the injur)', or to adopt other appropriate measures. 4. In critical circumstances where delay would cause damage difficult to repair, the Parties may take the measures before the consultations, on the condition that consultations shall be offered immediately after taking such action 5. In the selection of measures under this Article, the Parties shall give priority to those which cause least disturbance to the achievement of the aims of this Agreement. 6. Nothing in this Article shall prejudice or affect in any way the taking, by either Party, of anti-dumping or countervailing measures in accordance with Article VI of the GATT, the Agreement on implementation of Article VI of the GATT, the Agreement related on interpretation and application of Articles VI, XVI and XXIII of the GATT or related internal legislation. ARTICLE 14 The Parties undertake to consider development of the provisions in this Agreement on trade in goods between them, as circumstances allow, including the situation arising from the accession of the Republic of Uzbekistan to the WTO. The Cooperation Council may make recommendations on such developments to the Parties which could be put into effect, where accepted, by virtue of agreement between the Parties in accordance with their respective procedures. ARTICLE 15 This Agreement shall not preclude prohibitions or restrictions on imports, exports or goods in transit justified on grounds of public morality, public policy or public security; the protection of health and life of humans, animals or plants; the protection of natural resources; the protection of national treasures of artistic, historic or archaeological value or the protection of intellectual, industrial and commercial property or rules relating to gold and silver. Such prohibitions or restrictions shall not, however, constitute a means of arbitrary discrimination or a disguised restriction on trade between the Parties. ARTICLE 16 This Title shall not apply to trade in textile products falling under Chapters 50 to 63 of the Combined Nomenclature. Trade in these products shall be governed by a separate agreement, initialled on 4 December 1995 and applied provisionally since 1 January 1996. ~2' ARTICLE 17 1. Trade in products covered by the Treaty establishing the European Coal and Steel Community shall be governed by the provisions of this Title, with the exception of Article 11. 2. A contact group on coal and steel matters shall be set up, comprising representatives of the Community on the one hand, and representatives of the Republic of Uzbekistan on the other. The contact group shall exchange, on a regular basis, information on all coal and steel matters of interest to the Parties. ARTICLE 18 Trade in nuclear materials shall be subject to the provisions of a specific Agreement to be concluded between the European Atomic Energy Community and the Republic of Uzbekistan. 10 est* TITLE IV PROVISIONS AFFECTING BUSINESS AND INVESTMENT CHAPTER I Labour conditions ARTICLE 19 1. 2. Subject to the laws, conditions and procedures applicable in each Member State, the Community and the Member States shall endeavour to ensure that the treatment accorded to nationals of the Republic of Uzbekistan, legally employed in the territory of a Member State shall be free from any discrimination based on nationality, as regards working conditions, remuneration or dismissal, as compared to its own nationals. Subject to the laws, conditions and procedures applicable in the Republic of Uzbekistan, the Republic of Uzbekistan shall endeavour to ensure that the treatment accorded to nationals of a Member State, legally employed in the territory of the Republic of Uzbekistan shall be free from any discrimination based on nationality, as regards working conditions, remuneration or dismissal, as compared to its own nationals. ARTICLE 20 The Cooperation Council shall examine which improvements can be made in working conditions for business people consistent with the international commitments of the Parties, including those set out in the document of the CSCE Bonn Conference. ARTICLE 21 The Cooperation Council shall make recommendations for the implementation of Articles 19 and 20. - ^ ii v * J? " C H A P T ER II Conditions affecting the establishment and operation of companies A R T I C LE 22 1. The Community and its Member States shall grant, for the establishment of Uzbek companies as defined in Article 24 (d), treatment no less favourable than that accorded to any third country companies. 2. Without prejudice to the reservations listed in Annex II, the Community and its Member States shall grant to subsidiaries of Uzbek companies established in their territories a treatment no less favourable than that granted to any Community companies, in respect of their operation. 3. The Community and its Member States shall grant to branches of Uzbek companies established in their territories a treatment no less favourable than that accorded to branches of companies of any third country, in respect of their operation. 4. Without prejudice to the reservations listed in Annex III, the Republic of Uzbekistan shall grant, for the establishment of Community companies as defined in Article 24 (d), treatment no less favourable than that accorded to Uzbek companies or to any third country companies, whichever is the better. 5. The Republic of Uzbekistan shall grant to subsidiaries and branches of Community companies established in its territory treatment no less favourable than that accorded to its own companies or branches or to any third country company or branch, whichever is the better, in respect of their operations. A R T I C LE 23 1. The provisions of Article 22 shall not apply to air transport, inland waterways transport and maritime transport. 2. However, in respect of activities undertaken by shipping agencies for the provision of international maritime transport services, including intermodal activities involving a sea leg, each Party shall permit the companies of the other Party their commercial presence in its territory in the form of subsidiaries or branches, under conditions of establishment and operation no less favourable than those accorded to its own companies or to subsidiaries or branches of companies of any third country, whichever are the better Such activities include but are not limited to: (a) marketing and sales of maritime transport and related services through direct contact with customers, from quotation to invoicing, whether these services are operated or offered by the service supplier itself or by service suppliers with which the seivice seller has established standing business arrangements; 12 1 /2 <">' i"y " (b) purchase and use, on their own account or on behalf of their customers (and to resale to their customers) of any transport and related services, including inward transport services by any mode, particularly inland waterways, road and rail, necessary for the supply of an integrated service; (c) preparation of documentation concerning transport documents, customs documents, or other documents related to the origin and character of the goods transported; (d) provision of business information by any means, including computerized information systems and electronic data interchange (subject to any non-discriminatory restrictions concerning telecommunications); (e) setting up of any business arrangement, including participation in the company's stock and the appointment of personnel recruited locally (or, in the case of foreign personnel, subject to the relevant provisions of this Agreement), with any locally established shipping agency; (f) acting on behalf of the companies, organizing the call of the ship or taking over cargoes when required. For the purpose of this Agreement: ARTICLE 24 (a) A "Community company" or an "Uzbek company" respectively shall mean a company set up in accordance with the laws of a Member State or of the Republic of Uzbekistan respectively and having its registered office or central administration, or principal place of business in the territory of the Community or the Republic of Uzbekistan respectively. However, should the company set up in accordance with the laws of a Member State or the Republic of Uzbekistan respectively have only its registered office in the territory of the Community or the Republic of Uzbekistan respectively, the company shall be considered a Community or Uzbek company respectively if its operations possess a real and continuous link with the economy of one of the Member States or the Republic of Uzbekistan respectively. (b) "Subsidiary" of a company shall mean a company which is effectively controlled by the first company. (c) "Branch" of a company shall mean a place of business not having legal personality which has the appearance of permanency, such as the extension of a parent body, has a management and is materially equipped to negotiate business with third parties so that the latter, although knowing that there will if necessary be a legal link with the parent body, the head office of which is abroad, do not have to deal directly with such parent body but may transact business at the place of business constituting the extension. (d) "Establishment" shall mean the right of Community or Uzbek companies as referred to in point (a) to take up economic activities by means of the setting up of subsidiaries and branches in the Republic of Uzbekistan or in the Community respectively. (e) "Operation" shall mean the pursuit of economic activities. 13 (t) "Economic activities" shall mean activities of an industrial, commercial and professional character. (g) With regard to international maritime transport, including intermodal operations involving a sea leg, nationals of the Member States or of the Republic of Uzbekistan established outside the Community or the Republic of Uzbekistan respectively, and shipping companies established' outside the Community or the Republic of Uzbekistan and controlled by nationals of a Member State or nationals of the Republic of Uzbekistan respectively, shall also be beneficiaries of the provisions of this Chapter and Chapter III if their vessels are registered in that Member State or in the Republic of Uzbekistan respectively in accordance with their respective legislation ARTICLE 25 Notwithstanding any other provisions of this Agreement, a Party shall not be prevented from taking measures for prudential reasons, including for the protection of investors, depositors, policy holders or persons to whom a fiduciary duty is owed by a financial service supplier, or to ensure the integrity and stability of the financial system. Where such measures do not conform with the provisions of this Agreement, they shall not be used as a means of avoiding the obligations of a Party under this Agreement. Nothing in this Agreement shall be construed as requiring a Party to disclose information relating to the atfairs and accounts of individual customers or any confidential or proprietary information in the possession of public entities. For the purposes of this Agreement, "financial services" shall mean those activities described in Annex IV ARTICLE 26 The provisions of this Agreement shall not prejudice the application by each Party of any measure necessary to prevent the circumvention of its measures concerning third country access to its market, through the provisions of this Agreement. ARTICLE 27 Notwithstanding the provisions of Chapter I of this Title, a Community company or an Uzbek company established in the territory of the Republic of Uzbekistan or the Community respectively shall be entitled to employ, or have employed by one of its subsidiaries or branches, in accordance with the legislation in force in the host country of establishment, in the territory of the Republic of Uzbekistan and the Community respectively, employees who are nationals of Community Member States and the Republic of Uzbekistan respectively, provided that such employees are key personnel as defined in paragraph 2, and that they are employed exclusively by companies, or branches. The residence and work permits of such employees shall only cover the period of such employment. Kev personnel of the abovementioned companies herein referred to as "organizations" are "intra-coiporate transferees" as defined in (c) in the following categories, provided that the 14 // ^> /? organization is a legal person and that the persons concerned have been employed by it or have been partners in it (other than majority shareholders), for at least the year immediately preceding such movement: (a) Persons working in a senior position with an organization, who primarily direct the management of the establishment, receiving general supervision or direction principally from the board of directors or stockholders of the business or their equivalent, including: - directing the establishment or a department or subdivision of the establishment, - supervising and controlling the work of other supervisory, professional or managerial employees, - having the authority personally to hire and fire or recommend hiring, firing or other personnel actions; (b) Persons working within an organization who possess uncommon knowledge essential to the establishment's service, research equipment, techniques or management. The assessment of such knowledge may reflect, apart from knowledge specific to the establishment, a high level of qualification referring to a type of work or trade requiring specific technical knowledge, including membership of an accredited profession; (c) An "intra-corporate transferee" is defined as a natural person working within an organization in the territory of a. Party, and being temporarily transferred in the context of pursuit of economic activities in the territory of the other Party; the organization concerned must have its principal place of business in the territory of a Party and the transfer be to an establishment (branch, subsidiary) of that organization, effectively pursuing like economic activities in the territory of the other Party. ARTICLE 28 1. The Parties shall use their best endeavours to avoid taking any measures or actions which render the conditions for the establishment and operation of each other's companies more restrictive than the situation existing on the day preceding the date of signature of the Agreement. 2. The provisions of this Article are without prejudice to those of Article 36: the situations covered by Article 36 shall be solely governed by its provisions to the exclusion of any other. 3. Acting in the spirit of partnership and cooperation and in the light of the provisions of Article 42, the Government of the Republic of Uzbekistan shall inform the Community of its intentions to submit new legislation or adopt new regulations which may render the conditions for the establishment or operation in the Republic of Uzbekistan of subsidiaries and branches of Community companies more restrictive than the situation existing on the day preceding the date of signature of the Agreement. The Community may request the Republic of Uzbekistan to communicate the drafts of such legislation or regulations and to enter into consultations about those drafts. 15 Where new legislation or regulations introduced in the Republic of Uzbekistan would result in rendering the conditions for operation of subsidiaries and branches of Community companies established in the Republic of Uzbekistan more restrictive than the situation existing on the day of signature of this Agreement, such legislation or regulations shall not apply during three years following the entry into force of the relevant act to those subsidiaries and branches already established in the Republic of Uzbekistan at the time of entry into force of the relevant act. CHAPTER HI Cross border supply of services between the Community and the Republic of Uzbekistan ARTICLE 29 1. The Parties undertake in accordance with the provisions of this Chapter to take the necessary steps to allow progressively the supply of services by Community or Uzbek companies who are established in a Party other than that of the person for whom the services are intended taking into account the development of the service sectors in the Parties. 2. The Cooperation Council shall make recommendations for the implementation of paragraph 1. ARTICLE 30 The Parties shall cooperate with the aim of developing a market oriented service sector in the Republic of Uzbeki stan. ARTICLE 31 1. The Parties undertake to apply effectively the principle of unrestricted access to the international maritime market and traffic on a commercial basis: (a) the above provision does not prejudice from the United Nations Convention on a Code of Conduct for Liner Conferences, as applicable to one or other Party to this Agreement. Non-conference lines will be free to operate in competition with a conference as long as they adhere to the principle of fair competition on a commercial basis; the rights and obligations arising (b) the Parties affirm their commitment to a freely competitive environment as being an essential feature of the dry and liquid bulk trade. ; > " "• 16 2. In applying the principles of paragraph 1, the Parties shall: (a) not apply, as from the entry into force of this Agreement, any cargo sharing provisions of bilateral agreements between any Member States of the Community and the former Soviet Union; (b) not introduce cargo sharing clauses into future bilateral agreements with third countries, other than in those exceptional circumstances where liner shipping companies from one or other Party to this Agreement would not otherwise have an effective opportunity to ply for trade to and from the third country concerned; (c) prohibit cargo sharing arrangements in future bilateral agreements concerning dry and liquid bulk trade; (d) abolish upon entry into force of this Agreement, all unilateral measures, administrative, technical and other obstacles which could have restrictive or discriminatory effects on the free supply of services in international maritime transport. ARTICLE 32 With a view to assuring a coordinated development of transport between the Parties, adapted to their commercial needs, the conditions of mutual market access and provision of services in transport by road, rail and inland waterways and, if applicable, in air transport may be dealt with by specific agreements where appropriate negotiated between the Parties after entry into force of this Agreement. CHAPTER IV General Provisions ARTICLE 33 1. The provisions of this Title shall be applied subject to limitations justified on grounds of public policy, public security or public health. 2. They shall not apply to activities which in the territory of the Parties are connected, even occasionally, with the exercise of official authority. ARTICLE 34 For the purpose of this Title, nothing in this Agreement shall prevent the Parties from applying their laws and regulations regarding entry and stay, work, labour conditions and establishment of natural persons and supply of services, provided that, in so doing, they do not apply them in a manner as to nullify or impair the benefits accruing to any Party under the terms of a specific provision of this Agreement. The above provision does not prejudice the application of Article 17. A -'. / ARTICLE 35 Companies which are controlled and exclusively owned by Uzbek companies and Community companies jointly shall also be beneficiaries of the provisions of Chapters II, III and IV. ARTICLE 36 Treatment granted by either Party to the other hereunder shall, as from the day one month prior to the date of entry into force of the relevant obligations of the General Agreement on Trade in Services (GATS), in respect of sectors or measures covered by the GATS, in no case be more favourable than that accorded by such first Party under the provisions of GATS and this in respect of each service sector, sub-sector and mode of supply. ARTICLE 37 For the purposes of Chapters II, III and IV, no account shall be taken of treatment accorded by the Community, its Member States or the Republic of Uzbekistan pursuant to commitments entered into in economic integration agreements in accordance with the principles of Article V of the GATS. ARTICLE 38 The most-favoured-nation treatment granted in accordance with the provisions of this Title shall not apply to the tax advantages which the Parties are providing or will provide in the future on the basis of agreements to avoid double taxation, or other tax arrangements. Nothing in this Title shall be construed to prevent the adoption or enforcement by the Parties of any measure aimed at preventing the avoidance or evasion of taxes pursuant to the tax provisions of agreements to avoid double taxation and other tax arrangements, or domestic fiscal legislation. • ' O" Nothing in this Title shall be construed to prevent Member States or the Republic of Uzbekistan from distinguishing, in the application of the relevant provisions of their fiscal legislation, between tax payers who are not in identical situations, in particular as regards their place of residence. ARTICLE 39 Without prejudice to Article 27, no provision of Chapters II, III and IV shall be interpreted as giving the right to: - nationals of the Member States or of the Republic of Uzbekistan respectively to enter, or stay in, the territory of the Republic of Uzbekistan or the Community respectively in any capacity whatsoever, and in particular as a shareholder or partner in a company or manager or employee thereof or supplier or recipient of services; 18 - Community subsidiaries or branches of Uzbek companies to employ or have employed in the territory of the Community nationals of the Republic of Uzbekistan; - Uzbek subsidiaries or branches of Community companies to employ or have employed in the territory of the Republic of Uzbekistan nationals of the Member States; - Uzbek companies or Community subsidiaries or branches of Uzbek companies to supply Uzbek persons to act for and under the control of other persons by temporary employment contracts; - Community companies or Uzbek subsidiaries or branches of Community companies to supply workers who are nationals of the Member States by temporary employment contracts. C H A P T ER V Current payments and capital A R T I C LE 40 The Parties undertake to authorize in freely convertible currency, any payments on the current account of balance of payments between residents of the Community and of the Republic of Uzbekistan connected with the movement of goods, services or persons made in accordance with the provisions of this Agreement. With regard to transactions on the capital account of balance of payments, from entry into force of this Agreement, the free movement of capital relating to direct investments made in companies formed in accordance with the laws of the host country and investments made in accordance with the provisions of Chapter II, and the liquidation or repatriation of these investments and of any profit stemming therefrom shall be ensured. Without prejudice to paragraph 2 or to paragraph 5, as from the entry into force of this Agreement, no new foreign exchange restrictions on the movement of capital and current payments connected therewith between residents of the Community and the Republic of Uzbekistan shall be introduced and the existing arrangements shall not become more restrictive. The Parties shall consult each other with a view to facilitating the movement of forms of capital other than those referred to in paragraph 2 between the Community and the Republic of Uzbekistan in order to promote the objectives of this Agreement. the meaning of Article VIII of the Articles of Agreement of With reference to the provisions of this Article, until a full convertibility of the Uzbek currency within the International Monetary Fund (IMF) is introduced, the Republic of Uzbekistan may in exceptional circumstances apply exchange restrictions connected with the granting or taking up of short and medium-term financial credits to the extent that such restrictions are imposed on the Republic of Uzbekistan for the granting of such credits and are permitted according to the Republic of Uzbekistan's status under the IMF. The Republic of Uzbekistan shall apply these restrictions in a non-discriminatory manner. They shall be applied in such a manner as to cause the least possible disruption to this Agreement. The Republic of Uzbekistan shall inform the Cooperation Council promptly of the introduction of such measures and of any changes therein. 19 Without prejudice to paragrapiis 1 and 2, where, in exceptional circumstances, movements of capital between the Community and the Republic of Uzbekistan cause, or threaten to cause, serious difficulties for the operation of exchange rate policy or monetary policy in the Community or the Republic of Uzbekistan, the Community and the Republic of Uzbekistan, respectively, may take safeguard measures with regard to movements of capital between the Community and the Republic of Uzbekistan for a period not exceeding six months if such measures are strictly necessary. CHAPTER VI Intellectual, industrial and commercial property protection ARTICLE 41 Pursuant to the provisions of this Article and of Annex V, the Republic of Uzbekistan shall continue to improve the protection of intellectual, industrial and commercial property rights in order to provide, by the end of the fifth year after the entry into force of this Agreement, for a level of protection similar to that existing in the Community, including effective means of enforcing such rights. By the end of the fifth year after entry into force of this Agreement, the Republic of Uzbekistan shall accede to the multilateral conventions on intellectual, industrial and commercial property rights referred to in paragraph 1 of Annex V to which Member States are parties or which are de facto applied by Member States, according" to the relevant provisions contained in these conventions. 20 TITLE V LEGISLATIVE COOPERATION ARTICLE 42 1. The Parties recognize that an important condition for strengthening the economic links between the Republic of Uzbekistan and the Community is the approximation of the Republic of Uzbekistan's existing and future legislation to that of the Community. The Republic of Uzbekistan shall endeavour to ensure that its legislation will be gradually made compatible with that of the Community. 2. The approximation of laws shall extend to the following areas in particular: customs law, company law, laws on banking and other financial services, company accounts and taxes, intellectual property, protection of workers at the workplace, rules on competition including any related issues and practices affecting trade, public procurement, protection of health and life of humans, animals and plants, the environment, consumer protection, indirect taxation, technical rules and standards, nuclear laws and regulations, transport, telecommunications. 3. The Community shall provide the Republic of Uzbekistan with technical assistance for the implementation of these measures, which may include i. e. : - the exchange of experts; - the provision of early information especially on relevant legislation; - organization of seminars; - training of personnel involved in the drafting and implementation of legislation; - aid for translation of Community legislation in the relevant sectors. 4. The Parties agree to examine ways to apply their respective competition laws on a concerted basis in such cases where trade between them is affected. 21 TITLE VI ECONOMIC COOPERATION ARTICLE 43 1. The Community and the Republic of Uzbekistan shall establish economic cooperation aimed at contributing to the process of economic reform and recovery and sustainable development of the Republic of Uzbekistan. Such cooperation shall strengthen existing economic links, to the benefit of the Parties. 2. Policies and other measures will be designed to bring about economic and social reforms and restructuring of the economic system in the Republic of Uzbekistan and will be guided by the requirements of sustainability and harmonious social development; they will also fully incorporate environmental considerations. 3. To this end the cooperation will concentrate, in particular, on economic and social development, human resources development, (including privatization, investment and development of financial services), agriculture and food, energy and civil nuclear safety, transport, postal services and telecommunications, tourism, environmental protection and regional cooperation. for enterprises support 4. Special attention shall be devoted to measures capable of fostering regional cooperation. 5. Where appropriate, economic cooperation and other forms of cooperation provided for in this Agreement may be supported by technical assistance from the Community, taking into account the Community's relevant Council regulation applicable to technical assistance in the Independent States, the priorities agreed upon in the indicative programme related to Community technical assistance to the Republic of Uzbekistan and its established coordination and implementation procedures. ARTICLE 44 Cooperation in the field of trade in goods and services The Parties will cooperate with a view to ensuring that the Republic of Uzbekistan's international trade is conducted in conformity with the rules of the WTO. Such cooperation shall include specific issues directly relevant to trade facilitation, in particular with a view to assisting the Republic of Uzbekistan to harmonise its legislation and regulations with WTO rules and so to fulfil as soon as possible the conditions of accession to that Organisation. These include: - formulation of policy on trade and trade-related questions, including payments and clearing mechanisms, - drafting of relevant legislation. 22 ARTICLE 45 Industrial cooperation 1. Cooperation shall aim at promoting the following in particular. - the development of business links between economic operators of both sides; - Community participation in Uzbekistan's efforts to restructure its industry; - the improvement of management; - the improvement of the quality of industrial products; - the development of efficient production and processing capacity in the raw materials sector; - the development of appropriate commercial rules and practices including product marketing; - environmental protection; - defence conversion; _ training of management personnel. 2. The provisions of this Article shall not affect the enforcement of Community competition rules applicable to undertakings. ARTICLE 46 Investment promotion and protection 1. Bearing in mind the respective powers and competences of the Community and the Member States, cooperation shall aim to establish a favourable climate for private investment, both domestic and foreign, especially through better conditions for investment protection, the transfer of capital and the exchange of information on investment opportunities. 2. The aims of cooperation shall be in particular: - the conclusion, where appropriate, between the Member States and the Republic of Uzbekistan of agreements for the promotion and protection of investment; - the conclusion, where appropriate, between the Member States and the Republic of Uzbekistan of agreements to avoid double taxation; - the creation of favourable conditions for attracting foreign investments into the Uzbek economy; - to establish stable and adequate business law and conditions, and to exchange information on laws, regulations and administrative practices in the field of investment; - to exchange information on investment opportunities in the form of, inter alia, trade fairs, exhibitions, trade weeks and other events. 23 (t&^t A R T I C LE 47 Public Procurement The Parties shall cooperate to develop conditions for open and competitive award of contracts for goods and services in particular through calls for tenders. A R T I C LE 48 Cooperation in the field of standards and conformity assessment 1. Cooperation between the Parties shall promote alignment with internationally agreed criteria, principles and guidelines followed in the field of quality. The required actions will facilitate progress towards mutual recognition in the field of conformity assessment, as well as the improvement of Uzbek product quality. 2. To this end the Parties shall seek to cooperate in technical assistance projects which will: - promote appropriate cooperation with organizations and institutions specialized in these fields; - promote the use of Community technical regulations and the application of European standards and conformity assessment procedures; - permit the sharing of experience and technical information in the field of quality management. A R T I C LE 49 Mining and raw materials 1. The Parties shall aim at increasing investment and trade in mining and raw materials. 2. The cooperation shall focus in particular on the following areas: - exchange of information on the prospects of the mining and non-ferrous metals sectors; - the establishment of a legal framework for cooperation; - trade matters; - the adoption and implementation of environmental legislation; - training; - safety in the mining industry. A R T I C LE 50 Cooperation in science and technology 1. The Parties shall promote cooperation technological development (RTD) on the basis of mutual benefit and, taking into account the availability of resources, adequate access to their respective programmes and subject to appropriate levels of effective protection of intellectual, industrial and commercial property rights (IPR). in civil scientific research and 24 (a 2. Science and technology cooperation shall cover - the exchange of scientific and technical information, - joint RTD activities; - training activities and mobility programmes for scientists, researchers and technicians engaged in RTD in both sides. Where such cooperation takes the form of activities involving education and/or training, it should be carried out in accordance with the provisions of Article 51. The Parties, on the basis of mutual agreement, can engage in other forms of cooperation in science and technology. In carrying out such cooperation activities, special attention shall be devoted to the redeployment of scientists, engineers, researchers and technicians which are or have been engaged in research on/and production of weapons of mass destruction. 3. The cooperation covered by this Article shall be implemented according to specific arrangements to be negotiated and concluded in accordance with the procedures adopted by each Party, and which shall set out, inter alia, appropriate IPR provisions. ARTICLE 51 Education and training 1. The Parties shall cooperate with the aim of raising the level of general education and professional qualifications in the Republic of Uzbekistan, both in the public and private sectors. 2. The cooperation shall focus in particular on the following areas: - updating higher education and training systems in the Republic of Uzbekistan including the system of certification of higher educational establishments and diplomas of higher education; - the training of public and private sector executives and civil servants in priority areas to be determined; - cooperation between educational establishments and between educational establishments and firms; - mobility for teachers, graduates, administrators, young scientists and researchers, and young people; - promoting teaching in the field of European Studies within the appropriate institutions; - teaching Community languages; - post-graduate training of conference interpreters; - training of journalists; - training of trainers. 3. The possible participation of one Party in the respective programmes in the field of education and training of the other Party could be considered in accordance with their respective procedures and, where appropriate, institutional frameworks and plans of cooperation will then be established building on participation of the Republic of Uzbekistan in the Community's TEMPUS programme. - / X?/ y 5) 25 • ARTICLE 52 Agriculture and the agro-industrial sector The purpose of cooperation in this area shall be the pursuance of agrarian reform, the modernization, privatization and restructuring of agriculture, the agro-industrial and services sectors in the Republic of Uzbekistan, development of domestic and foreign markets for the Uzbek products, in conditions that ensure the protection of the environment, taking into account the necessity to improve security of food supply as well as the development of agri-business, the processing and distribution of agricultural products. The Parties shall also aim at the gradual approximation of Uzbek standards to Community technical regulations concerning industrial and agricultural food products including sanitary and phytosanitary standards. ARTICLE 53 Energy 1. Cooperation shall take place within the principles of the market economy and the European Energy Charter, against a background of the progressive integration of the energy markets in Europe. 2. Cooperation shall concentrate, inter alia, upon the formulation and development of energy policy. It shall include among others the following areas: - improvement in management and regulation of the energy sector in line with a market economy; - improvement of energy supply, including security of supply, in an economic and environmentally sound manner; - promotion of energy saving and energy efficiency and implementation of the Energy Charter Protocol on Energy Efficiency and related environmental aspects; - modernisation of energy infrastructures; - improvement of energy technologies in supply and end use across the range of energy types; - management and technical training in the energy sector; - transportation and transit of energy materials and products. - the introduction of the range of institutional, legal, fiscal and other conditions necessary to encourage increased energy trade and investment; - development of hydro-electric and other renewable energy resources. 3. The Parties shall exchange relevant information relating to investment projects in the energy sector, in particular concerning the production of energy resources and the construction and refurbishing of oil and gas pipelines or other means of transporting energy products. The Parties attach particular importance to cooperation regarding investments in the energy sector and the manner in which these are regulated. They shall cooperate with a view to implementing as efficaciously as possible the provisions of Title IV and of Article 46, in respect of investments in the energy sector. 26 / / ^ K ^ ; /- /. • / ARTICLE 54 Environment and human health 1. Bearing in mind the European Energy Charter, the Declarations of the Lucerne Conference of April 1993, and the of the Sofia Conference of October 1995, and taking into account the Energy Charter Treaty and especially its Article 19, and the Energy Charter Protocol on Energy Efficiency and related environmental aspects, the Parties shall develop and strengthen their cooperation on environment and human health. 2. Cooperation shall aim at combatting the deterioration of the environment and in particular. - effective monitoring of pollution levels and assessment of the environment; system of information on the state of the environment; - combating local, regional and transboundary air and water pollution; - ecological restoration; - sustainable, efficient and environmentally effective production and use of energy; - safety of industrial plants; - classification and safe handling of chemicals; - water quality; - waste reduction, recycling and safe disposal, implementation of the Basle Convention; - the environmental impact of agriculture, soil erosion, and chemical pollution; - the protection of forests; - the conservation of biodiversity, protected areas and sustainable use and management of biological resources; - land-use planning, including construction and urban planning; - use of economic and fiscal instruments; - global climate change; - environmental education and awareness; - implementation of the Espoo Convention on Environmental Impact Assessment in a transboundary context. 3. Cooperation shall take place particularly through: - disaster planning and other emergency situations; - exchange of information and experts, including information and experts dealing with the transfer of clean technologies and the safe and environmentally sound use of biotechnologies; - joint research activities; - improvement of laws towards Community standards; - cooperation at regional level, including cooperation within the framework of the European Environment Agency, and at international level; - development of strategies, particularly with regard to global and climatic issues and also in view to achieving sustainable development; - environmental impact studies. 4. The Parties shall seek to develop their cooperation on questions of human health, in particular through technical assistance on the prevention and combatting of infectious diseases and the protection of mothers and young children. 27 ARTICLE 55 Transport The Parties shall develop and strengthen their cooperation in the field of transport. This cooperation shall, inter alia, aim at restructuring and modernizing transport systems and networks in the Republic of Uzbekistan; developing and ensuring, where appropriate, compatibility of transportation systems in the context of achieving a more global transport system; and identifying and elaborating priority projects and seeking to attract investment for their implementation. The cooperation shall include, inter alia: - the modernisation of management and operations of road transport, railways, ports, airports and urban passenger transport systems; - modernization and development of railways, waterways, roads, airports and air navigation infrastructure including the modernization of major routes of common interest and the trans-European links for the above modes, particularly those related to the TRACECA project; - promotion and development of multi-modal transport, - the promotion of joint research and development programmes; - preparation of the legislative and institutional framework for policy development and implementation including privatization of the transport sector. ARTICLE 56 Postal services and telecommunications Within their respective powers and competences the Parties shall expand and strengthen cooperation in the following areas: - the establishment of policies and guidelines for the development of the telecommunications sector and postal services; - development of principles of a tariff policy and marketing in telecommunications and postal services; - transferring technology and know-how, particularly regarding European technical standards and certification systems; - encouraging the development of projects for telecommunications and postal services and attracting investment; - enhancing efficiency and quality of the provision of telecommunications and postal services, amongst others through liberalization of activities of sub-sectors; - advanced application of telecommunications, notably in the area of electronic funds transfer; - management of telecommunications networks and their "optimization"; - an appropriate regulatory basis for the provision of telecommunication and postal services and for the use of the radio frequency spectrum; - training in the field of telecommunications and postal services for operations in market conditions. 28 / ' / A R T I C LE 57 Financial Services and fiscal institutions 1. Cooperation in the field of financial services shall in particular aim at facilitating the in universally accepted systems of mutual involvement of the Republic of Uzbekistan settlements. Technical assistance shall focus on: - the development of a stock market and a securities market, - the development of banking services, the development of a common market of credit resources and the involvement of the Republic of Uzbekistan in a universally accepted system of mutual settlements; - the development of insurance services, which would inter alia create a favourable framework for Community companies' participation in the establishment of joint ventures in the insurance sector in the Republic of Uzbekistan, as well as the development of export credit insurance. This cooperation shall in particular contribute to foster the development of relations between the Parties in the financial services sector. 2. The Parties shall cooperate in developing the fiscal system and fiscal institutions in the Republic of Uzbekistan. This cooperation shall include the exchange of information and experience on fiscal matters and the training of personnel involved in the formulation and implementation of fiscal policy. A R T I C LE 58 Enterprise restructuring and privatisation Recognizing that privatisation is of fundamental importance to a sustainable economic recovery, the Parties agree to cooperate in the development of the necessary institutional, legal and methodological framework. Particular attention will be paid to the orderly and transparent nature of the privatisation process. Technical assistance shall focus on, inter alia : the further development of an institutional base within the Government of Uzbekistan to assist with defining and managing the privatisation process; the further development of the privatisation strategy of the government of Uzbekistan, including the legislative framework, and implementation mechanisms; furthering market approaches to land use and ownership, and the privatisation of land; the restructuring of those enterprises not yet ready for privatisation; the development of private enterprise, particularly in the small and medium enterprise sector. the development of investment privatisation jiinds systems. The objective of this cooperation is also to contribute to the promotion of Community investment in Uzbekistan. 29 ARTICLE 59 Regional development 1. The Parties shall strengthen cooperation on regional development and land-use planning. 2. To this end, the Parties shall encourage the exchange of information by national, regional and local authorities on regional and land-use planning policy and on methods of formulation of regional policies with special emphasis on the development of disadvantaged areas. They shall also encourage direct contacts between the respective regions and public organizations responsible for regional development planning with the aim, inter alia, to exchange methods and ways of fostering regional development. ARTICLE 60 Social cooperation 1. With regard to health and safety, the Parties shall develop cooperation between them with the aim of improving inter alia the level of protection of the health and safety of workers. The cooperation shall include notably: - education and training on health and safety issues with specific attention to high risk sectors of activity; - development and promotion of preventive measures to combat work related diseases and other work related ailments; - prevention of major accident hazards and the management of toxic chemicals; - research to develop the knowledge base in relation to working environment and the health and safety of workers. 2. With regard to employment, the cooperation shall include notably technical assistance to: - optimization of the labour market; - modernization of the job-finding and consulting services; - planning and management of the restructuring programmes; - encouragement of local employment development; - exchange of information on the programmes of flexible employment, including those stimulating self-employment and promoting entrepreneurship. 3. The Parties shall pay special attention to cooperation in the sphere of social protection which, inter alia, shall include cooperation in planning and implementing social protection reforms in the Republic of Uzbekistan. These reforms shall aim to develop in the Republic of Uzbekistan methods of protection intrinsic to market economies and shall comprise all directions of social protection. 30 • / >, „, ARTICLE 61 Tourism The Parties shall increase and develop cooperation between them, which shall include: - facilitating the tourist trade; - increasing the flow of information; - transferring know-how; - studying the opportunities for joint operations; - cooperation between official tourism bodies, including the preparation of promotional material; - training for tourism development. ARTICLE 62 Small and medium-sized enterprises 1. The Parties shall aim to develop and strengthen small and medium-sized enterprises and their associations and cooperation between SMEs in the Community and the Republic of Uzbekistan. 2. Cooperation shall include technical assistance, in particular in the following areas: - the development of a legislative framework for SMEs; - the development of an appropriate infrastructure to support SMEs; to promote communication between SMEs both within Uzbekistan and further afield; and to train SMEs in the skills necessary to access funding; - training in the areas of marketing, accounting and control of the quality of products. ARTICLE 63 Information and communication The Parties shall support the development of modern methods of information handling, including the media, and stimulate the effective mutual exchange of information. Priority shall be given to programmes aimed at providing the general public with basic information about the Community and the Republic of Uzbekistan, including, where possible, access to databases, in full respect of intellectual property rights. > 2* "" 31 ARTICLE 64 Consumer Protection The Parties will enter into close cooperation aimed at achieving compatibility between their systems of consumer protection. This cooperation may include the exchange of information on legislative work and institutional reform, the establishment of permanent systems of mutual information on dangerous products, the improvement of information provided to consumers especially on prices, characteristics of products and services offered, the development of exchanges between the consumer interest representatives, and increasing the compatibility of consumer protection policies, and the organization of seminars and training periods. ARTICLE 65 Customs 1. The aim of cooperation shall be to guarantee compliance with all the provisions scheduled for adoption in connection with trade and fair trade and to achieve the approximation of the Republic of Uzbekistan's customs system to that of the Community. 2. Cooperation shall include the following in particular: - the exchange of information; - the improvement of working methods; - the introduction of the Combined Nomenclature and the single administrative document; - interconnection between the transit systems of the Community and of the Republic of Uzbekistan; - the simplification of inspections and formalities in respect of the carriage of goods; - support for the introduction of modern customs information systems; - the organization of seminars and training periods. Technical assistance shall be provided where necessary. 3. Without prejudice to further cooperation foreseen in this Agreement and in particular Title VIII, mutual assistance in customs matters between administrative authorities of the Parties shall take place in accordance with the provisions of the Protocol attached to this Agreement. 32 ARTICLE 66 Statistical cooperation Cooperation in this area shall have as its aim the development of an efficient statistical system to provide the reliable statistics needed to support and monitor the process of economic reform and contribute to the development of private enterprise in the Republic of Uzbekistan. The Parties, in particular, shall cooperate in the following fields: - adaptation of the Uzbek statistical system to international methods, standards and classification; - exchange of statistical information; - provision of necessary statistical macro and microeconomic information to implement and manage economic reforms. The Community shall contribute to this end by rendering technical assistance to the Republic of Uzbekistan. ARTICLE 67 Economics The Parties shall facilitate the process of economic reform and the coordination of economic policies by cooperating to improve understanding of the fundamentals of their respective economies and the design and implementation of economic policy in market economies. To this end, the Parties shall exchange information on macroeconomic performance and prospects. The Community shall provide technical assistance so as to: - assist the Republic of Uzbekistan in the process of economic reform by providing expert advisory and technical assistance; - encourage cooperation among economists in order to expedite the transfer of know-how for the drafting of economic policies, and provide for wide dissemination of policy-relevant research; - improve Uzbekistan's capacity to formulate economic models. 33 TITLE VII COOPERATION ON MATTERS RELATING TO DEMOCRACY AND HUMAN RIGHTS ARTICLE 68 The Parties shall cooperate on all questions relevant to the establishment or reinforcement of democratic institutions, including those required in order to strengthen the rule of law, and the protection of human rights and fundamental freedoms according to international law and OSCE principles. This cooperation shall take the form of technical assistance programmes intended to assist, inter alia, in the drafting of relevant legislation and regulations; the implementation of such legislation; the functioning of the judiciary; the role of the State in questions of justice; and the operation of the electoral system. They may include training where appropriate. The Parties shall encourage contacts and exchanges between their national, regional and judicial authorities, parliamentarians, and non-governmental organisations. 34 / TITLE VIII COOPERATION ON PREVENTION OF ILLEGAL ACTIVITIES AND THE PREVENTION AND CONTROL OF ILLEGAL IMMIGRATION ARTICLE 69 The Parties shall establish cooperation aimed at preventing illegal activities such as: illegal activities in the sphere of economics, including corruption; illegal transactions of various goods, including industrial waste, and arms; counterfeiting; Cooperation in the abovementioned areas will be based on mutual consultation and close interaction. Technical and administrative assistance will be provided, including in the following areas: drafting of national legislation in the sphere of preventing illegal activities; creation of information centres; increasing the efficiency of institutions engaged in preventing illegal activities; training of personnel and development of research infrastructures; elaboration of mutually acceptable measures impeding illegal activities. ARTICLE 70 Money laundering 1. The Parties agree on the necessity of making efforts and cooperating in order to prevent the use of their financial systems for laundering of proceeds from criminal activities in general and drug offences in particular. 2. Cooperation in this area shall include administrative and technical assistance with the purpose of establishing suitable standards against money laundering equivalent to those adopted by the Community and international fora in this field, including the Financial Action Task Force (FATF). ARTICLE 71 Drugs Within the framework of their respective powers and competences the Parties shall cooperate in increasing the effectiveness and efficiency of policies and measures to counter the illicit production, supply and traffic in narcotic drugs and psychotropic substances, including the prevention of diversion of precursor chemicals, as well as in promoting drug demand prevention and reduction. Cooperation in this area shall be based on mutual consultation and close coordination between the Parties on objectives and measures to be taken in the various drug- related fields. >• ~> 35 /I > // ARTICLE 72 Illegal Immigration 1 The Member States and the Republic of Uzbekistan agree to cooperate in order to prevent and control illegal immigration. To this end: - The Republic of Uzbekistan agrees to readmit any of its nationals illegally present on the territory of a Member State, upon request by the latter and without further formalities; and each Member State agrees to readmit any of its nationals, as defined for community purposes, illegally present on the territory of the Republic of Uzbekistan, upon request by the latter and without further formalities. The Member States and the Republic of Uzbekistan will also provide their nationals with appropriate identity documents for such purposes. 2. The Republic of Uzbekistan, agrees to conclude bilateral agreements with Member States which so request, regulating specific obligations for readmission including an obligation for the readmission of nationals of other countries and stateless persons who have arrived on the territory of any such Member State from the Republic of Uzbekistan or who have arrived on the territory of the Republic of Uzbekistan from any such Member State. 3. The Cooperation Council shall examine what other joint efforts can be made to prevent and control illegal immigration. 36 T I T LE IX CULTURAL COOPERATION ARTICLE 73 The Parties undertake to promote, encourage and facilitate cultural cooperation. Where appropriate, the Community's cultural cooperation programmes or those of one or more Member States may be the subject of cooperation and further activities of mutual interest may be developed. 37 TITLE X FINANCIAL COOPERATION ARTICLE 74 In order to achieve the objectives of this Agreement and in accordance with Articles 75, 76 and 77 the Republic of Uzbekistan shall benefit from temporary financial assistance from the Community by way of technical assistance in the form of grants to accelerate the economic transformation of the Republic of Uzbekistan. ARTICLE 75 This financial assistance shall be covered within the framework of Tacis as foreseen in the Community's relevant Council Regulation. ARTICLE 76 The objectives and the areas of the Community's financial assistance shall be laid down in an indicative programme reflecting established priorities to be agreed between the two Parties taking into account the Republic of Uzbekistan's needs, sectoral absorption capacities and progress with reform. The Parties shall inform the Cooperation Council thereof. ARTICLE 77 In order to permit optimum use of the resources available, the Parties shall ensure that Community technical assistance contributions are made in close coordination with those from other sources such as the Member States, other countries, and international organizations such as the International Bank for Reconstruction and Development and the European Bank for Reconstruction and Development. 38 TITLE XI INSTITUTIONAL, GENERAL AND FINAL PROVISIONS ARTICLE 78 A Cooperation Council is hereby established which shall supervise the implementation of this Agreement. It shall meet at ministerial level once a year. It shall examine any major issues arising within the framework of this Agreement and any other bilateral or international issues of mutual interest for the purpose of attaining the objectives of this Agreement. The Cooperation Council may also make appropriate recommendations, by agreement between the Parties. ARTICLE 79 1. The Cooperation Council shall consist of the members of the Council of the European Union and members of the Commission of the European Communities, on the one hand, and of members of the Government of the Republic of Uzbekistan, on the other. 2. The Cooperation Council shall establish its rules of procedure. 3. The office of President of the Cooperation Council shall be held alternately by a representative of the Community and by a member of the Government of the Republic of Uzbekistan. ARTICLE 80 1. The Cooperation Council shall be assisted in the performance of its duties by a Cooperation Committee composed of representatives of the members of the Council of the European Union and of members of the Commission of the European Communities on the one hand and of representatives of the Government of the Republic of Uzbekistan on the other, normally at senior civil servant level. The office of President of the Cooperation Committee shall be held alternately by the Community and by the Republic of Uzbekistan. In its rules of procedure the Cooperation Council shall determine the duties of the Cooperation Committee, which shall include the preparation of meetings of the Cooperation Council, and how the Committee shall function. 2. The Cooperation Council may delegate any of its powers to the Cooperation Committee, which will ensure continuity between meetings of the Cooperation Council. 39 ( ^—7/S ARTICLE 81 The Cooperation Council may decide to set up any other special committee or body that can assist it in carrying out its duties and shall determine the composition and duties of such committees or bodies and how they shall function. ARTICLE 82 When examining any issue arising within the framework of this Agreement in relation to a provision referring to an Article of the GATT/WTO, the Cooperation Council shall take into account to the greatest extent possible the interpretation that is generally given to the Article of the GATT/WTO in question by the Members of the WTO. ARTICLE 83 A Parliamentary Cooperation Committee is hereby established. It shall be a forum for Members of the Uzbek Parliament and the European Parliament to meet and exchange views. It shall meet at intervals which it shall itself determine. ARTICLE 84 1. The Parliamentary Cooperation Committee shall consist of members of the European Parliament, on the one hand, and of members of the Uzbek Parliament, on the other. 2. The Parliamentary Cooperation Committee shall establish its rules of procedure. 3. The Parliamentary Cooperation Committee shall be presided in turn by the European Parliament and the Uzbek Parliament respectively, in accordance with the provisions to be laid down in its rules of procedure. ARTICLE 85 The Parliamentary Cooperation Committee may request relevant information regarding the implementation of this Agreement from the Cooperation Council, which shall then supply the Committee with the requested information. The Parliamentary Cooperation Committee shall be informed of the recommendations of the Cooperation Council. The Parliamentary Cooperation Committee may make recommendations to the Cooperation Council. 40 A R T I C LE 86 1. Within the scope of this Agreement, each Party undertakes to ensure that natural and legal persons of the other Party have access free of discrimination in relation to its own nationals to the competent courts and administrative organs of the Parties to defend their individual rights and their property rights, including those concerning intellectual, industrial and commercial property. 2. Within the limits of their respective powers and competences, the Parties: - shall encourage the adoption of arbitration for the settlement of disputes arising out of commercial and cooperation transactions concluded by economic operators of the Community and those of the Republic of Uzbekistan; - agree that where a dispute is submitted to arbitration, each party to the dispute may, except where the rules of the arbitration centre chosen by the parties provide otherwise, choose its own arbitrator, irrespective of his nationality, and that the presiding third arbitrator or the sole arbitrator may be a citizen of a third State; - will recommend their economic operators to choose by mutual consent the law applicable to their contracts; - shall encourage recourse to the arbitration rules elaborated by the United Nations Commission on International Trade Law (Uncitral) and to arbitration by any centre of a State signatory to the Convention on Recognition and Enforcement of Foreign Arbitral Awards done at New York on 10 June 1958. Nothing in this Agreement shall prevent a Party from taking any measures: A R T I C LE 87 (a) which it considers necessary to prevent the disclosure of information contrary to its essential security interests; (b) which relate to the production of, or trade in arms, munitions or war materials or to research, development or production indispensable for defence purposes, provided that such measures do not impair the conditions of competition in respect of products not intended for specifically military purposes; (c) which it considers essential to its own security in the event of serious internal disturbances affecting the maintenance of law and order, in time of war or serious international tension constituting threat of war or in order to carry out obligations it has accepted for the purpose of maintaining peace and international security; (d) which it considers necessary to respect its international obligations and commitments in the control of dual use industrial goods and technology. 41 / /V ' ^ > /' / ARTICLE 88 1. In the fields covered by this Agreement and without prejudice to any special provisions contained therein. - the arrangements applied by the Republic of Uzbekistan in respect of the Community shall not give rise to any discrimination between the Member States, their nationals or their companies or firms; - the arrangements applied by the Community in respect of the Republic of Uzbekistan shall not give rise to any discrimination between Uzbek nationals, or its companies or firms. 2. The provisions of paragraph 1 are without prejudice to the right of the Parties to apply the relevant provisions of their fiscal legislation to tax payers who are not in identical situations as regards their place of residence. ARTICLE 89 1. Each of the Parties may refer to the Cooperation Council any dispute relating to the application or interpretation of this Agreement. 2. The Cooperation Council may settle the dispute by means of a recommendation. 3. In the event of it not being possible to settle the dispute in accordance with paragraph 2 of this Article, either Party may notify the other of the appointment of a conciliator; the other Party must then appoint a second conciliator within two months. For the application of this procedure, the Community and the Member States shall be deemed to be one Party to the dispute. The Cooperation Council shall appoint a third conciliator. The conciliators' recommendations shall be taken by majority vote. Such recommendations shall not be binding upon the Parties. ARTICLE 90 The Parties agree to consult promptly through appropriate channels at the request of either Party to discuss any matter concerning the interpretation or implementation of this Agreement and other relevant aspects of the relations between the Parties. The provisions of this Article shall in no way affect and are without prejudice to Articles 13, 89 and 95. 42 ARTICLE 91 Treatment granted to the Republic of Uzbekistan hereunder shall in no case be more favourable than that granted by the Member States to each other. ARTICLE 92 For the purposes of this Agreement, the term "Parties" shall mean the Republic of Uzbekistan on the one part, and the Community, or the Member States, or the Community and the Member States, in accordance with their respective powers, on the other part. ARTICLE 93 Insofar as matters covered by this Agreement are covered by the Energy Charter Treaty and Protocols thereto, such Treaty and Protocols shall upon entry into force apply to such matters but only to the extent that such application is provided for therein. ARTICLE 94 This Agreement is concluded for an initial period of ten years after which time the Agreement shall be automatically renewed year by year provided that neither Party gives the other Party written notice of denunciation of this Agreement six months before it expires. ARTICLE 95 1. The Parties shall take any general or specific measures required to fulfil their obligations under this Agreement. They shall see to it that the objectives set out in this Agreement are attained. 2. If either Party considers that the other Party has failed to fulfil an obligation under this Agreement, it may take appropriate measures. Before so doing, except in cases of special urgency, it shall supply the Cooperation Council with all relevant information required for a thorough examination of the situation with a view to seeking a solution acceptable to the Parties. In the selection of these measures, priority must be given to those which least disturb the functioning of this Agreement. These measures shall be notified immediately to the Cooperation Council if the other Party so requests. ARTICLE 96 Annexes I, II, III, IV and V together with the Protocol shall form an integral part of this Agreement. 43 ARTICLE 97 This Agreement shall not, until equivalent rights for individuals and economic operators have been achieved hereunder, affect rights assured to them through existing Agreements binding one or more Member States, on the one hand, and the Republic of Uzbekistan, on the other, except in areas falling within Community competence and without prejudice to the obligations of Member States resulting from this Agreement in areas falling within their competence. ARTICLE 98 This Agreement shall apply, on the one hand, to the territories in which the Treaties establishing the European Community, the European Coal and Steel Community and the European Atomic Energy Community are applied and under the conditions laid down in those Treaties and, on the other hand, to the territory of the Republic of Uzbekistan. ARTICLE 99 The Secretary-General of the Council of the European Union shall be the depositary of this Agreement. ARTICLE 100 The original of this Agreement, of which the Danish, Dutch, English, Finnish, French, German, Greek, Italian, Portuguese, Spanish, Swedish and Uzbek languages are equally authentic, shall be deposited with the Secretary-General of the Council of the European Union. ARTICLE 101 This Agreement will be approved by the Parties in accordance with their own procedures. This Agreement shall enter into force on the first day of the second month following the date on which the Parties notify the Secretary-General of the Council of the European Union that the procedures referred to in the first paragraph have been completed. Upon its entry into force, and as far as relations between the Republic of Uzbekistan and the Community are concerned, this Agreement shall replace the Agreement between the European Economic Community, the European Atomic Energy Community and the Union of Soviet Socialist Republics on trade and economic and commercial cooperation signed in Brussels on 18 December 1989 44 ARTICLE 102 In the event that, pending the completion of the procedures necessary for the entry into force of this Agreement, the provisions of certain parts of this Agreement are put into effect in 1996 by means of an Interim Agreement between the Community and the Republic of Uzbekistan, the Parties agree that, in such circumstances, the term "date of entry into force of this Agreement" shall mean the date of entry into force of the Interim Agreement. 45 LIST OF DOCUMENTS ATTACHED Annex I Indicative list of advantages granted by the Republic of Uzbekistan to the Independent States in accordance with Article 8(3) Annex II Community reservations in accordance with Article 22(2). Annex III Uzbekistan reservations in accordance with Article 22(4) Annex IV Financial services, referred to in Article 25(3). Annex V Intellectual, industrial and commercial property conventions referred to in Article 41. Protocol on mutual assistance between administrative authorities in customs matters. v ^ 46 ANNEX I INDICATIVE LIST OF ADVANTAGES GRANTED BY THE REPUBLIC OF UZBEKISTAN TO THE INDEPENDENT STATES IN ACCORDANCE WITH ARTICLE 8(3) Advantages are accorded to those Independent States which are parry to the agreement on establishing a free trade zone and with which free trade agreements with Uzbekistan have been signed. In respect of Belarus, Georgia, Kazakhstan, Kyrgyzstan, Moldova, the Russian Federation, Turkmenistan and Ukraine: 1. Import/export taxation No import duties are levied. No export duties levied regarding goods supplied in accordance with intergovernmental or credit agreements, within quantitative limits set by the Government of Uzbekistan in the light of national requirements. No VAT or excise duties are applied to trade which takes place within the context of cooperation agreements. 2. Allocation of quotas and licensing procedures Export quotas for deliveries of Uzbek products under annual bilateral interstate trade and cooperation agreements are opened in the same way as for "deliveries for state needs". 3. Conditions of transportation and transit As regards Parties to the Multilateral Agreement "on the principles and conditions of relations in the field of transport" and/or on the basis of bilateral arrangements on transportation and transit, no taxes or fees are applied on a reciprocal basis for the transportation and customs clearing of goods (including goods in transit) and transit of vehicles. 4. Communication services including postal, courier, telecommunication, audio-visual and other types of communication services. 5. Access to information svstcms and databases In respect of the Russian Federation. Ukraine, Belarus, Kazakhstan: Payments may be made in the national currencies of these countries. In respect of Kazakhstan. Kyrgyzstan: Simplified system of customs procedure. 47. / C O M M U N I TY RESERVATIONS IN A C C O R D A N CE WITH A R T I C LE 22(2) ANNEX II Mining In some Member States, a concession may be required for mining and mineral rights for non-Community controlled companies. s Fishing Access to and use of the biological resources and fishing grounds situated in the maritime waters coming under the sovereignty or within the jurisdiction of Member States of the Community is restricted to fishing vessels flying the flag of a Community Member State and registered in Community territory unless otherwise provided for. Real estate purchase In some Member States, the purchase of real estate by non-Community companies is subject to restrictions. Audio-visual services including radio National treatment concerning production and distribution, including broadcasting and other forms of transmission to the public, may be reserved to audiovisual works meeting certain origin criteria. Telecommunications services including mobile and satellite services Reserved services In some Member States market access concerning complementary services and infrastructures is restricted. Professional services Services reserved to natural persons who are nationals of Member States. Under certain conditions those persons may create companies. Agriculture In some Member States national treatment is not applicable to non-Community controlled companies which wish to undertake an agricultural enterprise. The acquisition of vineyards by non-Community controlled companies is subject to notification, or, as necessary, authorization. News agency services In some Member States limitations of foreign participation in publishing companies and broadcasting companies. 4« , ^ ,- v- // ANNEX III UZBEKISTAN RESERVATIONS IN ACCORDANCE WITH ARTICLE 22(4) Under current Uzbekistan investment law, foreign companies wishing to establish in Uzbekistan are required to register at the Ministiy of Justice and to provide documentation demonstrating that they have been duly registered in their home country and are financially solvent. This registration procedure may not be used in order to nullity the benefits accorded to Community companies pursuant to Article 22 of this Agreement, nor to circumvent any other provisions of this Agreement. 49 / / ; ,y r / - FINANCIAL SERVICES R E F E R R ED TO IN A R T I C LE 25(3) ANNEX IV A financial service is any service of a financial nature offered by a financial service provider of a Party. Financial services include the following activities: A financial service is any service of a financial nature offered by a financial service provider of a party. Financial services include the following activities: A. All insurance and insurance-related services; 1. Direct insurance (including co-insurance), (i) (ii) life non-life 2. Reinsurance and retrocession. 3. 4. Services auxiliary to insurance, such as consultancy, actuarial, risk assessment and Insurance intermediation, such as brokerage and agency. claim settlement services. B. Banking and other financial services (excluding insurance). 1. Acceptance of deposits and other repayable funds from the public. 2. Lending of all types, including, inter-alia, consumer credit, mortgage credit, factoring and financing of commercial transaction. 3. Financial leasing. 4. All payment and money transmission services, including credit charge and debit cards, travellers cheques and bankers drafts. 5. Guarantees and commitments. 6. Trading for own account or for the account of customers, whether on an exchange, in an over the counter market or otherwise, the following: (a) (b) (c) (d) money market instruments (cheques, bills, certificates of deposits, etc. ) foreign exchange derivative products including, but not limited to, futures and options exchange rates and interest rate instruments, including products such as swaps, forward rate agreements, etc. transferable securities other negotiable instruments and financial assets, including bullion. 7. Participation in issues of all kinds of securities, including under-writing and placement as agent (whether publicly or privately) and provision of services related to such issues. (e) (f) 8. Money brokering. 9 Asset, management, such as cash or portfolio management, all forms of collective investment management, pension fund management, custodial depository and trust services. 10. Settlement and clearing services for financial assets, including securities, derivative products, and other negotiable instruments. 11 Advisory intermediation and other auxiliary financial services on all the activities listed in points 1 to 10 above, including credit reference and analysis, investment 50 12 Provision and transfer of financial information, and financial data processing and related software by providers of other financial services. The following activities are excluded from the definition of financial services. (a) Activities carried out by central banks or by any other public institution in pursuit of monetary and exchange rate policies. (b) Activities conducted by central banks, government agencies or departments, or public institutions, for the account or with the guarantee of the government, except when those activities may be carried out by financial service providers in competition with such public entities. (c) Activities forming part of a statutory system of social security or public retirement plans, except when those activities may be carried out by financial service providers in competition with public entities or private institutions. 50 (<0 ' " " >" ANNEX V Intellectual, industrial and commercial property conventions referred to in Article 41 1. Article 41(2) concerns the following multilateral conventions. - - - - - - Berne Convention for the Protection of Literary and Artistic Works (Paris Act, 1971); International Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations (Rome, 1961); Protocol relating to the Madrid Agreement concerning the International Registration of Marks (Madrid, 1989); Nice Agreement concerning the International Classification of Goods and Services for the purposes of the Registration of Marks (Geneva 1977 and amended in 1979); Budapest Treaty on the International Recognition of the Deposit of Micro Organisms for the purposes of Patent Procedures (1977, modified in 1980), International Convention for the Protection of New Varieties of Plants (UPOV) (Geneva Act, 1991); 2. The Cooperation Council may recommend that Article 41(2) shall apply to other multilateral conventions. If problems in the area of intellectual, industrial and commercial property affecting trading conditions were to occur, urgent consultations will be undertaken, at the request of either Party, with a view to reaching mutually satisfactory solutions. 3. The Parties confirm the importance they attach to the obligations arising from the following multilateral conventions. - - - Paris Convention for the Protection of Industrial Property (Stockholm Act, 1967 and amended in 1979); Madrid Agreement concerning the International Registration of Marks (Stockholm Act, 1967 and amended in 1979); Patent Cooperation Treaty (Washington, 1970, amended in 1979 and modified in 1984). 4. 5. From the entry into force of this Agreement, the Republic of Uzbekistan shall grant to Community companies and nationals, in respect of the recognition and protection of intellectual, industrial and commercial property, treatment no less favourable than that granted by it to any third country under bilateral agreements. The provisions of paragraph 4 shall not apply to advantages granted by the Republic of Uzbekistan to any third country on an effective reciprocal basis and to advantages granted by the Republic of Uzbekistan to another country of the former USSR. 51 PROTOCOL ON MUTUAL ASSISTANCE BETWEEN ADMINISTRATIVE AUTHORITIES IN CUSTOMS MATTERS 52 ARTICLE I Definitions For the purposes of this Protocol : a) "customs legislation" shall mean any legal or regulatory provisions applicable in the territory of the Parties governing the import, export, transit of goods and their placing under any customs procedure, including measures of prohibition, restriction and control; b) "applicant authority", shall mean a competent administrative authority which has been appointed by a Party for this purpose and which makes a request for assistance in customs matters; c) "requested authority", shall mean a competent administrative authority which has been appointed by a Party for this purpose and which receives a request for assistance in customs matters; d) "personal data", shall mean all information relating to an identified or identifiable individual. ARTICLE 2 Scope 1. The Parties shall assist each other, in the areas within their jurisdiction, in the manner and under the conditions laid down in this Protocol, in preventing, detecting and investigating operations in breach of customs legislation. 2 Assistance in customs matters, as provided for in this Protocol, shall apply to any administrative authority of the Parties which is competent for the application of this Protocol. It shall not prejudice the rules governing mutual assistance in criminal matters. Nor shall it cover information obtained under powers exercised at the request of the judicial authorities, unless those authorities so agree. ARTICLE 3 Assistance on request 1. At the request of the applicant authority, the requested authority shall furnish it with all relevant information which may enable it to ensure that customs legislation is correctly applied, including information regarding operations noted or planned which are or could be in breach of such legislation. / 53 At the request of the applicant authority, the requested authority shall inform it whether goods exported from the territory of one of the Parties have been properly imported into the territory of the other Party, specifying, where appropriate, the customs procedure applied to the goods At the request of the applicant authority, the requested authority shall, within the framework of its laws, take the necessary steps to ensure that a special watch is kept on : (a) natural or legal persons of whom there are reasonable grounds for believing that they are breaching or have breached the customs legislation of the Parties; (b) places where goods are stored in a way that gives grounds for suspecting that they are intended to supply operations in breach of customs legislation; (c) movements of goods notified as possibly giving rise to breaches of customs legislation; (d) means of transport for which there are reasonable grounds for believing that they have been, are or might be used in operations in breach of customs legislation. ARTICLE 4 Spontaneous assistance The Parties shall provide each other, as far as their national laws, rules and other legal instruments allow, with assistance without prior request if they consider that to be necessary for information the correct application of customs legislation, particularly when they obtain pertaining to : operations which are or appear to be in breach of such legislation and which may be of interest to another Party; new means or methods employed in carrying out such operations; - goods known to be subject to breaches of customs legislation. - natural or legal persons of whom there are reasonable grounds for believing that they are or have been in breach of customs legislation means of transport for which there are reasonable grounds for believing that they have been, are or might be used in operations in breach of customs legislation ARTICLE 5 Delivery/Notification At the request of the applicant authority, the requested authority shall, in accordance with its legislation, take all necessary measures in order : - to deliver all documents, - to notify all decisions, falling within the scope of this Protocol to an addressee, residing or established in its territory. In such cases, Article 6(3) shall apply as far as the request itself is concerned. 54 // A R T I C LE 6 Form and substance of requests for assistance 1 Requests pursuant to this Protocol shall be made in writing. They shall be accompanied by the documents necessary to enable compliance with the request. When required because of the urgency of the situation, oral requests may be accepted, but must be confirmed in writing immediately. 2. Requests pursuant to paragraph 1 of this Article shall include the following information : (a) the applicant authority making the request; (b) the measure requested; (c) the object of and the reason for the request; (d) the laws, rules and other legal elements involved; (e) indications as exact and comprehensive as possible on the natural or legal persons who are the target of the investigations; (f) a summary of the relevant facts and of the enquiries already carried out, except in cases provided for in Article 5. 3. Requests shall be submitted in an official language of the requested authority or in a language acceptable to that authority. 4. If a request does not meet the formal requirements, its correction or completion may be requested; precautionary measures may, however, be ordered. A R T I C LE 7 Execution of requests 1 In order to comply with a request for assistance, the requested authority shall proceed, within the limits of its competence and available resources, as though it were acting on its own account or at the request of other authorities of that same Party, by supplying information already possessed, by carrying out appropriate enquiries or by arranging for them to be carried out. This provision shall also apply to the administrative department to which the request has been addressed by the requested authority when the latter cannot act on its own. 2. Requests for assistance shall be executed in accordance with the laws, rules and other legal instruments of the requested Party. 3. Duly authorized officials of a Party may, with the agreement of the other Party involved and subject to the conditions laid down by the latter, obtain from the offices of the requested authority or other authority for which the requested authority is responsible, information relating to operations which are or may be in breach of customs legislation which the applicant authority needs for the purposes of this Protocol. 55 Officials of a Party may, with the agreement of the other Party involved and subject to the conditions laid down by the latter, be present at enquiries carried out in the latter's territory. They shall not wear uniform nor carry arms. A R T I C LE 8 Form in which information is to be communicated 1. The requested authority shall communicate results of enquiries to the applicant authority in the form of documents, certified copies of documents, reports and the like. 2. The documents provided for in paragraph 1 may be replaced by computerized information produced in any form for the same purpose. A R T I C LE 9 Exceptions to the obligation to provide assistance 1. The Parties may refuse to give assistance as provided for in this Protocol, where to do would: (a) be likely to prejudice the sovereignty of the Republic of Uzbekistan or that of a Member State of the European Union which has been asked for assistance under this Protocol; or (b) be likely to prejudice public policy, security or other essential interests, in particular in the cases referred to under Article 10 (2); or (c) involve currency or tax regulations other than customs legislation; or (d) violate an industrial, commercial or professional secret. 2. Where the applicant authority requests assistance which it would itself be unable to provide if so asked, it shall draw attention to that fact in its request. It shall then be left to the requested authority to decide how to respond to such a request. 3. If assistance is refused, the decision and the reasons therefor must be notified to the applicant authority without delay. A R T I C LE 10 Information exchange and confidentiality 1. Any information communicated in whatsoever form pursuant to this Protocol shall be of a confidential or restricted nature, depending on the rules applicable in each of the Parties. It shall be covered by the obligation of official secrecy and shall enjoy the protection extended the to like information under corresponding provisions applying to the Community institutions. laws of the Party which received the relevant it and 2. Personal data may be exchanged only where the receiving Party undertakes to protect such data in at least an equivalent way to the one applicable to that particular case in the 56 supplying Party. 3 Information obtained shall be used solely for the purposes of this Protocol. Where one of the Parties requests the use of such information for other purposes, it shall ask for the prior written consent of the authority which furnished the information. Moreover, it shall be subject to any restrictions laid down by that authority. 4. Paragraph 3 shall not impede the use of information in any judicial or administrative proceedings subsequently instituted for failure to comply with customs legislation. The competent authority which supplied that information shall be notified of such use. 5. The Parties may, in their records of evidence, reports and testimonies and in proceedings and charges brought before the courts, use as evidence information obtained and documents consulted in accordance with the provisions of this Protocol. ARTICLE 11 Experts and witnesses 1. An official of a requested authority may be authorized to appear, within the limitations of the authorization granted, as an expert or witness in judicial or administrative proceedings regarding the matters covered by this Protocol in the jurisdiction of the other Party, and produce such objects, documents or authenticated copies thereof, as may be needed for the proceedings. The request for an appearance must indicate specifically on what matters and by virtue of what title or qualification the official will be questioned. 2. The authorized official shall enjoy the protection guaranteed by existing legislation to officials of the applicant authority on its territory. ARTICLE 12 Assistance expenses The Parties shall waive all claims on each other for the reimbursement of expenses incurred pursuant to this Protocol, except, as appropriate, for expenses to experts and witnesses and to interpreters and translators who are not public service employees. 57 /' ARTICLE 13 Application The application of this Protocol shall be entrusted to the central customs authorities of the Republic of Uzbekistan, on the one hand and the competent services of the Commission of the European Communities and, where appropriate, the customs authorities of the Member States, on the other. They shall decide on all practical measures and arrangements necessary for its application, taking into consideration the rules in force in the field of data protection. They may recommend to the competent bodies amendments which they consider should be made to this Protocol. The Parties shall consult each other and subsequently keep each other informed of the detailed rules of implementation which are adopted in accordance with the provisions of this Protocol. ARTICLE 14 Complementarity Without prejudice to Article 10, any agreements on mutual assistance which have been concluded between one or more Member States and the Republic of Uzbekistan shall not prejudice Community provisions governing the communication between the competent services of the Commission of the European Communities and the customs authorities of the Member States of any information obtained in customs matters which could be of Community interest. 58 / J O I NT DECLARATION In applying the agreement, the parties are aware of the necessity of an adequate protection of individuals with regard to the processing of personal data and on the free movement of such data. 59 JOINT DECLARATION IN RELATION TO ARTICLE 5 Should the Parties agree that circumstances warrant meetings at the highest level, such meetings may be arranged on an ad hoc basis. 60 JOINT DECLARATION CONCERNING TITLE III All references to the GATT are to the text of the GATT as modified in 1994. 61 JOINT DECLARATION CONCERNING ARTICLE 14 Until the Republic of Uzbekistan accedes to the WTO, the Parties shall hold consultations in the Cooperation Committee on their import tariff policies, including changes in tariff protection. In particular, such consultations shall be offered prior to the increase of tariff protection. 62 • ^ / JOINT DECLARATION CONCERNING THE NOTION OF "CONTROL" IN ARTICLE 24(b) AND ARTICLE 35 1. The Parties confirm their mutual understanding that the question of control shall depend on the factual circumstances of the particular case. 2. A company shall, for example, be considered as being "controlled" by another company, and thus a subsidiary of such other company if: - - the other company holds directly or indirectly a majority of the voting rights, or the other company has the right to appoint or dismiss a majority of the administrative organ, of the management organ or of the supervisory organ and is at the same time a shareholder or member of the subsidiary. 3. The Parties consider the criteria in paragraph 2 to be non-exhaustive. 63 JOINT DECLARATION CONCERNING ARTICLE 34 The sole fact of requiring a visa for natural persons of certain Parties and not for those of others shall not be regarded as nullifying or impairing benefits under a specific commitment. 64 JOINT DECLARATION CONCERNING ARTICLE 41 The Parties agree that for the purpose of the Agreement, intellectual, industrial and commercial property includes in particular copyright, including the copyright in computer programs, and neighbouring rights, the rights relating to patents, industrial designs, geographical indications, including appellations of origin, trademarks and service marks, topographies of integrated circuits as well as protection against unfair competition as referred to in Article 10 bis of the Paris Convention for the protection of Industrial Property and protection of undisclosed information on know-how. 65 // JOINT DECLARATION CONCERNING ARTICLE 95 1. The Parties agree, for the purpose of its correct interpretation and its practical application, that the term "cases of special urgency" included in Article 95 of the Agreement means cases of material breach of the Agreement by one of the Parties. A material breach of the Agreement consists in (a) repudiation of the Agreement not sanctioned by the general rules of international law or (b) violation of the essential elements of the Agreement set out in Article 2. 2. The parties agree that the "appropriate measures" referred to in Article 95 are measures taken in accordance with international law. If a party takes a measure in a case of special urgency as provided for under Article 95, the other party may avail itself of the procedure relating to settlement of dispute. 66 EXCHANGE OF LETTERS BETWEEN THE COMMUNITY AND THE REPUBLIC OF UZBEKISTAN IN RELATION TO THE ESTABLISHMENT OF COMPANIES 67 A. Letter from the Government of the Republic of Uzbekistan Dear Sir, I refer to the Partnership and Cooperation Agreement initialled on As I underlined during the negotiations, the Republic of Uzbekistan grants to Community companies establishing and operating in the Republic of Uzbekistan in certain respects a privileged treatment. I explained that this reflects the Uzbek policy to promote by all means the establishment of Community companies in the Republic of Uzbekistan. With this in mind, it is my understanding that during the period between the date of initialling of this Agreement and the entry into force of the relevant articles on establishment of companies, the Republic of Uzbekistan shall not adopt measures or regulations which would introduce or worsen discrimination of Community companies vis-à-vis Uzbek companies or companies from any third country as compared to the situation existing on the date of initialling of this Agreement. I would be obliged if you would acknowledge receipt of this letter. Please accept, Sir, the assurance of my highest consideration. For the Government of the Republic of Uzbekistan 68 B. Letter from the European Community Dear Sir, Thank you for your letter of today's date, which reads as follows: "I refer to the Partnership and Cooperation Agreement initialled on As I underlined during the negotiations, the Republic of Uzbekistan grants to Community companies establishing and operating in the Republic of Uzbekistan in certain respects a privileged treatment. I explained that this reflects the Uzbek policy to promote by all means the establishment of Community companies in the Republic of Uzbekistan. With this in mind, it is my understanding that during the period between the date of initialling of this agreement and the entry into force of the relevant articles on establishment of companies, the Republic of Uzbekistan shall not adopt measures or regulations which would introduce or worsen discrimination of Community companies vis-à-vis Uzbek companies or companies from any third country as compared to the situation existing on the date of initialling of this Agreement. I would be obliged if you would acknowledge receipt of this letter. " I acknowledge receipt of the letter. Please accept, Sir, the assurance of my highest consideration. On behalf of the European Community z? 69 ?«'<:*::. DECLARATION BY THE FRENCH GOVERNMENT The French Republic notes that the Partnership and Cooperation Agreement with the Republic of Uzbekistan does not apply to the overseas countries and territories associated with the European Community pursuant to the Treaty establishing the European Community. 70 ISSN 0254-1475 COM(96) 254 final DOCUMENTS EN 11 Catalogue number : CB-CO-96-273-EN-C ISBN 92-78-05281-7 Office for Official Publications of the European Communities L-2985 Luxembourg

Decision of the EEA Joint Committee No 36/96 of 5 June 1996 amending Annex XX (Environment) to the EEA Agreement

http://publications.europa.eu/resource/cellar/bc6df2bf-f0a5-4808-b090-f43d802f2535

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L_1996237EN. 01004501. xml 19. 9. 1996    EN Official Journal of the European Communities L 237/45 DECISION OF THE EEA JOINT COMMITTEE No 36/96 of 5 June 1996 amending Annex XX (Environment) to the EEA Agreement THE EEA JOINT COMMITTEE, Having regard to the Agreement on the European Economic Area, as adjusted by the Protocol adjusting the Agreement on the European Economic Area, hereinafter referred to as the Agreement, and in particular Article 98 thereof, Whereas Annex XX to the Agreement was amended by Decision of the EEA Joint Committee No 75/95 (1); Whereas Commission Decision 95/533/EC of 1 December 1995 establishing the ecological criteria for the award of the Community eco-label to single-ended light bulbs (2) is to be incorporated into the Agreement, HAS DECIDED AS FOLLOWS: Article 1 The following point shall be inserted after point 2ef (Commission Decision 95/365/EC) in Annex XX to the Agreement: ‘2eg. 395 D 0533: Commission Decision 95/533/EC of 1 December 1995 establishing the eoclogical criteria for the award of the Community eco-label to single-ended light bulbs (OJ No L 302, 15. 12. 1995, p. 42). ’ Article 2 The texts of Decision 95/533/EC in the Icelandic and Norwegian languages, which are annexed to the respective language versions of this Decision, are authentic. Article 3 This Decision shall enter into force on 6 June 1996, provided that all the notifications under Article 103 (1) of the Agreement have been made to the EEA Joint Committee. Article 4 This Decision shall be published in the EEA Section of, and in the EEA Supplement to, the Official Journal of the European Communities. Done at Brussels, 5 June 1996. For the EEA Joint Committee The President P. BENAVIDES (1)  OJ No L 57, 7. 3. 1996, p. 41. (2)  OJ No L 302, 15. 12. 1995, p. 42

Re-examined proposal for a COUNCIL REGULATION (EC) on food-aid policy and food-aid management and special operations in support of food security

http://publications.europa.eu/resource/cellar/58fb3664-104d-4800-a4d5-dabfdac55f7d

eng

COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 04. 06 1996 COM(%) 250 final 95/0160 (SYN) Re-examined proposal tor a CQVNÇH ftEQUlATIQN (EC) ON FOOD-AID POLICY AND FOOD-AID MANAGEMENT AND SPECIAL OPERATIONS IN SUPPORT OF FOOD SECURITY (presented by the Commission pursuant to Article 189 c (d) of the EC Treaty) EXPLANATORY MEMORANDUM (concerning the amendments accepted and the amendments rejected) Re-examined proposal for a Council Regulation (EC) on food aid policy and food aid management and special operations in support of food security References: Proposal COM(95) 283 final 95/0160 (SYN). Cooperation procedure second reading Article 189c(d). BACKGROUND On 14 July 1995 the Commission presented to Council and Parliament a proposal for a regulation on food aid policy and food aid management and special operations in support of food security. The aim of this proposal is to review, restructure, update and adapt all the legal instruments of food aid policy and management, including special operations in support of food security, such as allocations of inputs and seeds and storage programmes or early warning systems. The proposal for a Council Regulation on aid and food security, based on Article 130w of the Treaty, is subject to the cooperation procedure (Article 189c of the Treaty). Under the cooperation procedure, on 21 May Parliament expressed its opinion upon second reading and adopted a total of 39 amendments (PE 216/574). In accordance with Article 189c(d) the Commission presented a re-examined proposal incorporating the amendments which it accepted. COMMENTS ON THE AMENDMENTS ADOPTED BY PARLIAMENT UPON SECOND READING Taken as a whole, the amendments fall into two categories: those which concern the content of the Regulation (food aid as an instrument for combating poverty, stepping up local purchases, supplying drinking water and women's role in food security projects) and those which concern the form, many of which provide clarification and helpful explanations that improve the text. (a) Brief detailed analysis of the amendments accepted/rejected The amendments submitted at second reading fall into four categories. The Commission accepted the following amendments in their entirety: The Commission accepted the following amendments in their entirety: Nos 1, 2, 3, 5, 6, 7, 9, 10, 15 (1st indent), 15 (2nd indent), 15 (3rd indent), 16 (3rd indent), 17, 18, 19, 20, 21 (1st indent), 21 (2nd indent), 21 (4th indent), 21 (5th indent), 21 (6th indent), 21 (7th indent), 22, 23, 24, 27, 28, 29, 30, 31, 34, 35, 37, 38, since they are amendments which are acceptable or even represent an improvement. The Commission accepted the substance of the following amendments but gave them another form, because they are acceptable in terms of substance but the Commission prefers other wording: Nos 8, 4, 11, 12, 13 and 14. The Commission did not accept the following amendments either because they restrict the scope of food aid or because they impose excessive management constraints on the Commission's departments (Nos 15 (4th indent), 16 (1st indent), 16 (2nd indent), 21 (3rd indent), 32,39 and 40) or because they are very difficult to reconcile with the compromise obtained within the Council (Nos 25, 26, 33 and 36). (b) Commission position and grounds for that position While taking account of the Commission position proposed for the remainder of the amendments as indicated under (a), the Commission rejected the amendments referred to in the preceding paragraph for the following reasons: No 15 (fourth indent): this amendment concerns the reduction of the beneficiary countries' dependence on food imports; the Commission supports commercial imports as a major component of food security policy in countries with a structural shortfall. No 16 (1st and 2nd indents): this amendment sets as an exclusive criterion for awarding food aid either the inability of the beneficiaries to make up their food shortfall themselves or the presence of fundamental food shortfalls. Making the award of food aid so exclusive is likely to restrict the scope of food aid and food security operations. No 21 (3rd indent): the purpose of the amendment is to step up financing for those responsible for marketing, transporting and distributing agricultural products and foodstuffs. Community financing is for the marketing, transport, distribution or processing of agricultural products and food, and is not intended to provide aid for "those responsible" for such operations. Nos 25 and 26: these amendments concern the mobilization of products on the developing countries' markets, the real "hard core" of the Regulation. The Commission considers that the priority criterion for purchases established by Parliament in amendments 25 and 26, while encouraging and increasing the importance of triangular exports, greatly exceeds the "dynamic balance" which was achieved with great difficulty within the Working Party on Food Aid by means of the proposal for a compromise on Article 11 drawn up by the Presidency. ^ — No 32: this amendment calls upon the Commission to undertake the necessary coordination between its directorates-general and departments in order to guarantee compatibility between the operations conducted in the sphere of aid and food security and those conducted in other spheres. The Commission is unable to accept the amendment since it already undertakes this coordination, which in any event comes under its own internal management rules. No 33: this amendment concerns Article 21 of the common position determining the respective contributions of the Community and the Member States making up the overall amount of cereals laid down in the Food Aid Convention. This Article is the result of lengthy discussions within the Council Working Party and the final text provides for joint action (decision sui generis ) by the Council on behalf of the Community in respect of the Community share and by the Member States' representatives on their own behalf for the national quantities. No 36: the aim of this amendment is to include national aid in the analysis and monitoring conducted by the Food Aid Committee. The Committee's powers are confined to food security operations which qualify for Community aid and do not in any instance extend to national aid. No 39: this amendment calls on the Commission to draw up a report evaluating food aid operations and to transmit it to Parliament once a year. In line with the "Williamson Declaration", the Commission considers that it would be better to remove the reference to timing for the presentation of reports other than that provided for in Article 31 of the common position. No 40: the aim of this amendment is to have the Commission present targeted evaluation of how far food aid operations complement the EU's other policies. A commitment of this kind would oblige the Commission to provide evaluation of the complementary nature of food aid operations, an evaluation operation which is now well advanced. o- - THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 130w thereof, Having regard to the proposal from the Commission, (1) Acting in accordance with the procedure laid down in Article 189c of the Treaty, i2) C) OJ No C 253, 29. 9. 95, p. 10. (2) Parliament decision of. not yet published in the OJ. —m S\-2 Whereas now as ever food aid is an important aspect of the Community's development cooperation policy; Whereas food aid must be integrated into the developing countries' policies for the improvement of their food security, in particular by the establishment of food strategies aimed at alleviating poverty and geared to achieving the ultimate goal of making food aid superfluous; Whereas the European Community and its Member States closely coordinate their development cooperation policies as regards food-aid programmes and operations aimed specifically at enhancing food security; whereas the Community, with its Member States, is a party to certain international agreements in this domain, and in particular the Food Aid Convention; Whereas regional, national and household food security, with the long-term aim of securing universal access to a diet that will promote a healthy and active life, is an important element in the fight against poverty; whereas it is important for this to be emphasized in all programmes intended for developing countries; Whereas food aid must not have any adverse effects on the normal production and commercial import structures of the recipient countries; Whereas food aid and operations in support of food security are key features of Community development cooperation policy and must be taken into account as objectives in all Community policies likely to affect the developing countries, in particular from the point of view of economic reforms and structural adjustment; Whereas, given the different responsibilities of men and women for the food security of households, systematic account should be taken of their different roles when drawing up programmes aimed at achieving food security; Whereas women and communities should be involved to a greater extent in efforts to achieve food security at national, regional or local level and at the level of households; EN 3 Whereas food aid must be an effective instrument ensuring access to an adequate and appropriate diet and improving the availability and accessibility of foodstuffs to the public, consistent with local dietary habits and production and trading systems, particularly in food crises, and fully integrated into development policy; Whereas the food-aid instrument is a key component of the Community's policy on preventing or helping in crisis situations in the developing countries; whereas account should be taken in its implementation of its possible social and political effects; Whereas food-aid operations cannot be part of a viable solution unless they are integrated into development operations geared to relaunching local production and trade; Whereas analysis, diagnosis, programming and monitoring need to be improved to make food aid more effective and avoid adverse effects on local production, distribution, transport and marketing capacities; Whereas food aid should be made a real instrument of the Community's policy of cooperation with the developing countries, thereby enabling the Community to participate fully in multiannual development projects; Whereas it is therefore necessary that the Community be able to provide a steady overall flow of aid and be in a position, in appropriate cases, to undertake to supply to the developing countries minimum amounts of products under specific multiannual programmes linked to development policies as well as to enter into undertakings in relation to international organizations; "ÉFJ 4 Whereas the Community's support for the developing countries' efforts to achieve food security could be enhanced by greater flexibility in food aid, granting financial support for operations concerning food security, and in particular the development of farming and food crops as an alternative to food aid in certain circumstances, while protecting the environment and the interests of small farmers and fishermen; Whereas the Community can assist those in need in rural and urban areas in the developing countries by helping finance operations in support of food security through the purchase of food products, seed, agricultural implements and inputs, and various means of production, and through storage programmes, early-warning systems, mobilization, supervision and technical and financial assistance; Whereas it is necessary to strengthen and continue to support regional approaches to food security, including triangular operations in the field of food aid and local purchasing operations in order to make use of the natural complementarity between countries belonging to the same region; whereas the policies conducted in the field of food security should be given a regional dimension in order to foster regional trade in foodstuffs and promote integration; Whereas the purchase of foodstuffs at local level reduces inefficiency, costs and damage to the environment which might be caused by the transport of large quantities of foodstuffs in the world; Whereas the genetic potential and bio-diversity of food production must be safeguarded; Whereas Community food-aid policy must adjust to geopolitical change and the economic reforms under way in many recipient countries; Whereas a list should be drawn up of the countries and bodies eligible for Community aid operations; Whereas to that end provision should also be made for Community aid to be made available to international, regional and non-governmental organizations; whereas such organizations must satisfy a number of conditions guaranteeing the success of food-aid operations; IN 5 Whereas, in order to facilitate the application of certain of the measures envisaged and ensure that they mesh with the recipient country's food security policy, provision should be made for close cooperation between the Member States and the Commission within a Food Security and Food Aid Committee; Whereas in determining the steps to be taken for the execution of food-aid operations the implementing procedures should be adjusted to the specific nature of each recipient area, although within the framework of a common policy and strategy; Whereas, in order to ensure better management of food aid, aligning it more closely on the interests and needs of the recipient countries, and to improve the decision-making and implementing procedures, it is desirable to replace Council Regulation (EEC) No 3 9 7 2 / 86 on food-aid policy and food-aid management, (3) as last amended by Council Regulation (EEC) No 1930/90 (4), Council Regulation No 1755/84 on the implementation in relation to food of alternative operations in place of food-aid deliveries, (5) Council Regulation No 2507/88 on the implementation of storage programmes and early warning systems (6), Council Regulation No 2508/88 on the implementation of cofinancing operations for the purchase of food products or seeds by international bodies or non-governmental organizations (7) and Council Regulation No 1420/87 laying down procedures for the implementation of Regulation (EEC) No 3972/86 on food-aid policy and food-aid management, (8) (3) O J N o L 3 7 0, 30. 12. 1986. (4) OJ No L 1 7 4, 7. 7. 1 9 9 0, p. 6. (5) O J N o L 1 6 5, 23. 6. 1984, p. 7. (6) O J N o L 2 2 0, 1 1. 8. 1988, p. 1. (7) O J N o L 2 2 0, 1 1. 8. 1988, p. 4. (8) OJ NO L 1 3 6, 2 6. 5. 1 9 8 7, p. 1. "ETC 6 HAS ADOPTED THIS REGULATION: CHAPTER 1 Objectives and general guidelines for food aid and operations in support of food security Article 1 1. Under its policy of cooperation with developing countries and in order to respond appropriately to situations of food insecurity caused by serious food shortages or food crises the Community shall carry out food-aid operations and operations in support of food security in the developing countries. Food-aid operations of a humanitarian nature shall be carried out in the framework of the rules on humanitarian aid and do not fall within the scope of this Regulation. In the event of a serious crisis, all the instruments of the Community's aid policy shall be implemented in close coordination for the benefit of the population concerned. 2. Operations under this Regulation shall be appraised after analysis of the desirability and effectiveness of this instrument as compared with other means of intervention available under Community aid which could have an impact on food security and food aid, and in coordination with these means. The Commission shall ensure that operations under this Regulation are appraised in close coordination with intervention by other donors. 1 3. The objectives of the food-aid operations and operations in support of food security referred to in paragraph 1 shall, in particular, be: - to promote food security geared to alleviating poverty to help the population of developing countries and regions; - to raise the standard of nutrition of the recipient population and help it obtain a balanced diet; - to improve the supply of drinking water to the population; - to promote the availability and accessibility of foodstuffs to the public; - to contribute towards the balanced economic and social development of the recipient countries in the rural and urban environment; by paying special attention to the respective roles of women and men in the household economy and in the social structure; the ultimate objective of Community aid operations shall be to make the recipients into agents of their own development; - to support the efforts of the recipient countries to improve their own food production at regional, national, local and family level; - reduce their dependence on food aid; - encourage them to be independent in food, either by increasing production, or by enhancing and increasing purchasing power; - to contribute to the initiatives to combat poverty with development as an objective. 8 4. The Community's aid shall be integrated as thoroughly as possible into the development policies, particularly those on agriculture and agri-foodstuffs, and the food strategies of the countries concerned. Community aid shall back up the recipient country's policies on poverty, nutrition, reproductive health care, environmental protection and rehabilitation, with special attention to the continuity of programmes, particularly in a post-emergency situation. Whether sold or distributed free of charge, aid must not be liable to disrupt the local market. TITLE I - Food-aid operations Article 2 1. The products supplied, along with any other operation in the framework of food aid, must reflect as closely as possible the dietary habits of the recipient population and shall not adversely affect the recipient country. When products are selected, consideration shall be given to how to maximize the quantity of food with a view to reaching the maximum number of people, taking into account the quality of products in order to ensure adequate levels of nutrition. 9 When selecting the products to be supplied as Community aid and the procedures for the mobilization and distribution of that aid, particular account shall be taken of the social aspects of access to food in the recipient countries, and especially o* the nrcs? vulnerable groups and the roie of women in the household economy. 2. Food aid shall primarily be allocated on the basis of an objective evaluation of the real needs justifying such aid, as this is the only way to improve the food security of groups which do not have the means or possibility of plugging their food shortage themselves. To that end, consideration shall be given to the following criteria, without exciudinq other relevant considerations: - food shortages; - the food situation measured using human development and nutritional indicators; - per capita income and the existence of particularly poor population groups; - social indicators of the welfare of the population in question; - the recipient country's balance-of-payments situation; - the economic and social impact and financial cost of the proposed operation; - the existence in the recipient country of a long-term policy on food security. 10 3. The granting of food aid shall, where necessary, be conditional on the implementation of short-term, multiannual development projects, sectoral operations or development programmes, and as a priority those which promote sustainable long-term food production and food security in the recipient countries within the framework of a food policy and strategy. Where appropriate, this aid may take the form of a direct contribution to the implementation of such projects, operations or programmes. Where Community aid is intended for sale, such complementarity must be ensured by the use of counterpart funds for purposes agreed by the Community and the recipient country or, where appropriate, the body or non-governmental organization which receives the aid. Where aid is provided as backing for a development programme spread over a number of years, it may be supplied on a multiannual basis linked to the programme in question. Besides the allocation of basic foodstuffs, aid may be used for the supply of seed, fertilizer, tools, other inputs and commodities, the creation of reserves, technical and financial assistance and awareness and training schemes. 4. As a key component of food-security programmes food aid may be given to support efforts by the recipient countries to create buffer stocks paying special attention to individual farmers' stocks and national reserves, in tandem with the setting-up of regional reserves. IN 11 5. Counterpart funds shall be managed in a manner consistent with other Community aid instruments. In the case of countries undergoing structural adjustment, and in line with the relevant resolutions of the Council, the counterpart funds generated by the various development assistance instruments constitute resources which must be managed as part of a single and consistent budgetary policy in the context of a programme of reforms. In this context, the Community could move from targeting counterpart funds towards more general allocation, as soon as progress has been made in improving the effectiveness of the monitoring instruments, programming and budget implementation, and as regards internalization of reviews of public expenditure. Without prejudice to the foregoing, these funds shall be managed in accordance with general Community aid procedures for such funds and as a priority to support food-security policies and programmes. TITLE II - Operations in support of food security Article 3 Where circumstances warrant it, the Community may carry out operations in support of food security in developing countries suffering a food shortage. Such operations may be implemented by the recipient countries, by the Commission, by international or regional bodies or by non-governmental organizations. 12 The purpose of these operations shall be to support, using the resources available, the framing and execution of a food strategy or other measures fostering the food security of the population concerned and to encourage it to reduce its food dependency and its dependence on food aid, especially in the case of low-income countries with serious food shortages. The operations must help to improve the living standards of the poorest people in the countries concerned. Operations in support of food security shall take the form of financial and technical assistance, in accordance with the criteria and procedures laid down in this Regulation. Such operations shall be planned and appraised in the light of their consistency w i t h, and complementarity to, the objectives and operations financed by other Community development-aid instruments. They must be part of a multiannual plan. Article 4 A developing country or international, regional or non-governmental organization eligible for Community food-aid operations under this Regulation may receive part or all of the food aid that has been - or may be - allocated to it in the form of operations in support of food security, with particular account being taken of trends in production, consumption and reserves in that country, the food situation of its inhabitants and the food aid granted by other donors. EN 13 Article 5 Operations in support of food security shall take the form of technical and financial assistance aimed, in accordance with the objectives laid down in Article 1, at improving sustainable and long-term food security by helping finance, inter alia: the supply of seed, tools and inputs essential to the production of food crops; rural credit support schemes targeted in particular at women; schemes to supply the population with drinking water; storage schemes at the appropriate level; operations concerning the marketing, transport, distribution or processmg of agricultural and food products; measures in support of the private sector for commercial development at national, regional and international level; applied research and field training; projects to develop the production of food crops while respecting the environment; flanking, awareness, technical assistance and field training operations, in particular for women and producers' organizations; support measures for women and producers' organizations; projects to produce fertilizer from raw materials and basic materials found in the recipient countries; schemes to support local food-aid structures, including training schemes on the ground. EN 14 TITLE III - Early-warning systems and storage programmes Article 6 The Community may support existing national early-warning systems and help to strengthen existing international early-warning systems concerning the food situation in developing countries and, in exceptional and duly substantiated cases, it may operate such systems, in accordance with the procedure laid down in Article 27 of this Regulation. It may also cover the cost of implementing storage programmes in these countries in support of food-aid operations under this Regulation or comparable measures undertaken by the Member States, international or regional bodies or non-governmental organizations. Such operations should be consistent with other Community development aid instruments, including the use of counterpart funds generated by the sale of food aid, and be compatible with Community development policy. These operations are intended to strengthen the food security of the recipient countries. They must help improve the living conditions of the poorest sections of the population in the countries concerned and conform with their development objectives, in particular the policy on food crops. Community participation in such operations shall take the form of financial and/or technical assistance, in accordance with the criteria and procedures laid down in this Regulation. 15 Operations supported by Community aid shall be appraised in the light of and in a manner consistent with existing programmes managed by specialist international organizations. Article 7 Community support for storage programmes and early-warning systems may be granted, upon request, to international or regional bodies or non-governmental organizations for operations to help developing countries eligible for food aid from the Community and its Member States. Article 8 Community aid may help finance the following measures: early-warning systems and systems for gathering data on trends in harvests, stocks and markets, the food situation of households and the vulnerability of the population with a view to improving understanding of the food situation in the countries concerned; operations aimed at improving storage systems with a view to reducing waste or ensuring sufficient storage capacity for emergencies. Such operations may also include the establishment of the infrastructure, in particular bagging, unloading, disinfection, treatment and storage facilities, needed to handle food products in these countries in support of food-aid operations or operations in support of food security; preparatory studies and training schemes in connection with the above activities. "EFÏ 16 CHAPTER II Implementing procedures for food aid and storage and early-warning operations in support of food security Article 9 1. The countries and bodies eligible for Community aid for operations under this Regulation are listed in the Annex. In this connection, priority shall be given to the poorest sections of the population and to low-income countries with serious food shortages. The Commission may amend that list of countries and bodies eligible for aid after consulting the Committee referred to in Article 26 and according to the procedure set out in Article 27. 2. Non-governmental organizations (NGOs) eligible for direct or indirect Community financing for the implementation of operations under this Regulation must meet the following criteria: IN 17 (a) if they are European NGOs they should be non-profit-making autonomous organizations in a Member State of the European Community under the laws in force in that Member State; (b) have their main headquarters in a Member State of the Community, the recipient countries or, exceptionally, in the case of international NGOs, a third country. This headquarters must be the effective decision-making centre for all co-financed operations; (c) show that they can successfully carry out food-aid operations; in particular through: - - - - - their administrative and financial management capacity, their technical and logistical capacity to handle the proposed operation, the results of operations implemented by the relevant NGOs carried out with Community finance or finance from the Member States, their experience in the field of food aid and food security, their presence in the recipient country and their knowledge of that country or of developing countries; (d) undertake to comply with the conditions laid down by the Commission for the allocation of food aid. Article 10 1. The Community may help finance operations in support of food security of the kind described in Titles I, II and III (Chapters I and II) executed by the recipient country, the Commission, international or regional bodies or non-governmental organizations. 1R 18 2. Cofinancing operations may be carried out at the request of recipient countries, international or regional bodies or non-governmental organizations, where such operations seem the most appropriate way of enhancing the food security of groups without the ways and means to cope with a food shortage themselves. 3. In the design of the Community operations defined in Titles I, II and III, particular attention will be given to: - the pursuit of sustainable impact and economic viability in project design; - the clear definition and monitoring of objectives and indicators of achievement. Article 11 1. Products shall be mobilized on the Community market, in the recipient country or in one of the developing countries (listed in the Annex to this Regulation) if possible one belonging to the same geographical region as the recipient country. 2. Exceptionally, products may be mobilized on the market of a country other than those provided for in paragraph 1 in accordance with the procedure laid down in Article 27 of this Regulation: - if the requisite type or quality of product is unavailable on the market of the Community or any of the developing countries; - if there is a serious food shortage, where such purchases are likely to increase the effectiveness of the operation. 19 3. Food products available on the European market may be mobilized on the market of a developing country, if the economic efficiency of doing so compares favourably with that of mobilizing products on the European market. 4. Where food is purchased or sold in the recipient country or in a developing country, steps must be taken to ensure that such purchases threaten neither to disrupt the market of the country concerned or of any other developing countries in the same region nor to affect adversely production or the supply of food to their inhabitants. Such purchases or sales shall be integrated as thoroughly as possible into the implementation of Community development policy towards these countries, particularly with regard to the promotion of food security in the country concerned or at regional level. Article 12 Where a recipient country has partially or totally liberalized food imports, the mobilization of Community aid must be consistent with that country's policy and not distort the market. In such cases, the Community contribution may take the form of a foreign-currency facility to be made available to private-sector operators in the country concerned, subject to the operation being part of a social and economic policy and an agricultural policy aimed at alleviating poverty (including the strategy on the importation of basic foodstuffs). The recipients shall be required to prove that they have made proper use of the means put at their disposal. Priority shall go to small and medium-sized private operators in order to ensure that operations are complementary. To the extent that its powers to carry out operations enable it, the Commission may adopt positive discrimination measures for small and medium-sized private operators. Such aid shall be governed by the principles laid down in Article 1 1. 1R 20 Article 13 1. The Community may cover costs relating to the transport of food aid. 2. Where the Commission considers that the Community should cover costs relating to the inland transport of food aid, it shall take account of the following general criteria: - a serious food shortage; - the delivery of food aid to low-income countries suffering from serious food shortages; - whether the food aid is destined for the international or regional bodies or non-governmental organizations referred to in Article 10; - the need to increase the efficiency of the food-aid operation in question. 3. Where food aid is sold in the recipient country, the Community should cover inland transport costs only in exceptional circumstances. 4. The Community may also cover the air transport costs of food-aid operations in exceptional circumstances. Article 14 The Community may cover final distribution costs where the smooth execution of the food-aid operations concerned requires it. 21 Article 15 Community aid shall take the form of grants. Aid may cover the external and local costs of implementing operations, including maintenance and operating costs. Operations under this Regulation shall be exempt from taxes, duties and customs charges. Any counterpart funds shall be used in accordance with the objectives laid down in this Regulation and managed in agreement with the Commission. The competent authority of the recipient country shall keep accounts on the collection and use of the funds and shall be obliged to render accounts. Article 16 The Community contribution may also cover flanking activities necessary to make the operations under this Regulation more efficient and, in particular, supervision, monitoring and inspection, distribution and field training. Article 17 Participation in invitations to tender and other procedures for the award of public contracts shall be open on equal terms to all natural and legal persons in the European Union and the recipient countries. It may be extended by the Commission to operations under Article 11 (2) to include natural and legal persons in the countries where the aid is mobilized. 22 When implementing this Regulation, the Commission shall guarantee the openness of the operations in question by publicizing them properly. The Commission shall ensure that operations by intermediary organizations are also publicized properly. Article 18 The Commission may authorize a representative to conclude cofinancing agreements in its name. Article 19 1. The Commission shall lay down the allocation, mobilizing and implementation conditions for aid under this Regulation. 2. Aid shall not be implemented unless the recipient country, international or regional organization or non-governmental organization complies with these conditions. Article 20 The Commission shall take all measures necessary for the proper implementation of food-aid programmes and operations, and operations in support of food security. To that end, the Member States and the Commission shall afford each other all necessary assistance and exchange all relevant information. TN 23 CHAPTER «I Procedure for implementing food-aid operations and early-warning and storage operations in support of food security Article 21 1. The Council, acting by a qualified majority on a proposal from the Commission and after consulting the European Parliament, shall determine the Community share of the overall amount of cereals aid laid down in the Food Aid Convention as the total contribution of both the Community and its Member States. 2. The Commission shall coordinate the operations of the Community and the Member States as regards the supply of cereals aid under the Food Aid Convention and shall ensure that the total contribution by the Community and its Member States is at least as high as the quantities provided for in that Convention^9) (9) Statement by the Council and the Commission "The Council and the Commission agree that the amount of the Community contribution under the Food Aid Convention should be determined at the same time as the amounts of the contributions of the Member States, jointly by the Council on behalf of the Community and by the representatives of Member States meeting within the Council on teir own behalf. To this end, the porposal to be submitted by the Commission to the Council will be accompanied by a draft allocation between the Member States of the total amount incumbent on them. " _ 24 Article 22 The Commission, acting in accordance with the procedure laid down in Article 27, and taking account of the general policy guidelines for food aid shall: adopt the list of products which may be mobilized as aid; lay down rules for mobilization, monitoring and evaluation; determine each recipient's share, in terms of the quantity and cost of the products; where necessary, adjust allocations during the implementation of programmes. Article 23 Decisions: granting food aid or providing for an operation in support of food security and laying down the conditions for the latter; granting a contribution to international or regional bodies and non-governmental organizations for the financing of operations in support of food security; IN 25 granting aid for a storage programme or early-warning system; shall be made by the Commission in accordance with the procedure laid down in Article 27, in compliance with the limits set in Article 25. Article 24 1. In accordance with the Council decisions referred to in Article 21 and the decisions taken under Article 22, the Commission shall decide on: (a) emergency or serious food shortage operations, where famine or an imminent danger thereof seriously threatens the lives or health of people in a country without the ways and means to cope itself with a food shortage, after consulting the Member States by the most appropriate means and according them three working days in which to put forward any objections. If there are any objections, the Committee shall examine the question at its next meeting;(10) (b) the conditions governing the supply and implementation of aid, in particular:. ^ the general conditions applicable to recipients; (10) Statement by the Council and the Commission "The procedures and the number of Member States for the purpose of taking into account any objections raised in the course of the written procedure will be laid down in the Committee's rules of procedure. " - ; ' ' ' "* ; ' ' • ; ; ! EN 26 - initiation of the procedures governing mobilization, supply of products and implementation of other measures, and conclusion of the relevant contracts. 2. For the purposes of paragraph 1 (a), the Commission shall be entitled to take all necessary measures to speed up the supply of food aid. The volume of aid granted in a given case shall be limited to the quantities needed by the population affected to cope with the situation for a period not normally exceeding six months. The Commission shall ensure that priority is given at all stages to the mobilization of food aid for the operations provided for in paragraph 1 (a) and (b). Article 25 Decisions regarding operations the financing for which under this Regulation exceeds ECU 2 million shall be taken in accordance with the procedure laid down in Article 27. Article 26 1. The Commission shall be assisted by a Food Aid Committee, hereinafter referred to as "the Committee", composed of the representatives of the Member States and chaired by a representative of the Commission. TN 27 2. The Committee must examine the long-term implications of any proposal to commit funds for food security at household, local, national and regional level in the recipient countries, bearing in mind the principles laid down in Article 1 of this Regulation. It shall also analyse and monitor food-security policies which are in receipt of Community aid and examine proposals for joint initiatives. 3. The Committee shall draw up its own rules of procedure. Article 27 Th& representative of the Commission shall submit to the Committee a draft of the measures to be taken. The Committee shall deliver its opinion on the draft within a time limit which the Chairman may lay down according to the urgency of the matter in question. The opinion shall be delivered by the majority laid down in Article 148(2) of the Treaty in the case of decisions which the Council is required to adopt on a proposal from the Commission. The votes of the representatives of the Member States within the Committee shall be weighted in the manner set out in that Article. The Chairman shall not vote. The Commission shall adopt measures which apply immediately. However, if these measures are not in accordance with the opinion of the Committee, they shall be communicated by the Commission to the Council forthwith. In that event, the Commission shall defer application of the measures which it has adopted for a period of t wo months from the date of such communication. The Council, acting by a qualified majority, may take a different decision within the time limit referred to in the previous paragraph. 28 Article 28 1. In order to guarantee the principle of complementarity referred to in the Treaty and enhance the effectiveness and consistency of the Community and national food-aid provisions and operations in support of food security, the Commission shall seek to ensure that its own activities are as closely coordinated as possible with those of the Member States and with other EU policies, both at decision-making level and on the ground, and may take any appropriate initiative in pursuit of this end. To that end, Member States shall notify the Commission of their national food-aid operations and of their food security programmes. The Commission, acting in accordance with the procedure laid down in Article 27, shall stipulate how notification of national operations is to be effected. 2. The Commission shall ensure that operations implemented by the Community are coordinated with those of international organizations and bodies, in particular those which form part of the United Nations system. 3. The Commission shall seek to develop collaboration and cooperation between the Community and third-country donors in the field of food security. 4. Coordination and cooperation between the Community and the Member States, and between the latter and international organizations and third-country donors shall be the subject of a regular exchange of information within the Article 27 Committee. 29 Article 29 The Committee may examine any other matter concerning food aid and other operations under this Regulation raised by its Chairman, either on the fetter's own initiative or at the request of a representative of a Member State. The Commission shall inform the Committee, within one month of taking its decision, of the food-aid or foo#-security operations and projects it has approved, indicating their amount and nature, the recipient country and the partner entrusted with implementation. The Commission shall notify the Committee of the general guidelines for products mobilized as Community food aid. Article 30 The Commission shall undertake regular evaluations of significant food-aid operations to establish whether the objectives laid down in the appraisal of those operations have been achieved and to provide guidelines for improving the effectiveness of future operations. It shall inform the Committee periodically on the evaluation programmes. Member States and the Commission shall notify each other as soon as possible of the results of evaluation work and of analyses or studies that would improve aid efficiency. The work will be analysed in the Committee. Member States and the Commission shall endeavour to carry out joint evaluation exercées. 30 The Commission shall draw up procedures for the dissemination and internal and external communication of the conclusions of evaluation exercises to the departments and organizations concerned. Article 31 At the close of each financial year, the Commission shall submit an annual report on the implementation of this Regulation to the European Parliament and the Council. The report shall set out the results of execution of the budget as regards commitments and payments and projects and programmes financed during the year. As far as possible, the report shall contain information on the funds committed nationally during the same financial year. As far as possible, it shall contain the most important statistical data (by recipient country, nationality, etc. ) on contracts awarded for the implementation of projects and programmes. The report shall also contain a breakdown of expenditure assigned to each type of operation as provided for in Articles 2, 5 and 8 of this Regulation. Lastly, the report shall contain information on operations undertaken with the counterpart funds generated by food aid. "EN 31 Article 32 Regulation (EEC) No 3972/86, as last amended by Regulation (EEC) No 1930/90, and Regulations (EEC) No 1755/84, No 2507/88, No 2508/88 and 1420/87 shall be repealed. As a transitional measure and until the new mobilization Regulation is adopted by the Commission, Commission Regulation No 2200/87 of 8 July 1987 shall continue to apply. Three years after the entry into force of this Regulation, the Commission shall submit to the Council and to the European Parliament an overall evaluation of the operations financed by the Community under this Regulation, accompanied by suggestions for the future of the Regulation and, if necessary by proposals for amendments to the Regulation. Article 33 This Regulation shall enter into force on the third day following that of its publication in the Official Journal of the European Communities. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Brussels, For the Council TR 32 1. COUNTRIES LLDCs (Least-developed countries) Other LICs (Other low-income countries. Per capita GNP < $675 in 1992) (Lower middle-income countries. Per capita GNP $676- $ 2695 in 1992) LMICs ANNEX China Egypt Eritrea Ghana Guyana Honduras India Indonesia Kenya Nicaragua Nigeria Pakistan Sri Lanka Tajikistan Timor Vietnam Zimbabwe Afghanistan Bangladesh Benin Bhutan Botswana Burkina Faso Burundi Cambodia Cape Verde Central African Republic Chad Comoros Djibouti Equatorial Guinea Ethiopia Gambia Guinea Bissau Guinea Haiti Kiribati Laos Lesotho Liberia Madagascar Malawi Maldives Mali Mauritania Mozambique Myanmar Nepal Niger Rwanda Sâo Tome and Principe Sierra Leone Solomon Islands Somalia Sudan Tanzania Togo Tuvalu Uganda Vanuatu Western Samoa Yemen Zaire Zambia Peru Philippines Senegal South Africa St Helena St Vincent & the Grenadines States of former Yugoslavia Swaziland Syria Thailand Tokelau Tonga Tunisia Turkey Turkmenistan Turks and Caicos Islands Uzbekistan Wallis and Futuna Albania Algeria Angola Anguilla Armenia Azerbaijan Belize Bolivia Cameroon Chile Colombia Congo Costa Rica Côte d'Ivoire Cuba Dominica Dominican Republic Ecuador El Salvador Fiji Georgia Grenada Guatemala Iran Iraq Jamaica Jordan Kazakhstan Korea (Dem. Rep. ) Kyrgyzstan Lebanon Macao Marshall Islands Micronesia, Federated States Moldova Mongolia Morocco Namibia Niue Occupied Territories (Gaza & the West Bank) Panama Papua New Guinea Paraguay (ANNEX) IN 33 2. BODIES WFP ICRC IFRC UNHCR UNRWA FAO UNICEF 3. NON-GOVERNMENTAL ORGANIZATIONS European NGOs, NGOs of the recipient country or, exceptionally, international NGOs specializing in development. (ANNEX) ood/BS/je TR 34 ISSN 0254-1475 COM(96) 250 final DOCUMENTS EN 11 Catalogue number : CB-CO-96-263-EN-C ISBN 92-78-05180-2 Office for Official Publications of the European Communities L-2985 Luxembourg sC

OPINION OF THE COMMISSION on the amendments proposed by the European Parliament to the Council' s common position on the proposal for a COUNCIL DIRECTIVE ON THE APPROXIMATION OF THE LAWS OF MEMBER STATES WITH REGARD TO THE TRANSPORT OF DANGEROUS GOODS BY RAIL

http://publications.europa.eu/resource/cellar/118883cb-d7f5-4b8a-a40e-799beedcb3ae

eng

ft*ft ft ft ft ft ft ft * f t* COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 04. 06. 1996 COM(96) 235 final 94/0284 (SYN) OPINION OF THE COMMISSION on the amendments proposed by the European Parliament to the Council's common position on the proposal for a COUNCIL DIRECTIVE ON THE APPROXIMATION OF THE LAWS OF MEMBER STATES WITH REGARD TO THE TRANSPORT OF DANGEROUS GOODS BY RAIL (presented by the Commission pursuant to Article 189 c (d) oi the EC Treaty) On 16 April 1996 the European Parliament amended the Common Position adopted by the Council on 8 December 1995 on the above-mentioned proposal. The amendments of the Parliament are at Annex. Under Article 189 C, sub-paragraph (d) of the EC Treaty, the Commission has re-examined its proposal and decided not to accept the amendments for the following reasons. The first amendment, requiring notification prior to all shipments of (undefined) "extremely" dangerous goods, is considered by the Commission to be unnecessarily bureaucratic with no obvious benefit to safety. The reference to "extremely" dangerous goods introduces an element of legal uncertainty, in that it would create an additional category of goods (the "extremely" dangerous ones) to the ones referred to in the proposal. The type of transport sought by the second amendment is already almost entirely covered by the existing derogation allowed for under Articles 6,11 and the new 6,14 of the Common Position where less stringent provisions may apply for transport within ports or airports or within or between industrial sites. Therefore this new amendment is superfluous. The Commission therefore maintains its proposal and rejects the amendments proposed by the Parliament to the Council's Common Position. Annex: 2 amendments of the European Parliament X ANNEX Common position of the Council Amendments (Amendment 1) Article 3(2a) (new) For the transport of extremely dangerous various shall be competent informed in advance. goods. authorities the (Amendment 2) Article 5 Without prejudice to other 1. Community provisions, each Member State shall retain the right to regulate or prohibit, strictly for reasons other than safety during transport connected in particular or with environmental the transport of certain dangerous goods within its territory. security protection, national 1. Without prejudice to other Community provisions, each Member' State shall retain the right to regulate or prohibit, strictly for reasons other than safety during transport connected in particular or with environmental the transport of certain dangerous goods within its territory. security protection, national 1a. This Directive shall not restrict the right of Member States, with due regard for Community law, to adopt special rules or grant derogations for transport operations of local significance, e. g. the transport of hydrogen cyanide in purpose-built tank wagons, or for the transport of dangerous goods on narrow-gauge, dock or mountain railways. 2(a). For transport via the Channel Tunnel, France and the United Kingdom may impose more stringent provisions than those provided for in the Annex. The Commission shall be informed of such provisions and it shall inform the other Member States. 2(a). For transport via the Channel Tunnel, France and the United Kingdom may impose more stringent provisions than those provided for in the Annex. The Commission shall be informed of such provisions and it shall inform the other Member States. 2(b). Where a Member State considers that stricter provisions should be applied to transport through tunnels with characteristics similar to the Channel Tunnel within its territory, it shall inform the Commission. The Commission, acting in accordance with the procedure laid down in Article 9, shall decide whether the tunnel in question has similar characteristics. Provisions adopted by a Member State shall be notified to the Commission, which shall inform the other Member States. 2(b). Where a Member State considers that stricter provisions should be applied to transport through tunnels with characteristics similar to the Channel Tunnel within its territory, it shall inform the Commission. The Commission, acting in accordance with the procedure laid down in Article 9, shall decide whether the tunnel an question has similar characteristics. Provisions adopted by a Member State shall be notified to the Commission, which shall inform the other Member States. 2 0e) -- ; Ai Member State ,i. ft which the ambient • -temperature is roqularly lower than - 20 C may impose more stringent standards as regards the operating temperature of material intended for use in the national transport of dangerous goods by rail within its territory until provisions the on reference appropriate temperatures for given climatic zones are incorporated in the Annex. 3. If on the occasion of an accident or an incident, a Member State considers that the safety provisions applicable have been found to be insufficient to limit the hazards involved in the transport operation and if there is an urgent need to take action, that Member State shall notify the Commission at the planning stage of the measures which it in proposes accordance with the procedure laid down in Article 9, the Commission shall the implementation of the measures in question should be authorized and shall determine the duration thereof. take. Acting whether decide to. •!(. <•):-. uiihit'iit A M « u n l xM. ' >1. 11 « • in w i n ch t <M»p*'i «it. in *' t:. 0 i v < m l , ti lv I |>. • Jowt. w than 2. 0 C may impose more stringent standards as regards the operating temperature of material intended for use in the national transport of dangerous goods by rail within its territory until provisions on reference appropriate temperatures for given climatic zones are incorporated in the Annex. the 3. If on the occasion of an accident or an incident, a Member State considers that the safety provisions applicable have been found to be insufficient to limit the hazards involved in the transport operation and if there is an urgent need to take action, that Member State shall notify the Commission at the planning stage of the measures which it in proposes accordance with the procedure laid down in Article 9, the Commission s h a ll the implementation of the measures in question should be authorized and shall determine the duration thereof. take. Acting whether decide to 4. Member States may maintain all national provisions applicable on 31 December 1996 to the transport and packing of substances containing dioxins or furans. 4. Member States may maintain all national provisions applicable on 31 December 1996 to the transport and packing of substances containing dioxins or furans. DOC EN\RR\295\295933 t PE 215. 566/fin. ISSN 0254-1475 COM(96) 235 final DOCUMENTS EN 06 07 Catalogue number : CB-C096-247-EN-C ISBN 92-78-04519-5 Office for Official Publications of the European Communities L-2985 Luxembourg i>

Proposal for a COUNCIL REGULATION (EC) derogating, for the 1996/97 marketing year, from Regulation (EC) No 1035/77 laying down special measures to encourage the marketing of products processed from lemon

http://publications.europa.eu/resource/cellar/1466eec5-4783-4991-8d66-4dda33f86afe

eng

COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 03. 06. 1996 COM(%) 240 final 96/0144 (CNS ) 96/0145 (CNS ) Proposal for a COUNCIL REGULATION (EC) derogating, for the 1996/97 marketing year, from Regulation (EC) No 1035/77 laying down special measures to encourage the marketing of products processed from lemon Proposal for a COUNCIL REGULATION (EC) amending Regulation (EC) No 1543/95 as regards the period of application (presented by the Commission) EXPLANATORY MEMORANDUM Subject: - Proposal for a Council Regulation derogating, for the 1996/97 marketing year, from Regulation (EEC) No 1035/77 laying down special measures to encourage the marketing of products processed from lemons - Proposal for a Council Regulation amending Regulation (EC) No 1543/95 as regards the period of application The current rules on the processing of citrus fruit provide for the grant, within the framework of contracts between producers and processors, of financial compensation to processors, provided they pay a minimum price to producers. For the 1995/96 price package, the Council adopted Regulation (EC) No 1543/95, which allows the Member States, if they wish, to pay the financial compensation directly to producers in the case of oranges, mandarins and clémentines, in order to solve the processors' financial problems. In view of the fact that the problems continue to exist, Regulation (EC) No 1543/95 should be extended to the 1996/97 marketing year and to lemons. £ Proposal for a COUNCIL REGULATION (EC) No 96/0144 (CNS ) of derogating, for the 1996/97 marketing year, from Regulation (EC) No 1035/77 laying down special measures to encourage the marketing of products processed from lemon THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 43 thereof, Having regard to the proposal from the Commission1, Having regard to the opinion of the European Parliament2, Having regard to the opinion of the Economic and Social Committee3, Whereas, within the framework of the Community scheme supporting the processing of lemon, it appears that certain processing companies are experiencing financial difficulties in paying the minimum price to producers; whereas that situation should be taken into account when authorizing the Member States, in respect of the new marketing year 1996/97, to pay the financial compensation directly to producers under certain conditions as from the entry into force of this Regulation; Whereas using this possibility will prevent Member States, for reasons of management and control, from having recourse to the provisions for granting financial compensation as referred to in Article 2 of Regulation (EEC) No 1035/774, 1 2 3 4 OJ No C OJ No C OJ No C O J N oL 125, 19. 5. 1977, p. 3. HAS ADOPTED THIS REGULATION: Article 1 Notwithstanding Article 2 of Regulation (EC) No 1035/77, Member States may pay financial compensation directly to producers for the quantities delivered by the latter under contracts as referred to in Article 1(2) of that Regulation that are concluded after the entry into force of this Regulation. In that case, processors must pay to producers a price which is at least equal to the difference between the minimum price referred to in Article 1(3) and the financial compensation referred to in Article 2 of that Regulation. Article 2 Where Article 1 is applied, the financial compensation shall be paid to the producer at his request when the control authorities in the Member States in which processing is carried out have established that the products which are covered by contracts have been delivered. Article 3 The decision of the Member State to apply Article 1 must concern all producers and processors on its territory. Article 4 The detailed rules for the application of this Regulation, in particular with regard to the guarantee, shall be adopted in accordance with the procedure laid down in Article 33 of Regulation (EEC) No 1035/725. OJ No L 118, 20. 5. 1972, p. 1. Regulation as last amended by Regulation (EC) No 1363/95 (OJ No L 132, 16. 6. 1995, p. 8). V Article 5 This Regulation shall enter into force on the third day following its publication in the Official Journal of the European Communities. It shall apply until end of the 1996/97 marketing year. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at For the Council j Proposal for a COUNCIL REGULATION (EC) No 96/0145 (CNS ) of amending Regulation (EC) No 1543/95 as regards the period of application THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 43 thereof, Having regard to the proposal from the Commission1, Having regard to the opinion of the European Parliament, Having regard to the opinion of the Economic and Social Committee , Whereas certain citrus fruit processors are still experiencing financial difficulties in paying the minimum price to producers; whereas, in order to rectify that situation, Council Regulation (EC) No 1543/954, authorizes the Member States, in respect of the 1995/96 marketing year, to pay the financial compensation directly to producers under certain conditions; whereas, as a result, Regulation (EC) No 1543/95 should be extended to the new 1996/97 marketing year, HAS ADOPTED THIS REGULATION: Article 1 The second paragraph of Article 5 of Regulation (EC) No 1543/95 is hereby replaced by the following: "It shall apply to the 1995/96 and 1996/97 marketing year. " O J N oC O J N oC O J N oC OJ No L 148, 30. 6. 1995, p. 30. Article 2 This Regulation shall enter into force on the third day of its publication in the Official Journal of the European Communities. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Fur the Council ISSN 0254-1475 COM(96) 240 final DOCUMENTS EN 03 Catalogue number : CB-CO-96-250-EN-C ISBN 92-78-04552-7 Office for Official Publications of the European Communities L-2985 Luxembourg

Proposal for a COUNCIL REGULATION (EC) amending Regulation (EC) No 1543/95 as regards the period of application

http://publications.europa.eu/resource/cellar/6e4b743c-a123-4dde-bd17-8563860667ff

eng

COMMISSION OF THE EUROPEAN COMMUNITIES Brussels, 03. 06. 1996 COM(%) 240 final 96/0144 (CNS ) 96/0145 (CNS ) Proposal for a COUNCIL REGULATION (EC) derogating, for the 1996/97 marketing year, from Regulation (EC) No 1035/77 laying down special measures to encourage the marketing of products processed from lemon Proposal for a COUNCIL REGULATION (EC) amending Regulation (EC) No 1543/95 as regards the period of application (presented by the Commission) EXPLANATORY MEMORANDUM Subject: - Proposal for a Council Regulation derogating, for the 1996/97 marketing year, from Regulation (EEC) No 1035/77 laying down special measures to encourage the marketing of products processed from lemons - Proposal for a Council Regulation amending Regulation (EC) No 1543/95 as regards the period of application The current rules on the processing of citrus fruit provide for the grant, within the framework of contracts between producers and processors, of financial compensation to processors, provided they pay a minimum price to producers. For the 1995/96 price package, the Council adopted Regulation (EC) No 1543/95, which allows the Member States, if they wish, to pay the financial compensation directly to producers in the case of oranges, mandarins and clémentines, in order to solve the processors' financial problems. In view of the fact that the problems continue to exist, Regulation (EC) No 1543/95 should be extended to the 1996/97 marketing year and to lemons. £ Proposal for a COUNCIL REGULATION (EC) No 96/0144 (CNS ) of derogating, for the 1996/97 marketing year, from Regulation (EC) No 1035/77 laying down special measures to encourage the marketing of products processed from lemon THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 43 thereof, Having regard to the proposal from the Commission1, Having regard to the opinion of the European Parliament2, Having regard to the opinion of the Economic and Social Committee3, Whereas, within the framework of the Community scheme supporting the processing of lemon, it appears that certain processing companies are experiencing financial difficulties in paying the minimum price to producers; whereas that situation should be taken into account when authorizing the Member States, in respect of the new marketing year 1996/97, to pay the financial compensation directly to producers under certain conditions as from the entry into force of this Regulation; Whereas using this possibility will prevent Member States, for reasons of management and control, from having recourse to the provisions for granting financial compensation as referred to in Article 2 of Regulation (EEC) No 1035/774, 1 2 3 4 OJ No C OJ No C OJ No C O J N oL 125, 19. 5. 1977, p. 3. HAS ADOPTED THIS REGULATION: Article 1 Notwithstanding Article 2 of Regulation (EC) No 1035/77, Member States may pay financial compensation directly to producers for the quantities delivered by the latter under contracts as referred to in Article 1(2) of that Regulation that are concluded after the entry into force of this Regulation. In that case, processors must pay to producers a price which is at least equal to the difference between the minimum price referred to in Article 1(3) and the financial compensation referred to in Article 2 of that Regulation. Article 2 Where Article 1 is applied, the financial compensation shall be paid to the producer at his request when the control authorities in the Member States in which processing is carried out have established that the products which are covered by contracts have been delivered. Article 3 The decision of the Member State to apply Article 1 must concern all producers and processors on its territory. Article 4 The detailed rules for the application of this Regulation, in particular with regard to the guarantee, shall be adopted in accordance with the procedure laid down in Article 33 of Regulation (EEC) No 1035/725. OJ No L 118, 20. 5. 1972, p. 1. Regulation as last amended by Regulation (EC) No 1363/95 (OJ No L 132, 16. 6. 1995, p. 8). V Article 5 This Regulation shall enter into force on the third day following its publication in the Official Journal of the European Communities. It shall apply until end of the 1996/97 marketing year. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at For the Council j Proposal for a COUNCIL REGULATION (EC) No 96/0145 (CNS ) of amending Regulation (EC) No 1543/95 as regards the period of application THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 43 thereof, Having regard to the proposal from the Commission1, Having regard to the opinion of the European Parliament, Having regard to the opinion of the Economic and Social Committee , Whereas certain citrus fruit processors are still experiencing financial difficulties in paying the minimum price to producers; whereas, in order to rectify that situation, Council Regulation (EC) No 1543/954, authorizes the Member States, in respect of the 1995/96 marketing year, to pay the financial compensation directly to producers under certain conditions; whereas, as a result, Regulation (EC) No 1543/95 should be extended to the new 1996/97 marketing year, HAS ADOPTED THIS REGULATION: Article 1 The second paragraph of Article 5 of Regulation (EC) No 1543/95 is hereby replaced by the following: "It shall apply to the 1995/96 and 1996/97 marketing year. " O J N oC O J N oC O J N oC OJ No L 148, 30. 6. 1995, p. 30. Article 2 This Regulation shall enter into force on the third day of its publication in the Official Journal of the European Communities. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Fur the Council ISSN 0254-1475 COM(96) 240 final DOCUMENTS EN 03 Catalogue number : CB-CO-96-250-EN-C ISBN 92-78-04552-7 Office for Official Publications of the European Communities L-2985 Luxembourg

Analytical tables of foreign trade - Nimexe 1969, imports/exports : machinery and equipment.,Analytische tabellen van de buitenlandse handel - Nimexe 1969, invoer/uitvoer : machines, apparaten.,Analytische Übersichten des Auβenhandels - Nimexe 1969, Einfuhr/Ausfuhr : Maschinen, Apparate.,Tableaux analytiques du commerce extérieur - Nimexe 1969, importations/exportations : machines, appareils.,Tavole analitiche del commercio estero - Nimexe 1969, importazioni/esportazioni : macchine ed apparecchi.

http://publications.europa.eu/resource/cellar/aeea1410-76f2-44d6-9b3d-a03c2c33fe6b

eng

Analytical tables of foreign trade - Nimexe 1977, imports/exports : plastics, leather.,Analytische tabellen van de buitenlandse handel - Nimexe 1977, invoer/uitvoer : plastische stoffen, leer.,Analytische Übersichten des Auβenhandels - Nimexe 1977, Einfuhr/Ausfuhr : Kunststoffe, Leder.,Analytiske Tabeller vedrørende Udenrigshandelen - Nimexe 1977, indførsel/udførsel : Plasticstoffer, læder.,Tableaux analytiques du commerce extérieur - Nimexe 1977, importations/exportations : matières plastiques, cuirs.,Tavole analitiche del commercio estero - Nimexe 1977, importazioni/esportazioni : materie plastiche, pelli.

http://publications.europa.eu/resource/cellar/f7a9f974-5f49-4882-8db1-267a629eeeef

eng

Euronorm : Semi-processed steel strip for the construction of magnetic circuits.

http://publications.europa.eu/resource/cellar/f68a52fc-3f75-4bba-917e-3c8f3184e8fb

eng

New forms of work organization in the European Community : Belgium.

http://publications.europa.eu/resource/cellar/e9d120e1-a0bd-4536-9aeb-18d598b1353f

eng

Euronorm 137-83 : Plates and wide flats made of weldable fine-grained structural steels in the quenched and tempered conditions.

http://publications.europa.eu/resource/cellar/cb53db9d-e6f0-4116-ba99-30071db7ef3b

eng

An investigation of activities for the unemployed : An annotated and selective bibliography.

http://publications.europa.eu/resource/cellar/80a1822f-a243-4752-b801-d5f16c3faf87

eng

Analytical tables of foreign trade - Nimexe 1967, imports/exports : transport equipment.,Analytische tabellen van de buitenlandse handel - Nimexe 1967, invoer/uitvoer : vervoermaterieel.,Analytische Übersichten des Auβenhandels - Nimexe 1967, Einfuhr/Ausfuhr : Beförderungsmittel.,Tableaux analytiques du commerce extérieur - Nimexe 1967, importations/exportations : matériel de transport.,Tavole analitiche del commercio estero - Nimexe 1967, importazioni/esportazioni : materiale da trasporto.

http://publications.europa.eu/resource/cellar/a55895ef-1b81-452b-9f59-123e547271b4

eng

Analytical tables of foreign trade - Nimexe 1975, imports/exports : pig-iron, iron and steel.,Analytische tabellen van de buitenlandse handel - Nimexe 1975, invoer/uitvoer : gietijzer, ijzer en staal.,Analytische Übersichten des Auβenhandels - Nimexe 1975, Einfuhr/Ausfuhr : Eisen und Stahl.,Analytiske Tabeller vedrørende Udenrigshandel - Nimexe 1975, indførsel/udførsel : Støbejern, jern og stål.,Tableaux analytiques du commerce extérieur - Nimexe 1975, importations/exportations : fonte, fer et acier.,Tavole analitiche del commercio estero - Nimexe 1975, importazioni/esportazioni : ghisa, ferro e acciaio.

http://publications.europa.eu/resource/cellar/d702c94b-c80e-11e6-a6db-01aa75ed71a1

eng

Energiestatistiek : Jaarboek 1960-1969.,Energiestatistik : Jahrbuch 1960-1969.,Energy statistics : Yearbook 1960-1969.,Statistiche dell'energia : Annuario 1960-1969.,Statistiques de l'énergie : Annuaire 1960-1969.

http://publications.europa.eu/resource/cellar/77fda1ab-12c6-47be-a11f-2d2f642e39c7

eng