Question Time (Commission)
The next item is Question Time (B7-0411/2011).
The following questions are addressed to the Commission.
Part one
Subject: Colombian human rights and the Free Trade Agreement (FTA)
Activists in Colombia continue to be threatened and murdered, as shown by the recent case of Ana Fabricia Cordoba, who had publicly denounced the threats she was receiving. Her children attribute her assassination to members of the police. Since July 2010 40 activists have been assassinated, and an effective response from the Colombian Government is not forthcoming.
The Commission always refers to the human rights clause as a means of improving respect for human rights. Yet Colombia is already part of GSP+, which includes a human rights clause. The latter has never been invoked by the EU, and Community leaders, NGO staff and activists continue to be assassinated in Colombia.
What reason do we have to believe that the impact of the clause in the FTA will be any different?
Member of the Commission. - I welcome the opportunity to discuss human rights and our trade agreement with Colombia and Peru in line with the fundamental values the EU holds dear. Let me start by saying very clearly that there is no leniency in the Commission in any form whatsoever on such grave matters. We are fully aware that threats and attacks against human rights activists in Colombia continue and I deplore them. In the specific and tragic case of Mrs Córdoba the Colombian Government has not only unequivocally condemned her killing but has also offered a reward for any information leading to the identification of her killer.
It is also taking measures to strengthen the safety of victims as well as activists and their leaders. On every possible occasion the EU is actively raising the issue of human rights and in particular the need to guarantee the personal safety of human rights defenders in Colombia. Only last week the EU held a human rights dialogue with the Colombian authorities in Bogotá and raised individual cases in this context. The parties also discussed the land restitution law and ways to combat impunity.
Two weeks ago I personally raised the human rights issued with President Santos to tell him how close this is to the heart of the people in the EU and their elected representatives. He gave me an unequivocal response that the course that he has set for his country towards the full restoration of law, in the practice of respect for human democracy and the rule of law, is definite and resolute. I assure you the Colombians know that the Commission means business when it comes to approving their human rights record.
Now as regards the agreement with Colombia, it is the view of the Commission that the EU would be overlooking its responsibilities if it were to walk away from an enhanced economic partnership with Colombia. If we were to do so we would fail to support the transition of this country from a culture of conflict and violence to a society of freedom and opportunity. There is indeed not a single doubt in my mind that the trade agreement, through the incentives it creates, will have a positive effect on Colombia's civil society, its governance structures and the human rights situation in general.
Sustainable improvement of the human rights situation in Colombia requires us to address the root causes of the violence in the country. These include poverty, social exclusion and a lack of economic opportunity in some parts of the territory. The EU trade agreement coupled with our efforts in the development cooperation field will further this economic development, create jobs and reduce poverty.
In particular our contribution will be significant in creating the means of income generation that provide viable alternatives to drug cultivation whose stranglehold has been a main driver for Colombia's internal conflict and for the human rights violations that it entails. If this overall approach were to fail, the human rights provisions that we negotiated in the trade agreement fully address the human rights challenges that Colombia is facing.
Article 1 of the agreement states that respect for fundamental human rights as laid down in the Universal Declaration of Human Rights constitutes an essential element of the trade agreement. In the event of violation of this essential element, the EU will be in a position to immediately, unilaterally and without prior consultation suspend the agreements. It is clear to me that our fundamental objective to consolidate and support democracy, the rule of law and human rights will be fully safeguarded thanks to these strong provisions.
In addition our agreement includes a number of binding commitments to effectively implement core labour and environmental conventions and makes provision for a mechanism for monitoring the implementation of labour standards which allows for the participation of civil society organisations.
The agreement with Colombia and Peru is a trade pact for development which requires, unlike our GSP autonomous preferences scheme, full reciprocity of commitments and contains solid human rights guarantees. In the coming months you will soon have the opportunity to give your consent to this agreement. I urge you to take this overall balance into consideration and approve the conclusion of this agreement when the time comes.
(DE) Madam President, firstly, I would like to thank you very much, Commissioner, for your answer which sounds very positive. However, I would like to emphasise once again that the problem lies in the fact that there was already a human rights clause in the old preferences scheme and it did not help to prevent the violations of human rights which took place under the Uribe government and before that. Therefore, my question was specifically: What exactly will be different? How do the EU and the Commission intend to guarantee in future that these violations of human rights will not be repeated?
On the other hand, I have figures which show that under the new government in the last 300 days there have been more than 200 attacks on human rights activists. Also 15 leaders who supported human rights and the fair distribution of land in the agricultural sector have been murdered. When I look at what is happening, I have to ask once again: How exactly are you going to ensure that you can prevent this? I still do not know what the answer to this question is.
Member of the Commission. - First of all, the word 'ensure' which you are using is a somewhat difficult word. We are not an insurance company: we are a political body that has been negotiating a free trade agreement with Colombia in good faith and with very clear provisions with regard to fundamental rights. These provisions are an essential part of the agreement and enable us to suspend it without prior consultation in the event of gross infringements.
This is different from the existing GSP arrangements because, under the GSP scheme, agreements cannot be suspended without first holding an inquiry. This agreement goes further since it can even be suspended without prior consultation. But it is not only about this: it is also about creating new opportunities through the trade agreement. And it is by eradicating poverty, by giving new opportunities to people, that we will be able to do this.
Thirdly, I will say that I am convinced that the authorities are doing everything possible to stop this, that they are very honest with respect to this. But you should not forget that we are speaking about a country that two decades ago was - and has been in the decades since - at war.
I remember the first time I went to Colombia at the beginning of the 1980s: just walking a couple of hundred metres in the main street of Bogotá in daytime was dangerous. So the situation is much better than it was then, far better. The governments, be it that of Uribe, or now that of Santos, are really serious in trying to combat this danger.
(PL) I should like to raise the following issue. I act as Vice-Chair of Parliament's Subcommittee on Human Rights, which deals in detail with issues such as the situation in Columbia. I agree with the Commissioner that there has been a certain amount of progress in the country, and I would like to voice my very strong support for what the EU has begun to do, namely not merely to talk about observing human rights, but also to ensure in practice that this issue is tabled during talks on trade agreements. This is the right path to take, and I believe that it will yield results in the longer term.
Member of the Commission. - I can confirm that we have these human rights clauses in the agreement, that they constitute an essential element of the agreement and that, if there is infringement, we can suspend the agreement without prior consultation. We have duly taken this into account when negotiating this agreement.
Subject: Competition law and public property
On 23 September 2010 the Qatar Investment Authority (QIA) and the Greek government signed a Memorandum of Understanding, providing, inter alia, for the commercial and residential development of the former Ellinikon airport site. According to press sources, the QIA now intends to withdraw from this particular investment, citing obstacles erected by European competition law. Regardless of the fact that this area should be a 'green lung' for Athens, given the daily degradation of the city's environment by air pollution, and regardless of possible political disagreements about the Greek government's commitment to sell off public assets worth €50 billion, will the Commission say:
Have there been any complaints about breaches of EU competition law in the procedure initiated with the QIA? What are, in the Commission's opinion, the correct procedures to be followed in such cases?
Vice-President of the Commission. - I understand that this question was asked by Mr Chountis.
The honourable Member has informed us that a commercial contract was concluded between the Greek state and a company to invest in a project for a commercial residential development on the former site of Ellinikon airport. According to this information, this company now wants to withdraw from this contract.
The Commission has not received any complaints on the matter in relation to competition law rules. However, the company's withdrawal from a contract may be a breach of contract law that must be assessed under national law. But the act of withdrawal in itself is not against competition law rules.
The Commission has not received any complaint concerning a possible infringement of European public procurement rules in this matter. But in any case it should be underlined that, should the agreement mentioned by the honourable Member or any other agreement related to the development of this area, fall under the scope of the EU public procurement directives, the relevant provisions thereof have to be fully complied with.
(EL) Madam President, Commissioner, thank you for at least part of your reply, that there have been no complaints of infringements of EU law and that the Commission has no such information in its possession.
As you know, my other question is extremely important. Regardless of whether or not I agree with this sale of public property, the Greek government has agreed in the medium-term programme to raise EUR 50 billion from denationlisations. My question is this: what, broadly speaking, is the EU legislation in cases where a Member State of the European Union sells public property?
I would be grateful if you could give me some more information.
Vice-President of the Commission. - I am not a legal expert but, from what I know of this process, I would say that it will depend on the kind of asset to be privatised and the circumstances. In any case, if there are obligations to be fulfilled under the EU public procurement rules, those rules should apply. And if, because of the privatisation, there should be a merger that has an EU dimension, then it would be the direct responsibility of my services, as I am Commissioner for Competition, to analyse whether this merger complies with EU rules. This is not, of course, a legal answer, it is a political one. In any case, I think we could provide a much more precise answer about the EU laws, regulations and directives that would apply.
Subject: National Asset Management Agency
It is now over a year since the Commission approved the establishment of the National Asset Management Agency (NAMA) in Ireland under State aid rules. In light of the potential effects of the NAMA scheme on European competition law, the Commission requested, and obtained, a commitment from the Irish authorities that yearly reports would be submitted to both the Commission and the Irish national competition authorities on the use of NAMA's post-acquisition powers.
A year on, is the Commission still satisfied with the NAMA scheme?
Vice-President of the Commission. - As the Member correctly says, paragraph 74 of the Commission decision on the NAMA case in 2009 includes a commitment from the Irish authorities to report yearly on the use of some of the post-acquisition powers conferred on NAMA by the legislator. On 16 February this year, the Commission received the first yearly report on the use of post-acquisition powers.
We have not raised any concerns on the use of the aforementioned powers mentioned by NAMA for the period covered by this report. In addition to assessing the report on the use of post-acquisition powers, the Commission follows NAMA's operations closely, both directly and indirectly. As for direct monitoring, we have adopted two decisions in the period up to June 2011, one for each of the two first tranches of assets that have been transferred to NAMA and notified to the Commission.
These decisions stem from the commitment to notify each individual tranche of transfer assets set out in the aforementioned paragraph 74 of the decision and indirect monitoring is carried out through the assessment of the impact on the financial institutions participating in the NAMA scheme.
deputising for the author. - I want to apologise for Mr Mitchell, who might be leaving us shortly, as might Ms McGuinness later, because both are going to be presidential candidates in the Irish presidential election. Can I say that I am very pleased with the reply that I have received from the Commissioner?
But what is crucially important is that the Commission keeps its eye on the situation, because we are in the early stages of an experiment that we have never had before, in which stressed assets are being taken over by NAMA. What is crucially important is that the hospitality sector, with its multi-million euro hotels, which cost the Irish taxpayer and the banks a lot of money, is kept under review and does not contravene the competition laws.
So I am delighted that, in year one, NAMA is complying with the conditions and terms which were applied by the Commission at the request of the Irish Government.
Vice-President of the Commission. - Indeed I can assure the honourable Member, and also Mr Mitchell, with whom I recently had the opportunity of discussing these issues in Dublin, that we will indeed monitor very closely the operations of NAMA. We know how important it is and the huge volume of assets and resources that they have to manage, and that there is a lot at risk for Irish taxpayers.
At the same time we are looking very closely at the individual cases of restructuring of the banks that benefited from this outsourcing of the bad assets towards NAMA. We decided last week on the liquidation of Anglo Irish and INBS; we are waiting until the end of this month of July for the reception of the restructuring plans both of Allied Irish Banks and Bank of Ireland, according to the programme that Ireland subscribed to with the EU, the IMF and the ECB, and we will look very closely at those restructuring plans.
Hopefully this will pave the way for the sustainability of the banking sector in Ireland, which is one of the necessary conditions for the recovery of its economy.
Like Mr Mitchell and Ms McGuinness, I too was a prospective candidate, but said I would stay here with my colleague Mr Higgins, so I withdrew from the race.
My question is as follows: it is strongly rumoured in Ireland that NAMA-owned hotels are undercutting non-NAMA hotels and will possibly put them out of business. Is the Commission aware of this and, if so, what action does it propose should be taken to alleviate that situation?
Vice-President of the Commission. - It is not our responsibility to look at every case of the management of assets by NAMA. That is impossible. This is a good question to be addressed to the Irish authorities in the Irish Parliament.
We have to monitor the development of the functioning of NAMA on a yearly basis. If you address me this question in the light of the report that NAMA will submit to us and that we will assess regarding the operations that NAMA is managing this year, maybe I will be able to answer your question ex-post next year. However, I cannot give you a precise answer on every kind of asset that is being managed right now by NAMA.
I would recommend that you tell your colleagues to put this question in the Irish Parliament, which will have much more information than I do.
Subject: Irish banking sector
Can the Commission outline the advantages and disadvantages of plans by the Irish Government to create two-pillar institutions in the Irish banking sector? On a recent visit to Ireland, the Commissioner for Competition noted concerns in relation to this strategy.
Vice-President of the Commission. - As Mr Gallagher has pointed out, the Commission has recently expressed some concerns about the situation regarding competition in the banking sector in Ireland. I myself expressed these concerns over the medium term.
As you know, on 31 March the Irish Minister of Finance announced the government's plans regarding the future of the Irish banking sector. In particular the Minister announced the merger of Allied Irish Banks with EBS. The Allied Irish Banks and the Bank of Ireland are now the two pillar banks in Ireland. This decision by the present Irish Minister of Finance, Mr Noonan, has been endorsed by the IMF, the ECB and the Commission. The Commission also sees the rationale for the merger of Allied and EBS, as it clearly serves a financial stability purpose in the short term, which in the current climate is an advantage.
What is a matter of concern - and I personally express this concern - is the situation of the Irish retail banking market in the medium to long term. For financial and stability reasons and because of what has happened with other financial institutions in Ireland - I have just mentioned that Allied Irish Banks is in liquidation and we decided on this liquidation process last week - in the short term there is no alternative other than to base the functioning of the banking sector in Ireland on these two pillars - Allied Irish Banks and the Bank of Ireland.
But this situation should not mean that over the medium term the barriers to entering into the banking sector in Ireland will increase because of the short-term situation of a de facto duopoly. We will be monitoring very closely to ensure these barriers to entry will not be increased and we will carefully encourage other players to enter into the Irish banking system gradually. In the short term there is probably no alternative to the present situation but in a few years - hopefully - the situation will improve and will be completely different from the present one. In that case, maintaining a duopoly would present a serious risk for competition and in real terms for the citizens of Ireland, who will require a competitive, dynamic and efficient banking sector.
- I want to thank the Commissioner for his comprehensive response. Can I ask the Commissioner to provide an update as to when a final decision will be taken on the ordinary liquidation of Anglo Irish and Irish Nationwide? He referred to our Finance Minister, Mr Noonan, and his announcement in March. You will be aware that in the United States, in Washington, he announced his intention to impose losses on EUR 3.2 billion of senior unsecured guaranteed bonds.
What is the Commission's view? Can the Commissioner confirm that the Commission supports this plan?
Vice-President of the Commission. - We clearly support the liability management that is taking place with subordinated bondholders.
The question of the senior bondholders is a different one given that, because of the way the decisions were taken in the recent past at the beginning of the crisis, these senior bondholders have a strong state guarantee. So, one way or another, the taxpayers are supporting their interests. In this case I can share the concerns that have been expressed, among others, by the President of the ECB about the negative consequences that the imposition of this kind of haircut on the senior bondholders can have.
But I praise the exercise of the liability management with subordinated debt bondholders. In such cases - with Anglo Irish or in other cases - as in all the other financial institutions which are under restructuring because of the consequences of the financial crisis and the intervention of the state giving public resources for the rescue and restructuring of those banks, we are always taking decisions that will try to distribute the burden of the operation in a fair way. This is one of the three elements that we always take into account when analysing the restructuring plans that are submitted to the Commission and when adopting our own decisions.
Thank you, Commissioner, for your very comprehensive reply and your understanding of the banking situation in Ireland. In particular I welcome your comments that you are encouraging other players to enter the Irish market.
At present we have a number of banks in the Irish market, for example KBC, who are doing very well indeed. Can I ask the Commission if it would have any objection to the establishment of a further Irish domestic bank? This is because, like in Greece, there is a lot of private money in Ireland. It is a case of setting down new terms, new standards, new protocols and new conditions. So would the Commission have any objection if a whole new Irish bank - or several Irish banks - were to emerge in the market to avail of the capital that is there?
- Commissioner, you said that other players would be encouraged to enter the Irish banking market. Can you be a little bit more precise about that? What exactly do you mean by encouraging them? What steps would you see as appropriate for that?
Secondly, you said that because of earlier decisions, the bank guarantee, etc., we could not now impose haircuts on senior bondholders. Your argument here is the existence of earlier guarantees, yet, at the same time, we have Angela Merkel saying that post-2013 there will be burden-sharing. So it seems to me that we are in an interim phase at the moment, and I would just like your comments on that please.
Vice-President of the Commission. - What kind of measures will encourage market players or potential new entrants? First of all, there is the question of solving the present problems. I have my doubts that, even under the best possible conditions, a lot of new entrants will be knocking at the door of the Irish banking system under the present circumstances. Hopefully in one or two or three years the situation will have improved and will be much better than today.
When we were discussing the previous restructuring plans, we suggested to the banks in Ireland, for instance in the case of Bank of Ireland, that we should adopt the decision in relation to the first and previous restructuring plan that, if new entrants were to knock at the door, they should help their future competitors to enter the market.
I think that these kinds of measures are possible and will be necessary, but I stress in the short term that financial instability concerns prevail. Now we need to seriously restructure these banks and put them on a sound footing with a viable business model able to finance the activity in Ireland, both households and companies. But in the future, and I hope in the foreseeable future, we can tell these banks that have been restructured with public money that they should provide some help to new entrants to enter the market in a successful way. This is what I can say today.
You mentioned a known institution that is present in Ireland, but this institution is also under a restructuring plan. So we need to call for new entrants, but first of all the new entrants should also be in a sound position.
Concerning 2013 and the Angela Merkel comments: that is in the new mechanism and the revision of the Treaty. One thing to anticipate is that you can be subject to a contribution for restructuring a debt or a kind of haircut under certain circumstances that the issuers announce and the subscribers are aware of at the beginning. It is a completely different matter to change the rules of the game in the middle of the match.
Subject: Proper functioning of the food supply chain
The share of agriculture in the food supply chain fell from 29% in 2000 to 24% in 2005, while over the same period the share of the food industry, wholesale and distribution sector all increased (Commission CAP Communication November 2010).
Does the Commission believe that competition policy has a role to play in addressing concerns regarding the proper functioning of the food supply chain and to ensure that producers are paid a fair price, given that these figures demonstrate that a growing share of revenue is being taken by others in the supply chain who have market power over primary producers?
What existing competition law provisions could be used to address this issue and where could the application of these provisions be broadened?
Does the Commission intend to tackle the lack of transparent pricing in the food supply chain?
Would the Commission consider it beneficial to initiate a sector inquiry to examine the behaviour of dominant actors in the supply chain and to determine how to address the unfair commercial practices that undoubtedly exist?
Vice-President of the Commission. - Madam President, lack of competition in any sector stifles modernisation of production, leads to higher prices for consumers, worse products and, ultimately, to a less competitive sector. It is important that the food supply chain remains competitive, with efficiencies passed on to consumers.
For that purpose, the competition rules - Articles 101 and 102 of the Treaty - ensure that cartels and abuses of dominant position are sanctioned and that companies have access to the market and supplies.
Farmers should also increase efficiency to improve their position in the food supply chain. The EU agricultural sector needs consolidation and rationalisation to achieve this. EU competition policy can contribute to this goal, to the extent that Article 101 of the Treaty allows farmers to develop sustainable and pro-competitive forms of cooperation to become more efficient, innovative, and better equipped to face competition both within and outside the EU.
You will be aware of the work undertaken within the high-level forum for a better functioning food supply chain, which includes a wide range of initiatives including the European price monitoring tool. You will also be aware that the Director-General for Competition is working in close cooperation with the national competition authorities within the European competition network. Over recent years a number of national competition authorities have actively undertaken sector inquiries to identify potential malfunctions in the food markets.
The Commission will submit a detailed report of the most significant actions taken in recent years by the national competition authorities in the food sector to the high-level forum by autumn of this year. The Commission will inform Parliament of this report at the time of its submission.
With regard to the sector inquiries, decisions to launch this kind of study are carefully considered, in line with the strategic priorities set by the Commission. To ensure the effectiveness of its actions, the Commission cannot announce in advance which sector might possibly be investigated.
deputising for the author. - I am beginning to feel more and more like a super-substitute. I hope that normal service will resume once the presidential race is over.
The emphasis in this issue is on competition, as the Commissioner has said. Would the Commission not agree that the victims in all of this are the small farmers who have limited cash flow and the small retail outlets that are increasingly being squeezed out of business by the multinationals and the big retail chains? What does the Commission propose to do to get a proper balance between the two?
Would the Commissioner, who has been very forthcoming, not agree that, once the huge supermarket chains achieve total dominance and get a stranglehold on the retail market, the two groups that are really squeezed are the producers, particularly small producers, on the one hand, and the consumers on the other hand?
Vice-President of the Commission. - As you know, we have been analysing these issues in recent years in a kind of task force, involving a lot of Commissioners, our respective services, and the stakeholders in the sector, so I think we now have a sound knowledge of where the problems lie along these value chains. Certain problems lie in my direct area of responsibility - competition policy. Others are being dealt with by my colleague, Dacian Cioloş, the Agriculture Commissioner, or by the Commissioners for trade, consumer protection or health, for example.
In my view, as Competition Commissioner, the solution for the farmers will not be to organise cartels; it will be to become more efficient, and farmers have lots of possibilities open to them, in compliance with the competition rules under Article 101 of the Treaty, to increase their bargaining power, to improve the vertical integration of their activities and to be able to negotiate on a sound footing with the distribution chains or their intermediaries. We have excellent examples within the EU of these kinds of strategy for improving dynamism, efficiency and quality and improving bargaining power against other parts of the value chain.
I know that, on some occasions, farmers say they are not used to organising themselves into cooperatives or integrating themselves into a vertical chain. Nonetheless, I think this is the right way to go. There are also problems elsewhere along the chain but, according to our knowledge - which has improved over recent years with this analysis - these problems are better dealt with at national level by the national competition authorities. In fact, during the last few years, several national competition authorities have carried out sectoral studies and are adopting a lot of decisions to improve competition and improve the functioning of the value chain. All this is taking place from a competition point of view: there are also other structural policies that should help the whole sector to function better.
At the end of the day, we need to protect farmers and we need to consider consumers. These are the two ends of the value chain, and both extremes of the value chain should put pressure on all the authorities concerned, so that we can deal with the problems we are finding at intermediate stages along the chain. So far, from the competition point of view, our work in this sector in recent years has not had an EU dimension. However, many of the competition authorities at national level are doing a very good job, and in our report next autumn I hope to show you how the European competition network, through the national competition authorities, is contributing to the solutions you are seeking with your question.
You will note that both Ms McGuinness and Mr Mitchell asked Mr Higgins to take their questions. I hope he did not promise both of them that he was going to vote for them next Saturday. He wouldn't do that.
Now, moving on to the question, the last few words in Ms McGuinness's question concern unfair commercial practices that undoubtedly exist. One of those is 'hello money', and that is being dealt with in the programme for government. The other practice, supported by a lot of anecdotal evidence, is the fact that multinational companies moving to a town first sell at very low prices to eliminate SMEs, local businesses and so forth, and then raise prices again. Is the Commission aware of this? What would they suggest could be done to eliminate it?
Vice-President of the Commission. - The Commission is aware of these types of practice. These practices require decisions at a national level because they are not the same throughout the EU. We are not talking about an EU-wide market here, but basically about nationwide markets. In some cases, these distortions of certain prices ought to be tackled not with competition-policy instruments but rather with consumer-protection instruments or through good commercial practices, legislation for which is normally adopted at national level. At EU level too we are analysing these types of bad practice and trying to combine all the instruments available to address them. It is true that these practices exist.
Subject: Financing of Belene nuclear power plant with state aid
Under the EU's Nuclear Illustrative Programme, projects to build nuclear power plants in the Union may not be funded via state aid, and other solutions need to be identified, such as financing by private operators or from the capital markets. The planned Bulgarian state guarantees for the Belene project fall under the heading of 'state aid'.
In this connection, would the Commission approve financing for the Belene project which was contingent in one way or another on state guarantees?
Has the Commission's Competition DG been consulted by the Bulgarian Government, under the urgent procedure, as to whether this type of financing could be approved and, if so, what stage have the consultations reached?
Does the BGN 300 million already allocated to the construction of the Belene plant in 2008 constitute state aid? Have proceedings been opened in that regard and, if so, when will the relevant decision be announced?
Vice-President of the Commission. - The Commission has not been approached either formally or informally by the Bulgarian authorities concerning possible notification of a potential state aid issue regarding the future financing of the Belene project. The Commission has recently requested clarification from the Bulgarian authorities on the subject, but no information has been received so far. It is thus premature to draw conclusions as to whether possible state guarantees or other ways of financing the project in the future may or may not be in line with EU state aid rules.
As regards past financing, the Commission has investigated the matter following a complaint. Based on the Council of Ministers decree of 27 October 2008, BGN 300 million were allocated from the state budget with a view to increasing the capital of NEK-EAD, the Bulgarian national electricity distributing company, in order to implement the project of building this nuclear power plant, the Belene nuclear power plant.
The information showed that the capital injection was performed in the light of considerations and prospects, and under conditions, that would have prompted a private investor to carry it out. Furthermore, the project was subject to an invitation for expressions of interest from strategic investors addressed to prospective private co-investors in May 2007. Several of them replied positively, showing interest in the project based on the available prospects at the time.
This is additional evidence that private investors also consider investment in the project at market terms to be justified. On that basis and pending the further information requested from Bulgaria as to future plans for the financing of the project, it would be premature to conclude that state aid financing is planned for the future and, if so, when the Commission could take a decision on the matter.
(BG) Thank you very much, Commissioner. Your statement to the effect that no response has yet been forthcoming from the Bulgarian authorities about the financing of the Belene nuclear power plant is the information which we also have. I have a further question which is: what is the procedure if such information is not forthcoming and can the Commission initiate any other measures to actually avoid a conflict of interests really taking place?
Vice-President of the Commission. - The Member State is obliged to send us the information we requested. If, after the normal deadline, the information has not reached DG Competition, we will request it on an informal basis. Then, after waiting for a prudent amount of time, we can decide to send an injunction obliging the Bulgarian authorities to send us the information.
Subject: Regulation (EC) No 561/2006
Can the Commission comment on the situation where Regulation (EC) No 561/2006 would prevent drivers from working more than 30 hours per week? What remedies would the Commission propose?
For example, a person drives a short school run of less than 40km, twice per day each day from Monday to Friday, for between five and six hours. He has the opportunity on a Saturday to drive another run for between six and nine hours, finishing on Saturday at 20.00 (including an uninterrupted break of 45 minutes), but the required weekly rest period of 45 hours means that he cannot start his school bus run at 08:00 on Monday.
How does the Commission propose to deal with situations like this where the application of the directive means that drivers - as in this example - are restricted to driving 30 hours per week and unable to earn a living?
Vice-President of the Commission. - Regulation (EC) No 561/2006 does not prevent drivers from working longer than 30 hours per week. Normal weekly driving time is 45 hours averaged over two consecutive weeks and 56 hours as a maximum.
Similarly Working Time Directive 2002/15/EC allows for a maximum of 60 hours of weekly working time, provided that the average of 48 hours per week is respected. In fact driving a bus on regular routes shorter than 50 kilometres is a transport operation which does not fall within the scope of the regulation. Consequently the provision on the obligatory weekly rest specified in the regulation does not concern such drivers. Member States are obliged, however, to establish national protection rules for such drivers with regard to the permitted driving times, mandatory breaks and rest areas.
I am very pleased to hear what the Commissioner says but unfortunately the Road Safety Authority in Ireland does not agree with what he has just said.
Correct me if I am wrong, but I understand that where a driver's weekday routes are less than 50 kilometres long he does not fall under the regulation from Monday to Friday. However, because on a Saturday his route would be longer than that, it is my understanding that he then does fall under the regulation. The driver in such a case does five to six hours per day, five days a week but, because he may drive eight to nine hours on a Saturday, according to the Road Safety Authority in Ireland he cannot start work at 8 a.m. the following Monday morning.
Commissioner, perhaps I have this wrong and perhaps the Road Safety Authority has it wrong but I really would like clarification on it from you. I accept what you have said and I am very pleased to hear it, but I am just not sure.
Vice-President of the Commission. - We probably need to establish closer contacts here and look into this case more deeply. But, in the case you mention, this will not prohibit school bus services.
We must take into account all details. The national authorities have their own decision-making mandate, enabling them to introduce stricter rules and to regulate this within this framework. But in reply to your question, this should not lead to the prohibition of school bus services. We are ready to look into this in greater detail if necessary.
Subject: Commission's position on mega-trucks
So-called mega-trucks are to be brought into operation for trial purposes in freight transport in some German Länder. Given that these trucks weigh up to 60 tonnes and are more than 25 metres long, there is no doubt that they will cause more wear and tear on infrastructure than conventional lorries. There is also a risk that using these vehicles will cause lasting damage to the goal of bringing about a modal shift to rail transport.
In the Transport White Paper the Commission referred to independent studies on the possible use of longer and heavier trucks. Have these studies already produced results? Does the Commission have a clear position for or against the use of mega-trucks?
Vice-President of the Commission. - Mega-trucks is a hot topic and will remain so for a while. The maximum authorised weight and dimensions of vehicles for national and international road traffic are governed by EU legislation, namely Directive 96/53/EC, which does not currently authorise the longer and heavier trucks referred to by the honourable Member for international road transport.
Some stakeholders in the road industry argue that significantly heavier and longer trucks would bring efficiency gains. The Commission needs to take into account all critical factors, including future traffic generation, facilitation of intermodal transport infrastructure capacity and upgrading and maintenance costs in its policy-making on the dimensions and weight of trucks.
At present there is no uncontested evidence that the introduction of larger and heavier vehicles, through general acceptance of the European modular systems, would result in an overall reduction of energy consumption and emissions from the transport system as a whole.
The Commission will subject any proposal to amend current regulations to a thorough impact assessment, taking into account economic, social and environmental aspects. It nevertheless appears to the Commission that there may be a good case for limited change to current dimensions in order to improve the aerodynamics, and thereby the fuel efficiency, of vehicles.
Limited changes may also be necessary to accommodate new standards of intermodal vehicles and to deal with electric vehicles and, perhaps, also journeys between adjoining countries which allow the use of longer trucks internally.
(DE) Madam President, as you said, Mr Kallas, the gigaliners or monster trucks or whatever you want to call them are a controversial subject. You mentioned efficiency gains in terms of fuel consumption. I would like to know what exactly these efficiency gains are. I know that those in favour of these trucks say that you can make one truck out of two. This would ultimately result in warehousing as we know it today becoming less expensive and it would be cheaper to drive goods around on the streets than to store them in warehouses, with the result that making one truck out of two would actually have exactly the opposite effect. I would like to ask you to consider this, because it would mean that we would have more trucks on the roads than we did before.
You have announced various studies on the subject of the monster trucks. What is happening with them? What results have you so far received? What are the next steps to be taken? I would be interested in knowing more, because Germany does not have a uniform approach to these trucks and most people are opposed to them.
Vice-President of the Commission. - Germany is a country where bigger trucks are allowed, so the position here is not so black and white. Actually, you raised several issues on which I simply do not know the answer. These matters are much debated in technical circles too. Construction is a key factor: if a truck is heavier but the burden for the axis is spread differently then the actual burden on the road can be less. So all the aspects of how a given model is constructed in terms of manoeuvring, etc. need to be examined carefully. I have seen contradictory reports and arguments from both sides. Currently the Commission has no final or fixed position. We are looking carefully at all aspects.
These bigger trucks are used in Nordic countries, where they are allowed and are not seen as a problem. At the same time in countries like Austria people are extremely opposed to them. They are concerned that this will be a big problem in terms of road structure in complex areas such as the Alps. We will not push for a radical decision that would provoke major opposition in society. We will listen to all arguments and then we will come up with a proposal. I cannot say what the efficiency gain will be because that depends very much on the various analyses and the construction of possible models.
Subject: Airlines' non-compliance with Regulation (EC) No 261/2004 with regard to protection and information for passengers
Regulation (EC) No 261/2004 came into force in 2005, with the key aim of ensuring that airline passengers were protected and properly informed. The Commission has run its own awareness-raising campaigns on the subject, yet airlines repeatedly violate the regulation, leaving passengers without swift and effective remedies. Meanwhile, online booking has turned into a racket: a ticket from Brussels to Strasbourg with an ordinary carrier, advertised and heavily promoted at the price of EUR 98, ends up costing a total of EUR 219.60, including am additional 'fuel fee'.
Can the Commission indicate when and how it intends to ensure that the Member States apply Regulation (EC) No 261/2004 and to require them to introduce arrangements for rapid and effective compensation?
Vice-President of the Commission. - This is very high on our agenda.
The correct application of Regulation (EC) No 261/2004 on air passenger rights must be ensured by the designated national enforcement bodies in the Member States. They have to take all reasonable measures to ensure that the rights of passengers are fully respected. The Commission's task is to ensure that EU law is correctly implemented and enforced by the Member States by constantly monitoring their activity.
During the recent air traffic disruptions due to the Grimsvoetn volcano, right from the start of the disruptions the national enforcement bodies and the Commission services took a proactive approach, verifying with air carriers that they planned to put measures and procedures in place to help passengers in the event of disruption to flights, whenever this was necessary.
Furthermore last April the Commission adopted a communication on the application of Regulation (EC) No 261/2004 which identifies possible shortcomings of the regulation and proposes action to clarify and strengthen the enforcement of passenger rights. The Commission also announced an impact assessment in view of a possible revision of the regulation, which would also cover enforcement issues. In this context all interested parties will be able to contribute to a public consultation scheduled for the autumn. In the meantime Parliament has announced its intention to carry out its own inquiry or own-initiative report.
Price indications while booking are subject to the price transparency rules in Article 23 of Regulation (EC) No 1008/2008 on common rules for the operation of air services in the Community. The final price to be paid must at all times be indicated and shall include the applicable air fare as well as applicable taxes, charges, surcharges and fees which are unavoidable and unforeseeable at the time of publication. This also includes the so-called fuel surcharge that you mention.
The Commission is monitoring this important question very closely in close cooperation with the national authorities in charge of the enforcement of such measures in the Member States. Our services are also currently undertaking a deeper review into the matter, in the context of the so-called fitness check and with the help of an independent study, the result of which is expected later this year.
(FR) Madam President, Commissioner, I hear what you are saying. Nonetheless, we have to recognise that for every incident which causes a flight to be delayed or cancelled, including those caused by what are deemed exceptional circumstances, air carriers do all they can to avoid taking responsibility for travellers and to avoid paying the compensation set out in the regulation.
A recent ruling by the European Court of Justice had to state, once again, that the concept of 'exceptional circumstances' is actually very limited and that in most cases, air carriers have an obligation to compensate travellers.
You mentioned an impact assessment. Let me say again that I disapprove of this approach, which involves extremely costly assessments that do not always produce results.
Do you not think, Commissioner, that the real problem is the total lack of information, indeed the critical lack of information available to consumers about their rights and the procedure for lodging complaints, which is rather complicated, to be honest.
Vice-President of the Commission. - During my time as Transport Commissioner I have had three big disruptions in air traffic, and a fourth for cargo security as well, and we have definitely obtained a lot of experience during this time. The situation is not so bad. It was, of course, an extraordinary situation when the volcano erupted, and most airlines operated very responsibly. Yes, there were airlines which tried to avoid and to evade their responsibility, but most airlines operated quite reasonably. Most national enforcement bodies take this issue seriously - though yes, not all of them - and we monitor and try to enforce it, but this is in the hands of the national enforcement bodies. In the new regulations we will be more precise concerning extraordinary circumstances which can be a reason not to compensate.
I think that overall the regulation works very well; there must certainly be some adjustment time for its correctives. Air traffic is of course a huge issue. This summer we warned all Member States to take the necessary measures to ensure that there will be no big delays in traffic, because we foresee very many places where the traffic will increase delays. This machinery tries to do its best and of course we try also from our side to facilitate this functioning. The legislation is quite advanced and there will be some accommodation. Now we are opening the process of consultation, so it is for everybody to express their comments.
- Questions which have not been answered for lack of time will receive written answers (see Annex).
That concludes Question Time.
(The sitting was suspended at 20:00 and resumed at 21:00)
Colleagues, I apologise to those who have had to suffer the catering tonight in the European Parliament. It is quite the worst I have ever had. It is a shame for France.


Approval of the minutes of the previous sitting: see Minutes