CELEX: 51988PC0111
Language: en
Date: 1988-05-03
Title: Proposal for a COUNCIL REGULATION (EEC) on structural improvements in inland waterway transport (presented by the Commission)

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COM (88) 111
Vol. 1988/0032
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 ---pagebreak--- COMMISSION OF THE EUROPEAN COMMUNITIES
                                                 COM(88 ) 111 final
                                                Brussels , 3 May 1988
                          Proposal for a
                     COUNCIL REGULATION ( EEC )
    on structural improvements in inland waterway transport
                  (presented by the Commission )
                                    m
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 ---pagebreak---                           EXPLANATORY MEMORANDUM
I.  INTRODUCTION
1 . A structural imbalance between supply and demand is causing serious
    problems in inland waterway transport in the Community today .
    There is nothing new about this overcapacity : it has been observed ,
    on and off and with varying intensity the last ten years . However ,
    a series of indicators , such as the growing queue of vessels
    awaiting cargo , journey times and fast-falling rates suggest that
    over the last few years structural overcapacity has become
    particularly severe .
    There are many reasons for this situation . Beyond doubt , the most
    important is the changing pattern of demand on the inland waterway
    market . The combined effect of the contraction of the coal
    industry , the steel crisis , the decline in the building industry
    and the switch to new sources of energy has greatly depressed the
    inland waterways . Against this , the upturn on a few other markets ,
    such as in container transport , has been too small to offset these
    traffic losses . In addition , the undertakings themselves have made
    wrong decisions and misplaced investments , either because they have
    not been fully informed about the markets and market trends or
    because of overoptimistic interpretation of the economic forecasts .
    Whatever the reasons for the current overcapacity , the fact remains
    that it is steadily eroding the economic position of the inland
    waterway transport industry . The latest market trend indicators and
    demand forecasts show no signs of improvement unless urgent
    measures are taken to cut excess capacity .
 ---pagebreak---                                        2
2 . Overcapacity is particularly marked in the fleets of the Member
     States with linked inland waterway networks - Belgium , France ,
     Germany , Luxembourg and the Netherlands . It is difficult to
     quantify the impact of the current overcapacity : figures from the
     industry and the Member States concerned suggest that surplus
     capacity is now about 20 % of the combined tonnage of these five
     countries' fleets .
     Since it is beyond the means of the industry to reduce this
     structural overcapacity by itself , the Member States concerned have
     taken measures to remedy the problem , based , inter alia , on the
     1968 Commission recommendation on the subject ( 1 ). National schemes
     to scrap inland waterway vessels have been conducted in Belgium ,
     France , Germany and the Netherlands . Since 1969 , when the German
     scrapping scheme started , these measures - varying in length , aims
     and success - have removed around 9 400 vessels with a deadweight
     capacity of over 4 million tonnes from the inland waterway
     transport market . Since the onset of the latest crisis in 1980 a
     total of 2 230 vessels with a combined deadweight capacity of
     around 1 million tonnes have been scrapped . Scrapping schemes are
     still operative in Germany and the Netherlands , and France has a
     modest government programme for buying vessels .
( 1 ) Commission Recommendation of 31 July 1968 to the Member States on
      structural improvements to the market in the carriage of goods by
      inland waterway ( 0J No L 218 , 4.9.1968 ).
 ---pagebreak---                                       3
3 . Despite the large number of vessels scrapped , the post-1980
    national scrapping schemes have failed to make sufficient inroads
    into structural overcapacity . The primary reason has been the
    persistent decline in demand combined with the entry into service
    of new , more productive capacity , particularly between 1978 and
    1981 . Second , the modernization of transport and handling
    technology and improvements to the inland waterway infrastructure
    in recent years have boosted vessel performance without any
    proportionate growth in traffic . One other important factor is the
    long service life of the vessels : in several cases , vessels over 60
    years old are still taking a share of the traffic . As a result , the
    fleet can only slowly shed capacity . Consequently , scrapping
    schemes are needed to allow faster adjustment of supply to demand .
4 . Two other factors help to explain the failure of the post-1980
    scrapping schemes to end structural overcapacity . First , the
    programmes have not been synchronized in every Member State
    concerned . Given the lack of any firm dividing-line between the
    national inland waterway networks , the result has been that
    overcapacity in the countries without a scrapping scheme has
    cancelled out some of the gains made elsewhere . Second , the
    national scrapping schemes did too little to curb new investment in
    the vessel categories suffering from overcapacity , while a
    scrapping scheme was in operation .
II . GENERAL CONSIDERATIONS
5 . To take account of these last two factors and rapidly reduce
    structural overcapacity , the Commission proposes a two-part system
    entailing :
 ---pagebreak---                                       4
     ( i ) measures tu coordinate the national scrapping schemes by
           harmonizing some of the basic principles and procedures
           throughout the Community :
    ( ii ) arrangements to prevent the impact of a coordinated scrapping
           scheme from being cancelled out while it is still in operation
           by the bringing into service of extra vessels .
    These measures have been called for by the European organizations
    representing inland waterway carriers .
6 . The system proposed is based on national scrapping funds , some
    already in place , others yet to be set up , in the Member States
    particularly concerned by inland waterway transport . The Commission
    considered the possiblity of an international scrapping fund .
    However , in view of the seriousness of the situation in inland
    waterway transport , it seemed preferable to draw on the systems and
    structures used in past or present national scrapping funds so that
    a coordinated scrapping scheme could start as early as possible . In
    practice , the introduction of an international fund could raise a
    host of institutional , administrative and other problems which
    would seriously delay the starting of the scrapping scheme in view .
    Consequently , national scrapping funds will operate in the Member
    States whose inland waterways are linked to those of another Member
    State and the tonnage of its float is above 100.000 tonnes
    ( referred to as " the Member States " henceforth ). Belgium , France ,
    Germany and the Netherlands are particularly concerned hereby . The
    Luxembourg authorities will not introduce a special scrapping fund
    for their small fleet . Instead , Luxembourg carriers will be
    required to register with one of the other funds of their choice .
                                                                            6
 ---pagebreak---      The same treatment can be extended to any inland waterway
     undertakings from Member States other than these five which carry
     goods on the inland waterways linking the five . They too should be
     required to contribute to one of the scrapping funds set up .
     Paragraph 11 gives details of the arrangements for the Swiss
     fleet . There is no need for the Regulation to take into considera¬
     tion vessels from the Eastern European countries , because their
     entry into inland waterways linked to those of the Member States
     concerned is not likely to threaten the objectives of the system
     envisaged . By virtue of Council Regulation no . 2919 /85 ( 1 ), only
     boats having a " genuine link " with one of the Rhine States or with
     a Member State , may carry out transport operations on inland water¬
     ways covered by the Revised Convention for the Navigation of the
     Rhine . On the other inland waterways of the Member States concer¬
     ned , the participation of vessels from Eastern countries is subject
     to technical and administrative conditions , with the result that
     their participation would have a negligeable impact .
     The public authorities in the Member State where the scrapping fund
     is set up will administer the fund , with the resources at their
     disposal . Each Member State concerned will involve the organiza¬
     tions representing inland waterway carriers in its country in the
     administration of its fund .
( 1 ) 0.3 . no. L 280 of 22.10.1985 .
 ---pagebreak---                                       6
    In view of the scale of the overcapacity today , the lack of funds
    to reduce it rapidly and the danger of a further fall in demand ,
    the system must be a permanent arrangement for combating
    overcapacity effectively at all times . It will apply to all pusher
    craft and cargo vessels carrying goods for hire or reward or on an
    own-account basis on inland waterways linking the Member States
    concerned . However , vessels which are in no way to blame for the
    overcapacity on the waterways concerned , either because of their
    technical equipment or because they operate solely on closed
    national markets , should be exempted .
    Although all Community-based inland waterway undertakings operating
    on the inland waterway network concerned will be required to
    contribute to the system for structural improvements in the inland
    waterway sector , scrapping will remain voluntary . It will be left
    to each undertaking to decide for itself whether or not to scrap
    vessels .
7 . As regards operation of the system , the national funds must have as
    many elements as possible in common to avoid unequal treatment
    caused by application of widely diverging procedures and criteria .
    For instance :
    (i)   the scrapping schemes will be started at the same time , be of
          the same duration and be subject to the same conditions in
          every Member State concerned ;
 ---pagebreak---                                         7
    ( ii ) each national scrapping fund will be financed by annual
            contributions from each cargo vessel or pusher craft
            operating on the inland waterways linking the Member States
            concerned . These contributions will be based on the
            deadweight tonnage and motive power of the vessels . The rates
            must be set at a level which inland waterway undertakings in
            a difficult economic position can afford . The vessel owner
            will make the payments into the funds ;
    ( iii ) arrangements will be made for the Member States to pay an
            advance into the fund , in the form of interest-free repayable
            loans , to allow the system to start immediately .
    ( iv ) the same rates will apply in every Member State concerned
            both for the contributions from the undertakings and for the
            scrapping premiums paid to them ; these will be calculated in
            a single , stable currency , the ECU .
    To allow for the fundamental differences between the dry cargo and
    liquid cargo markets , it seems advisable for each scrapping fund to
    keep separate accounts for dry cargo carriers and tankers . Pusher
    craft can operate on either of these two markets and should
    therefore be entered in the accounts for the market on which they
    carried most of their cargo in the year before the Regulation
    entered into force .
8 . The second part of the system consists of measures to curb
    investment in extra vessels in the course of the coordinated
    scrapping scheme . However , in order to avoid totally blocking
    access ( for new entrants ) to the inland waterway transport market
                                                                           «
 ---pagebreak---                                       6
   or placing a quota on fleets , as a general rule the " Oud voor
   Nieuw " ( old for new ) system could be used . This implies that
   during the coordinated scrapping scheme 's life , carriers who wish
   to bring into service extra capacity ( whether newly built vessels ,
   vessels from non-Community countries or vessels from waterways not
   covered by the Regulation ) would :
   ( a ) either have to scrap tonnage equivalent to the new vessel
         without , however , receiving the scrapping premium ;
   ( b ) or , if they decide not to scrap tonnage , have to pay a special
         contribution into the fund .
   In cases of serious , persistent structural overcapacity , the
   tonnage to be scrapped ( a ) and the special contribution ( b ) could
   be increased to up to double the original value .
   In addition , Member States must refrain from granting aid to
   stimulate investment in additional capacity during the life of the
   coordinated scrapping scheme . The Commission shall watch the
   situation in the course of exercising its competence by virtue of
   article 93 of the Treaty . It will make a declaration on this
   question when the Council adopts the Regulation .
9. To mitigate the social impact of a coordinated scrapping scheme on
   certain carriers and workers in inland waterway transport , the
   Member States should plan back-up measures to help workers who
   wish to leave the industry or retrain for jobs in another sector
   of the economy . To achieve this , the Member States could draw on
   the facilities offered by the European Social Fund .
 ---pagebreak---                                        9
1G . Since this will be a Community system , all decisions on its
     operation will have to be taken at Community level . The Commission
     must be authorized to adopt these decisions after consulting the
     Member States and the European organizations representing inland
     waterway carriers and taking account of the results of the
     observation of transport markets and of any foreseeable changes in
     the situation . For instance , the Commission will decide on :
     (i)     the starting date and duration of the coordinated scrapping
             scheme ;
     ( ii ) the rates for the annual contributions and the scrapping
             premiums ;
     ( iii ) eligibility for a scrapping premium ;
     ( iv )  the adjustment coefficients for each vessel category ,
     (v)     the system of mutual financial support by the Funds .
     Also , in cases of serious and persistent overcapacity , the
     Commission will be empowered to increase the tonnage to be
     scrapped , or the special payments to be made in order to bring
     into service new capacity , to up to double the original values .
11 . In the Central Commission for the Navigation of the Rhine ( CCR )
     the Swiss authorities have shown interest in a similar solution to
     the one proposed in the Regulation . In response to this position
     on the part of Switzerland , whose fleet operates on the inland
     waterways linking the Member States concerned , it appears
     desirable for the Community to negotiate an arrangement with
     Switzerland so that it can adopt measures comparable to those set
     out in this proposal . The Council will have to authorize the
     Commission to open such negotiations .
 ---pagebreak---                                      10
12 . There appears to be no problem as regards compatibility of the
     system proposed with the Revised Convention for the Navigation of
     the Rhine . The proposed Regulation will in no way affect the
     principle of freedom of navigation on the Rhine in practice .
     Moreover , although the annual contributions to the scrapping fund
     are compulsory , they cannot be considered tolls since they are in
     no way linked to the number of carriage operations or to freight
     rates . Finally , scrapping will remain voluntary .
13 . In conclusion , the Commission feels that the measures proposed
     form an indispensable response by the common transport policy to
     the current difficulties in the inland waterway transport sector .
     Only an industry with healthy structures closer in line with
     demand will be capable of bolstering its competitive position and
     profitability and rising effectively to the challenge of
     completion of the internal market by 1992 .
III . PARTI CULAR C0NSIDERATI0NS
      Artide 1
      No comment .
      Article 2
      Peragraph 1
      The reasons for the current overcapacity , particularly the
      decline in demand , apply equally to carriage on own account and
      carriage for hire or reward . Consequently , the Regulation must
      apply to all the markets for the carriage of goods by inland
 ---pagebreak---                                11
waterway . What is more , no legal distinction is drawn between
carriage on own account and carriage for hire or reward in the
regulations governing international shipping on the Rhine . For
this reason , it would be harder to implement the Regulation in
practice if the rules were limited to one of the two .
Paragraph 2
Sub-paragraph ( a ) exempts vessels operating on inland waterways
other than those interlinking the five Member States concerned
( e.g. in the United Kingdom or Italy ).
Overcapacity in multiple-barge convoy sets includes barges and
pusher craft alike . Consequently , there is a clear need to
include both in the Regulation . However , small pusher craft with
a motive power of less than 300 kilowatts may be exempted because
there is hardly any overcapacity in this range , which is
restricted mainly to the short-haul market ( for example , port
services ) .
Article 3
No comment .
Article 4
Vessels are registered or recorded in the owner 's name , even if
they are operated by someone else . Consequently , the owner , not
the operator , should pay the contributions to the scrapping
fund . In return , the scrapping premium too should be paid to the
owner .
Article b
No comment .
                                                                   A
 ---pagebreak---        Artide 6
       Rate3 of annual contributions are based on the deadweight tonnage
       and motive power of the vessel . To calculate these , adjustment
       coefficients must be applied to allow for the differences in the
       value and productivity per tonne or per kilowatt between various
       types of vessel .
       In view of the difficult economic position of inland waterway
       transport undertakings , the annual contributions should not on
       average exceed 1 % of their annual turnover .
       The individual annual contributions will be fixed each year by
       the Commission and will depend on the situation on the market
       concerned . Where appropriate , they may be zero-rated if the
       financial situation of the scrapping funds permits .
       Article 7
       In view of the difficulties now facing the inland waterway
       transport sector , the Member States should pay advances into the
       scrapping funds in the form of interest-free repayable loans .
       This advance is " an exceptional and temporary measure in order to
       eliminate , as part of a reorganization plan , excess capacity
       causing serious structural problems " and , as such , satisfies the
       criteria set out in Article 3(l)(d ) of Council Regulation ( EEC )
       No 1107 /70 of 4 June 1970 on the granting of aids for transport
       by rail , road and inland waterway ( 1 ).
( 1 ) 0J No L 130 , 13 /06 /1970
 ---pagebreak---                               13
Artide 8
The same coefficients of adjustment should be applied to
calculate the " equivalent tonnage " of each category of inland
waterway vessel and to calculate annual contributions and
scrapping premiums .
Article 9 , 10 , 11 and 12
No comment .
 ---pagebreak---                            Proposai for a
                      COUNCIL REGULATION ( EEC )
      cn structural improvements in inland waterway transport
THE COUNCIL OF THE EUROPEAN COMMUNITIES ,
Having regard to the Treaty establishing the European Economic
Community , and in particular Article 75 thereof ,
Having regard to the proposal from the Commission ,
Having regard to the opinion of the European Parliament ,
Having regard to the opinion of the Economic and Social Committee ,
Whereas the structural overcapacity manifest for some time in the
fleets operating on the linked inland waterway networks of Belgium ,
France , Germany , Luxembourg and the Netherlands appreciably affects
the economics of transport services , particularly of the carriage of
goods by inland waterway in those countries ;
Whereas forecasts show no sign of a sufficient increase in demand in
this sector to absorb this overcapacity in the next few years ; whereas
in fact the share of the total transport market taken by inland
waterway transport is continuing to decline as a result of progressive
changes in the basic industries supplied mainly by inland waterway ;
Whereas the results of the national vessel-scrapping schemes organized
by certain Member States , while positive , have been insufficient , for
want of international coordination of these schemes ;
Whereas a common approach , allowing Member States to take joint
measures to attain the same objective , is a sine qua non for
effectively reducing overcapacity ; whereas , to this end , scrapping
 ---pagebreak---                                         2
funds should be Introduced in the Member States particularly concerned
by inland waterway transport ; whereas undertakings established in
other Member States but providing transport services on the linked
inland waterways of the Member States concerned must contribute to one
of the scrapping funds set up ;
Whereas , in view of the present severity of structural overcapacity ,
of the likely lack of financial resources to reduce this overcapacity
rapidly and of the danger of a further decline in demand in the wake
of other industrial changes , it appears advisable to set up , for an
indefinite period , the legal , administrative and financial instruments
needed to remedy this overcapacity ;
Whereas overcapacity generally affects every sector of the inland
waterway transport market ; whereas the measures adopted must ,
therefore , be generally applicable and cover all cargo vessels and
pusher craft ; whereas , however , vessels which in no way contribute to
the overcapacity on the abovementioned network of linked inland
waterways either because of their size or because they are operated
solely on closed national markets , could be exempted from these
measures ; whereas , by contrast , private fleets performing carriage on
own account must be included in the system because of their impact on
transport markets ;
Whereas , in view of the fundamental differences between the dry cargo
and liquid cargo markets , it is advisable to keep separate accounts in
each fund for dry cargo carriers and tanker vessels ;
Whereas , in the context of an economic policy compatible with the Treaty,
responsibility for structural improvements in a given sector of the
economy lies primarily with operators in the sector ; whereas ,
therefore , the cost of any system introduced must be borne by the
inland waterway transport undertakings ; whereas , in order to launch
                                                                   • • •/ • • •
 ---pagebreak---                                         3
the system on a fully operational basis from the outset , arrangements
should be made , however , for the Member States concerned to pay an
advance in the form of repayable loans ; whereas , in view of the
difficult economic situation of the undertakings , these loans should
be interest-free ;
Whereas , in accordance with Article 74 of the Treaty , the objectives
of the Treaty are to be pursued as regards transport within the framework of
a common policy : whereas , as Article 77 makes clear , this policy may
include the granting of aids , in particular if they meet the needs of
coordination of transport ; whereas the Community 's action in this
area , including aids , must however take into account the various
general objectives of Article 3 and in particular that of Article 3(f ),
concerning competition; whereas , as with all aids subject to the rules
of Article 92 et seq . of the Treaty, it is desirable to ensure that the
measures provided for in this Regulation and their implementation do not
distort or threaten to distort competition by favouring certain
undertakings to an extent which is contrary to the common interest;
whereas , in order to place the enterprises concerned in similar conditions of
competition, the contributions to be paid to the scrapping funds
and the scrapping premiums should be set at uniform rates ; whereas
likewise the scrapping programmes should be started at the same time ,
be of the same duration and subject to the same conditions in all the
Member States concerned ;
Whereas steps should be taken to prevent the gains from the
coordinated scrapping scheme being cancelled out by extra capacity
coming into service et the same time ; whereas , in cases of serious and
persistent overcapacity , temporary measures may have to be taken to
curb investment without , however , totally blocking access to the
inland waterway market or imposing a quota on the national fleets ;
Whereas , as part of the proposed system , social measures should be
taken to help workers who wish to leave the inland waterway industry
or to retrain for jobs in another sector ;
                                                                               4
 ---pagebreak---                                         4 -
Whereas , since the system is a Community one , decisions on its
operation must be taken at Community level after consultation with
the Member States and the organizations representing the inland
waterway transport industry ; whereas the requisite power for the
adoption of those decisions , as well as for ensuring their implementation
and the maintenance, of the conditions of competition laid down in this
Regulation , must be conferred on the Commission;
Whereas , in order to prevent distortion of competition on the markets
in question and to render the proposed system more effective , it is
desirable for Switzerland to adopt similar measures for its fleet on
the linked inland waterway network of the Member States concerned ;
whereas , as provided for by the Treaty , the Commission should
therefore open negotiations on this subject with Switzerland , on
behalf of the Community,
HAS ADOPTED THIS REGULATION :
                                   Article 1
1 . Inland waterway vessels used to carry goods by inland waterway in
     the Member States shall be subject to a system for structural
     improvements in inland waterway transport under the conditions laid
     down hereinafter .
2 . The system shall comprise :
     - measures .to reduce structural overcapacity by means of scrapping
       schemes ;
     - supporting measures to avoid aggravation of existing overcapacity
       or the emergence of further overcapacity .
                                    Article 2
 1 . This Regulation shall apply to cargo-carrying vessels and pusher
     craft providing transport services on own account or for hire or
     reward and registered in a Member State or , if not registered ,
     operated by an undertaking established in a Member State .
                                                                           4
 ---pagebreak---       For the purposes of this Regulation " undertaking " means any natural
     or Legal person exercising an economic activity on a non-industrial or
     industrial scale .
 2 . The following shall be exempt from this Regulation :
      ( a ) vessels sailing exclusively on national waterways not linked to
            other waterways in the Community ;
     ( b ) - pusher craft with a motive power not exceeding 300 kilowatts ;
            - sea-going inland waterway vessels and ship-borne barges used
              exclusively for transport operations which include a sea
              crossing ;
            - ferries ;
            - vessels providing a non- profit - making public service .
                                    Article 3
1 .. Each of the Member States whose inland waterways are linked to
     those of another Member State and the tonnage of whose fleet is above
     100.000 tonnes , hereinafter referred to as " the Member States
     concerned ", shall set up , under its national legislation and with
     its own administrative resources , a Scrapping Fund , hereinafter
     referred to as " the Fund ".
2 - The corooetent authorities in the Member State concerned shall
     administer the Fund . Each Member State shall involve its national
     organizations representing inlend waterway carriers in this
     administration .
3 . Each Fund shall consist of two separate accounts , one for dry cargo
     carriers , the other for tanker vessels .
 ---pagebreak---                                         6
                                    Article 4
1 . For each vessel referred to in Article 2 and not exempted from this
    Regulation the owner shall pay into one of the Funds set up under
    Article 3 a contribution fixed in accordance with Article 6 .
2 . The contribution for vessels registered in one of the Member States
    concerned or for non-registered vessels operated by an undertaking
    established in one of those States shall be paid into the Fund of
    the Member State where the vessel is registered or the undertaking
    is established , respectively .
3 . The contribution for vessels registered in another Member State or
    for non-registered vessels operated by an undertaking established
    in another Member State shall be paid into one of the Funds set up in the
    Member States concerned , at the choice of the vessel owner .
    This choice shall be made once only and shall apply to all vessels
    belonging to the same owner or operated by the same undertaking .
                                    Article 3
1 . Any owner scrapping a vessel for which a contribution has been paid
    shall receive a scrapping premium from the Fund to which his vessel
    belongs in so far as the financial means are available, subject to
    the conditions set out in Article 6 . This scrapping premium shall
    be granted only in respect of vessels which the owner proves form part of
    his active fleet .
                                                                              До
 ---pagebreak---                                           7
 2 . There shall be mutual financial support as between the various Funds .
     It shell come into play where a Fund cannot meet requests for scrapping
     premiums through lack of financial resources and where other Funds have
     an excess of liquidity since insufficient requests have been made of them .
                                     Artide 6
1 . The Commission shall lay down separately for dry cargo carriers ,
     for tankers and for pusher craft :
     - the rate for the annual contributions to the Fund for each
        vessel ;
     - the rate for the scrapping premiums ;
     - the period covered by the scrapping programmes , during which
        scrapping premiums will be paid, and the conditions under which
        they may be obtained ;
     - the adjustment coefficients for each type and category of inland
       waterway vessel .
2 . Rates of contributions and scrapping premiums shall be expressed in ECU
     and shall be the same for each Fund .
3 . Contribution   rates  shall   be  fixed  at  a  level  allowing the   Funds
     sufficient financial resources to make an effective contribution to
     reducing the structural imbalance between supply and demand in the
     inland waterway transport sector . In addition , they shall be set at
     a level acceptable to inland waterway undertakings in a difficult
     economic position .
     Contributions  shall  be   calculated  on  the  basis  of  the
     deadweight tonnage and motive power of the vessel . They shall be
     paid annually at the start of the year in return for a certificate
 ---pagebreak---                                          8
    of payment . From 1 March of the year concerned this certificate
    must be on board the vesael or , in the caae of unmanned vessels , on
    board the pusher craft .
    In duly proven cases where the vessel has been laid up for more
    than three consecutive months , the contribution may be refunded
    in respect of the period for which the vessel was laid up .
4 . The Commission shall lay down the periods during which scrapping
    premiums may be obtained and the conditions for granting these
    premiums on the basis of the objectives to be attained , the vessel
    types or categories and the financial resources of the Funds .
5 . The Commission shall lay down detailed rules for the mutual financial
    support referred to in Article 5(2 ).
6 . The Commission shall take the decisions referred to in paragraphs 1
    to 5 after consulting the Member States and the organizations
    representing inland waterway carriers at Community level .
    The decisions reached by the Commission shall also take account of
    the results of observation of the transport markets in the
    Community and of any foreseeable changes therein , as well as of the
    need to avoid any distortion of competition which is contrary to
    the common interest .
                                   Article 7
Without prejudice to the provisions of the Treaty on aids and to the rules
adopted in implementation thereof , the Member States concerned may make
advance payments, in the form of loans , to the Fund set up in their territory .
The sums granted in this way shall be repaid, free of interest, by the Fund,
according to a predetermined schedule .
                                                                                 SSL
 ---pagebreak---                                     Article 8
 1 . Throughout the duration of the scrapping schemes decided upon by the
     Commission in accordance with Article 6, vessels covered by this
     Regulation pursuant to Article 2 which are newly constructed , imported
     from a third country or exempted under Article 2(2 ) (a ) may be brought
     into service on inland waterways as referred to in Article 3 only
     where :
     - the owner of the vessel to be brought into service scraps a
        tonnage of carrying capacity equivalent to the new vessel without
        receiving a scrapping premium ;
     - or , where the owner scraps no vessel ,     he pays into the Fund      <■
        covering his new vessel or into the Fund chosen by him in
        accordance with Article 4 , a special contribution equal to the
        scrapping premium fixed for the current scrapping period for a
        tonnage equal to that of the new vessel ;
     - or , where the owner scraps a tonnage smaller than that of the new
        vessel to be brought into service , he pays into the Fund in
        question a special contribution equivalent to the scrapping
        premium corresponding at the time to the difference between the
        tonnage of the new vessel and the tonnage scrapped .
     These conditions shall not apply to vessels which the owner proves
     were under construction on the date on which the scrapping scheme was
     instituted .
2 . In cases where serious structural overcapacity is expected to
     persist in the Community inland waterway transport sector or on one of
     its markets , the Commission may , after consulting the
     organizations representing inland waterway carriers at Community
     level and with the agreement of the Member States concerned , decide
     to increase to up to double the original values the values for the
     tonnage to be scrapped and for the special contributions for
     bringing new capacity into service , as provided for in paragraph 1 .
 ---pagebreak---                                       10
    At the same time the Commission shall lay down the period for which
    this measure is to apply .
                                   Artide 9
The Member States shall take measures :
- to make it easier for inland waterway carriers leaving the trade to
   obtain an early retirement pension or to transfer to another
   economic activity ;
- to grant early retirement pensions to workers leaving the inland
   waterways as a result of scrapping schemes and to organize
   vocational training courses or retraining courses .
                                  Artide 10
The Commission shall negotiate , on behalf of the Community ,
arrangements with Switzerland for the Latter to apply measures
comparable to the Community measures adopted under this Regulation .
                                  Article 11
1 . By 31 October 1988 Member States shall adopt the measures necessary
    to implement this Regulation , after consulting the Commission .
    These measures shall provide for , inter alia , permanent and
    effective verification of compliance with the obligations imposed
    on undertakings by this Regulation , of the national provisions
    adopted in implementation thereof and of the appropriate penalties
    in the event of infringement .
                                                                        J2M
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2 . Throughout the duration of a scrapping scheme Member States shall
    communicate to the Commission every six months all relevant
    information on progress with the current scheme and , in particular ,
    on the financial position of the Fund , the number of applications
    to scrap vessels and the tonnage actually scrapped .
3 . By 30 November 1988 the Commission shall adopt the decisions which it is
    required to take under Article 6 and , where appropriate , under
    Article 8(2 ).
                                  Article 12
This Regulation shall apply from 1 July 1988 .
This Regulation shall be binding in its entirety and directly
applicable in all Member States .
Done at Brussels ,                                    for the Counci l
                                                                             15
 ---pagebreak---     Statement of the impest of toe proposal for a Council Regulation
          cn structural improvements in inland waterway transport
                        on small firms and employment
1 . ADMINISTRATIVE OBLIGATIONS IMPOSED ON SMALL FIRMS AS A RESULT OF
    APPLICATION OF THE PROPOSAL FOR A REGULATION
    The main new administrative obligation imposed on firms in this
    sector in Member States where scrapping funds are to be introduced
    will be to pay an annual contribution and to keep a certificate of
    payment on board their vessels .
2 . ADVANTAGES FOR SMALL FIRMS
    The measures are proposed to reduce structural overcapacity on the
    market and , hence , bring about, improvements which will boost the
    profitability of all inland waterway undertakings in the Member
    States -
3 . DISADVANTAGES FOR SMALL FIRMS
    Yes . Undertakings will have to pay an annual contribution to the
    scrapping fund . However , this expense will be amply offset by the
    benefits derived from greater profitability in a healthier market .
4.  IMPACT ON EMPLOYMENT
    Inland waterway undertakings will be free to choose whether or not
    to scrap vessels . And the Commission has proposed social measures
    to help workers whose jobs are lost under a vessel-scrapping
    scheme .
5 . HAVE BOTH SIDES OF INDUSTRY BEEN CONSULTED BEFOREHAND?
    Yes . The European organizations representing inland waterway
    carriers have approved the broad lines of the proposed system for
    structural improvements in the inland waterway transport sector .
    The trade unions have raised no objections to the system .
6 . IS THERE ANY ALTERNATIVE , LESS BINDING APPROACH?
    No . The approach proposed, is advocated by the Member States and
    inland waterway carriers alike .