Important legal notice

|

52005SC0147

Recommendation for a Council opinion in accordance with the third paragraph of Art. 9 of Council Regulation (EC) No 1466/97 of 7 July 1997 On the updated convergence programme of Poland, 2004-2007  /* SEC/2005/0147 final */

	Brussels, 2.2.2005SEC(2005) 147 finalRecommendation for aCOUNCIL OPINIONin accordance with the third paragraph of Art. 9 of Council Regulation (EC) No 1466/97 of 7 July 1997 On the updated convergence programme of Poland, 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 non-participating Member States, that is, those which have not adopted the single currency, have to submit convergence programmes to the Council and the Commission. In accordance with Article 9 of this Regulation, the Council has to examine each convergence 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 convergence programmes, which may also be examined by the Council in accordance with these same procedures.The Member States that joined the EU on 1 May 2004 do not participate in the single currency, but are required to fulfil in due time the convergence criteria, including the one on the sustainability of the government financial position, in order to qualify for the adoption of the euro. In view of a general government deficit of 3.9% of GDP recorded in 2003, the Council decided that Poland was in excessive deficit on 5 July 2004 and recommended that the excessive deficit be corrected by 2007 at the latest in line with the May 2004 convergence programme. In particular, Poland was recommended to implement with vigour the measures envisaged in the May convergence programme, in particular those contained in the so-called Hausner plan . It was recommended to take effective action regarding the measures envisaged to achieve the 2005 deficit target by the deadline of 5 November 2004 in line with the Stability and Growth Pact (SGP). In addition, Polish authorities were invited to allocate possible extra revenues to decrease the general government deficit and to ensure the rise in the debt ratio is brought to a halt. In its Communication of 22 December 2004, the Commission concluded that the Polish government had taken effective action regarding the measures envisaged to achieve the 2005 deficit target[2].The Member States which joined the EU on 1 May 2004 committed themselves to submitting their convergence programmes by 15 May 2004 and a first update thereof towards the end of 2004. The first convergence programme of Poland, covering the period 2004-2007, was submitted on 17 May 2004 and assessed by the Council on 5 July 2004. Poland submitted an update of its convergence programme on 1 December 2004. The Commission services have carried out a technical evaluation of this update, taking into account the results of the Commission services Autumn 2004 economic forecasts, and having regard to the code of conduct[3], the commonly agreed methodology for the estimation of potential output, 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[4]. This evaluation warrants the following assessment:-  Poland submitted to the European Commission its updated convergence programme covering the period 2004-2007 on 1 December 2004, following the approval by the Council of Ministers on 30 November 2004. The document incorporates the measures taken in the 2005 budget and draws upon the government’s “ Programme of Rationalisation and Reduction of Public Expenditure ” (the so-called Hausner plan ) endorsed in January 2004. The programme partly complies with the data requirements of the “code of conduct on the content and format of stability and convergence programmes” and adheres to ESA95 standards. The quality of ESA95 data on the composition of the general government revenue and expenditure is not fully in line with ESA95 statistical standards. Accordingly, Poland is invited to achieve compliance with the data requirements.-  The macroeconomic framework presented in the programme predicts a deceleration in real GDP growth from 5.7% in 2004 to 5.0% and 4.8% in 2005 and 2006, respectively, followed by a rebound to 5.6% in 2007. Throughout the forecast period, growth will be driven by domestic demand, while the contribution of net exports is expected to turn negative from 2005 onwards. The macroeconomic scenario up to 2006 is plausible and is close to the Commission services autumn 2004 forecasts, although the latter predict a somewhat lower GDP growth for 2006. By contrast, the growth forecast for the last year of the programme appears on the high side. The projected acceleration in GDP growth in 2007 reflects optimistic assumptions about the growth of both potential output and domestic demand. In particular, the programme assumes a strengthening of potential growth from 3.6% in 2004 to 4.7% in 2007 (according to Commission services calculations), resulting in an estimated output gap of over 2% at the end of the programme period. This suggests also that price pressures could be stronger than expected in the programme.-  During 2004, inflation in Poland has been increasing from the very low levels recorded in 2003, but the pace has recently slowed. The surge in inflation observed between April and August 2004 was mostly due to temporary factors (food and oil prices, accession-related tax increases), while continued moderate wage growth and a stronger zloty help to underpin prospects for a slowing of inflation in 2005. The zloty appreciated strongly during most of 2004, gaining some 13% against the euro relative to December 2003. In effective terms, both nominal and real, the zloty also recorded an appreciation of more than 10% in the course of 2004 (year-end vs. year-end). Yield spreads between Polish and euro area benchmark bonds widened between mid-2003 and mid-2004 due to investor concerns about economic policy governance, but narrowed again in recent months, down to about 200 basis points at year-end. No change to the existing monetary and exchange rate arrangements, i.e. a direct inflation targeting framework combined with a floating exchange rate regime, is foreseen.-  The budgetary strategy underlying the updated programme aims at reducing the general government deficit to below 3% of GDP by 2007 and maintaining the debt ratio below 60% of GDP. The update foresees a gradual reduction of the deficit to 2.2% of GDP in 2007 from 5.4% of GDP in 2004. The open pension funds (estimated annual impact of 1.5% of GDP) are classified within the general government sector as allowed by the transition period granted by Eurostat. Compared with the previous programme, the most significant difference is the upward revision of the general government deficit target in 2007 by 0.7 percentage points of GDP, despite the projected rebound in economic growth. The fiscal consolidation would result from the implementation of a comprehensive set of measures contained in the Hausner plan, which, if fully implemented, would have an estimated total budgetary impact of 4.7% of GDP over the period 2005-2007 (revised downwards by 0.6 percentage points compared with the previous programme).-  The reduction of the headline deficit between 2004 and 2007 is less ambitious than in the May convergence programme and amounts to 3.2 instead of 4.2 percentage points. Many risks surround the planned consolidation strategy. The risk of a delayed or incomplete implementation of the envisaged measures of the Hausner plan , described in the assessment of the May 2004 programme, is already materialising. There is still uncertainty over the implementation of the remaining measures contained already in the budget for 2005, but requiring legislative action. Despite the rejection by Parliament of two important measures, the deficit targets remained unchanged. Almost half of the measures aiming at additional revenue and expenditure savings described in the update are unspecified. Contingent liabilities constitute an additional risk to the sustainability of public finances. The achievement of the deficit targets is also conditional on projected high GDP growth throughout the programme period. In addition, the funded pension scheme continues to be recorded inside the general government sector. With a change in classification in 2007, the deficit figures for each year will be adjusted upwards by 1.5 percentage points. In the absence of additional savings measures, the fulfilment of the Council recommendation to bring the deficit below 3% in the end year of the programme is not ensured, based on the new 2007 deficit target of 2.2% of GDP. Based on the risk assessment, the budgetary outcome could be worse than projected.-  The government debt ratio is projected to increase by a cumulative 2.6 percentage points between 2004 and 2006 to peak at 48% of GDP at the end of 2006, before declining by 0.8 percentage points in 2007. The Commission services autumn 2004 forecasts show a less favourable debt development. The classification of the open pension funds outside the general government sector in accordance with the Eurostat ruling would lead to an increase in the debt figures by about 6 percentage points on average each year over the period 2005-2007. The debt ratio would thus remain below the 60% of GDP reference value even with this change in classification. The debt forecast for 2004 has been revised downwards by some 3 percentage points compared to the May programme, mainly due to stronger than expected nominal GDP growth and valuation effects following the appreciation of the zloty. Over the rest of the programme period, improving primary balances and a large nominal growth dividend would partly offset the net debt-increasing impact of the stock-flow adjustment, in part reflecting the pre-financing of EU funds. The planned slowdown and eventual reversal of the increase in the debt ratio is also conditional on sizeable privatisation proceeds. Contingent liabilities also represent a risk to the planned path of debt reduction. The stock of treasury guarantees amounted to 3.9% at the end of 2004 and is expected to increase in the coming years. In addition, the outstanding debt of the health-care system continues to grow and expectations for a bail-out by the government are rising.-  The update outlines only briefly the measures envisaged in the Hausner plan to curb social spending and improve public expenditure management. The adjustment path described in the programme hinges critically on the implementation of the planned reform of social protection. The update complements the May convergence programme, where most of the measures were discussed, with the estimates of the budgetary impact of the measures. Besides their budgetary impact, these reforms would pave the way for reducing the high labour tax wedge, which is a major impediment to job creation and discourages labour market participation. They also address the challenge of decreasing the relatively high share of the legally determined expenditure. Due to the public finance reform and the rationalisation of expenditure, the share of mandatory (legally determined) expenditure is expected to decrease from 42.5% in 2003 to 39.3% in 2007.-  The lack of budgetary projections beyond 2020 makes it very difficult to assess the long-term sustainability of the Polish public finances, as most of the budgetary impact of aging is likely to take place after 2020. However, on the basis of the available information, some risks cannot be ruled out. Major uncertainties regarding the budgetary impact of policies aimed at strengthening the long-term budgetary trends remain.-  While the strategy outlined in the programme relies mainly on the impact of the pension reform and the necessary budgetary consolidation in the medium-term, additional reform measures need to be implemented in the future to improve the capacity to cope with an ageing population. Thus, a successful implementation of the planned measures, a strict monitoring of outstanding contingent liabilities and the resolute implementation of the planned budgetary consolidation in the medium-term should contribute to a sustainable position in the longer term.-  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. On the one hand, the programme is in line with the reduction of the general government deficit recommended by the Council and the reduction is based on the implementation of the Hausner plan . On the other hand, the programme does not present concrete steps to safeguard the long-term sustainability of public finances, and to address the issue of the rising stock of contingent liabilities.-  In view of the above assessment and in the light of the recommendations made by the Council under Article 104(7), it would be appropriate that Poland strengthens the fiscal adjustment and lowers the deficit target for 2007. In order to bring the deficit below 3% of GDP in 2007 in a credible and sustainable manner, it should ensure a full implementation of the structural measures contained in the Hausner plan and take additional fiscal consolidation measures. If risks related to implementation materialized, additional effort should also be made to introduce alternative measures. Furthermore, Poland should be invited to undertake efforts to address the issue of the rising stock of contingent liabilities.Based on this assessment, the Commission has adopted the attached recommendation for a Council Opinion on the updated convergence programme of Poland and is forwarding it to the Council.Recommendation for aCOUNCIL OPINIONin accordance with the third paragraph of Art. 9 of Council Regulation (EC) No 1466/97 of 7 July 1997 On the updated convergence programme of Poland, 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 9(3) thereof,Having regard to the recommendation of the Commission,After consulting the Economic and Financial Committee,HAS DELIVERED THIS OPINION:On [17 February] 2005 the Council examined the updated convergence programme of Poland, which covers the period 2004 to 2007. The programme complies partly with the data requirements of the “code of conduct on the content and format of stability and convergence programmes”. The quality of ESA95 data on the composition of the general government revenue and expenditure are not fully in line with ESA95 statistical standards. The programme also deviates from the data requirements in the area of the long-term sustainability of public finances. Accordingly, Poland is invited to achieve compliance with the data requirements.The macro-economic scenario underlying the programme envisages real GDP growth to decelerate from 5.7% in 2004 to 4.9% on average in 2005 and 2006, before rebounding to 5.6% in 2007. On the basis of currently available information, this scenario seems to reflect rather favourable growth assumptions. If the growth projections for 2005 and 2006 are plausible, the growth forecast for the last year of the programme appears on the high side. In particular, the projected acceleration in GDP growth in 2007 reflects optimistic assumptions about the growth of potential output and the strength of domestic demand. The programme’s projections for inflation appear on the low side.On 5 July 2004, the Council decided that an excessive deficit existed in Poland and recommended that this be corrected by 2007. The budgetary strategy underlying the updated programme aims at reducing the general government deficit to below 3% of GDP by 2007 and maintaining the debt ratio below 60% of GDP. The update foresees a gradual reduction of the deficit to 2.2% of GDP in 2007 from 5.4% of GDP in 2004, including the surplus of the open pension funds (estimated annual impact of 1.5% of GDP). Compared with the previous programme, the most significant difference is the upward revision of the general government deficit target in 2007 by 0.7 percentage points of GDP, despite the projected rebound in economic growth.The fiscal consolidation over the period 2005-2007 would result from the implementation of a comprehensive set of measures contained in the Hausner plan, which, if fully implemented, would have an estimated total budgetary impact of 4.7% of GDP (revised downwards by 0.6 percentage points compared with the previous programme). At the same time, a significant programme of public investment is being implemented, which lifts public investment from 3.4% of GDP in 2003 to an average of 4.1% over the programme period against an EU-average of 2.4% of GDP in 2004.There are clear risks that the budgetary outcome could be worse than projected in the programme. The risk of a delayed or incomplete implementation of the envisaged measures of the Hausner plan , described in the assessment of the May 2004 programme, is already materialising. There is still uncertainty over the implementation of the remaining measures that require legislative procedures but contained already in the budget for 2005. Despite the rejection by Parliament of two important measures, the deficit targets remained unchanged. Almost half of measures aiming at additional revenue and expenditure savings described in the update are unspecified. Contingent liabilities constitute an additional risk to the sustainability of public finances. The achievement of the deficit targets is also conditional on projected high GDP growth throughout the programme period. In addition, the funded pension scheme continues to be recorded inside the general government sector as allowed by the transition period granted by Eurostat. With a change in classification, the deficit figures for each year will be adjusted upwards by 1.5 percentage points. Hence, in the absence of additional savings measures, the fulfilment of the Council recommendation to bring the deficit below 3% in the end year of the programme is not ensured, based on the new 2007 deficit target of 2.2% of GDP.In view of this risk assessment, the budgetary stance in the programme seems insufficient to reduce the deficit to below 3% of GDP by 2007, and additional measures may be needed on top of the Hausner plan described in the updated programme.The debt ratio is estimated to have reached 45.9% of GDP in 2004, below the 60% of GDP Treaty reference value. The programme projects the debt ratio to increase by a cumulative 1.8 percentage points over the period 2004-2007, with the increase coming to a halt only in the last year of the programme.The lack of budgetary projections beyond 2020 makes it difficult to assess the long-term sustainability of the Polish public finances, as most of the budgetary impact of aging is likely to take place after 2020. However, on the basis of the available information, some risks cannot be ruled out. Major uncertainties regarding the budgetary impact of policies aimed at strengthening the long-term budgetary trends remain. While the strategy outlined in the programme relies mainly on the impact of the pension reform and the necessary budgetary consolidation in the medium term, additional reform measures need to be implemented in the future to improve the capacity to cope with an ageing population. Thus, a successful implementation of the planned measures, a strict monitoring of outstanding contingent liabilities and the resolute implementation of the planned budgetary consolidation in the medium term should contribute to a sustainable position in the longer term.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. On the one hand, the programme is in line with the reduction of the general government deficit recommended by the Council and the reduction is based on the implementation of the Hausner plan . On the other hand, the programme does not present concrete steps to safeguard the long-term sustainability of public finances, specifically through addressing the issue of the rising stock of contingent liabilities.* * *In view of the above assessment and in the light of the recommendations made by the Council under Article 104(7), the Council is of the opinion that Poland should:(i) strengthen the fiscal adjustment and lower the deficit target for 2007;(ii) ensure a full implementation of the structural measures contained in the Hausner plan and make further efforts to introduce alternative measures if implementation risks were to materialize; and(iii) address the issue of the rising stock of contingent liabilities.Comparison of key macroeconomic and budgetary projections2004 | 2005 | 2006 | 2007 |Real GDP (% change) | CP Dec 2004 | 5.7 | 5.0 | 4.8 | 5.6 |COM Oct 2004 | 5.8 | 4.9 | 4.5 | n.a. |CP May 2004 | 5.0 | 5.0 | 5.6 | 5.6 |HICP inflation (%) | CP Dec 2004 | 3.5 | 3.0 | 2.7 | 2.5 |COM Oct 2004 | 3.5 | 3.3 | 3.0 | n.a. |CP May 2004 | 2.2 | 2.8 | <3 | <3 |General government balance (% of GDP) | CP Dec 2004 | -5.4 | -3.9 | -3.2 | -2.2 |COM Oct 2004 | -5.6 | -4.1 | -3.1 | n.a. |CP May 2004 | -5.7 | -4.2 | -3.3 | -1.5 |Primary balance (% of GDP) | CP Dec 2004 | -2.6 | -1.3 | -0.5 | 0.4 |COM Oct 2004 | -2.5 | -1.0 | -0.0 | n.a. |CP May 2004 | -2.8 | -1.1 | -0.3 | 1.3 |Government gross debt (% of GDP) | CP Dec 2004 | 45.9 | 47.6 | 48.0 | 47.3 |COM Oct 2004 | 47.7 | 49.8 | 49.3 | n.a. |CP May 2004 | 49.0 | 51.9 | 52.7 | 52.3 |Sources: Convergence programme (CP); Commission services autumn 2004 forecasts (COM) |[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] SEC(2004) 1630 final, 22.12.2004.[3] Revised Opinion of the Economic and Financial Committee on the content and format of stability and convergence programmes, document EFC/ECFIN/404/01–REV 1 of 27.6.2001, endorsed by the ECOFIN Council on 10.7.2001.[4] COM(2002) 668 final, 27.11.2002.[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.


title: Council Recommendation of 12 July 2011 on the national reform programme 2011 for Cyprus and delivering a Council opinion on the updated stability programme of Cyprus, 2011-2014

text:
               16.7.2011

               EN

               Official Journal of the European Union

               C 210/12

         COUNCIL RECOMMENDATION
   of 12 July 2011
   on the national reform programme 2011 for Cyprus and delivering a Council opinion on the updated stability programme of Cyprus, 2011-2014
   2011/C 210/04
   THE COUNCIL OF THE EUROPEAN UNION,
   Having regard to the Treaty on the Functioning of the European Union, and in particular Articles 121(2) and 148(4) thereof,
   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 (1), and in particular Article 5(3) thereof,
   Having regard to the recommendation of the European Commission,
   Having regard to the conclusions of the European Council,
   Having regard to the opinion of the Employment Committee,
   After consulting the Economic and Financial Committee,
   Whereas:

               (1)

               On 26 March 2010, the European Council agreed to the Commission's proposal to launch a new strategy for jobs and growth, Europe 2020, based on enhanced coordination of economic policies, which will focus on the key areas where action is needed to boost Europe's potential for sustainable growth and competitiveness.

               (2)

               On 13 July 2010, the Council adopted a recommendation on the broad guidelines for the economic policies of the Member States and the Union (2010 to 2014) and, on 21 October 2010, adopted a decision on guidelines for the employment policies of the Member States (2), which together form the ‘integrated guidelines’. Member States were invited to take the integrated guidelines into account in their national economic and employment policies.

               (3)

               On 12 January 2011, the Commission adopted the first Annual Growth Survey, marking the start of a new cycle of economic governance in the EU and the first European semester of ex-ante and integrated policy coordination, which is anchored in the Europe 2020 strategy.

               (4)

               On 25 March 2011, the European Council endorsed the priorities for fiscal consolidation and structural reform (in line with the Council's conclusions of 15 February and 7 March 2011 and further to the Commission's Annual Growth Survey). It underscored the need to give priority to restoring sound budgets and fiscal sustainability, reducing unemployment through labour market reforms and making new efforts to enhance growth. It requested Member States to translate these priorities into concrete measures to be included in their stability or convergence programmes and national reform programmes.

               (5)

               On 25 March 2011, the European Council also invited the Member States participating in the Euro Plus Pact to present their commitments in time to be included in their stability or convergence programmes and their national reform programmes.

               (6)

               On 6 May 2011, Cyprus submitted its 2011 national reform programme and on 7 May 2011 its 2011 stability programme update covering the period 2010-2014. In order to take account of the interlinkages, the two programmes have been assessed at the same time.

               (7)

               The Cypriot economy is recovering moderately after experiencing the first economic contraction in the last 35 years in 2009, when real GDP fell by 1,7 %. The labour market suffered from the recession, with unemployment reaching 6,5 % in 2010. Public finances also deteriorated. From a surplus, the general government budget dropped to a deficit of 6 % of GDP in 2009, driven by automatic stabilisers, discretionary fiscal stimulus measures to counter the economic downturn and rather large effects due to a less tax-rich growth pattern. Economic activity improved moderately in 2010 with growth at 1 %, mainly driven by inventory accumulation, after the large destocking that took place in 2009, in tandem with a mild resumption of private consumption. The strengthening economic outlook is expected to benefit the labour market, employment is projected to recover modestly while unemployment should ease gradually from its peak at the end of 2010.

               (8)

               Based on the assessment of the updated stability programme pursuant to Regulation (EC) No 1466/97, the Council is of the opinion that the macroeconomic scenario underpinning the budgetary projections is plausible until 2012, but rather favourable thereafter, as assessed against the Commission services’ spring 2011 forecast. The stability programme aims to reduce the budgetary deficit to 4 % of GDP in 2011 and 2,6 % in 2012, in line with the Council Recommendation of 13 July 2010, and to continue consolidation afterwards. The programme projects the debt ratio to peak in 2012 and to decline thereafter. The annual average improvement in the structural balance for the period 2011-2012 is 1,5 % of GDP, in line with the Council Recommendation of 13 July 2010. However, the structural improvement is set to be below the requirements of the Stability and Growth Pact in both 2013 and 2014. The medium-term objective (MTO), which is reaffirmed as a balanced budget in structural terms, will not be reached within the programme period. While the overall adjustment planned is based on expenditure restraint, most measures in 2011 are on the revenue side. Overall, there are downside risks to the consolidation path mapped out in the programme, associated with the continued rebalancing towards a less tax-rich growth pattern, the practice of adopting supplementary budgets during the course of the year and the timely implementation of measures which are still to be agreed with the social partners and others still to be specified (e.g. containment of current expenditure). In view of these risks, additional measures may need to be adopted if macroeconomic or budgetary developments turn out to be worse than expected.

               (9)

               Despite the decline to around 8 % of GDP in 2010, the current account deficit is still large and likely to constrain economic growth over the medium term. High public-sector outgoings need to be financed by either foreign debt or higher domestic private savings. The latter would imply lower output growth by crowding out private consumption or investment. In the medium term, the deficit would continue improving, but at a moderate rate. On 13 July 2010, in the context of the excessive deficit procedure, the Council recommended to the Cypriot authorities to strengthen the binding nature of their medium-term budgetary framework too. Until now, no progress has been reported. According to the stability programme, the medium-term budgetary framework is to be fully implemented from the fiscal year 2014 onwards, rather than 2012, as expected until recently. Therefore, its impact would be felt only in the medium term. Timely implementation of the new framework would be important for successful and lasting consolidation of the public finances.

               (10)

               The banking sector weathered the global financial crisis and the sovereign debt crisis in the euro area well, without any need for government intervention. However, with assets of more than six times GDP, excluding subsidiaries and branches of foreign banks, and nine times GDP when they are included, the banking sector is large in relation to the economy. Moreover, it is relatively concentrated, with the market dominated by three domestic groups that hold about 55 % of total consolidated banking assets, excluding the cooperative banks. The ongoing risks on international financial markets call for continuation of conservative balance-sheet management and for prudent supervision. There are two different supervisors: the Central Bank of Cyprus for commercial banks and the Authority for the Supervision and Development of Cooperative Societies (ASDCS) for cooperative credit institutions The government promotes harmonisation practices in the two supervisory bodies. Meanwhile, the transparency of supervision of the cooperative credit societies needs to be enhanced as a step towards unifying supervision.

               (11)

               The projected long-term budgetary impact of ageing is well above the EU average, mainly as a result of a relatively strong increase in pension expenditure as a share of GDP over the decades ahead. According to the Commission's latest assessment, the risks with regards to long-term sustainability of public finances appear to be high. A pension reform was introduced in April 2009. It is aimed mainly at the revenue side and would only slightly slow down the rise in pension expenditure. Progress on healthcare reform, with the aim of curbing the projected rise in expenditure by establishing a national health system and transforming public hospitals into autonomous entities, has been very limited.

               (12)

               The twice-a-year automatic cost-of-living allowance (COLA) adjustment is linked directly to the average percentage change in the consumer price index (CPI) over the last six months compared with the preceding six months. It enjoys strong support from the social partners and has remained non-negotiable during the collective bargaining process. However, its uniform application does not allow wages to reflect productivity differences across sectors. The shortcomings of the COLA are, first, that wages are connected to product prices only and not to productivity gains. Second, those benefiting most from this system are those with higher incomes. Third, the COLA also has a significant impact on public finances as, beyond wages and salaries, it is also an integral feature of pensions, benefits and other allowances.

               (13)

               While labour participation in Cyprus is higher than the EU average, the labour market displays strong gender imbalances. Gender employment gaps, the cost and availability of childcare facilities, the scarcity of flexible forms of employment and the persistently high gender pay gap are acknowledged in the NRP as major bottlenecks hindering employment and growth. Related measures have been presented in the NRP in this respect. While educational attainment at secondary school and university level in Cyprus is high, vocational education and training (VET) does not appear to be an attractive option. High youth unemployment combined with a high proportion of people with high educational attainment in total unemployment is a sign of a significant skills mismatch in the Cypriot economy. Also, participation in lifelong learning is low for a country that has generally good educational levels, particularly for certain groups (low-skilled workers, older people and the unemployed). To address these issues, the national reform programme envisages a number of measures including the establishment of a series of new post-secondary VET institutes as well as the new apprenticeship system from 2012-2013 onwards. Overall, the country's strategic objective to shift from low to high productivity jobs would benefit greatly from the reorientation of the education and training system to bring about a better mix of skills, in match with labour market demand.

               (14)

               Cyprus adopted a general law for transposition of the Services Directive in July 2010. Some sector-specific legislation has also been adopted and recently transmitted to the European Commission through the notification of national execution measure in early June 2011. However, there are concerns about the completeness of the transposition, as some obstacles to establishment and free provision of services still persist in some sector-specific legislation, where amendments have not yet been made. These obstacles range from generally applicable ones, such as authorisations required by local authorities for any business activity or the limited duration of authorisations, irrespective of the field and the risks involved, to very specific ones, such as fixed tariffs applicable to tourism services, economic needs tests in the authorisations for car rentals, discriminatory treatment of construction companies from other Member States and bans on architects and engineers exercising their profession as legal persons.

               (15)

               Overall, environmental constraints and issues connected with resource and energy use could create bottlenecks to growth. These are related to its specific geographical location and to the consequences of climate change in the form of prolonged droughts. A study on the cost-effectiveness of support schemes for renewable energy has recently been completed and publicised, based on which the support schemes have been revised. The functioning of the energy sector can be significantly improved, by the introduction of natural gas and the facilitation of infrastructure investments for renewable energy.

               (16)

               Cyprus has made a number of commitments under the Euro Plus Pact. On the fiscal side, the Pact commits the country to strengthening fiscal sustainability by preparing a framework law for dealing with financial crises and setting up a fully independent Financial Stability Fund. Furthermore, a dialogue on restructuring the public sector pension system is taking place and should be concluded by the end of 2011. Employment measures are focusing on combating illegal and undeclared work, addressing the skills mismatch and increasing the competitiveness of enterprises. The competitiveness measures cover containing public-sector wages (redesigning the wage indexation mechanism), strengthening the competitiveness of small and medium-sized enterprises, finalising the National Digital Strategy by 2011 and promoting energy efficiency and renewable energy sources. These commitments reflect the four areas of the Pact. They provide for continuity of the broader reform agenda outlined in the stability and national reform programmes and confirm the plans already announced to deliver reforms to address the country's structural weaknesses, without at this stage specifying a timeframe to address issues such as the public-sector wages and pension system. These commitments have been assessed and taken into account in the recommendations.

               (17)

               The Commission has assessed the stability programme and national reform programme, including Euro Plus Pact commitments. It has taken into account not only their relevance for sustainable fiscal and socio-economic policy in Cyprus, but also their compliance with EU rules and guidance, given the need to reinforce the overall economic governance of the EU by providing EU-level input into future national decisions. In this light, the Commission considers that more efforts are needed on achieving the 2011 budget deficit target and that additional consolidation measures should be specified for 2012 and beyond. In order to improve the long-term sustainability of public finances, further action on the pension and healthcare system is needed. Further steps should also be taken to strengthen the prudential framework of banking supervision, to adjust the wage-indexation system and to improve vocational education, training and skills, the business environment and energy efficiency.

               (18)

               In the light of this assessment, also taking into account the Council Recommendation of 13 July 2010 under Article 126(7) of the Treaty on the Functioning of the European Union, the Council has examined the 2011 update of the stability programme of Cyprus and its opinion (3) is reflected in particular in its recommendations (1) and (3) below. Taking into account the European Council conclusions of 25 March 2011, the Council has examined the national reform programme of Cyprus,

         HEREBY RECOMMENDS that Cyprus take action within the period 2011-2012 to:

               1.

               Adopt the necessary measures of a permanent nature to achieve the budgetary target in 2011 and the correction of the excessive deficit by 2012, in line with the Council recommendations under the EDP. Take measures to keep tight control over expenditure and make use of any better-than-expected budgetary developments for faster deficit and debt reduction. Ensure progress towards the medium-term objective by at least 0,5 % of GDP annually and bring the public debt ratio on a downward path. Accelerate the phasing-in of an enforceable multiannual budgetary framework with a binding statutory basis and corrective mechanisms, as from the preparation of the 2012 budget. The programme and performance budgeting should be implemented as soon as possible.

               2.

               Strengthen further the prudential framework for supervision of banks and cooperative credit societies to ensure early detection of risks.

               3.

               Improve the long-term sustainability of public finances by implementing reform measures to control pension and healthcare expenditure in order to curb the projected increase in age-related expenditure. For pensions, extend years of contribution, link retirement age with life expectancy or adopt other measures with an equivalent budgetary effect, while taking care to address the high at-risk-of-poverty rate for the elderly. For healthcare, take further steps to accelerate implementation of the national health insurance system.

               4.

               Take steps to reform, in consultation with social partners and in accordance with national practices, the system of wage bargaining and wage indexation to ensure that wage growth better reflects developments in labour productivity and competitiveness.

               5.

               Take further steps, within the reforms planned for the vocational education and training system, to match education outcomes to labour market needs better, including by setting up post-secondary vocational education and training institutes. Take measures to increase the effectiveness of the vocational training system by increasing the incentives for and improving access to vocational education and training, especially for low-skilled workers, women and older workers.

               6.

               Abolish remaining obstacles to the establishment and free provision of services in sector-specific legislation by December 2011 in order to create more opportunities for growth and jobs in the services sector.

               7.

               Introduce measures to increase the diversity of the energy mix and the expansion of renewable energy sources. Establish, by 2012, a water management plan and a price-setting scheme reflecting cost efficiency and equity concerns in order to ensure more sustainable management of water resources.

      Done at Brussels, 12 July 2011.

            For the Council

            The President

         J. VINCENT-ROSTOWSKI

      (1)  OJ L 209, 2.8.1997, p. 1.

      (2)  Maintained for 2011 by Council Decision 2011/308/EU of 19 May 2011 on guidelines for the employment policies of the Member States (OJ L 138, 26.5.2011, p. 56).

      (3)  Foreseen in Article 5(3) of Regulation (EC) No 1466/97.


Avis juridique important

|

31982K1399

Commission Recommendation No 1399/82/ECSC of 1 June 1982 on Community surveillance in respect of the importation of certain iron and steel products covered by the ECSC Treaty and originating in certain non-member countries

Official Journal L 157 , 08/06/1982 P. 0005 - 0009

*****COMMISSION  RECOMMENDATION No 1399/82/ECSC  of 1 June 1982  on Community surveillance in respect of the importation of certain iron and steel products covered by the ECSC Treaty and originating in certain non-member countries  THE COMMISSION OF THE EUROPEAN  COMMUNITIES,  Having regard to the Treaty establishing the European Coal and Steel Community, and in particular Article 74 thereof,  Whereas imports of certain ECSC iron and steel products originating in non-member countries are subject to Community surveillance under recommendation No 587/80/ECSC (1), as last amended by recommendation No 1997/81/ECSC (2);  Whereas, bearing in mind recent trends in the conditions under which certain of the products concerned have been imported, it is advisable to amend and supplement the terms of that recommendation and set it out in consolidated form,  MAKES THE FOLLOWING RECOMMENDATION:  Article 1  1. The importation into the Community of the iron and steel products covered by the ECSC Treaty, listed in Annex III A or III B and originating in non-member countries shall be subject to the issue of an import licence.  2. The abovementioned products shall be considered as being of first-choice quality until proof to the contrary is supplied by the importer.  3. Such licence shall be issued or endorsed by the Member States, free of charge and for any quantities requested, within not more than five working days from the submission of the completed application and presentation of a photocopy of the relevant purchase contract or contracts, or, where the licence-issuing authority requires, the originals of these documents. If the products in question are declared as being seconds or of substandard quality, the import licence shall state the characteristics put forward in this context by the importer.  4. The application of paragraph 1 shall be without prejudice to the maintenance of existing quantitative restrictions imposed by certain Member States on certain iron and steel products in respect of certain non-member countries.  5. The period of validity of the import licence is hereby fixed at two months, without prejudice to possible changes in the import arrangements in force.  6. Completely used import licences shall be returned immediately to the issuing office. Licences not, or incompletely, utilized two months after their date of issue shall be returned to the issuing office within five working days of their date of expiry.  Article 2  1. The importer's application must state for goods listed in Annex III A or III B of whatever origin:  (a) the country of origin and the country of consignment;  (b) the Common Customs Tariff subheading and the NIMEXE code;  (c) the quantity of the goods in tonnes, including tonnage of individual losses;  (d) the characteristics establishing any claim that the goods are seconds or of substandard quality;  (e) the name, address, telephone number and telex number of the importer;  (f) the name, address, telephone number and telex number of the vendor;  (g) the proposed date and place (customs office) of importation;  (h) the point of delivery;  (i) the date of the contract for the purchase of the goods and the contract number of any other reference given by the vendor by which the delivery in question may be identified;  (j) where applicable, that the goods in question are intended for processing under contract and subsequent re-export outside the Community (country of re-export to be specified).  2. The following additional information shall also be supplied when a licence to import goods listed in Annex III A is applied for:  A. For goods originating in and consigned directly from one of the countries listed in Annex II (direct importation):  (a) a full commercial description of the goods, including exact specifications, sufficient to permit calculation of the delivered price according to the published price lists selected;  (b) the delivered price per tonne, including customs duties, transport costs to point of delivery and all extras, rebates and any other factors relevant to calculation of the delivered price;  (c) details of:  (i) the Community producer's price lists chosen for calculating the delivered price, stating the date of the chosen lists; or  (ii) where appropriate, the non-member country offer on which the terms of the delivery have been aligned, giving details sufficient to identify the offer, including its date; or  (iii) where appropriate, other price (to be justified);  (d) the date and reference of the bill of lading, if available.  B. - For goods originating in one of the countries listed in Annex II but consigned from a non-member country other than the country of origin (indirect importation),  - for products originating in Brazil, other than pig and cast iron under heading 73.01 of the Common Customs Tariff,  - and for goods originating in a non-member country not listed in Annexes I or II:  (a) a complete description corresponding to that appearing in the list of products subject to basic prices (1);  (b) the price free-at-Community-frontier, cif, duty-paid and unloaded, per tonne, in the currency of the contract;  C. For goods originating in one of the countries listed in Annex I, at the option of the importer:  either:  (a) a full description of the goods corresponding to that appearing in the list of products subject to basic prices (1);  (b) the price free-at-Community-frontier, cif, duty-paid and unloaded, per tonne, in the currency of the contract;  or:  (a) a full commercial description of the goods, including exact specifications, sufficient to permit calculation of the delivered price according to the published price list selected;  (b) the delivered price per tonne, including customs duties, transport costs to point of delivery and all extras, rebates and any other factors relevant to calculation of the delivered price;  (c) details of:  (i) the Community producer's price list chosen for calculating the delivered price, stating the date of the chosen lists; or  (ii) where appropriate, the non-member country offer on which the terms of the delivery have been aligned, giving details sufficient to identify the offer, including its date; or  (iii) any other appropriate price (to be justified);  (d) if available, the date of reference of the bill of lading.  3. In addition, the importer shall declare that no rebate will be granted that is not mentioned in the purchase contract or contracts.  4. The importer shall certify that his application for an import document is accurate.  5. The importer shall state whether his application is a repeat of a previous application concerning the same delivery.  Article 3  1. The Member States shall communicate to the Commission, as soon as such information is established by the competent authorities, any difference between the basic price plus any extras, as published in the Official Journal of the European Communities, and the price free-at-Community-frontier, cif, duty-paid and unloaded, in European units of account per tonne, for the following goods:  (i) goods originating in one of the countries listed in Annex II, but consigned from a non-member country other than the country of origin;  (ii) goods originating in non-member countries, other than those listed in Annexes I and II;  (iii) goods originating in Brazil, other than pig and cast iron falling under heading No 73.01 of the Common Customs Tariff.  2. Within the first 10 days of each month, Member States shall notify the Commission of the tonnage and amounts (calculated on the basis of the basic cif prices) for which import documents were issued during the preceding month.  3. The information supplied by Member States shall include:  (a) a breakdown by product (Common Customs Tariff subheading and NIMEXE code);  (b) a breakdown by country of origin;  (c) within the total of any one product originating in any one country, the quantities not imported directly from that country and, where appropriate, a breakdown by country or countries of consignment;  (d) the quantities of each product re-exported outside the Community after inward processing.  4. Within the first 10 days of each month, Member States shall communicate to the Commission the tonnage and the amounts (calculated on the basis of cif price) for which import licences have expired during the preceding month without having been used by importers.  Article 4  For the purposes of this recommendation, the country of consignment is deemed to be the last intermediate non-member country in which the product in question was the subject of 'entrepôt' operations or legal transactions not connected with its transportation.  Article 5  Recommendation No 587/80/ECSC is hereby repealed.  Article 6  This recommendation shall enter into force for each Member State on the day of its publication in the Official Journal of the European Communities.  It shall apply until 31 December 1982.  Done at Brussels, 1 June 1982.  For the Commission  Wilhelm HAFERKAMP  Vice-President  ANNEX I  Austria  Finland  Norway  Sweden  ANNEX II  1.2 // Australia Brazil (1) Bulgaria Czechoslovakia Hungary  // Japan Poland Romania Korea Spain  (1) Only for pig and cast iron falling under heading No 73.01 of the Common Customs Tariff.  (1) OJ No L 65, 11. 3. 1980, p. 5.  (2) OJ No L 194, 17. 7. 1981, p. 20.  (1) OJ No L 372, 29. 12. 1981, p. 1.  ANNEX  III A  List of products the importation of which is subject to the issue of an import document  (quantity and price surveillance)  1.2.3 //   //   //   // CCT heading No  // NIMEXE code  // Description  //   //   //   //   //   //   // 73.01 B  // 73.01-21; 23; 25; 27  // Haematite pig iron and cast iron  // 73.01 C  // 73.01-31; 35  // Phosphoric pig iron and cast iron  // 73.01 D  // 73.01-41; 49  // Pig iron and cast iron other than spiegeleisen, haematite and phosphoric pig iron and cast iron  // 73.02 A I  // 73.02-01; 09  // Ferro-manganese containing more than 2 % by weight of carbon (high carbon ferro-manganese)  // 73.07 A I  // 73.07-12  // Blooms and billets, of iron or steel, rolled (1)  // 73.07 B I  // 73.07-21; 24  // Slabs and sheets bars, of iron or steel, rolled (1)  // 73.08  // 73.08-01; 03; 05; 07; 21; 25; 29; 41; 45; 49  // Iron or steel coils for re-rolling  // 73.10 A I  // 73.10-11  // Wire rod of iron or steel  // 73.10 A II  // 73.10-73  // Concrete reinforcing bars of iron or steel with minor identations, flanges, grooves or other deformations produced during the rolling process, whether or not twisted after rolling  //   // 73.10-16  // Concrete reinforcing bars of iron or steel other than those with minor identations, flanges, grooves or other deformations produced during the rolling process  //   //   // Bars and rods of iron or steel, not further worked than hot-rolled or extruded other than concrete reinforcing bars  // 73.11 A I  // 73.11-11; 12; 14; 16; 19  // Angles, shapes and sections of iron or steel, not further worked than hot-rolled or extruded  // 73.12 A II  // 73.12-19  // Hoop and strip of iron or steel, other than electrical, not further worked than hot-rolled  // 73.13 A II  // 73.13-16  // 'Electrical' sheets and plates of iron or steel, other than with a watt-loss, regardless of thickness, of 0;75 watt or less  // 73.13 B I a)  // 73.13-17; 19; 21; 23; 26  // Sheets and plates, other than 'electrical', not further worked than hot-rolled, of a thickness of 2 mm or more  // 73.13 B II b)  // 73.13-43; 45  // Sheets and plates, other than 'electrical', not further worked than cold-rolled, of a thickness of more than 1 mm but less than 3 mm  // 73.13 B II c)  // 73.13-47; 49  // Sheets and plates, other than 'electrical', not further worked than cold-rolled, of a thickness of 1 mm or less  // 73.13 B IV c) 1 + 2  // 73.13-67; 68; 72  // Sheets and plates, other than 'electrical', zinc-coated  // 73.15 B I b) 2 (aa)  // 73.71-53  // Blooms, billets, slabs, sheet bars, other than forged (1): - Stainless or heat-resisting steel  // 73.15 B V b) 1 (aa)  // 73.73-23  // Wire rod: - Stainless or heat-resisting steel  // 73.15 B V b) 1 (cc)  // 73.73-25  // Wire-rod: - S, Pb and P steels  // 73.15 B V b) 1 (dd)  // 73.73-26  // Wire rod: - Mangano-silicon  // 73.15 B V b) 1 (ee)  // 73.73-29  // Wire rod: - Other (excluding high-speed)  // 73.15 B V b) 2 (aa)  // 73.73-33  // Hot-rolled or extruded bars, rods, angles, shapes and sections: - Stainless or heat-resisting steel  // 73.15 B V b) 2 (cc)  // 73.73-35  // Hot-rolled or extruded bars, rods, angles, shapes and sections: - S, Pb and P steels  // 73.15 B V b) 2 (dd)  // 73.73-36  // Hot-rolled or extruded bars, rods, angles, shapes and sections: - Mangano-silicon  //  //   //   //   //   //  (1) Includes products of the same form in continuous casting.  1.2.3 //   //   //  //   //   //   // CCT heading No  // NIMEXE code  // Description  //   //   //   //   // 73.15 B V b) 2 (ee)  // 73.73-39  // Hot-rolled or extruded bars, rods, angles, shapes and sections: - Other alloy (excluding high-speed)  // 73.15 B VII a) 2  // 73.75-19  // Electrical sheet and plate in alloy steel with a watt-loss, regardless of thickness of greater than 0;75 watt  // 73.15 B VII b) 1 (aa) 11  // 73.75-23  // Hot-rolled sheets and plates of a thickness more than 4;75 mm: - Stainless or heat-resisting  // 73.15 B VII b) 1 (bb) 11  // 73.75-33  // Hot-rolled sheets and plates of a thickness not less than 3 mm but not more than 4;75 mm: - Stainless or heat-resisting  // 73.15 B VII b) 1 (cc) 11  // 73.75-43  // Hot-rolled sheets and plates of a thickness less than 3 mm: - Stainless or heat-resisting  // 73.15 B VII b) 2 (bb) 11  // 73.75-63  // Cold-rolled sheet of a thickness less than 3 mm: - Stainless or heat-resisting  //   //   //  ANNEX III B  List of products for which import is subject to the issue of an import document (quantity monitoring)  1.2.3 //   //   //   // CCT heading No  //  NIMEXE code  // Description  //   //   //   // 73.15 A I b) 2  // 73.61-50  // Blooms, billets, slabs and sheet bars of high carbon steel, other than forged (1):  // 73.15 A V b) 1  // 73.63-21  // Wire rod of high carbon steel  // 73.15 B I b) 2 (bb)  // 73.71-54  // Blooms, billets, slabs and sheet bars: - High-speed steel (1)  // 73.15 B I b) 2 (cc)  // 73.71-55  // Blooms, billets, slabs and sheet bars: - S, Pb and P steels (1)  // 73.15 B I b) 2 (dd)  // 73.71-56  // Blooms, billets, slabs and sheet bars: - Mangano-silicon steel (1)  // 73.15 B I b) 2 (ee)  // 73.71-59  // Blooms, billets, slabs and sheet bars: - Other alloy steel (1)  // 73.15 B V b) 1 (bb)  // 73.73-24  // Wire rod of high-speed steel  // 73.15 B V b) 2 (bb)  // 73.73-34  // Hot-rolled or extruded bar, rod, angles, shapes and sections of high-speed steel  // 73.15 B VII b) 1 (aa) 22  // 73.75-24  // Hot-rolled plate and sheet of a thickness more than 4;75 mm: - High-speed steel  // 73.15 B VII b) 1 (aa) 33  // 73.75-29  // Hot-rolled plate and sheet of a thickness more than 4;75 mm: - Other alloy (excluding stainless)  // 73.15 B VII b) 1 (bb) 22  // 73.75-34  // Hot-rolled plate and sheet of a thickness not less than 3 mm but not more than 4;75 mm: - High-speed steel  // 73.15 B VII b) 1 (bb) 33  // 73.75-39  // Hot-rolled plate and sheet of a thickness not less than 3 mm but not more than 4;75 mm: - Other alloy (excluding stainless)  // 73.15 B VII b) 1 (cc) 22  // 73.75-44  // Hot-rolled sheet of a thickness less than 3 mm: - High-speed steel  // 73.15 B VII b) 1 (cc) 33  // 73.75-49  // Hot-rolled sheet of a thickness less than 3 mm: - Other alloy (excluding stainless)  // 73.15 B VII b) 2 (bb) 22  // 73.75-64  // Cold-rolled sheet of a thickness less than 3 mm: - High-speed steel  // 73.15 B VII b) 2 (bb) 33  // 73.75-69  // Cold-rolled sheet of a thickness less than 3 mm: - Other alloy (excluding stainless)  //   //   //  (1) Includes products of the same form in continuous casting.( 1 ) INCLUDES PRODUCTS OF THE SAME FORM IN CONTINUOUS CASTING .


Commission Recommendation providing a policy advice on the economic and budgetary policy in France


Avis juridique important

|

52004SC0831

Recommendation for a Council Decision on the existence of an excessive deficit in the Czech Republic  /* SEC/2004/0831 final */

Recommendation for a COUNCIL DECISION on the existence of an excessive deficit in the Czech Republic(presented by the Commission)EXPLANATORY MEMORANDUMOn 7 April 2004, the Commission published its Spring 2004 forecasts [1]. According to these forecasts, which took into consideration data reported by the Czech Republic in March 2004, the general government deficit in the Czech Republic increased from 6.4% of GDP in 2002 to 12.9% of GDP in 2003 (5.9% of GDP excluding a major one-off operation related to imputed state guarantees), thus exceeding the 3% of GDP Treaty reference value.[1]  The Commission Spring 2004 forecast is available at the following website: http://europa.eu.int/comm/economy_finance/ publications/european_economy/2004/ee204en.pdf.Based on this prima facie evidence, the Commission initiated the excessive deficit procedure for the Czech Republic on 12 May 2004, with the adoption of the report foreseen in Article 104(3) of the Treaty [2]. On 13 May 2004, the Commission received the convergence programme of the Czech Republic, which confirmed a deficit figure of 12.9% of GDP for 2003.[2]  The full text of this report is available at the following website: http://europa.eu.int/comm/economy_finance/ about/activities/sgp/procedures_en.htmThe application of the excessive deficit procedure (EDP) is governed by Article 104 of the Treaty and by Council Regulation (EC) No 1467/97 "on speeding up and clarifying the implementation of the excessive deficit procedure", which is part of the Stability and Growth Pact [3]. Countries that joined the EU on 1 May 2004 are Member States with a derogation and are to avoid excessive deficits, but sanctions according to Article 104 (9) and (11) cannot be imposed on them."[3]  OJ L 209, 2.8.1997.The Commission report according to Article 104(3) of the Treaty concluded that the excess of the Czech Republic's deficit in 2003 over the 3% of GDP Treaty reference value did not result from an unusual event outside the control of the Czech authorities, nor was it the result of a severe economic downturn in the sense of the Stability and Growth Pact, as real GDP growth reached 2.9% in 2003. Concerning developments in 2004, the report concluded that the general government deficit is likely to decrease but remain above 3% of GDP. In particular, the Commission Spring 2004 forecasts are for a general government deficit of 5.9% of GDP in 2004, which is above the 5.3% of GDP projected by the Czech authorities in the convergence programme.Based on the Commission Spring 2004 forecasts, the Commission report also concluded that the debt-to-GDP ratio, which had reached 37.6% of GDP in 2003, will remain below the 60% reference value of the Treaty in 2004. In particular, the Commission Spring 2004 forecasts projects the debt ratio to reach 40.6% of GDP in 2004, which is above the 38.4% of GDP projected by the Czech authorities in the convergence programme.Article 104(4) of the Treaty states that "the Committee provided for in Article 114 (i.e. the Economic and Financial Committee) has to formulate an opinion on the report of the Commission". The Committee issued its opinion on 24 May 2004, subscribing to the assessment made by the Commission in its report. In particular, the Committee concluded that the budgetary situation in the Czech Republic indicated the existence of an excessive deficit under the first of the two criteria foreseen by Article 104(2) for the identification of such deficits. Consideration of other relevant factors, in particular the medium-term budgetary position and the public investment ratio, did not change the assessment based on the criteria themselves. The Committee also considered as likely that the general government deficit would continue to exceed the Treaty reference value in 2004, and that general government gross debt would remain below the Treaty reference value of 60% of GDP but increase further to 40.6% of GDP in 2004.The Commission, having examined the relevant factors taken into account in its report and having regard to the opinion of the Committee, is of the opinion that an excessive deficit exists in the Czech Republic. This opinion, adopted by the Commission on 24 June 2004, has been addressed to the Council, according to Article 104(5) of the Treaty. The Commission recommends that the Council shall decide accordingly, in conformity with Article 104(6) and herewith addresses a recommendation for a decision to that effect. In addition, the Commission is submitting to the Council a recommendation for a Council recommendation to be addressed to the Czech Republic with a view to bringing the situation of an excessive deficit to an end, according to Article 104(7) of the Treaty.Recommendation for a COUNCIL DECISION on the existence of an excessive deficit in the Czech RepublicTHE COUNCIL OF THE EUROPEAN UNIONHaving regard to the Treaty establishing the European Community, and in particular Article 104(6) thereof,Having regard to the recommendation from the Commission,Having regard to the observations made by the Czech Republic,Whereas:(1) According to Article 104 of the Treaty Member States are to avoid excessive government deficits; this applies also to Member States with a derogation, the case of all countries that joined the EU on 1 May 2004;(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 excessive deficit procedure under Article 104 provides for a decision on the existence of an excessive deficit and the Protocol on the excessive deficit procedure annexed to the Treaty sets out further provisions relating to the implementation of the excessive deficit procedure. Council Regulation (EC) No 3605/93 [4], amended by Council Regulation (EC) No 475/2000 [5] and by Commission Regulation (EC) No 351/2002 [6], lays down detailed rules and definitions for the application of the provision of the said Protocol;[4]  OJ L 332, 31.12.1993, p. 7.[5]  OJ L 58, 3.3.2000, p. 1.[6]  OJ L 55, 26.2.2002, p. 23.(4) Article 104(5) of the Treaty requires the Commission to address an opinion to the Council if the Commission considers that an excessive deficit in a Member State exists or may occur. Having examined all relevant factors taken into account in its report in accordance with Article 104(3) and having regard to the opinion of the Economic and Financial Committee in accordance with Article 104(4), the Commission concluded in its opinion of 24 June 2004 that there exists an excessive deficit in the Czech Republic;(5) Article 104(6) of the Treaty lays down that the Council should consider any observations which the Member State concerned may wish to make before deciding, after an overall assessment, whether an excessive deficit exists;(6) The overall assessment leads to the following conclusions. The general government deficit reached 12.9% of GDP in 2003 (5.9% of GDP excluding a major one-off operation related to imputed state guarantees) in the Czech Republic, above the 3% of GDP Treaty reference value. The excess of the general government deficit over the reference value did not result from an unusual event outside the control of the Czech authorities, nor was it the result of a severe economic downturn, in the sense of the Stability and Growth Pact. The general government deficit is likely to remain above 3% of GDP in 2004. In particular, according to the Commission Spring 2004 forecast, the deficit is projected to reach 5.9% of GDP in 2004, while the convergence programme of the Czech Republic expects a deficit of 5.3% of GDP. The debt ratio, which was 37.6% in 2003, is likely to remain below the 60% of GDP Treaty reference value in 2004.HAS ADOPTED THIS DECISON:Article 1From an overall assessment it follows that an excessive deficit exists in the Czech Republic.Article 2This decision is addressed to the Czech Republic.Done at Brussels, [5 July] 2004.For the CouncilThe President[...]


title: Recommendations to national courts and tribunals in relation to the initiation of preliminary ruling proceedings

text:
               6.11.2012

               EN

               Official Journal of the European Union

               C 338/1

   RECOMMENDATIONS
   to national courts and tribunals in relation to the initiation of preliminary ruling proceedings
   2012/C 338/01
   I —   GENERAL PROVISIONS

      The Court’s jurisdiction in preliminary rulings

               1.

               The reference for a preliminary ruling is a fundamental mechanism of European Union law aimed at enabling the courts and tribunals of the Member States to ensure uniform interpretation and application of that law within the European Union.

               2.

               Under Article 19(3)(b) of the Treaty on European Union (‘TEU’) and Article 267 of the Treaty on the Functioning of the European Union (‘TFEU’), the Court of Justice of the European Union has jurisdiction to give preliminary rulings on the interpretation of Union law and on the validity of acts adopted by the institutions, bodies, offices or agencies of the Union.

               3.

               Article 256(3) TFEU provides that the General Court is to have jurisdiction to hear and determine questions referred for a preliminary ruling under Article 267 TFEU, in specific areas laid down by the Statute. However, since no provisions have been introduced into the Statute in that regard, the Court of Justice alone currently has jurisdiction to give preliminary rulings.

               4.

               While Article 267 TFEU confers on the Court of Justice a general jurisdiction in that regard, a number of primary law provisions exist which lay down exceptions to or temporary restrictions on that jurisdiction. This is true, in particular, of Articles 275 TFEU and 276 TFEU and Article 10 of Protocol (No 36) on Transitional Provisions of the Treaty of Lisbon (OJEU 2010 C 83, p. 1) (1).

               5.

               Since the preliminary ruling procedure is based on cooperation between the Court of Justice and the courts and tribunals of the Member States, it may be helpful, in order to ensure that that procedure is fully effective, to provide those courts and tribunals with the following recommendations.

               6.

               While in no way binding, these recommendations are intended to supplement Title III of the Rules of Procedure of the Court of Justice (Articles 93 to 118) and to provide guidance to the courts and tribunals of the Member States as to whether it is appropriate to make a reference for a preliminary ruling, as well as practical information concerning the form and effect of such a reference.

      The role of the Court of Justice in the preliminary ruling procedure

               7.

               As stated above, under the preliminary ruling procedure the Court’s role is to give an interpretation of European Union law or to rule on its validity, not to apply that law to the factual situation underlying the main proceedings. That is the task of the national court or tribunal and it is not, therefore, for the Court either to decide issues of fact raised in the main proceedings or to resolve any differences of opinion on the interpretation or application of rules of national law.

               8.

               When ruling on the interpretation or validity of European Union law, the Court makes every effort to give a reply which will be of assistance in resolving the dispute in the main proceedings, but it is for the referring court or tribunal to draw specific conclusions from that reply, if necessary by disapplying the rule of national law in question.

      The decision to make a reference for a preliminary ruling

      The originator of the request for a preliminary ruling

               9.

               Under Article 267 TFEU, any court or tribunal of a Member State, in so far as it is called upon to give a ruling in proceedings intended to arrive at a decision of a judicial nature, may as a rule submit a request for a preliminary ruling to the Court of Justice. Status as a court or tribunal is interpreted by the Court of Justice as a self-standing concept of European Union law, the Court taking account of a number of factors such as whether the body making the reference is established by law, whether it is permanent, whether its jurisdiction is compulsory, whether its procedure is inter partes, whether it applies rules of law and whether it is independent.

               10.

               Whether or not the parties to the main proceedings have expressed the wish that it do so, it is for the national court or tribunal alone to decide whether to refer a question to the Court of Justice for a preliminary ruling.

      References on interpretation

               11.

               Article 267 TFEU provides that any court or tribunal may submit a request for a preliminary ruling to the Court of Justice on the interpretation of a rule of European Union law if it considers it necessary to do so in order to resolve the dispute brought before it.

               12.

               However, courts or tribunals against whose decisions there is no judicial remedy under national law must bring such a request before the Court, unless the Court has already ruled on the point (and there is no new context that raises any serious doubt as to whether that case-law may be applied in that instance), or unless the correct interpretation of the rule of law in question is obvious.

               13.

               Thus, a national court or tribunal may, in particular when it considers that sufficient guidance is given by the case-law of the Court of Justice, itself decide on the correct interpretation of European Union law and its application to the factual situation before it. However, a reference for a preliminary ruling may prove particularly useful when there is a new question of interpretation of general interest for the uniform application of European Union law, or where the existing case-law does not appear to be applicable to a new set of facts.

               14.

               In order to enable the Court of Justice properly to identify the subject-matter of the main proceedings and the questions that arise, it is helpful if, in respect of each question referred, the national court or tribunal explains why the interpretation sought is necessary to enable it to give judgment.

      References on determination of validity

               15.

               Although the courts and tribunals of the Member States may reject pleas raised before them challenging the validity of acts of an institution, body, office or agency of the Union, the Court of Justice has exclusive jurisdiction to declare such an act invalid.

               16.

               All national courts or tribunals must therefore submit a request for a preliminary ruling to the Court when they have doubts about the validity of such an act, stating the reasons for which they consider that the act may be invalid.

               17.

               However, if a national court or tribunal has serious doubts about the validity of an act of an institution, body, office or agency of the Union on which a national measure is based, it may exceptionally suspend application of that measure temporarily or grant other interim relief with respect to it. It must then refer the question of validity to the Court of Justice, stating the reasons for which it considers the act to be invalid.

      The appropriate stage at which to make a reference for a preliminary ruling

               18.

               A national court or tribunal may submit a request for a preliminary ruling to the Court as soon as it finds that a ruling on the interpretation or validity of European Union law is necessary to enable it to give judgment. It is that court or tribunal which is in fact in the best position to decide at what stage of the proceedings such a request should be made.

               19.

               It is, however, desirable that a decision to make a reference for a preliminary ruling should be taken when the national proceedings have reached a stage at which the referring court or tribunal is able to define the legal and factual context of the case, so that the Court of Justice has available to it all the information necessary to check, where appropriate, that European Union law applies to the main proceedings. In the interests of the proper administration of justice, it may also be desirable for the reference to be made only after both sides have been heard.

      The form and content of the request for a preliminary ruling

               20.

               The decision by which a court or tribunal of a Member State refers one or more questions to the Court of Justice for a preliminary ruling may be in any form allowed by national law as regards procedural steps. However, it must be borne in mind that it is that document which will serve as the basis of the proceedings before the Court and that it must therefore contain such information as will enable the Court to give a reply which is of assistance to the referring court or tribunal. Moreover, it is only the request for a preliminary ruling which is notified to the parties to the main proceedings and to the other interested persons referred to in Article 23 of the Statute, including the Member States, in order to obtain any written observations.

               21.

               Owing to the need to translate it into all the official languages of the European Union, the request for a preliminary ruling should therefore be drafted simply, clearly and precisely, avoiding superfluous detail.

               22.

               About 10 pages is often sufficient to set out in a proper manner the context of a request for a preliminary ruling. That request must be succinct but sufficiently complete and must contain all the relevant information to give the Court and the interested persons entitled to submit observations a clear understanding of the factual and legal context of the main proceedings. In accordance with Article 94 of the Rules of Procedure, the request for a preliminary ruling must contain, in addition to the text of the questions referred to the Court for a preliminary ruling:

                           —

                           a summary of the subject-matter of the dispute and the relevant findings of fact as determined by the referring court or tribunal, or, at least, an account of the facts on which the questions referred are based;

                           —

                           the tenor of any national provisions applicable in the case and, where appropriate, the relevant national case-law (2);

                           —

                           a statement of the reasons which prompted the referring court or tribunal to inquire about the interpretation or validity of certain provisions of European Union law, and the relationship between those provisions and the national legislation applicable to the main proceedings.

               23.

               The European Union law provisions relevant to the case should be identified as accurately as possible in the request for a preliminary ruling, which should include, if need be, a brief summary of the relevant arguments of the parties to the main proceedings.

               24.

               If it considers itself able to do so, the referring court or tribunal may, finally, briefly state its view on the answer to be given to the questions referred for a preliminary ruling. That information may be useful to the Court, particularly where it is called upon to give a preliminary ruling in an expedited or urgent procedure.

               25.

               In order to make the request for a preliminary ruling easier to read, it is essential that the Court receive it in typewritten form. To enable the Court to refer to the request it is also very helpful if the pages and paragraphs of the order for reference – which must be dated and signed – are numbered.

               26.

               The questions themselves should appear in a separate and clearly identified section of the order for reference, preferably at the beginning or the end. It must be possible to understand them on their own terms, without referring to the statement of the grounds for the request, which will however provide the necessary background for a proper understanding of the implications of the case.

               27.

               Under the preliminary ruling procedure, the Court will, as a rule, use the information contained in the order for reference, including nominative or personal data. It is therefore for the referring court or tribunal itself, if it considers it necessary, to delete certain details in its request for a preliminary ruling or to render anonymous one or more persons or entities concerned by the dispute in the main proceedings.

               28.

               After the request for a preliminary ruling has been lodged, the Court may also render such persons or entities anonymous of its own motion, or at the request of the referring court or tribunal or of a party to the main proceedings. In order to maintain its effectiveness, such a request for anonymity must, however, be made at the earliest possible stage of the proceedings, and in any event prior to publication in the Official Journal of the European Union of the notice relating to the case concerned, and to service of the request for a preliminary ruling on the interested persons referred to in Article 23 of the Statute.

      The effects of the reference for a preliminary ruling on the national proceedings

               29.

               Although the national court or tribunal may still order protective measures, particularly in connection with a reference on determination of validity (see point 17 above), the lodging of a request for a preliminary ruling nevertheless calls for the national proceedings to be stayed until the Court of Justice has given its ruling.

               30.

               In the interests of the proper conduct of the preliminary ruling proceedings before the Court and in order to maintain their effectiveness, it is incumbent on the referring court or tribunal to inform the Court of Justice of any procedural step that may affect the referral and, in particular, if any new parties are admitted to the national proceedings.

      Costs and legal aid

               31.

               Preliminary ruling proceedings before the Court of Justice are free of charge and the Court does not rule on the costs of the parties to the proceedings pending before the referring court or tribunal; it is for the referring court or tribunal to rule on those costs.

               32.

               If a party to the main proceedings has insufficient means and where it is possible under national rules, the referring court or tribunal may grant that party legal aid to cover the costs, including those of lawyers’ fees, which it incurs before the Court. The Court itself may also grant legal aid where the party in question is not already in receipt of aid under national rules or to the extent to which that aid does not cover, or covers only partly, costs incurred before the Court.

      Communication between the Court of Justice and the national courts and tribunals

               33.

               The request for a preliminary ruling and the relevant documents (including, where applicable, the case file or a copy of it) are to be sent by the national court or tribunal making the reference directly to the Court of Justice. They must be sent by registered post to the Registry of the Court of Justice (Rue du Fort Niedergrünewald, L-2925 Luxembourg).

               34.

               Until the decision containing the Court’s ruling on the referring court’s or tribunal’s request for a preliminary ruling is served on that court or tribunal, the Court Registry will stay in contact with the referring court or tribunal, and will send it copies of the procedural documents.

               35.

               The Court of Justice will send its ruling to the referring court or tribunal. It would welcome information from that court or tribunal on the action taken upon its ruling in the main proceedings, and communication of the referring court’s or tribunal’s final decision.

         II —   SPECIAL PROVISIONS IN RELATION TO URGENT REFERENCES FOR A PRELIMINARY RULING

               36.

               As provided in Article 23a of the Statute and Articles 105 to 114 of the Rules of Procedure, a reference for a preliminary ruling may, in certain circumstances, be determined pursuant to an expedited procedure or an urgent procedure.

      Conditions for the application of the expedited and urgent procedures

               37.

               The Court of Justice decides whether these procedures are to be applied. Such a decision is generally taken only on a reasoned request from the referring court or tribunal. Exceptionally, the Court may, however, decide of its own motion to determine a reference for a preliminary ruling under an expedited procedure or an urgent procedure where that appears to be required by the nature or the particular circumstances of the case.

               38.

               Article 105 of the Rules of Procedure provides that a reference for a preliminary ruling may be determined pursuant to an expedited procedure derogating from the provisions of those Rules, where the nature of the case requires that it be dealt with within a short time. Since that procedure imposes significant constraints on all those involved in it, and, in particular, on all the Member States called upon to lodge their observations, whether written or oral, within much shorter time-limits than would ordinarily apply, its application should be sought only in particular circumstances that warrant the Court giving its ruling quickly on the questions referred. The large number of persons or legal situations potentially affected by the decision that the referring court or tribunal has to deliver after bringing a matter before the Court for a preliminary ruling does not, in itself, constitute an exceptional circumstance that would justify the use of the expedited procedure (3).

               39.

               The same applies a fortiori to the urgent preliminary ruling procedure, provided for in Article 107 of the Rules of Procedure. That procedure, which applies only in the areas covered by Title V of Part Three of the TFEU, relating to the area of freedom, security and justice, imposes even greater constraints on those concerned, since it limits in particular the number of parties authorised to lodge written observations and, in cases of extreme urgency, allows the written part of the procedure before the Court to be omitted altogether. The application of the urgent procedure should therefore be requested only where it is absolutely necessary for the Court to give its ruling very quickly on the questions submitted by the referring court or tribunal.

               40.

               Although it is not possible to provide an exhaustive list of such circumstances, particularly because of the varied and evolving nature of the rules of European Union law governing the area of freedom, security and justice, a national court or tribunal might, for example, consider submitting a request for the urgent preliminary ruling procedure to be applied in the case, referred to in the fourth paragraph of Article 267 TFEU, of a person in custody or deprived of his liberty, where the answer to the question raised is decisive as to the assessment of that person’s legal situation, or in proceedings concerning parental authority or custody of children, where the identity of the court having jurisdiction under European Union law depends on the answer to the question referred for a preliminary ruling.

      The request for application of the expedited procedure or the urgent procedure

               41.

               To enable the Court to decide quickly whether the expedited procedure or the urgent preliminary ruling procedure should be applied, the request must set out precisely the matters of fact and law which establish the urgency and, in particular, the risks involved in following the ordinary procedure.

               42.

               In so far as it is able to do so, the referring court should briefly state its view on the answer to be given to the questions referred. Such a statement makes it easier for the parties to the main proceedings and the other interested persons participating in the procedure to define their positions and facilitates the Court’s decision, thereby contributing to the rapidity of the procedure.

               43.

               The request for the application of the expedited procedure or the urgent procedure must be submitted in an unambiguous form that enables the Court Registry to establish immediately that the file has to be dealt with in a particular way. Accordingly, the referring court or tribunal is asked to specify which of the two procedures is required in that particular case, and to mention in its request the relevant article of the Rules of Procedure (Article 105 for the expedited procedure or Article 107 for the urgent procedure). That mention must be included in a clearly identifiable place in its order for reference (for example, at the head of the page or in a separate judicial document). Where appropriate, a covering letter from the referring court or tribunal can usefully refer to that request.

               44.

               As regards the order for reference itself, it is particularly important that it should be succinct where the matter is urgent, as this will help to ensure the rapidity of the procedure.

      Communication between the Court of Justice, the referring court or tribunal and the parties to the main proceedings

               45.

               In order to expedite and facilitate communication with the referring court or tribunal and the parties before it, a court or tribunal submitting a request for the expedited procedure or the urgent procedure to be applied is asked to state the e-mail address and any fax number which may be used by the Court of Justice, together with the e-mail addresses and any fax numbers of the representatives of the parties to the proceedings.

               46.

               A copy of the signed order for reference together with a request for the expedited procedure or the urgent procedure to be applied can initially be sent to the Court by e-mail (ECJ-Registry@curia.europa.eu) or by fax (+352 43 37 66). Processing of the reference and of the request can then begin upon receipt of the e-mailed or faxed copy. The originals of those documents must, however, be sent to the Court Registry as soon as possible.

      (1)  Article 10(1) to (3) of Protocol No 36 provides that the powers of the Court of Justice in relation to acts of the Union adopted in the field of police cooperation and judicial cooperation in criminal matters before the entry into force of the Treaty of Lisbon, and which have not since been amended, are to remain the same for a maximum period of five years from the date of entry into force of the Treaty of Lisbon (1 December 2009). During that period, such acts may, therefore, form the subject-matter of a reference for a preliminary ruling only where the order for reference is made by a court or tribunal of a Member State which has accepted the jurisdiction of the Court of Justice, it being a matter for each of those States to determine whether the right to refer a question to the Court is to be available to all of its national courts and tribunals or is to be reserved to the courts or tribunals of last instance.

      (2)  The referring court or tribunal is requested to provide precise references for those texts and their publication, such as a page of an official journal or a specific law report, or a reference to an internet site.

      (3)  For an insight into circumstances that have resulted in the approval or refusal of requests for the application of the accelerated procedure, made on the basis of Article 104a of the Rules of Procedure of the Court of Justice of 19 June 1991, as amended, see the orders made by the President of the Court of Justice, available at www.curia.europa.eu (the orders can be found under ‘Case-law’, by selecting each of the following in turn in the search form: Documents – Documents not published in the ECR – Orders – Expedited procedure).