Important legal notice

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52005SC0440

Recommendation for a Council opinion in accordance with the third paragraph of Art. 5 of Council Regulation (EC) No 1466/97 of 7 July 1997 on the updated stability programme of Greece, 2004-2007  /* SEC/2005/0440 final */

	[pic] | COMMISSION OF THE EUROPEAN COMMUNITIES |Brussels, 6.4.2005SEC(2005) 440 finalRecommendation for aCOUNCIL OPINIONin accordance with the third paragraph of Art. 5 of Council Regulation (EC) No 1466/97 of 7 July 1997 on the updated stability programme of Greece, 2004-2007(presented by the Commission)EXPLANATORY MEMORANDUMCouncil Regulation (EC) No 1466/97 on the strengthening of the surveillance of budgetary positions and the surveillance and coordination of economic policies[1] stipulates that participating Member States, that is, those which have adopted the single currency, have to submit stability programmes to the Council and the Commission. In accordance with Article 5 of this Regulation, the Council has to examine each stability programme based on assessments prepared by the Commission and the Committee set up by Article 114 of the Treaty (the Economic and Financial Committee). On the basis of a recommendation from the Commission and after consulting the Economic and Financial Committee, the Council is required to deliver an opinion, following its examination of the programme. According to the Regulation, Member States need to submit annual updates of their stability programmes, which may also be examined by the Council in accordance with these same procedures.In view of a general government deficit of 3.2% of GDP and a debt ratio of 103.0% of GDP recorded in 2003, the Council decided that Greece was in excessive deficit on 5 July 2004 and recommended that the excessive deficit be corrected by 2005 at the latest. On 18 January 2005, the Council decided that Greece had not taken effective action in response to these recommendations. On 17 February 2005, also upon a Commission recommendation in accordance with Article 104(9), the Council decided to give notice to Greece to take measures for the deficit reduction below the 3% of GDP threshold by 2006 at the latest. The Greek authorities were also required to identify and control factors other than net borrowing, which contribute to the change in debt levels, and to improve the collection and processing of general government data.The first stability programme of Greece, covering the period 2000-2004, was submitted on 19 June 2000 and assessed by the Council on 12 February 2001. Updates were presented every following year. Greece submitted the update of its stability programme covering the period 2004-2007 on 17 December 2004. The Commission did not assess it. A revision of the update of the stability programme was submitted on 21 March 2005. A fiscal package including additional measures was made public on 29 March. The Commission services have carried out a technical evaluation of this update, taking into account the results of the Commission services spring 2005 economic forecasts, and having regard to the code of conduct[2], the commonly agreed methodology for the estimation of potential output and cyclically-adjusted balances, the recommendations in the broad economic policy guidelines for the period 2003-2005 and the principles laid down in the Communication from the Commission to the Council and the European Parliament of 27 November 2002 on strengthening the coordination of budgetary policies[3]. This evaluation warrants the following assessment:-  The Greek 2004 revised update of the stability programme was submitted on 21 March 2005 and covers the years 2004 to 2007. The targets in the programme take into account the budgetary impact of a fiscal package, made public by the government on 29 March, to underpin the implementation of the revised programme, including a public commitment to target a deficit below 3% of GDP in the 2006 draft budget. The programme partly complies with the data requirements of the “the code of conduct on the content and format of stability and convergence programmes”. The programme does not provide detail of the measures behind the targets for 2007. Price developments are presented in terms of the deflator of private consumption expenditure and not in terms of Harmonised Index of Consumer Prices. As regards the basic external assumptions the programme does not provide data on world GDP growth excluding EU nor the growth rate of relevant foreign markets as required by the code of conduct.-  The programme considers three different macroeconomic scenarios. The so-called baseline scenario essentially coincides with the macroeconomic framework provided in the 2005 budget. It optimistically assumes that the Greek economy will manage to sustain the economic momentum gathered until 2004 thanks to strong domestic demand. This scenario is clearly outside the current range of forecasts. In a second, less buoyant scenario, which is in line with the already outdated Commission services autumn 2004 forecast, GDP growth is projected at 3.3% over the programme period. Finally, in the third scenario, real GDP is projected to grow at 2.9% in 2005 and marginally accelerate to 3% in 2006 and 2007, which is essentially in line with the Commission services spring 2005 forecast. Consequently, based on the latest available information, this third scenario should be considered as the most plausible and used as reference for assessing the programme. The data in the scenario imply a rate of potential output growth that gradually eases over the programme period from around 3.3% in 2005 to 3% in 2007. This is also broadly in line with the estimates derived from the Commission services 2005 spring forecast. The deceleration in the underlying rate of growth is estimated to result from total factor productivity. The sizeable positive output gap recorded in 2004 is set to narrow somewhat up until 2007.-  According to the March 2005 reporting of deficit and debt levels in accordance with Council Regulation (EC) No 3605/93 (henceforth EDP notification), the general government balance is estimated to have recorded a deficit of 6.1% of GDP (6.0% of GDP according to ESA95 definition, i.e. excluding swap-related flows). This deficit is 0.8 percentage points higher than the figure of 5.3% of GDP estimated by the Greek government at the time of the September 2004 EDP notification. The EDP March 2005 notification presents an additional slippage, which includes, besides 0.3 percentage point of GDP higher interest payments, tax shortfalls and expenditure overruns worth an additional half a point of GDP, on top of those already unveiled in the September 2004 EDP notification. On 18 March 2004 Eurostat did not validate the deficit figures for Greece because of an inconsistent recording of flows between Greece and the EU budget. Eurostat also noted that healthcare- and Olympics-related expenditure for past years is not yet final. Therefore the government deficit figures for 2004 and earlier years may have to be revised upwards.-  The reference scenario used for the assessment of the programme targets a reduction of the nominal general government budget deficit by 3.6 percentage points over the programme period, from the outturn of 6.1% of GDP in 2004 to 2.4% in 2007. The fiscal adjustment is frontloaded and concentrated in 2005 and, to a lesser extent in 2006, while in 2007 the adjustment amounts to just 0.5 percentage point of GDP. The strategy aims at reducing the deficit to below the 3% of GDP reference value by 2006, in line with the Council decision under Article 104(9). To achieve the targets the programme relies on a mix of revenue-enhancing measures and expenditure retrenchment, which should result in increasing primary surpluses. The primary balance is projected to move from a deficit of 0.4% in 2004 to a surplus of 1.8% of GDP in 2005, rising to 3.3% of GDP at the end of the period. In cyclically-adjusted terms, based on Commission services calculations carried out in accordance with the commonly agreed methodology applied to the data in the programme, the deficit would fall from 7.0% of GDP in 2004 to 4.4% of GDP in 2005, to 3.5% of GDP in 2006, and 3% in 2007.-  The deficit targets of the reference scenario are lower than those projected in the Commission services spring 2005 forecast, which projects deficits of 4.5% of GDP in 2005 and of 4.4% of GDP in 2006. A significant part of the difference is explained by the budgetary impact in 2005 and carryover effects in 2006 of additional fiscal measures to be implemented in 2005, which were announced after the cut-off date of the Commission forecast and amount to around 0.5 percentage point of GDP in 2005 and 0.9 percentage point of GDP in 2006. In addition, there are negative risks to the budgetary outlook for 2005 and beyond on both the revenues and expenditure side. Specifically, the trend projections for social security contributions appear on the high side while those for public consumption, especially health care and public wages, might be underestimated. Therefore, in line with their commitment announced on 29 March, the Greek authorities may have to implement additional measures in 2006, on top of those already announced for 2005, to effectively bring the deficit below the 3% threshold. Net of cyclical factors, the Commission services’ forecast for the 2005 and 2006 deficit is above 5%. It stays above 3% of GDP even after taking into account the additional measures taken in March. Hence, the budgetary stance in the programme does not provide a sufficient margin against breaching the 3% of GDP reference value with normal cyclical fluctuations nor does it achieve the Stability and Growth Pact’s medium term objective of a budgetary position of close-to-balance or in surplus throughout the programme period.-  The debt ratio is projected to decline from 110.5% of GDP in 2004 to only 109.5% in 2005 and then to 107.2% in 2006 and 104.7% in 2007. The increasing primary surplus and high nominal GDP growth would be the main driving forces behind the projected path of debt-reduction. A faster pace of debt reduction is hampered by significant debt increasing stock-flow adjustments (SFA), which, while declining compared to 2004, are expected to remain significant in spite of planned privatisation proceeds. The programme provides a detailed account of the operations behind the SFA in 2004. Therefore, it seems that some progress has been made in identifying the sources of the SFA. However, the programme does not provide details on the origin of the projected SFA over 2005-2007. The evolution of the debt ratio may be less favourable than projected given the risks to the budgetary targets mentioned above.-  The programme reviews the government’s structural reform programme, which focuses on the re-orientation of public expenditures towards more productive uses. It also outlines measures to reduce business start-ups costs and to further open up markets to competition, especially network industries. On health-care, the government is preparing a reform aiming at ensuring financial sustainability and addressing some of the weaknesses of the system. However, while the programme does not give much detail of the corresponding measures, the plans for a far-reaching reform are still in a very preliminary stage. On the restructuring of expenditures, the 2005 budget foresees a reduction of consumption expenditure by over 16% in nominal terms. Such spending cuts appear optimistic since they affect certain components of the budget (wages, social transfers), the trends of which have always exhibited strong resilience to spending control measures.-  Greece appears to be at serious risk with regard to the long-term sustainability of public finances, also on account of the very important projected budgetary costs of an ageing population. The considerable increase projected in age-related spending suggests that additional measures to control public pension expenditures, including the resolute implementation of reform measures enacted, are necessary. The strategy outlined in the programme is mainly based on the implementation of legislated pension reforms and the necessary consolidation of public finances in the medium-term. Nevertheless, gross debt-to-GDP, while projected to fall, remains above 100% of GDP throughout the programme period. Even if the planned budgetary consolidation should materialise over the programme period, a considerable sustainability gap emerges, pointing to the need for a broad-based approach to ensure the sustainability of the public finances. These results show that a strategy based exclusively on fiscal consolidation does not seem to be feasible.-  Overall, the economic policies outlined in the update are partly consistent with the country-specific Broad Economic Policy Guidelines, in the area of public finances. In particular, the programme does not outline sufficiently effective action towards the close-to-balance-or-in-surplus position. The cyclically-adjusted deficit, calculated by the Commission services according to the commonly agreed methodology applied to the data of the reference scenario, although projected to improve by at least 0.5% of GDP per year, would remain above 3% of GDP throughout the programme period. However, within the framework of the Council notice given to Greece on 17 February in accordance to Article 104(9), the Commission[4] has concluded that this budgetary strategy is consistent with the Council recommendations in the notice and that no further steps in the excessive deficit procedure are needed at present. A new assessment of compliance with such recommendations will be carried out on the basis of the report to be presented by the Greek authorities in October, as foreseen in the Council decision.-  In view of the above assessment it would be appropriate for Greece to (i) implement the necessary permanent measures leading to the correction of the excessive deficit by 2006 at the latest; (ii) reduce the cyclically-adjusted deficit by at least 0.5% of GDP from 2007 onward, preferably through primary spending control measures, leading to a close-to-balance-or-in-surplus position in the medium term; (iii) enhance the efforts to identify and control factors other than net borrowing, which contribute to the change in debt levels; in order to ensure a reduction in the government gross debt ratio so as to approach the reference value at a faster pace; (iv) control public pension expenditures and resolutely implement the enacted reforms to ensure the sustainability of public finances and (v) improve the collection and processing of general government data in collaboration with Eurostat, notably by enhancing the mechanisms that ensure a prompt and correct supply of this data.Based on this assessment, the Commission has adopted the attached recommendation for a Council Opinion on the revised update of the stability programme of Greece and is forwarding it to the Council.Recommendation for aCOUNCIL OPINIONin accordance with the third paragraph of Art. 5 of Council Regulation (EC) No 1466/97 of 7 July 1997 on the updated stability programme of Greece, 2004-2007THE COUNCIL OF THE EUROPEAN UNION,Having regard to the Treaty establishing the European Community,Having regard to Council Regulation (EC) No 1466/97 of 7 July 1997 on the strengthening of the surveillance of budgetary positions and the surveillance and coordination of economic policies[5], and in particular Article 5(3) thereof,Having regard to the recommendation of the Commission,After consulting the Economic and Financial Committee,HAS DELIVERED THIS OPINION:1.  On 12 April 2005 the Council examined the updated stability programme of Greece, which covers the period 2004 to 2007. The programme partly complies with the data requirements of the “code of conduct on the content and format of stability and convergence programmes”. The programme does not provide detail of the measures behind the targets for 2007. Price developments are presented in terms of the deflator of private consumption expenditure and not in terms of Harmonised Index of Consumer Prices. As regards the basic external assumptions the programme does not provide data on world GDP growth excluding EU nor the growth rate of relevant foreign markets as required by the code of conduct. Accordingly Greece is invited to achieve full compliance with the data requirements.2.  The programme considers three different macroeconomic scenarios. On the basis of the latest available information, incorporated in the Commission services spring forecast, the second alternative scenario, and not the baseline one, is taken as the reference for assessing the programme because it seems to reflect plausible macroeconomic assumptions. In this reference scenario used for the assessment of the programme, real GDP is projected to grow at 2.9% in 2005 and marginally accelerate to 3% in 2006 and 2007. Potential output growth is expected to gradually ease over the programme period from around 3.3% in 2005 to 3% in 2007, while the sizeable positive output gap recorded in 2004 is set to narrow somewhat up until 2007.3.  On 5 July 2004, the Council decided that Greece was in excessive deficit and recommended its correction by 2005 at the latest. On 18 January 2005, the Council decided that Greece had not taken effective action in response to these recommendations. On 17 February 2005, the Council decided in accordance to Article 104(9) to give notice to Greece to take measures for the deficit reduction below the 3% of GDP threshold by 2006 at the latest. The Greek authorities were also required to identify and control factors other than net borrowing, which contribute to the change in debt levels, and to improve the collection and processing of general government data.4.  According to the March 2005 EDP notification, the general government balance of 2004 is estimated to have recorded a deficit of 6.1% of GDP. This deficit is 0.8 percentage points higher than the figure of 5.3% of GDP estimated by the Greek government in autumn 2004 at the time of the September 2004 EDP notification, reflecting further tax shortfalls and expenditure overruns worth half a point of GDP. On 18 March 2005 Eurostat decided not to validate the deficit figures for Greece, noting that due to some outstanding issues the government deficit figures for 2004 and earlier years may have to be revised upwards.5.  The budgetary strategy of the Greek government aims at reducing the deficit below the 3% of GDP reference value by 2006, in line with the Council decision under Article 104(9), through a mix of revenue-enhancing measures and expenditure retrenchment, which should result in increasing primary surpluses. To that end, the Greek government has adopted a package of fiscal measures for 2005, in addition to those included in the 2005 budget, which have lasting effects on subsequent years. The reference scenario targets a reduction of the nominal general government budget deficit by 3.6 percentage points over the programme period, from the outturn of 6.1% of GDP in 2004 to 2.4% in 2007. The primary balance is projected to improve substantially from a deficit of 0.4% in 2004 to a surplus of 1.8% of GDP in 2005 increasing to 3.3% of GDP at the end of the period.6.  There is a risk that the budgetary outcome for 2005 and beyond may be worse than in the programme. In particular, trends in social security contributions and public consumption expenditure may have been projected favourably, while the envisaged adjustment measures, especially in the outer years of the programme, are not sufficiently indicated. Moreover, no measures have been envisaged in the programme to offset the potential carryover effects of the new statistical revisions for 2004 and earlier years. The Greek authorities have announced that they stand ready to implement additional measures in 2006, on top of those already adopted in 2005, in order to effectively bring the deficit below the 3% reference value in 2006 as required by the Council. The budgetary stance in the programme does not provide a sufficient safety margin against breaching this threshold with normal cyclical fluctuations nor does it achieve the Stability and Growth Pact’s medium term objective of a budgetary position of close-to-balance or in surplus throughout the programme period.7.  The debt ratio is projected to decline from 110.5% of GDP in 2004 to only 109.5% in 2005 and then to 107.2% in 2006 and 104.7% in 2007. A faster pace of debt reduction is hampered by significant debt-increasing stock-flow adjustments, which, while declining compared to 2004, are expected to remain significant in spite of planned privatisation proceeds. The evolution of the debt ratio may be less favourable than projected given the risks to the budgetary targets mentioned above.8.  Greece appears to be at serious risk with regard to the long-term sustainability of public finances, also on account of the very important projected budgetary costs of an ageing population. The considerable increase projected in age-related spending suggests that additional measures to control public pension expenditures, including the resolute implementation of reform measures enacted, are necessary.9.  The economic policies outlined in the update are partly consistent with the country-specific Broad Economic Policy Guidelines in the area of public finances. In particular, the programme does not outline sufficiently effective action towards the close-to-balance-or-in-surplus position. The cyclically-adjusted deficit calculated by the Commission services according to the commonly agreed methodology applied to the data of the reference scenario, although projected in the programme to improve by 0.5% of GDP per year, would remain above 3% of GDP throughout the programme period. However, considering the steps taken towards correcting fiscal imbalances, this budgetary strategy is consistent with the Council recommendations in its notice given to Greece on 17 February in accordance with Article 104(9), and no further steps in the excessive deficit procedure are needed at present. A new assessment of compliance with such recommendations will be carried out on the basis of the report to be presented by the Greek authorities in October, as foreseen in the Council notice.* * *In view of the above assessment, the Council is of the opinion that Greece should:-  implement the necessary permanent measures leading to the correction of the excessive deficit by 2006 at the latest;-  reduce the cyclically-adjusted deficit by at least 0.5% of GDP from 2007 onward, preferably through primary spending control measures, leading to a close-to-balance-or-in-surplus position in the medium term;-  enhance the efforts to identify and control factors other than net borrowing, which contribute to the change in debt levels, in order to ensure a reduction in the government gross debt ratio so as to approach the reference value at a faster pace;-  control public pension expenditures and resolutely implement the enacted reforms to ensure the sustainability of public finances;-  further improve the collection and processing of general government data in collaboration with Eurostat, notably by enhancing the mechanisms that ensure a prompt and correct supply of this data.Comparison of key macroeconomic and budgetary projections2004 | 2005 | 2006 | 2007 |Real GDP (% change) | SP Mar 2005 | 4.2 | 2.9 | 3.0 | 3.0 |COM Mar 2005 | 4.2 | 2.9 | 3.1 |SP Dec 2003 | 4.2 | 4.0 | 3.8 | n.a. |HICP inflation (%) | SP Mar 2005 | 3.0 | n.a | n.a | n.a |COM Mar 2005 | 3.0 | 3.2 | 3.2 |SP Dec 2003 | 3.0 | 2.8 | 2.6 | n.a. |General government balance (% of GDP)(*) | SP Mar 2005 | -6.1 | -3.7 | -2.9 | -2.4 |COM Mar 2005 | -6.1 | -4.5 | -4.4 |SP Dec 2003 | -1.2 | -0.5 | 0.0 | n.a. |Primary balance (% of GDP)(*) | SP Mar 2005 | -0.4 | 1.8 | 2.7 | 3.3 |COM Mar 2005 | -0.4 | 1.0 | 1.0 |SP Dec 2003 | 4.7 | 5.1 | 5.3 | n.a. |Cyclically-adjusted balance (% of GDP)(*) | SP Mar 20051 | -7.0 | -4.4 | -3.5 | -3.0 |COM Mar 2005 | -7.1 | -5.5 | -5.3 |SP Dec 2003 | -1.2 | -0.5 | 0.0 | n.a. |Government gross debt (% of GDP) | SP Mar 2005 | 110.5 | 109.5 | 107.2 | 104.7 |COM Mar 2005 | 110.5 | 110.5 | 108.9 |SP Dec 2003 | 98.5 | 94.6 | 90.5 | n.a. |Note: 1 Commission services calculations on the basis of the information in the programme. (*) The Commission projections do not take into account the measures announced on 29 March. Sources: Stability programme March 2005 revised update (SP); Commission services spring 2005 economic forecasts (COM); Commission services calculations. |[1] OJ L 209, 2.8.1997. All the documents referred to in this text can be found at the following website:http://europa.eu.int/comm/economy_finance/about/activities/sgp/main_en.htm.[2] Revised Opinion of the Economic and Financial Committee on the content and format of stability and convergence programmes, endorsed by the ECOFIN Council on 10.7.2001.[3] COM(2002) 668, 27.11.2002.[4] Commission communication on ‘The action taken by Greece in response to the Council decision of 17 February 2005 in accordance to Article 104(9) of the Treaty for the deficit reduction judged necessary in order to remedy the situation of excessive deficit - SEC(2005) 443, 6.4.2005.[5] OJ L 209, 2.8.1997, p. 1. The documents referred to in this text can be found at the following website http://europa.eu.int/comm/economy_finance/about/activities/sgp/main_en.htm.


Avis juridique important

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31986H0666

86/666/EEC: Council Recommendation of 22 December 1986 on fire safety in existing hotels

Official Journal L 384 , 31/12/1986 P. 0060 - 0068

COUNCIL RECOMMENDATION of 22 December 1986 on fire safety in existing hotels  (86/666/EEC)THE COUNCIL OF THE EUROPEAN COMMUNITIES, Having regard to the Treaty establishing the European Economic Community, and in particular Article  235 thereof, Having regard to the proposal from the Commission(1), Having regard to the opinion of the European Parliament(2), Having regard to the opinion of the Economic and Social Committee(3), Whereas rules governing fire safety in all hotels do not exist in all the Member States; whereas in  many cases where they do exist the relevant provisions are incomplete and contained in several  different texts and it is thus difficult to gain a clear picture; whereas they are not always fully  observed; Whereas, with the rapid expansion of tourism and business travel, more and more people need to stay  in hotels in Member States other than their countries of origin; whereas such persons are entitled  to adequate protection in the host country and to be informed of the nature and extent of that  protection; whereas the safety of guests must be compatible with the safety of staff at work; Whereas even allowing for any differences in type or construction in hotels in the Member States,  it is possible to define a minimum standard of fire safety for all hotels; whereas their conformity  with that minimum standard is essential for their continuing operation and whereas it is advisable  to subject hotels to periodic inspections; Whereas for economic, technical, and architectural reasons it will take some time to introduce fire  precautions fully in hotels; whereas for the objective in question to be attained the period  allowed must be within reasonable limits; Whereas harmonized provisions regarding the use and application of materials from the point of view  of fire protection do not exist at Community level; whereas this situation cannot justify the  adoption by Member States of measures liable to aggravate technical barriers to trade; whereas, on  the contrary, fire precautions in hotels based on a minimum standard of safety must help to prepare  and promote harmonization work in progress elsewhere; Whereas, for economic reasons and from the standpoint of the safety of tourists and persons  travelling for any other reason from one Member State to another, it is important to promote the  circulation and dissemination of information regarding measures adopted at national level to  protect hotels against the risks of fire; whereas the Commission is called upon to play an  essential role in the provision and dissemination of this type of information, HEREBY RECOMMENDS MEMBER STATES: (1)to take all appropriate measures in so far as existing laws are not already sufficient to meet  the requirements of this recommendation to ensure that fire precautions in existing hotels are  subject to provisions based on the principles set out below. Aim and means of ensuring safety in existing hotels 1.The introduction of fire precautions in existing hotels is intended to: 1.1.reduce the risk of fire breaking out; 1.2.prevent the spread of flames and smoke; 1.3.ensure that all occupants can be evacuated safely; 1.4.enable the emergency services to take action. 2.In order to meet these objectives, all necessary precautions should be taken within the  establishment so that: 2.1.safe escape routes are available, are clearly indicated and remain accessible and  unobstructed; 2.2.the building's structural stability in the event of fire is guaranteed at least for as long as  is needed for the occupants to evacuate the building safely; 2.3.the presence or use of highly flammable materials in wall, ceiling or floor coverings and  interior decorations is carefully limited; 2.4.all technical equipment and appliances (electrical, gas, heating, etc.) operate safely; 2.5.appropriate systems are installed and maintained in proper working order for alerting the  occupants; 2.6.safety instructions and a plan of the premises with an indication of the escape routes are  displayed in each room normally occupied by guests or staff; 2.7.emergency fire-fighting equipment (ex- tinguishers, etc.) is provided and maintained in proper working order; 2.8.the staff is given suitable instruction and training. 3.In applying the above principles to existing commercially operated establishments which occupy  all or part of a building and which, under the name of hotel, boarding house, inn, tavern, motel or  other equivalent designation, can offer accommodation to at least 20 temporary paying guests,  Member States should take into account the technical guidelines set out in the Annex. Member States  may use different or more stringent measures than those specified in the Annex, if they achieve at  least an equivalent result. In particular, if any of the provisions of the Annex cannot be  implemented for economic, technical (including anti-seismic or architectural) reasons, the  alternative solutions adopted must ensure the overall minimum safety standard which the provisions  of that Annex are designed to establish. For establishments offering accommodation to less than 20 temporary paying guests, Member States  should adopt the most appropriate measures in order to guarantee their safety in conformity with  the principles set out under points 1 and 2 above, taking into account the size of the risk; (2)to subject hotels to periodic inspection of their conformity with the national provisions based  on the principles set out above; (3)to inform the Commission of all national measures designed to ensure that hotels meet the  requirements set out above and of the measures which they intend to take for this purpose within  the next five years. The Commission will report to the Council, within a period of six months, on  the measures taken or proposed. Done at Brussels, 22 December 1986. For the CouncilThe PresidentG. SHAW (1)OJ N° C 49, 21. 2. 1984, p. 7.  (2)OJ N° C 262, 14. 10. 1985, p. 20; OJ N° C 36, 17. 2. 1986, p. 155.  (3)OJ N° C 248, 17. 9. 1984, p. 4.   ANNEX TECHNICAL GUIDELINES 1.ESCAPE ROUTES 1.1.General 1.1.1.The escape routes must be arranged and located in such a way as to lead independently into  the street or into an open space large enough to allow people to move away from the building and to  enable persons to evacuate the premises quickly and safely. 1.1.2.Doors, staircases, exits and routes thereto shall be indicated by standard safety signs  visible day and night. For this purpose, use shall be made in particular of the symbols for public information laid down  in ISO/DIS standard 6309.2 (11 December 1985). 1.1.3.Doors which must not be used by the public in the event of fire and which give direct access  to escape routes must, unless they are normally locked, be kept closed or be self-closing and bear  an appropriate standard sign. 1.2.Direction of opening of doors - obstruction of escape routes 1.2.1.As far as possible, doors located on escape routes must be capable of opening in the intended  direction of evacuation. 1.2.2.It must always be possible for the final exit door of an escape route to be opened easily  from the inside by a person escaping from the hotel. 1.2.3.A door opening in the intended direction of evacuation must be provided alongside a revolving  or sliding door. 1.2.4.Obstacles (stores, furniture, etc.) which might impede movement and create a risk of fire  spread must not be placed in escape routes. 1.2.5.Mirrors which might mislead occupants as to the direction of exits and stairways must not be  hung in escape routes. 1.3.Minimum number of staircases 1.3.1.Various criteria may be used to determine whether an existing hotel has a sufficient number  of staircases: 1.3.1.1.either the total number of persons that may be in the hotel, 1.3.1.2.or the distance to be covered to reach the staircases. 1.3.2.If the criterion used is the number of persons, hotels with two or more levels above the  ground which can accommodate a total of more than 50 persons must have at least two staircases. 1.3.3.If the criterion used is the distance to be covered: 1.3.3.1.the length of blind passages must not exceed 10 metres, 1.3.3.2.when the hotel has two or more stair cases the distance to be covered from any point on an  escape route to reach one of them must not exceed 35 metres. 1.3.4.An existing hotel in a building of more than three levels above the ground should generally  be provided with at least two staircases. 1.3.5.The maximum lengths of 10 metres for blind passages and 35 metres for the distance to be  covered to reach a staircase must be observed in all cases. 1.3.6.An outside staircase may be accepted as a second staircase, provided that it offers  satisfactory conditions of safety. 1.3.7.In a hotel, the existing staircases must each be sufficiently wide to allow satisfactory  evacuation of the persons likely to be on the premises. However, should it prove necessary to  provide additional staircases to make an existing hotel safe, each of these new staircases shall  have a minimum width of 0,80 metre. 2.CONSTRUCTION FEATURES 2.1.It must be ensured that the construction features of existing hotels are such that: 2.1.1.the fire resistance of the load-bearing components is adequate to ensure the structural  stability of the whole for a sufficient length of time in the event of fire; 2.1.2.the compartmentation provides a barrier to the spread of fire and smoke adequate to keep the  escape routes accessible and usable for a sufficient length of time; 2.1.3.in general, the situation must be assessed case by case on the basis of the minimum  requirements set out below. 2.2.Building structures 2.2.1.In buildings having not more than three levels above the ground, with the exception of  one-storey buildings without a basement, the fire resistance (R) of the structure of the building  must be at least 30 minutes (R 30). 2.2.2.In buildings having more than three levels above the ground, the fire resistance (R) of the  structure of the building must be at least 60 minutes (R 60). 2.3.Floors 2.3.1.In buildings having not more than three levels above the ground, the fire resistance (REI) of  the floors must be at least 30 minutes (REI 30). 2.3.2.In buildings having more than three levels above the ground, the fire resistance (REI) of the  floors must be at least 60 minutes (REI 60). 2.4.Staircase enclosures 2.4.1.In general, the staircases of existing hotels having more than two levels above the ground  must be enclosed. 2.4.1.1.The wall of the stairwell must have a fire resistance (REI) of at least 30 minutes (REI  30). 2.4.1.2.The access door sets to the stairwells must have a fire resistance (RE) of at least 30  minutes (RE 30), and the doors must be self-closing and bear an appropriate sign indicating that  they must be kept shut. 2.4.2.If the same staircase provides access both to levels accessible to the public and to the  basement, its enclosure shall be designed so as to enable the basement to be isolated from the  remainder of the stairwell. 2.4.3.The upper part of each stairwell must have a skylight or window glazed in the glass about 1  m2 in an area which, if it is not directly accessible, must be fitted with a device allowing it to  be opened easily from the ground floor. 2.4.4.The protection of the service stairwells accessible only to the staff of the establishment  shall be based on the same principles as those applicable to the stairwells to which the public  have access. 2.5.Partitions 2.5.1.In general, floor-to-ceiling partitions separating bedrooms from escape routes must have a  fire resistance (REI) of at least 30 minutes (REI 30); their access door sets must have a fire  resistance (RE) of at least 15 minutes (RE 15). 2.5.2.In general, the structures (floors, floor-to ceiling partitions and ceilings) separating  bedrooms and escape routes from areas presenting special fire hazards must have a fire resistance  (REI) of at least 60 minutes (REI 60); their door sets must have a fire resistance (RE) of at least 60 minutes (RE  60) and the doors must be self-closing and bear an appropriate sign indicating that they must be  kept shut. 3.COVERINGS AND DECORATIONS 3.1.The fire behaviour of the interior coverings and decorations of existing hotels shall be such  that they do not constitute a particular hazard by contributing to fire spread and smoke  production. 3.1.1.This requirement applies in particular to parts of the premises such as: 3.1.1.1.escape routes, especially corridors, staircases and open areas such as halls; 3.1.1.2.rooms accessible to the public and in particular to hotel guests, other than bedrooms. 3.1.2.In the areas referred to in 3.1.1 the coverings and decorations particularly concerned are: 3.1.2.1.floor coverings, 3.1.2.2.wall coverings and decorations, 3.1.2.3.ceiling coverings and decorations. 3.1.3.Since methods for testing and classifying materials as regards their reaction to fire have  not as yet been harmonized, the minimum requirements to be met by interior coverings and  decorations in existing hotels shall for the time being be expressed by reference to the national  provisions on the subject. 3.2.Escape routes 3.2.1.The material classifications in the following table are regarded as corresponding to the  minimum safety standard required for interior coverings and decorations in the escape routes of  existing hotels: >TABLE> 3.2.2.The national provisions to which this table refers are as follows: (a)Federal Republic of Germany Standard DIN 4102, Part 1 Reaction to fire of construction components and materials. (b)Denmark 1977 construction code, Annex 3. (c)France Order of 4 June 1973 classifying construction components and materials by categories on the basis  of their reaction to fire and specification of test methods (Journal Officiel de la République  Française of 26 July 1973). (d)Italy Ministerial Decree of 26 June 1984. Classification of reaction to fire and approval of materials for the purpose of preventing fires  (Gazzetta ufficiale della Repubblica italiana N° 234 of 25 August 1984). (e)Netherlands Standard NEN 3883. (f)United Kingdom Standard BS 476, part 6, 1981 Fire propagation tests for products. Standard BS 476, part 7, 1971 Surface spread of flame for materials. (g)Ireland 1.Standard BS 4790, 1972 Determination of the effect of a small source of ignition on textile floor coverings (hot metal nut  method), evaluated in line with standard BS 5287, 1976). 2.Standard BS 5867, Part 2, 1980 Flammability requirements - specification for fabrics for curtains and drapes. 3.Standard BS 5852, Part 1, 1979 Standard BS 5852, Part 2, 1982 Methods of tests for the ignitability of upholstered composites for seating by flaming sources. 3.3.Rooms accessible to the public with the exception of bedrooms 3.3.1When the room complies with the provisions in 2.5.2 the interior coverings and decorations  must comply with the national provisions in force, depending on the use to which the room is put. 3.3.2.When the room does not comply with the provisions in 2.5.2, the interior coverings and  decorations must at least comply with the provisions laid down in 3.2 which apply to escape  routes. 3.3.3.For rooms accessible to the public other than those covered by 3.1.1, independent escape  routes must at least comply with all the provisions applicable to the escape routes from the hotel,  adapted to circumstances in each case. 4.ELECTRIC LIGHTING 4.1.1.Principal lighting system 1.1.The principal lighting system of a hotel establishment must be an electric lighting system. 4.1.2.The electrical installation in an existing hotel must be designed and fitted in such a way as  to prevent among other things the ignition and spread of fires. The installation must be earthed. 4.1.3.Point 4.1.2. shall also apply if the hotel's electricity supply comes from an independent  source. 4.2.Emergency lighting system 4.2.1.All hotel establishments must be equipped with a suitable emergency lighting system which  comes into operation when the principal lighting system fails. 4.2.2.The emergency lighting system of a hotel establishment must be capable of operating for a  sufficient period to enable all occupants to be evacuated if the principal lighting system fails. 5.HEATING 5.1.General rule 5.1.1.Heating may be provided either by a central heating system or by fixed individual heaters. 5.1.2.The heating installations in an existing hotel must be designed and fitted in such a way as  to prevent among other things the ignition and spread of fires. 5.2.Boiler room When the effective capacity of a combustion heater is such, and in any case when it is 70 kW or  more, that the heater must be installed in a room separate from other rooms: 5.2.1.this room shall be designed and fitted out in accordance with the rules laid down in the  relevant national legislation; 5.2.2.the walls of the boiler room must have a fire resistance (REI) of at least 60 minutes (REI  60) and the door sets must have a fire resistance (RE) of at least 60 minutes (RE 60); the doors  must be self-closing and bear an appropriate sign indicating that they must be kept closed. 5.3.Liquid or gaseous fuel supply 5.3.1.Without prejudice to the provisions of 5.1.2, it must be possible to cut off the supply of  liquid or gaseous fuel to the heating appliances by at least one manually controlled shut-off  device. 5.3.1.1.In the case of fixed individual heaters, this shut-off device must be situated near the  appliance. 5.3.1.2.For block heaters installed in a boiler room, this shut-off device must be located outside  the boiler room in an easily accessible position and be clearly marked. 5.3.2.Where a gas supply pipe serves the entire building in which the hotel is situated, it shall  have at least one manually operated shut-off-device located at the point at which the pipe enters  the building and be clearly marked. 5.3.3.When liquid fuel is stored inside a room it must be designed so as to comply at least with  the requirement of 2.2 and be capable of containing any fuel leaks. 5.3.4.Liquified petroleum gas must be stored outside. 5.4.Fixed individual heater 5.4.1.Without prejudice to the provisions of 5.1.2, when the use of fixed individual heaters is  authorized in existing hotels they must be installed in such a way as to preclude any danger of  fire and not to present a hazard for the occupants of the rooms in which they are located. 5.4.2.Fixed individual heaters must be suitably and regularly serviced and instructions for their  use must be clearly posted. 6.VENTILATION SYSTEMS 6.1.Where an existing hotel is equipped with a ventilation system, measures must be taken to  prevent among other things the spread of fire, hot gases and smoke through the supply ducts of such  a system. 6.2.Ventilation systems must be equipped with a general shut-off device in an easily accessible and  clearly marked position. 7.FIRE-FIGHTING, ALARM AND ALERTING EQUIPMENT 7.1.Emergency fire-fighting equipment 7.1.1.Emergency fire-fighting equipment is intended to fight the outbreak of a fire and must be  distinguished from more powerful fire-fighting equipment intended to control an established fire  and generally used by fire-fighting experts. 7.1.2.The emergency fire-fighting equipment shall consist of portable extinguishers and equivalent  fixed devices. They shall be in accordance with the relevant national regulations or standards or,  where appropriate, of the relevant European standards. 7.1.3.The emergency fire-fighting equipment must be located on every floor close to the access  points to the stairways or exits, in the escape routes at intervals of not more than 25 m and close  to areas of particular risk. 7.1.4.The emergency fire-fighting equipment must be easily accessible and kept in good working  order. 7.2.Alarm 7.2.1.Hotels shall be equipped with a reliable acoustic alarm system, the noise of which must be  distinguishable from that of the telephone system. 7.2.2.Irrespective of type, the operation of this system must be adapted to the structural features  of the establishment and must be such as to provide a warning to all persons in the different parts  of the hotel in good time in the event of an emergency. 7.3.Alerting 7.3.1.It must be possible to alert the emergency services easily either by the public telephone  service or via a direct line or by any other suitable equivalent means. 7.3.2.The procedure for calling the emergency services shall be clearly posted in the immediate  vicinity of any point from which a call may be made. Where the public telephone system is used, the telephone number and possibly the address of the  emergency service shall be clearly posted near the hotel telephone. 7.4.Instructions for staff The hotel management must ensure that: 7.4.1.in the event of fire, the hotel staff are capable of correctly using the available emergency  fire-fighting equipment and activating the alerting and alarm systems. 7.4.2.In the event of fire, the hotel staff must be able to: 7.4.2.1.apply the instructions drawn up for their guidance, 7.4.2.2.help in the efficient evacuation of all hotel occupants. 7.4.3.Hotel staff shall be required to participate, at least twice a year, in a manner compatible  with the running and, where appropriate, seasonal operation of the hotel, in instruction and  training sessions involving the operation of the emergency fire-fighting equipment and the alerting  and alarm system and in evacuation exercises. 8.SAFETY INSTRUCTIONS 8.1.In the entrance hall of the hotel: 8.1.1.Precise instructions on action to be taken by the staff and the public in the event of fire  must be prominently posted. 8.1.2.A plan of the hotel for the information of emergency teams shall indicate the location of: -staircases and escape routes, -available extinguishers, -gas and electricity supply shut-off devices, -where appropriate, the shut-off device for the ventilation system, -the control panel for the automatic detection and alarm system where appropriate, -installations and areas of particular risk where appropriate. 8.2.On each floor: A simplified layout plan located in the vicinity of the floor access point in hotels having two or  more storeys above the ground. 8.3.In each bedroom: 8.3.1.Prominently posted and precise instructions shall indicate the action to be taken in the  event of fire; in addition to the national languages, these instructions must be posted up in  appropriate foreign languages depending on the origin of the hotel's usual guests. 8.3.2.These instructions shall be accompanied by a simplified floor plan showing schematically the  location of the room in relation to escape routes, staircases and/or exits. 8.4.The instructions shall, in particular, draw attention to the fact that lifts must not be used  in the event of fire, except for lifts reserved for the handicapped which are specially protected.


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31998H0286

98/286/EC: Commission Recommendation of 23 April 1998 concerning banking charges for conversion to the euro

Official Journal L 130 , 01/05/1998 P. 0022 - 0025

COMMISSION RECOMMENDATION of 23 April 1998 concerning banking charges for conversion to the euro (98/286/EC)THE COMMISSION OF THE EUROPEAN COMMUNITIES,Having regard to the Treaty establishing the European Community, and in particular Article 155 thereof,1. Whereas the euro will become the currency of the participating Member States as from 1 January 1999; whereas the euro will be substituted for the national currencies of the participating Member States at the conversion rates; whereas during a transitional period the euro will exist in different denominations; whereas the national currency units will be sub-units of the euro according to the conversion rates; whereas according to Article 4(3) of Council Regulation (EC) No 1103/97 of 17 June 1997 on certain provisions relating to the introduction of the euro (1), the conversion rates are to be used for conversions either way between the euro unit and the national currency units; whereas the draft Council Regulation on the introduction of the euro (2) imposes certain obligations to convert;2. Whereas the Commission considers that banks are not legally entitled to charge:- for the conversion of incoming payments denominated in the euro unit or in the national currency unit during the transitional period,- for the conversion of accounts from the national currency unit to the euro unit at the end of the transitional period,- a different fee for services denominated in the euro unit from that charged for otherwise identical services denominated in the national currency unit;3. Whereas the Commission considers that, in order to facilitate the smooth introduction of the euro, banks should go beyond the minimum required by law by providing without charge the conversion of accounts from the national currency unit to the euro and during the transitional period, by providing without charge the conversion of outgoing payments from the national currency unit to the euro unit and vice versa during the transitional period, and by providing for the exchange without charge to their customers of 'household amounts` of the national banknotes and coin for euro banknotes and coin during the final period;4. Whereas for reasons of clarity and completeness the legal requirements as interpreted by the Commission as well as the recommendations of the Commission should be presented together; whereas the term 'standard of good practice` is used to signify both the legally required and the recommended practice;5. Whereas the standard of good practice should not include conversion without charge of accounts from the euro denomination into the national denomination, as this is not necessary for the introduction of the euro, nor should it include the exchange of euro-area national banknotes for other euro-area national banknotes without charge, as the need for such exchange is not affected by the introduction of the euro; whereas the standard of good practice should cover the transparency of any charges for such conversions;6. Whereas the standard of good practice should not include the exchange of national banknotes and coin other than in household amounts; whereas banks and retailers should negotiate any charges for the withdrawal from retailers of national banknotes and coin and for the delivery to retailers of euro banknotes and coin, taking into account arrangements made by the competent authorities at national level;7. Whereas for all conversions between any national currency unit and the euro unit and vice versa, and for all exchanges of banknotes and coin of participating Member States, banks should show clearly the application of the conversion rates in accordance with the provisions of Regulation (EC) No 1103/97; whereas the use of the conversion rate and any charges should be transparent; whereas the standard of good practice in so far as it concerns transparency of charges should be implemented by banks in advance of 1 January 1999, wherever possible, in order to reduce the risk that consumers may wrongly attribute already existing charges to the introduction of the euro;8. Whereas banks which implement the standard of good practice should publicise this, to demonstrate that they comply with the standard, and all banks should in any event inform their customers in advance of 1 January 1999 whether they apply the standard of good practice and, if not, for which conversions they intend to charge;9. Whereas the Commission intends to monitor the application of the standard of good practice; whereas such monitoring activity is addressed in Recommendation 98/288/EC on dialogue, monitoring and information to facilitate the transition to the euro (3); whereas the dialogue provided for in that Recommendation may include discussions on the implementation and monitoring of the standard of good practice; whereas the dialogue could also address aspects of charging for conversion which could extend beyond the scope of the standard of good practice as laid down by this Recommendation;10. Whereas consumers without a bank account may need special consideration in relation to the exchange of banknotes and coin denominated in the national currency for banknotes and coin denominated in euro, during the final period to be determined by local conditions within each Member State;11. Whereas the issue of charging for conversion to the euro has been discussed at the Round Table in May 1997; whereas an expert group has been established to examine the issue, involving all sectors concerned, and its report has been published (4); whereas the conclusions of the experts' report have been accepted by the Commission in its Communication 'Update on practical aspects of the introduction of the euro` adopted on 11 February 1998 (5) and discussed at the Round Table in February 1998,HEREBY RECOMMENDS:Article 1 Definitions For the purpose of this Recommendation, the following definitions apply:(a) 'Banks` are credit institutions as defined in Council Directive 77/780/EEC (6), and any other financial institutions as defined in Article 4(1) of Council Regulation (EC) No 3604/93 (7), whose business is to carry out activities related to the conversion of payments and accounts and the exchange of notes and coin, and bureaux de change and post offices;(b) 'national currency unit` is the unit of the currency of a participating Member State, as that unit is defined on the day before the start of the third stage of economic and monetary union; 'the national currency unit` in this Recommendation refers to the national currency unit of the Member State where the bank making the conversion is located;(c) 'participating Member States` are those Member States which adopt the single currency in accordance with the Treaty;(d) 'conversion` is the change of denomination of a monetary amount from the national currency unit to the euro unit and vice versa at the conversion rate, in accordance with the provisions of Regulation (EC) No 1103/97;(e) 'euro unit` is the currency unit of the euro as referred to in the second sentence of Article 2 of the draft Council Regulation on the introduction of the euro;(f) 'transitional period` is the period beginning on 1 January 1999 and ending on 31 December 2001;(g) 'final period` is the period beginning on 1 January 2002 and ending on 30 June 2002 at the latest, which period may vary in length according to participating Member State, under the terms of the draft Council Regulation on the introduction of the euro;(h) 'conversion rate` is the irrevocably fixed rate adopted for the currency of each participating Member State by the Council according to the first sentence of Article 109l(4) of the Treaty;(i) 'incoming payments` are payments received for crediting to accounts of beneficiaries;(j) 'outgoing payments` are payments made by debiting accounts of originators;(k) 'accounts` are all types of accounts with banks (as defined in (a)) and include deposit accounts, current accounts, mortgage accounts and securities accounts.Article 2 Standard of good practice Banks should implement, in accordance with Article 4, a standard of good practice on conversion without charge, which should include:(a) Practice that the Commission considers to be legally required:(i) the conversion without charge of incoming payments from the national currency unit to the euro unit and vice versa during the transitional period;(ii) the conversion without charge of accounts from the national currency unit to the euro unit at the end of the transitional period;(iii) the charging for services denominated in the euro unit at fees no different from those for identical services denominated in the national currency unit.(b) Other recommended practice:(i) the conversion without charge of outgoing payments from the national currency unit to the euro unit and vice versa during the transitional period;(ii) the conversion without charge of accounts from the national currency unit to the euro unit during the transitional period;(iii) the exchange without charge to their customers (namely the account holders) of 'household amounts` of the national banknotes and coin for euro banknotes and coin during the final period. Banks should quantify 'household amounts` by volume and frequency in a transparent manner.Article 3 Transparency 1. For all conversions between any national currency unit and the euro unit and vice versa, and for all exchanges of banknotes and coin of participating Member States, banks should show clearly the application of the conversion rates in accordance with the provisions of Regulation (EC) No 1103/97, and should identify separately from the conversion rate any charges for any kind whatever which have been applied.2. Where banks charge for conversions and exchanges which are not included in Article 2 or where banks do not implement one or more of the provisions of Article 2(b), they should provide clear and transparent information concerning those conversion charges or exchange charges by providing their customers with:(a) prior (ex ante) written information on any conversion charges or exchange charges which they propose to apply, and(b) specific information (ex post) on any conversion charges or exchange charges which have been applied, on bank and cardholder statements and any other means used for communicating with the customer. This information should demonstrate clearly to their customers the application of the conversion rates in accordance with the provisions of Regulation (EC) No 1103/97, with any conversion charges or exchange charges being identified separately from the conversion rate and from any other charges of any kind whatever which are applied.Article 4 Implementation 1. Banks should implement the standard of good practice by 1 January 1999 at the latest, and earlier in the case of Article 3 if this is technically feasible.2. Banks should inform their customers as soon as possible before 1 January 1999 about whether and to what extent they will implement the standard of good practice.3. Implementation of the standard of good practice should be publicised by any method which demonstrates that banks comply with the standard, such as:(a) professional codes of conduct;(b) provisions within a national changeover plan;(c) displaying a 'conversion symbol` which demonstrates that banks comply with the standard of good practice. A scheme to confer the right to display a conversion symbol should be worked out at national level by the parties concerned, if and when it is considered appropriate.Article 5 Other recommended measures The competent authorities of the Member States are invited to consider how best to facilitate the exchange, free of charge, of banknotes and coin denominated in the national currency unit in reasonable amounts and at reasonable frequencies, for banknotes and coin denominated in the euro unit during the final period, in the case of consumers having no bank account.Article 6 Final provision Member States are invited to support the implementation of this Recommendation.Article 7 Addressees This Recommendation is addressed to the Member States and to banks and their associations.Done at Brussels, 23 April 1998.For the CommissionYves-Thibault DE SILGUYMember of the Commission(1) OJ L 162, 19. 6. 1997, p. 1.(2) OJ C 236, 2. 8. 1997, p. 8.(3) See page 29 of this Official Journal.(4) Report of the expert group on banking charges for conversion to the euro, Euro Paper No 14.(5) COM(1998) 61 final.(6) OJ L 322, 17. 12. 1977, p. 30.(7) OJ L 332, 31. 12. 1993, p. 4.


title: Recommendation for a Council Recommendation with a view to bringing an end to the situation of an excessive government deficit in Finland

text:
   EN
EN    EN
 ---pagebreak---                   EUROPEAN COMMISSION
                                                   Brussels, 15.6.2010
                                                   SEC(2010) 747 final
                                  Recommendation for a
                           COUNCIL RECOMMENDATION
   with a view to bringing an end to the situation of an excessive government deficit in
                                         Finland
EN                                                                                EN
 ---pagebreak---                                          Recommendation for a
                                     COUNCIL RECOMMENDATION
       with a view to bringing an end to the situation of an excessive government deficit in
                                                 Finland
   THE COUNCIL OF THE EUROPEAN UNION,
   Having regard to the Treaty on the Functioning of the European Union, and in particular
   Article 126(7) thereof;
   Having regard to the recommendation from the European Commission;
   Whereas:
   (1)     According to Article 126 of the Treaty Member States shall avoid excessive
           government deficits.
   (2)     The Stability and Growth Pact is based on the objective of sound government finances
           as a means of strengthening the conditions for price stability and for strong sustainable
           growth conducive to employment creation.
   (3)     The 2005 reform of the Stability and Growth Pact sought to strengthen its
           effectiveness and economic underpinnings as well as to safeguard the sustainability of
           the public finances in the long run. It aimed at ensuring that in particular the economic
           and budgetary background was taken into account fully in all steps in the EDP. In this
           way, the Stability and Growth Pact provides the framework supporting government
           policies for a prompt return to sound budgetary positions taking account of the
           economic situation.
   (4)     The Council has decided on [13 July 2010], in accordance with Article 126(6) of the
           treaty, that an excessive deficit exists in Finland.
   (5)     In accordance with Article 126(7) of the Treaty and Article 3 of Council Regulation
           (EC) No 1467/97 on speeding up and clarifying the implementation of the excessive
           deficit procedure1 (which is part of the Stability and Growth Pact), the Council is also
           required to make recommendations to the Member State concerned with a view to
           bringing the situation of excessive deficit to an end within a given period. The
           recommendation has to establish a deadline of six months at the most for effective
           action to be taken by the Member State concerned to correct the excessive deficit as
           well as a deadline for the correction of the excessive deficit, which should be
           completed in the year following its identification unless there are special
           circumstances. In deciding whether special circumstances exist, “relevant factors” as
           clarified in Article 2(3) of Regulation (EC) No 1467/97 should be taken into account.
   1
           OJ L 209, 2.8.1997, p. 6.
EN                                                    2                                              EN
 ---pagebreak---        Furthermore, in a recommendation to correct an excessive deficit the Council should
       request the achievement of a minimum annual improvement in the structural balance,
       i.e. the cyclically-adjusted balance excluding one-off and other temporary measures, of
       0.5% of GDP as a benchmark.
   (6) In the case of Finland, the relevant factors, as clarified in Article 2(3) of Regulation
       (EC) No 1467/97 and examined in the Commission’s report under Article 124(3),
       were considered favourable. However, they do not suggest the existence of special
       circumstances warranting a departure from the standard deadline for correcting the
       deficit. In particular, according to the Commission services' spring 2010 forecast, the
       general government deficit would fall by a narrow margin below the 3% reference
       value under a no-policy-change assumption already in 2011.
   (7) Prior to the global crisis, Finland built up a substantial surplus in public finances. This
       has allowed Finland provide for a relatively large discretionary fiscal stimulus
       amounting to 1.8% of GDP in 2009 and 1.1% in 2010 and to allow a full operation of
       automatic stabilisers. This has turned the general government finances into a deficit of
       2.2% of GDP in 2009. The deficit is projected to widen further to 4.1% of GDP in
       2010 according to the April 2010 EDP notification presented by the Ministry of
       Finance. The Commission service's spring forecast projected a slightly smaller deficit
       of 3.8% of GDP in 2010. The third supplementary budget presented by the Ministry of
       Finance to the Parliament on 14 May 2010 suggests that tax revenue in 2010 could
       turn out by 0.5% of GDP higher-than-planned, principally on account of stronger
       corporate income tax accrual. This indicates upside risks to the current public finance
       projections, but given that no full-fledged update of these projections has been made,
       the deficit target for 2010 has not been officially changed and the current assessment
       remains valid. In 2011, both the Ministry of Finance and the Commission services’
       forecast the general government deficit to fall narrowly below 3% of GDP on a no
       policy change assumption. On the basis of the Commission services’ forecast, the
       correction of the excessive deficit in 2011 implies a fiscal effort of around 0.3
       percentage points of GDP in 2011.
   (8) The main tool in controlling central government expenditure are the multiannual
       spending limits, which exclude cyclically sensitive expenditure items and have
       therefore allowed the full operation of automatic stabilisers. While this setup, in
       particular the free operation of automatic stabilisers, has supported economic activity
       and social cohesion over the crisis period, it has also led to a relatively sharp negative
       swing in public finances. This budgetary framework will therefore effectively support
       the reduction of central government expenditure pressures, including social
       expenditure, only once the economic recovery is well underway. Local governments
       are responsible for a large part of age-related public expenditure such as education,
       health and long-term care and they are not bound by centrally-imposed expenditure
       limits. To compensate for increasing expenditure, local tax rates have typically been
       increased, avoiding building up debt at the municipal level but adding to the overall
       national tax burden. The government pursues reforming local governments' structures
       and service provision in the medium term with the aim of curbing expenditure growth
       related to population ageing.
   (9) In its opinion of 26 April 2010 on the most recent stability programme update, the
       Council assessed the long-term sustainability of Finland’s public finances and invited
       the authorities to take timely action to define a comprehensive and concrete medium
EN                                               3                                                 EN
 ---pagebreak---            term fiscal strategy to consolidate from 2011 onwards, also with a view to achieve the
           MTO and to restore the long-term sustainability of public finances.
   (10)    The general government gross debt amounted to 44% of GDP in 2009. The April EDP
           notification expects the debt ratio to rise to 49.9% of GDP in 2010. The Commission
           spring forecast projected the debt ratio to grow slightly faster, reaching 50.5% of GDP
           in 2010 and 54.9% of GDP in 2011, still remaining below the 60% of GDP reference
           value.
   (11)    Enhanced surveillance under the EDP will require regular and timely monitoring of
           the progress made in the implementation of the fiscal consolidation strategy. In this
           context, a separate chapter in the forthcoming updates of the Finnish stability
           programme could usefully be devoted to this issue.
   (12)    In general, in the view of the Council, budgetary consolidation measures should secure
           a lasting improvement in the general government balance, while being geared towards
           enhancing the quality of the public finances and reinforcing the growth potential of the
           economy.
   HAS ADOPTED THIS RECOMMENDATION:
   (1)     Recognising that Finland’s budgetary position in 2010 resulted from measures
           amounting to 1.8% of GDP in 2009 and 1.1% in 2010, which is an adequate response
           to the downturn and were in line with the European Economic Recovery Plan
           principles, as well as from the free play of automatic stabilisers, the Finnish authorities
           should put an end to the present excessive deficit situation at the latest by 2011.
   (2)     The Finnish authorities should bring the general government deficit below 3% of GDP
           in a credible and sustainable manner. Specifically, to this end, the Finnish authorities
           should:
           (a)     implement the fiscal measures in 2010 as envisaged in the latest update of the
                   stability programme, while ensuring that the planned breach of the 3%-of-GDP
                   reference value would remain contained and temporary;
           (b)     ensure a fiscal effort of at least ½% of GDP in 2011;
           (c)     specify measures to ensure that the planned correction of the excessive deficit
                   in 2011 is secured.
   (3)     The Council establishes the deadline of [13 January 2011] for the Finnish government
           to take effective action to specify the measures that will be necessary to progress
           towards the correction of the excessive deficit. The assessment of effective action will
           take into account economic developments compared with the economic outlook in the
           Commission services' spring 2010 forecast.
   The Finnish authorities should report on progress made in the implementation of these
   recommendations in a separate chapter in the forthcoming updates of the stability programme
   until the abrogation of the excessive deficit procedure.
EN                                                    4                                                EN
 ---pagebreak---    In addition, the Council highlights the importance of achieving the medium-term objective
   (MTO) for appropriate budgetary management of economic downturns and also with a view
   of restoring the long-term sustainability of public finances. It therefore invites the Finnish
   authorities to ensure that budgetary consolidation towards the medium-term objective for the
   budgetary position –a structural surplus of 0.5% of GDP – is sustained after the excessive
   deficit will have been corrected.
   This recommendation is addressed to the Republic of Finland.
   Done at Brussels,
                                               For the Council
                                               The President
EN                                                5                                               EN


title: Recommendation of the European Central Bank of 9 October 2006 to the Council of the European Union on the external auditors of Banka Slovenije (ECB/2006/14)

text:
               25.10.2006

               EN

               Official Journal of the European Union

               C 257/19

      RECOMMENDATION OF THE EUROPEAN CENTRAL BANK

   of 9 October 2006
   to the Council of the European Union on the external auditors of Banka Slovenije
   (ECB/2006/14)
   (2006/C 257/08)
   THE GOVERNING COUNCIL OF THE EUROPEAN CENTRAL BANK,
   Having regard to the Statute of the European System of Central Banks and of the European Central Bank, and in particular Article 27.1 thereof,
   Whereas:

               (1)

               The accounts of the European Central Bank (ECB) and of the national central banks of the Eurosystem are audited by independent external auditors recommended by the Governing Council of the ECB and approved by the Council of the European Union.

               (2)

               Pursuant to Article 1 of Council Decision 2006/495/EC of 11 July 2006 in accordance with Article 122(2) of the Treaty on the adoption by Slovenia of the single currency on 1 January 2007 (1), Slovenia now fulfils the necessary conditions for the adoption of the euro and the derogation in favour of Slovenia referred to in Article 4 of the 2003 Act of Accession (2) is abrogated with effect from 1 January 2007.

               (3)

               The external auditors recommended herein are Banka Slovenije's current auditors, who were appointed for the financial years 2006 to 2008,

         HAS ADOPTED THIS RECOMMENDATION:
   It is recommended that Deloitte & Touche revizija d.o.o. should be appointed as the external auditors of Banka Slovenije for the financial years 2007 and 2008.

      Done at Frankfurt am Main, 9 October 2006.

            The President of the ECB

         Jean-Claude TRICHET

      (1)  OJ L 195, 15.7.2006, p. 25.

      (2)  OJ L 236, 23.9.2003, p. 33.