               EUROPEAN COMMISSION
            Brussels, 18.5.2016
            COM(2016) 346 final
            Recommendation for a
            COUNCIL RECOMMENDATION
            on the 2016 national reform programme of Finland and delivering a Council opinion on the 2016 stability programme of Finland

               Recommendation for a

               COUNCIL RECOMMENDATION

               on the 2016 national reform programme of Finland

                  and delivering a Council opinion on the 2016 stability programme of Finland

               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(2) thereof,

               Having regard to Regulation (EU) No 1176/2011 of the European Parliament and of the Council of 16 November 2011 on the prevention and correction of macroeconomic imbalances
                  2
               , and in particular Article 6(1) thereof,

               Having regard to the recommendation of the European Commission
                  3
               ,

               Having regard to the resolutions of the European Parliament
                  4
               ,

               Having regard to the conclusions of the European Council,

               Having regard to the opinion of the Employment Committee,

               Having regard to the opinion of the Economic and Financial Committee,

               Having regard to the opinion of the Social Protection Committee,

               Having regard to the opinion of the Economic Policy Committee,

               Whereas:

               (1)On 26 November 2015, the Commission adopted the Annual Growth Survey
                  5
               , marking the start of the 2016 European Semester of economic policy coordination. The priorities of the Annual Growth Survey were endorsed by the European Council on 17-18 March 2016. On 26 November 2015, on the basis of Regulation (EU) No 1176/2011, the Commission adopted the Alert Mechanism Report
                  6
               , in which it identified Finland as one of the Member States for which an in-depth review would be carried out. On the same day, the Commission also adopted a recommendation for a Council recommendation on the economic policy of the euro area
                  7
               . This recommendation was endorsed by the European Council on 18-19 February 2016 and adopted by the Council on 8 March 2016. As a country whose currency is the euro and in view of the close interlinkages among the economies in the economic and monetary union, Finland should ensure the full and timely implementation of those recommendations.

               (2)The 2016 country report for Finland
                  8
                was published on 26 February 2016. It assessed Finland's progress in addressing the country-specific recommendations adopted by the Council on 14 July 2015, and Finland's progress towards its national Europe 2020 targets. It also included the in-depth review under Article 5 of Regulation (EU) No 1176/2011. On 8 March 2016, the Commission presented the results of the in-depth review.
                  9
                The Commission’s analysis led it to conclude that Finland is experiencing macroeconomic imbalances. In particular, it is essential to tackle the loss of cost-competitiveness accumulated over several years, which is mainly due to wage growth having exceeded that of productivity for a protracted period, leading to a sharp deterioration in the current account between 2008 and 2012. The analysis also pointed to significant medium- and long-term risks to the sustainability of already strained public finances.

               (3)On 14 April 2016, Finland submitted its 2016 national reform programme and its 2016 stability programme. To take account of their interlinkages, the two programmes have been assessed at the same time.

               (4)Relevant country-specific recommendations have been addressed in the programming of the European Structural and Investment Funds for the 2014-2020 period. As foreseen in Article 23 of Regulation (EU) No 1303/2013, where it is necessary to support the implementation of relevant Council recommendations, the Commission may request a Member State to review and propose amendments to its Partnership Agreement and relevant programmes. The Commission has provided further details on how it would make use of this provision in guidelines on the application of the measures linking the effectiveness of the European Structural and Investment Funds to sound economic governance
                  10
               .

               (5)The 2016 stability programme indicates that the budgetary impact of the exceptional inflow of refugees is significant and provides adequate evidence of the scope and nature of these additional budgetary costs. According to the Commission, the eligible additional expenditure amounted to 0.05% of GDP in 2015 and is currently estimated at 0.2% of GDP in 2016. The provisions defined in Article 5(1) and Article 6(3) of Regulation (EC) No 1466/97 allow catering for this additional expenditure, in that the inflow of refugees is an exceptional event, its impact on Finland's public finances is significant and sustainability would not be compromised by allowing for a temporary deviation from the adjustment path towards the medium-term budgetary objective. Therefore, the required adjustment towards the medium-term budgetary objective for 2015 has been reduced to take into account these costs. Regarding 2016, a final assessment, including on the eligible amounts, will be made in spring 2017 on the basis of observed data as provided by Finland's authorities.

               (6)Finland is currently in the preventive arm of the Stability and Growth Pact. On 18 May 2016, the Commission issued a report under Article 126(3) of the TFEU, as Finland's general government debt exceeded the 60% of GDP reference value in 2015. The analysis concluded that the debt criterion should be considered as complied with. In its 2016 stability programme, the government plans an improvement in the headline balance to -2.5% of GDP in 2016 and further to -1.3% in 2020. The government plans to reach its medium-term budgetary objective — a deficit of 0.5 % of GDP in structural terms – by 2019. According to the stability programme, the government debt-to-GDP ratio is expected to peak at 67.4% in 2019 and to decline to 67.2% in 2020. The macroeconomic scenario underpinning these budgetary projections is plausible. The measures needed to reach the medium-term budgetary objective by 2019 have not been sufficiently specified. Based on the Commission 2016 spring forecast, there is a risk of some deviation from the recommended adjustment in 2016. The conclusion for 2016 would not change in case the budgetary impact of the exceptional inflow of refugees was excluded from the assessment. Under unchanged policies, there is a risk of a significant deviation from the recommended adjustment in 2017. The debt-to-GDP ratio is projected to continue its upward trend, reaching 66.9% in 2017. Based on its assessment of the stability programme and taking into account the Commission 2016 spring forecast, the Council is of the opinion that there is a risk that Finland will not comply with the provisions of the Stability and Growth Pact. Therefore, further measures will be needed to ensure compliance in 2016 and 2017.

               (7)Due to ageing of the population and a declining workforce, expenditure on pensions, health and long-term care is set to increase from 23.1% in 2013 to 26.9% of GDP by 2030
                  11
               . In January 2016, Finland enacted a pension reform that will link pensions to life expectancy as of 2017. Social and healthcare services, provided by the municipalities, amount to 10 % of GDP. Without reform of the system, that expenditure is forecast to grow by 2.4% annually in nominal terms and increase as a share of GDP. The main outline of a far-reaching administrative reform and restructuring of healthcare and social services has been agreed. The reform's main aims include the reduction of the sustainability gap in the long run by EUR 3 billion through better control of the costs. This will be achieved through integration of services, larger arrangers of services and digitalisation. All of the details still need to be worked out and change management plans put in place before the reform can be implemented from 2019 as planned. The government has announced that measures to implement the reform will be presented at the end of 2016. The magnitude and tight timetable of the reform mean that implementation will be a challenge. Timely adoption of the legislative proposals is therefore important.

               (8)To restore Finland's competitiveness, the functioning of the labour market must be improved in several ways. On an aggregate level, wage increases have been moderate since the centrally agreed wage deal was agreed in late 2013. Under the agreement, the year-on-year increase in negotiated wages slowed from 1.3 % in the last quarter of 2013 to 0.5 % in the fourth quarter of 2015. In June 2015, the social partners decided to extend the agreement into 2016. However, labour productivity growth has not yet recovered and therefore nominal unit labour costs are forecast to increase, albeit more slowly. Negotiations have been carried out to restore cost-competitiveness. A Competitiveness Pact was agreed between social partners on 29 February 2016. The agreement needs to be translated into sectoral agreements before it can be implemented. The Competitiveness Pact will be complemented with measures agreed between social partners to ensure more labour market flexibility and a new model for wage growth by anchoring wages of other sectors to those facing external competition. It is important to implement the labour market measures in a way that fully respects the role of social partners.

               (9)Due to declining size of the working age population, improving the labour market participation rate is important. This requires continued efforts to integrate older workers, young people, the long-term unemployed and the low-skilled into the labour market. The employment rate has decreased by more than two percentage points, from a pre-crisis peak of 70.6 % in 2008 to 68.5 % in 2015, while unemployment has increased from 6.4 % to 9.4 %. The employment rate of the elderly has been gradually improving, but some early exit pathways remain in the form of extended unemployment benefits for older workers until retirement which, if not limited, could compromise the positive impact of the pension reform enacted in 2016. The effects of the pension reform will be assessed in 2019. Long-term unemployment increased considerably between 2008 and 2014 from 1.2 % to 1.9 % of the total labour force, despite many of the long term unemployed eventually moving out of the labour force. Youth unemployment increased to 22.4% in 2015. The low-skilled are affected most by the poor performance of the labour market. Cutting the budget for active labour market policies at a time when there is an increasing demand for such measures could harm opportunities for the above-mentioned groups to return to work. In terms of activation, the complex benefits system with its different types of allowances can result in significant inactivity and low wage traps. Addressing these traps and introducing positive incentives to accept work, such as improving the possibility to combine work and benefits, is particularly important in view of the cuts to the budget for active labour market policies. The arrival of a comparatively large number of migrants and refugees in Finland in 2015 could serve to counter the effects of population ageing, but only if they are successfully integrated into the labour market and the education system. There are matching problems in the labour market, partly due to the structural change in the economy, as new jobs are created in different geographical areas and industries compared with those where jobs have been lost. Measures that increase affordable housing in the Helsinki area and effective policies to help people update their skills and find work are needed.

               (10)The business environment in Finland is as good as or better than in other advanced economies. However, lack of competition, in particular in services aimed primarily at the domestic market, such as retail and transport services, affects the overall competitiveness of the Finnish economy. Businesses have identified excessive regulatory requirements as obstacles to entry to and growth in some markets. These excessive requirements need to be addressed to promote entrepreneurship and investment. In the retail sector, the reform of planning regulations will set more flexible rules on the size and location of stores. The tradable sector continues to restructure and would benefit from developing new markets, products and services, particularly those with high value added. Structural change could be facilitated by policies supporting company expansion, internationalisation and innovation. Legislative amendments were passed in autumn 2015, but most are expected to be implemented only between 2016 and 2018. The government has announced that further structural reforms will be made to increase market competition.

               (11)In the context of the European Semester, the Commission has carried out a comprehensive analysis of Finland’s economic policy and published it in the 2016 country report. It has also assessed the stability programme and the national reform programme and the follow-up given to the recommendations addressed to Finland in previous years. It has taken into account not only their relevance for sustainable fiscal and socio-economic policy in Finland but also their compliance with EU rules and guidance, given the need to strengthen the EU's overall economic governance by providing EU-level input into future national decisions. The recommendations under the European Semester are reflected in recommendations 1 to 3 below.

               (12)In the light of this assessment, the Council has examined the stability programme, and its opinion
                  12
                is reflected in particular in recommendation (1) below.

               (13)In the light of the Commission’s in-depth review and this assessment, the Council has examined the national reform programme and the stability programme. Its recommendations under Article 6 of Regulation (EU) No 1176/2011 are reflected in recommendations 2 and 3 below,

               HEREBY RECOMMENDS that Finland take action in 2016 and 2017 to:

               1.Achieve an annual fiscal adjustment of at least 0.5 % of GDP towards the medium-term budgetary objective in 2016 and 0.6 % in 2017. Use windfall gains to accelerate the reduction of the general government debt ratio. Ensure timely adoption and implementation of the administrative reform with a view to better cost-effectiveness of social and healthcare services.

               2.While respecting the role of social partners, ensure that the wage setting system enhances local wage bargaining and removes rigidities, contributing to competitiveness and a more export industry-led approach. Increase incentives to accept work and ensure targeted and sufficient active labour market measures, including for people with a migrant background. Take measures to reduce regional and skills mismatches.

               3.Continue pursuing efforts to increase competition in services, including in retail. Promote entrepreneurship and investment, including by reducing administrative and regulatory burden, to foster growth of high value added production.

               Done at Brussels,

                     For the Council

                     The President

                     (1)
                  OJ L 209, 2.8.1997, p. 1.

                     (2)
                  OJ L 306, 23.11.2011, p. 25.

                     (3)
                  COM(2016) 346 final.

                     (4)
                  P8_TA(2016)0058, P8_TA(2016)0059, and P8_TA(2016)0060.

                     (5)
                  COM(2015) 690 final.

                     (6)
                  COM(2015) 691 final.

                     (7)
                  COM(2015) 692 final.

                     (8)
                  SWD(2016) 94 final.

                     (9)
                  COM(2016) 95 final.

                     (10)
                  COM(2014) 494 final.

                     (11)
                  The 2015 Ageing Report: Economic and budgetary projections for the 28 EU Member States (2013-2060) European Economy 3. May 2015. Brussels.

                     (12)
                  Under Article 5(2) of Council Regulation (EC) No 1466/97.


title: DRAFT RECOMMENDATION OF THE ASSOCIATION COUNCIL laying down the methods of administrative cooperation in customs matters pursuant to the EEC-MALTA Association Agreement

text:
ARCHIVES HISTORIQUES
DE LA COMMISSION
COLLECTION RELIEE DES
DOCUMENTS "COM"
COM (71) 1176
Vol. 1971/0192
 ---pagebreak--- Disclaimer
Conformément au règlement (CEE, Euratom) n° 354/83 du Conseil du 1er février 1983
concernant l'ouverture au public des archives historiques de la Communauté économique
européenne et de la Communauté européenne de l'énergie atomique (JO L 43 du 15.2.1983,
p. 1), tel que modifié par le règlement (CE, Euratom) n° 1700/2003 du 22 septembre 2003
(JO L 243 du 27.9.2003, p. 1), ce dossier est ouvert au public. Le cas échéant, les documents
classifiés présents dans ce dossier ont été déclassifiés conformément à l'article 5 dudit
règlement.
In accordance with Council Regulation (EEC, Euratom) No 354/83 of 1 February 1983
concerning the opening to the public of the historical archives of the European Economic
Community and the European Atomic Energy Community (OJ L 43, 15.2.1983, p. 1), as
amended by Regulation (EC, Euratom) No 1700/2003 of 22 September 2003 (OJ L 243,
27.9.2003, p. 1), this file is open to the public. Where necessary, classified documents in this
file have been declassified in conformity with Article 5 of the aforementioned regulation.
In Übereinstimmung mit der Verordnung (EWG, Euratom) Nr. 354/83 des Rates vom 1.
Februar 1983 über die Freigabe der historischen Archive der Europäischen
Wirtschaftsgemeinschaft und der Europäischen Atomgemeinschaft (ABI. L 43 vom 15.2.1983,
S. 1), geändert durch die Verordnung (EG, Euratom) Nr. 1700/2003 vom 22. September 2003
(ABI. L 243 vom 27.9.2003, S. 1), ist diese Datei der Öffentlichkeit zugänglich. Soweit
erforderlich, wurden die Verschlusssachen in dieser Datei in Übereinstimmung mit Artikel 5
der genannten Verordnung freigegeben.
 ---pagebreak---          ο ο :: :: ι 2 Ρ. ι ο ττ ο Ρ   Τ ΙΙ Ε  Ι: Ν Π ο ? ^ Λ Ν   Ο Ο Ϋ :: υ π ι τ ι Έ Ζ
                                                            COM(71)1175 final
                                                            Brunnels . 22nd october 1971
                                       D R A F T
                       RECOMMENDATION OF ΤHE ASSOCIATION COUNCIL,
                       laying down tie methods of administrative
                        cooperation in customs matters pursuant
                        to the EEC-MALTA Association Agreement
C0i:(7l ) 117C finr.l
 ---pagebreak---    f
                                    DHAFT
                           ' MTAIIV ON' ITITH   r\r<   RIATT»^+'
   laying dorn tho methods of administrative cooperation-        >
                        in     customc matters
      pursuunt to the EEC •• MALTA Ansocifttion Agreement
THE ASSOCIATION COUNCIL ,             .              .                      . ..
HAVING REGARD to the Agreement establishing nn Association between,
the . European Economic Community and MALTA , signed at' Valletta or.
5 December 1970 , and in particular Title I thereof ,
                                              m
HAVING REGARD to the Protocol on the definition of the concept of
" originating " products and on the methods of administrative coopera
tion , and in particular Article 16 ( 2 ) thereof ,
WHEREAS the proper operation of tho Agreement requires organisation
of close administrative cooperation between the Contracting Parties
to .the. .Agreement in' order to ensure correct and uniform,. implementation .
cf it .*5 cur.torrs provisions , and more particularly thor.e of the ■ ^r&tocol •
on the definition of the concept of " originating" - productf-i and on the
methods of administrative cooperation ,
 ---pagebreak---                                       - ?. -
liUCOMliKW TIT:, WIHOFBAK ECiWWIC COi'r.l'fKT'I'y A1ID fcM.TA
Vv " ti'l o , rithiri their resppcti v« RpheruM of competence , the ro qui ait e
Pinasuro-.?. for the implementation of the following provisions :
                                                                         « /
A.   To n u c of mo ve- rric n t cartif ica te s A.M., 1
     I. Rola of the exporter
                                                                                *
          1 . It shall bo for tho exporter or his representative authorized
                to sign the export declaration tp. request , ort the exporter • £.:
                responsibility , the endorsement of a movement certificate A . M. ,, 1 .
                This request shall be made out on a form A.M. 1 which must be
                completed in accordance with the provisions, of . Title II of the
                Protocol on the definition of the concept of " originating "
                products and on the methods "of administrative cooperation , here
                inafter referred to as " the Protocol ", and with the rules set
                out on the back of the         first shoot of the form .
          2 . The exporter         or his representative shall attach to hio request
                any document proving that the goods to be exported, are such as
                to qualify them for the endorsement of a movement, certificate
                A.M.  1.
              ■  i
   II . Role of tho Customa authorities
          1 . It shall be the responsibility of the Customs authorities of the
                exporting country to ensure that the form A.M. 1 ie duly completed .
                In particular , they shall, check whether tho space reserved, for
                the description of tho goods has been completed in. such manner
                as to exclude all possibility of . fraudulent additions . To this
                end the description of the goods must be indicated in without
                leaving any blank lines . Where the space is not completely filled ,
                a horizontal line must be drawn below the last line of the des
                cription , the empty space being crossed through .
 ---pagebreak---                               - 3 -
       2 * Sinco the movement certificate A.M. 1 constitutes tho dcnuuiiont.ury
           evidence for tho application of the preferential tariff and (
           quota system laid down in tho Agreement , it shn.ll be the respon
           sibility of the Customs office of the exporting ' country carefully
           to verify tho origin of tho goods and to check tho other statement *;
           on tho certificate .
III . Exports frota a Member State of the European Economic Community
                                   ,                                              «
       1 . The movement certificate A . M. 1 ,§ hall be endorsed by the CUP tome-
           authorities of a Member State of the European Economic Community
                                                                             < *
           if the goods being exported can be considered products originating
           in the Community within the meaning of the Protocol .
       2 . For the purpose of verifying v/hether the condition stated in
           paragraph 1 has been met , 'the Customs authorities rhall have
           the right to call for any documentary evidence or to carry out .
           any check which they consider appropriate .
       3 » The Customs authorities of the Member State shall refuse to endorse-
           u movement certificate A.M. 1 if j,t appears from the export
           documents submitted that the goods to which tho certificate
           relates are- not consigned to MALTA .                                    r ,
m                                                                                i f
  IV . Exports from MALTA                            " '      '
       1 . The movement certificate A.M. 1 shall be endorsed by the Custom.?
           authorities of MALTA if tho goods being exported can bs considered
           products originating dn MALTA within the meaning of the Protocol .
                                             /
       2 . For the purpose of verifying whether tho condition stated in
                                        r      . *
           paragraph 1 has been mot , the - Customs authorities chall have the
           right to call for any documentary evidence or to carry out any
           check which they , consider appropriate .
 ---pagebreak---                                       M 'f -
       1 . Til e CuiiUan author! Ill                   of 1' A. T.'VA vim 12 r<«ftiftO to un';or*o ft i1 ' c
           corM . Pier to A.M. 1 i ,1" it appears ifrorr Die orpcrt Oo nvrwits /.. re
           mitted that the goods to which the certificate relates are not              »  ;
           consigned to the Community#
   V. Indication of the^type^of S^'.o^t^document^ used
       In Hurt part of the movement cur bificate A.M. 1 reserved for the
       Customs authorities , a reference must bo macle to 'the date and fcyp«s                               *
       or to the serial number of the expor t document +.o vhlcix the c>'-
                 r*        + ■> /■»*» •»  r* »* T*T 1 T i A     T   r"^Y>"rf> T**r 0
  VI . Customs office stamp
       The Custom® office stamp used to stamp the certificates shall be
       preferably steel .                                   •
       The Member States and MALTA shall provide each other , through tho
       Commies ion of the European Communities , with specimen impressions
       of the types of stamp used in the Customs offices . .
 VII . TierO acoment of movement certificates A . M «, 1 by cert.i firnten of
       the o curie tyj»o,.
*
       1 . It shall always be possible to replace, o,ne or more movement
           certificates A.M. 1 by one or more other • movement certificates
           A.M. 1 , provided thnt this is done at the Customs office where
           the goods are held .
                                                   ··   «
       2 , Where the new movement certificate A.M. 1 relates to products
           which were originally imported 'from a Member State or MALTA or. d
                                                              r »     /
           which are being re-exported- in 'the same state , the new cerfcifucaU-r
            issued in the re-exporting Member State or MALTA must indicate
            the country in which the original certificate was issued .
 ---pagebreak---                                   M S M
VI-TT . Pet roar live ipc-ue of." movement __ c e r _t x f, :, e a t. e n
        1 . Where , as a rer.ult of error or involuntary omission , no request
            for a movement certificates A.M. 1 was made at the tiir.o the
            goods v/ere exported , a certificate may be issued after the actual
            exportation of the Roods to which it relates# In this case , the
            exporter must :
            - make a request in writing , giving details of the type ,
               quantity , method of packing and m&rkingc of the goods and also
                            ....                                            • <f
               the place and date of dispatch ;
            - certify that no movement certificate A.M. 1 wan innued at the
               time of exportation of the - goods in quest ion , and state: the
               rearonn therefor ;             .
            •• enclose a form A.M. 1 duly completed and signed .
        2 . The? Customs authorities may issue a movement certificate A.I-' ,, 1
            retroactively only after verifying that the information supplied
            in the exporter 's request agrees with that in the corresponding
            file .
 0
            Certificates A.M. 1 iaeued. retroactively 'must, be endorsed in
            red ink with one of the following phrases :
            " NACHTSACIJCH AUSGE5TELLT", "L-ELIVII2 A POSTERIORI », •'RILASCIATO
            A POSTERIORI' », " AFGEGEVEN A POSTERIORI ", " ISSUED PETROACTIVKJ.'i! '
                                       • 1
            The Cue loins author ! tieu may issue a movement certificate A.M. 1
            retroactively only under the condition that the goods in ques
            tion v/cre oonnigned to the territory of one of the Contracting
            Parties at the time the goods were exported .
                     t
 ---pagebreak---                                  m   6
    IX . Isr;ue of duplicates                      •                                .
         In the event of the theft , loss or destruction of < a /movement
         certificate A.M. 1 , the exporter nay apply to the Customs authority
         which issued it for a duplicate made out on the basis of the export
         documents in their pons ens ion . The duplicate issued in thin way
         must he endorsed in. red ink with one of the following words :
         " DUFLIKAT ", " DUPLICATA ", " DUPLICATO ", " DUPLICAAT " , " DUPLICATE ".
                                                                                φ
         The duplicate on -which the date of the original A.M. 1 certi fica.t.e
         is to be mentioned takes effect on the . said date .
D. Condition ? governing the xiac of the movement certificate A.M. 1
                                           m
   . I. fri£fcct__trHnr»part_of^poor!p
         of the Oontracting Parties sha.Vl be considered as goods transported
         direct .
         However , the following shall not bo considered as interrupting
         direct transport s
  «
         n ) calls at ports situated in territories other than those of th<i
             Contracting Parties }
         b ) transshipments in such ports , where those result from force
             majeure or where they are consequent upon conditions at sea ;
                                   *•
         c ) passage through territories other than those of the Contracting
             Parties , or transhipment in such territories , wh-vre the passage-
             through such territories or the transhipment is covered by
             a single transport document drawn up in a M or heir State or
             MALTA o
 ---pagebreak---                                    M   7 M
    II , Aer o c hane c o:f movement _ certi fj,catfc.s_ai ter__cxpir         n:-.c
         for tfceir eubrniofilon
         Movement certificates A.M. 1 submitted to the Customs authorities
         of the importing country after expiry of the time-limit for their
         submission stipulated in Article 9 » of the Protocol may be accepted
         for the purpose of applying the preferential system provided the
         failure to observe this time-limit results from force na.ieuro or          4
         exceptional circumstances .                                        ,
                              –                                         ■ *   » r
         In addition to such cases , the Customs authorities of the importing
         country may accept such certificates provided the goods have been
         submitted to them before the expiry of the said time-limit .
   III . Acceptance of movement, certificates with statements not corresponds * k
         to the floods imported
         Tho discovery of slight discrepancies between the atat&ircuta made
         in the movement certificate A.M. 1 and those made in tho documents
         submitted to the Customs office for the purpose of carrying out
         the formalities for importing the goods shall not ipso facto render
         the certificate null and void , if it is duly established that the
         certificate does correspond to the goods submitted .
C.   Free ge n es
     The Member States and MALTA shall take all necessary steps to ensure
     that goods traded within the Association under the cover o ? a movement
     certificate A.M. 1 and which in the , course of trans port use a free
     zone situated .in their territory arc not replaced by ether goods an :?
     that they do not undergo handling, other than the norr.ial operations
     designed to keep them in good condition .
 ---pagebreak---                                      . 8 -
D.   Po^tv. l coppi flncum io (jnclmllng. parccln )
                                                                       l
     1". Form A.M. ' ?. shall bs ur.ed solely for postal consignments ( incluoiri ,-,
         parcels ) of a value of up to 1.000 units of account per consign
         ment .
    II . It shall be for tho exporter or his representative T on the expor tccr 1 ;-*
         responsibility , to complete ancl sign tho two parts of form A.M.
                                                                                . *1
         If tha goods contained in tho consignment have already been checked
         in the exporting country in the light of tho definition given for
         tho concept of " originating " products , the exporter may refer to
         thit; check ir.i the space reserved for " Observations " in form A.M. 2
         ( part 1 ).                          .
   III . On tho green label Model C 1 or declaration C 2 or C ?. M , or the
         Customs declaration CP 3 or CP 3 M » the exporter shall enter the
         form number "A . M „ 2 ", followed by its serial number . He shall
         alrco mark the form number and serial number on the invoice for the
         good.'; contained iri tho consignment .
E.   Small pa cka pots an d jpers o>in 1 lytppapo
     The production of a movement certificate A.M. 1 and the completion
     of a form A.M. 2. ohall be waived for goods sent as email packages
     to private persons and forming part of passenger 's personal luggage ,
     provided such imports fulfil the conditions laid down in Article                       ,
     of the Protocol .               •"
F.   Ret roa ctive cho cks oil moveme nt o<n* tifi cnt cB A » M. 1 an d form s A.M. 2
     I , Retroactive     checks on movement certificates     A. I'!. 1    and on forma
         A,','., 2 ohall   be  carried    out at random,' and also       whenever the
 ---pagebreak---                                       M 0 M
          Customs authorities of the importing country have roanonabJ c doubt
          tin to the authenticity of the document or the accuracy of the
          information regarding th « true origin of the goods in question
          er of certain parts thereof *
 II . For the purpose of implementing the previsions of Paragraph I
         above , the Customs authorities of the importing country shall'
          return the movement certificate A.M. 1 or part 1 of form A , II . 2 „
          to the Customs; authorities of the exporting country , /riving the
          formal or substantive reasons for fin inquiry * To part 1 of
          fcr« A.M. 2 they shall attach the invoice if it has been sub
          mitted , or a copy thereof , and they shall for war d any information
          that has been obtained suggesting that the particulars given on
          the said certificate or the said form are inaccurate .
          If the Customs authorities of the importing country decide to
          suspend execution of the provisions of the Agreement rvhile awaiting
          the resultr; of the chock , they shall offer to release the goods
          to the importer subject to any conservatory measures deemed neees-
         cary ,
III . The Customs authorities of the importing country sh;.,!!'. bo informed
         of the results of the cheek as soon as possible . These reculte
         must be such no to make it possible to determine whether the dis
         puted movement certificate A.M. 1 or form A.M. 2 applies to the
         goods actually exported , and whether these goods can , in fact ,
         qualify for application of the preferential system .
 IV . Where such disputes cannot bo settled between the Customs authorities
         of the importing country and those of the exporting country or
         where thoy raise a question as to the interpretation, of the Proto r.ci ,
          they shall be submitted to the Association Council ,,
  V. For 'the purrsone of the retroactive check on certificate *!, thv Ciu.it oSiS
      {.'.u thoriti rr.: ox' the evpyrtins country mw«t k?*ep all export, document r,
      or copi.ro          povement «»• rtific'itos w-tod iii place thereof , for   !•
      t)viu two yearn ,


               EUROPEAN COMMISSION
            Brussels, 13.5.2015
            COM(2015) 275 final
            Recommendation for a
            COUNCIL RECOMMENDATION
            on the 2015 National Reform Programme of Finlandand delivering a Council opinion on the 2015 Stability Programme of Finland

               Recommendation for a

               COUNCIL RECOMMENDATION

               on the 2015 National Reform Programme of Finland

                  and delivering a Council opinion on the 2015 Stability Programme of Finland

               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(2) thereof,

               Having regard to Regulation (EU) No 1176/2011 of the European Parliament and of the Council of 16 November 2011 on the prevention and correction of macroeconomic imbalances
                  2
               , and in particular Article 6(1) thereof,

               Having regard to the recommendation of the European Commission
                  3
               ,

               Having regard to the resolutions of the European Parliament
                  4
               ,

               Having regard to the conclusions of the European Council,

               Having regard to the opinion of the Employment Committee,

               Having regard to the opinion of the Economic and Financial Committee,

               Having regard to the opinion of the Social Protection Committee,

               Having regard to the opinion of the Economic Policy Committee,

               Whereas:

               (1)On 26 March 2010, the European Council agreed to the Commission’s proposal to launch a new strategy for growth and jobs, Europe 2020, based on enhanced coordination of economic policies. The strategy focuses 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, on the basis of the Commission’s proposals, 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 it adopted a decision on guidelines for the employment policies of the Member States. Together these form the ‘integrated guidelines’ which Member States were invited to take into account in their national economic and employment policies.

               (3)On 8 July 2014, the Council adopted a recommendation on Finland’s National Reform Programme for 2014 and delivered its opinion on Finland’s updated Stability Programme for 2014. On 28 November 2014, in line with Regulation (EU) No 473/2013
                  5
               , the Commission presented its opinion on Finland’s draft budgetary plan for 2015
                  6
               .

               (4)On 28 November 2014, the Commission adopted the Annual Growth Survey
                  7
               , marking the start of the 2015 European Semester of economic policy coordination. On the same day, on the basis of Regulation (EU) No 1176/2011, the Commission adopted the Alert Mechanism Report
                  8
               , in which it identified Finland as one of the Member States for which an in-depth review would be carried out.

               (5)On 18 December 2014, the European Council endorsed the priorities for boosting investment, accelerating structural reforms and pursuing responsible growth-friendly fiscal consolidation.

               (6)On 26 February 2015, the Commission published its 2015 country report for Finland
                  9
               . This assessed Finland’s progress in addressing the country-specific recommendations adopted on 8 July 2014. The country report also includes the results of the in-depth review under Article 5 of Regulation (EU) No 1176/2011. The Commission’s analysis leads it to conclude that Finland is experiencing macroeconomic imbalances which require policy action and monitoring. In particular, risks relating to weak export performance in a context of industrial restructuring deserve attention. While the decline in export market shares and electronic industry has largely come to an end, investment remains low and potential growth has declined. Private-sector debt has stabilised and does not appear to be a source of immediate concern, but its relatively high level calls for close monitoring.

               (7)On 2 April 2015, Finland submitted its 2015 National Reform Programme and its 2015 Stability Programme. To take account of their interlinkages, the two programmes have been assessed at the same time.

               (8)Finland is currently in the [corrective] arm of the Stability and Growth Pact,  following the adoption by the Council of a decision in accordance with article 125(6) TFEU on [XX]. In the 2015 Stability Programme, which is based on a no-policy-change assumption and covers the period 2014-2019, the headline deficit, which has been increased to 3.2% of GDP in 2014 and thereby exceeded the reference value of 3% of GDP, is projected to further deteriorate to 3.4% of GDP in 2015, Before gradually declining to 3.1% in 2017 and further to 2.5% of GDP in 2019. According to the 2015 Stability Programme the government debt-to-GDP ratio is expected to increase over the programme's forecast horizon and to reach 67.8% by 2019. The medium-term objective - a structural deficit of 0.5% of GDP - is not reached by the end of the programme period. The macroeconomic scenario underpinning these budgetary projections is plausible. Based on the Commission's 2015 spring forecast, Finland's general government deficit is forecast at 3.3% of GDP in 2015 and 3.2% of GDP in 2016, while the debt-to-GDP ratio is forecast to increase to 64.4% of GDP by 2016. The Commission has published on 13 May 2015 a report in accordance with art 126(3) of the Treaty concluding that deficit and debt criteria were not considered to be complied with. The Stability Programme  does ensure that the excessive deficit is corrected in a timely and durable manner by 201X. Therefore, further measures will be needed. Based on its assessment of the Stability Programme and taking into account the Commission's 2015 spring forecast, the Council is of the opinion that there is a risk that Finland will not comply with the provisions of the Stability and Growth Pact. Although Finland has made some progress in implementing administrative reforms, the efficiency of the Finnish public sector could be improved further, particularly in areas that face cost pressures in the future from ageing. Social partners reached agreement on the content of the pension reform in autumn 2014, but this has yet to be adopted. Increasing the participation of older workers in the labour force is crucial in view of the fiscal sustainability gap and the planned increase of the statutory retirement age. Early exits from the labour market are mainly due to disability or on the basis of extended unemployment benefits for older workers. The Government’s bill on the reform of social and healthcare services was presented to parliament in December 2014, but no solution was found to balance the administrative model of large municipal coalitions with the autonomy of single municipalities guaranteed by the Constitution before the parliamentary elections in April 2015, and the bill lapsed. Finnish municipalities are relatively small but carry out quite extensive tasks as compared with those in other European countries. The reform of municipal structures is proceeding with some delay and the municipalities are conducting studies on the benefits of mergers. According to the 2015 National Reform Programme, a new legislative proposal may be submitted to parliament by the end of 2016.

               (9)In view of ageing and the shrinking workingage population, it is important that the labour market has access to the full potential workforce. Finland has made some progress on this and taken several measures, including a better organisation of wage subsidies, with a particular focus on the elderly, and of the public employment service. The unemployment rate was 8.7 % in 2014 and is on the rise, particularly among young people and older workers. The moderate wage agreement of 2013 supports the restoration of cost and export competitiveness through lower growth in unit labour costs.

               (10)Finland has made some progress in boosting its capacity to deliver innovative products. The Government is implementing a comprehensive reform of research institutes and funding. Policy programmes for clean technology, biotechnology and digitisation are promising but relatively smallscale. Although investment in R&D is among the highest in the EU, Finland still faces challenges in converting this into successful export products and services. The Government has sought to make support systems for businesses simpler and more efficient, increase financing for start-ups and promote their internationalisation. Nevertheless, investment in Finland has remained low, export difficulties have continued and employment has fallen. Efforts are also needed to enhance competition in product and service markets, especially in the retail sector, which remains highly concentrated.

               (11)In the context of the European Semester, the Commission has carried out a comprehensive analysis of Finland’s economic policy and published it in the 2015 country report. It has also assessed the Stability Programme and the National Reform Programme and the follow-up given to the recommendations addressed to Finland in previous years. It has taken into account not only their relevance for sustainable fiscal and socioeconomic policy in Finland but also their compliance with EU rules and guidance, given the need to strengthen the overall economic governance of the European Union by providing EU-level input into future national decisions. The recommendations under the European Semester are reflected in recommendations 1 to 4 below.

               (12)In the light of this assessment, the Council has examined Finland’s Stability Programme, and its opinion
                  10
                is reflected in particular in recommendation 1 below.

               (13)In the light of the Commission’s in-depth review and this assessment, the Council has examined the National Reform Programme and the Stability Programme. Its recommendations under Article 6 of Regulation (EU) No 1176/2011 are reflected in recommendations 2 and 3 below.

               (14)In the context of the European Semester the Commission has also carried out an analysis of the economic policy of the euro area as a whole. On the basis of this analysis, the Council has issued specific recommendations for the Member States whose currency is the euro. Finland should also ensure the full and timely implementation of these recommendations,

               HEREBY RECOMMENDS that Finland take action in 2015 and 2016 to:

               1.Ensure that the excessive deficit is brought below 3% of GDP in a timely and durable manner by [XX] in line with Finland's obligations under Article 126 TFEU. Continue efforts to reduce the fiscal sustainability gap and strengthen conditions for growth.

               2.Adopt the agreed pension reform and gradually eliminate early exit pathways. Ensure effective design and implementation of the administrative reforms concerning municipal structure and social and healthcare services, with a view to increasing productivity and cost-effectiveness in the provision of public services, while ensuring their quality.

               3.Pursue efforts to improve the employability of young people, older workers and the long-term unemployed, focusing particularly on developing job-relevant skills. Ensure, in consultation with the social partners and in accordance with national practices, that wages evolve in line with productivity.

               4.Take measures to open the retail sector to effective competition.

               Done at Brussels,

                     For the Council

                     The President

                     (1)
                  OJ L 209, 2.8.1997, p. 1.

                     (2)
                  OJ L 306, 23.11.2011, p. 25.

                     (3)
                  COM(2015) 275.

                     (4)
                  P8_TA(2015)0067, P8_TA(2015)0068, P8_TA(2015)0069.

                     (5)
                  OJ L 140, 27.5.2013, p. 11.

                     (6)
                  C(2014) 8815 final.

                     (7)
                  COM(2014) 902.

                     (8)
                  COM(2014) 904.

                     (9)
                  SWD(2015) 45 final of 26.2.2015.

                     (10)
                  Under Article 5(2) of Council Regulation (EC) No 1466/97.


title: DRAFT COUNCIL RECOMMENDATION ON ELECTRICITY TARIFF STRUCTURES IN THE COMMUNITY (presented by the Commission to the Council)

text:
ARCHIVES HISTORIQUES
DE LA COMMISSION
COLLECTION RELIEE DES
DOCUMENTS "COM"
COM (80) 356
Vol. 1980/0128
 ---pagebreak--- Disclaimer
Conformément au règlement (CEE, Euratom) n° 354/83 du Conseil du 1er février 1983
concernant l'ouverture au public des archives historiques de la Communauté économique
européenne et de la Communauté européenne de l'énergie atomique (JO L 43 du 15.2.1983,
p. 1), tel que modifié par le règlement (CE, Euratom) n° 1700/2003 du 22 septembre 2003
(JO L 243 du 27.9.2003, p. 1), ce dossier est ouvert au public. Le cas échéant, les documents
classifiés présents dans ce dossier ont été déclassifiés conformément à l'article 5 dudit
règlement.
In accordance with Council Regulation (EEC, Euratom) No 354/83 of 1 February 1983
concerning the opening to the public of the historical archives of the European Economic
Community and the European Atomic Energy Community (OJ L 43, 15.2.1983, p. 1), as
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In Übereinstimmung mit der Verordnung (EWG, Euratom) Nr. 354/83 des Rates vom 1.
Februar 1983 über die Freigabe der historischen Archive der Europäischen
Wirtschaftsgemeinschaft und der Europäischen Atomgemeinschaft (ABI. L 43 vom 15.2.1983,
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erforderlich, wurden die Verschlusssachen in dieser Datei in Übereinstimmung mit Artikel 5
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 ---pagebreak--- COMMISSION OF THE EUROPEAN COMMUNITIES
                                                  COM(80)356 final
                                                  Brussels . 26th June 1980
            η η
                               DRAFT COUNCIL RECOMMENDATION
              ON ELECTRICITY TARIFF STRUCTURES IN THE COMMUNITY
                 ( presented by the Commission to the Council )
                                      . S
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  C0M(80 ) 356 final
 ---pagebreak---           Electricity Tariff Structures
Communication from the Commission to the Council
 ---pagebreak---                                ELECTRICITY      TARIFF   STRUCTURES
         I.   INTRODUCTION
     1 . In its Resolution of 13 February 1975 , the Council emphasised    the need
          to make it possible for prices to cover gradually and to the fullest
         extent possible / the cost of making energy available and the amortisation
                                        (1 )
         of the necessary investments        . On several occasions the Council has
         emphasised the need to save energy, by optimising the use of resources .
     2 . The achievement of these objectives in the electricity sector can be
         facilitated through the adoption of an adequate and rational electricity
       - tariff policy based on common principles agreed at Community level .
     3 . The Commission keeps under review the development of prices and pricing
          structures in the energy sector . In 1979 the Commission , together with the
          electricity supply industry , examined the electricity tariff structures
          in the Community and the possibilities of their alignment . It is now
          opportune for the Council to review the position and to adopt an agreed
          policy .
        II .  PRINCIPLES     ,
4 . Tariff structures should guarantee that consumers receive electricity supplies
     at prices that ensure that costs are covered and that sound financial balances
     are achieved . Tariffs should take account of the production , transmission and               ]
             M  I »               I • _ « I    f • * r .    .   •   . f          a . < r « • Il    L
     distribution costs 6f supplying the different categories of consumer - Artificially t
      low rates for " certain sectors at the expense of higher charges for others                  j
      involve the risk of distortions in the structure of demand . So the requirement              j
      to cover costs should be fulfilled separately for each consumer sector . Tariffs             !
                                                                         ■                      "  r
     should also be as clear a'nd straight-forward as possible for obvious reasons                .i
     of commercial , public relations and management policy .                   .                  •
5 . Tariff structures should'also be designed with the rational use of energy in                   )
                                                                                X
     mind by avoiding , in particular , inducements that could encourage energy          "         .
     wastage . A clear and coherent tariff policy for energy sources enables the .              .j
     consumer to make correct choices and leads to the optimum utilization of resources .
( 1 ) O.J. N° C 153 / 6 of 9.7.1975
 ---pagebreak---      III . Five QUIftELINiS                \
6 . The Commission believes that a rational tariff structure for the electricity
     sector should be based on these principles which lead to the following five
     guideline proposals :                           ,
     a ) General application of two-part tariffs .        . r
             TWo-part tariffs consist of payment of a periodical
    '              fixed charge      independent of consumption; and a payment for the
             ki lowatthours actually consumed , ,
            As bulk electricity : cannot be stored , it is produced when demanded . .
            Electricity production , transmission and distribution plant is of course
            therefore installed to meet the maximum load which may be expected at a ..
         • specific time * As consequent heavy investment is committed independently
            of the actual period during which plant on the system is used , the over
            heads (capital , payroll , plant costs ) therefore account for 50 %- 80 X
            of total costs , depending on circumstances . Costs resulting from an
      , increase in consumption using existing plant ( essentially fuel costs )
            account for a smaller proportion of total costs . The average" cost per Kwh *
          " therefore decreases the>- more Kwh a given plant produces . The cost structure
             is thus the inescapable logical basis for two-part tariffs . Where tariffs
     \ are such as to align prices with costs , the price moves in step with the ,
        v costs incurred , thus producing a decreasing unit price with increasing .
            consumption . In addition , however , in the sharing of fixed costs among
            the different categories of consumer , account needs to be taken of the
       .    contribution of each category to the forming of peak electricity demands .
            This should be taken into consideration particularly to ensure that fixed
            costs are fairly allocated at low levels of consumption (e.g. , in thfe
            domestic sector ).           .
            Although most electricity suppliers in the Community are turning               ^
            towards two-part tariff structures, the Commission believes this trend         [
            should continue at a faster rate . This should reduce disparities with
            other tariffs in which the price of electricity is reduced too sharply
            as consumption grows ( See paragraph b ). .       N
                                                                         ' ./  " ..
(*) The fixed component is related to maximum demand (Kilowatt ) and ,
          consequently, to the investment which the electricity supplier has to make .
 ---pagebreak---                               <*)
b ) Elimination of block          tariffs of a promotional nature
      Some tariffs promote electricity demand by dividing consumption in a
      specific period into successive fixed amounts of Kwh , to which reducing
      prices apply . These are thus structured in a way that accentuates       v
      artificially a diminishing level of costs and therefore stimulates
      unnecessarily high consumption . Although this type of tariff may have
      been justified in the past , it is no longer acceptable now that the
      rational use of energy resources is paramount . This kind of promotional
      tariff structure must now be eliminated .                      -
c ) Avoidance of tariffs based on type of use of electricity
      The cost of supplying electricity is independent of how it is used by '
      the consumer . Cost depends solely on quantity and on the times at which
      the consumption takes place ( i.e. peak and off-peak ).               '
      Certain tariff structures , however , still apply to the specific use of
      electricity for such purposes as lighting , cooking , motive power and
  •   heating . The application of tariffs of this type to consumers who , in
      increasing numbers , are using electricity , for different purposes , causes
      separate supply circuits to be" installed on the same premises , and to
      be monitored by separate meters needed for separate invoicing , which
      thus leads to additional costs . Such procedures are to be avoided .
                                           <**>
d ) The provision of multiple tariffs           incorporating different price
      levels
      Consumption of electricity at periods of maximum demand gives rise to -
    ' a need for new investment in electrical plant . On the other hand a
      consumer who takes electricity during off-peak periods could receive
      supplies from existing plant . It is therefore desirable to restrain
      demand for electricity during peak periods and to transfer it to off-
      peak . This can be achieved by applying multiple tariffs incorporating
      different prices to different Load periods' such as : peak periods ,
      off-peak periods , winter and summer periods and , in particular , in the
      home , during the day and night .                   n
                                                     v
                               ,
(*) Block tariff : a tariff in which the charge is based on a series of
       di f ferent ki lowatt-hour rates applying to successive kilowatt-hour
       blocks of give ) size , supplied during a specific period .
 (**) Plult1ple tariff : a tariff comprising different rates according to
        the periods of the day ( e.g t rates for peakload hours , for day-time
        hours , or for low-load hours ) or according to the season of the year .
 ---pagebreak---        This kind of tariff is already adopted in some countries and can with
       benefit be expanded ,, particularly for supplies to industry , where
   . consumption is heavy . Deferment of investment in new plant and savings
       on operation of existing plant will be especially significant where '
       contracts for interruptible supplies are developed , in particular in
       the industrial and commercial sector .
e ) . Exclusion of outside influences in drawing up tariffs
       As the supply of electricity is a public service , electricity utilities
       are on occasion under pressure to offer uneconomic tariffs to certain
       categories of consumers . If this is done , ' for whatever desirable social
     • •                               -
       motives ;  or  anti-inflationary policy reasons , electricity and energy
       demand as a whole i s/di stort ed. Other consumers may then be asked
       to pay higher tariffs . Policy should ensure that appropriate and economic
   / tariffs are ch'arged to all consumers and that where subsidies may be
 ^ warranted on social grounds to those on low income , separate Government
  " action is taken to provide support grants .
The guidelines in the five areas set out above could provide a common basis
for tariff structures for electricity consumers in the Communi ty . . The
necessary diversity in tariff structures , owing to the specific charac
teristics of consumer groups in each country and the structure of power
statiort capacity , may need to be taken into account in the
adoption of these guidelines . In addition , it is desi rable , : in times
                                                          . .                i
of rapidly rising costs , that prices should tie frequently up-dated
to avoid Aarge changes and the political problems which they may cause .
Tariff structures will need to ensure that this' is feasible .
                                                     /
 ---pagebreak---                                  /   •   •
                                       - s -
     IV . A COMMUNITY TARIFF POLICY
 8 . Consistent and rational tariff structures are . an important factor in the
                                           -         •   /  .
     continued development of Community energy policy .
               ...
     Although the ownership and organization of electricity utilities take
     different forms in the Community , the supply of electricity is a public
     service which aims at the equal treatment of consumers .      Within the
     Community these aims require a common alignment of tariffs in order to
     provide homogeneous supply conditions , i.e. to ensure equality of treatment
     of consumers , avoiding . distortions in pricing .   In this way the securing
     of appropriate competition in the industrial sector can be helped , and
     consumers will be enabled to choose the right options , with the availability
     of clearer information on supply conditions .
 9 . Nevertheless , attention must be drawn to the fact that any changes to
     the tariff structures for electricity involve the solution of economic ,
     technical , legal and administrative problems . Although price adjustments
     are relatively1 easy to implement ,- this may not be the case when changes    ■
     to tariff structures are proposed : the merits of altering long-established
     tariff structures may not *be immediately clear to all . Consumers will-
     need to be advised about the reasons for , and consequences of , such      -
     changes .
10 . The Commission 's objective with this Recommendation is only to get
     agreement on some basic tariff structure principles . Further action
     in tariff and price policy must be carefully studied and developed in
     collaboration with Member States .
     V.   TARIFF RESEARCH                               '
11 . In addition it will be wise to continue and intensify research into the
     demand charactsristics of the various consumer categories and their
     long-term developments This entails highly complex and expensive survey
     and assessment work . Exchanges of information on methodology and results , ~
     and collaboration between Community countries in this field should be
     increased .
                                 i
                                 »
     V.   RECOMMENDATION
     The               invites the CeuneU t© approve the attached draft
      Recommendation .
 ---pagebreak---                                    DRAFT
                         COUNCIL RECOMMENDATION
          on electricity tariff structures in the Community
THE COUNCIL OF THE EUROPEAN COMMUNITIES ,
Having regard to the Treaty establishing the European Economic Community,
Having regard to the draft Recommendation submitted by the Commission ,
Having regard to the opinion of the European Parliament ,
Whereas the Council , in its Resolution of 13 February 1975 ( 1 ), emphasised
the need to make it possible for prices to cover , gradually and to the
fullest extent possible, the costs of making energy available and the
amortization of the necessary investments ;
Whereas consistent energy pricing is a fundamental element of economic and
energy policy ;
Whereas rational tariff structures allow better utilization of
resources ;                                          >
Whereas the provision of electricity is a public service , irrespective, of
the legal status of the undertakings involved, and whereas for this
reason undertakings must ensure equality of treatment of consumers under
comparable supply conditions ;
Whereas tariff structures founded on common principles lead to more
homogeneous conditions of supply and are a st£p in the direction, of more
coherent electricity prices throughout the Community ;
Whereas electricity supply undertakings must cover their costs on the
basis of an objective allocation of these costs among the various ,
categories of users ;
Whereas tariff structures should not be used for the redistribution of
resources among electricity consumers ;         f,
Whereas promotional tariff structures likely'to prevent the rational use
of energy should*be avoided;                     :
                                                Π ->   . > ■ ■
 ( 1 ) OJ No- C 353 , 9.7.1975 , p. 6
                                                n -r
 ---pagebreak--- Whereas the principles underlying electricity tariff structures are not
yet in general use in the Community ,       although certain of . these structures
already reflect a common approach , and whereas efforts to bring about
simplification and unification must be pursued ;         •
HEREBY RECOMMENDS TO THE MEMBER STATES :
                    • '                            i
That they adopt , where these do not already exist , the requisite laws ,
regulations and administrative provisions to ensure that electricity                  ,
tariff structures are based on the following common principles :
1 . Tariff structures should be drawn up and adopted so as to allow the
     application of a rational price policy for electricity and so as to
     reflect the costs incurred in supplying the various categories of        •
     consumer ; tariff structures should be designed with the rational use
     of energy in mind ,       avoid inducements that could encourage unjustifiably
     high consumption ,   and be as clear and simple as possible .
2 . The two-part tariff system , which of the various tariff options
     available , best reflects the cost structure of providing electricity ,
    should be generally used .                                           -        .     .
3 . Promotional tariff structures which encourage unnecessary consumption
     and in which the price of electricity is artificially lowered as           .
     increasing amounts of electricity are used      should be discontinued ,
4 . Tariffs based on .the use to which electricity is put should be eliminated ,
5 . Tari ff systems should provide for multiple - tariffs , jrith differential v
              . ^            -■                : 1              .
     rates which aim 'to transfer demand for electricity to off-peak periods ,
     and for contracts for interruptible supplies ;
6 . Tariffs should not be kept artificially low , for example - for social
     motives or anti-inflationary policy reasons ; in such cases , separate         -
     action , where warranted , should be taken .
7 . Tariff structures should ensure, that :it is possible to up-date prices
     at regular intervals ;.                 !
 ---pagebreak---                                 - 3 -
That research be pursued and developed , in close cooperation at Community
level , into the characteristics of electricity demand for different
categories of consumers and their evolution in the long-term, with the
objective of further . improving tari ff structures;
That electricity prices on the market fbe characterised by the
greatest possible degree of transparency , and that these prices and
the cost to the electricity consumer should be made known to the
public as widely as possible .
                             -0O0-


               EUROPEAN COMMISSION
            Brussels, 13.5.2015
            COM(2015) 252 final
            Recommendation for a
            COUNCIL RECOMMENDATION
            on the 2015 National Reform Programme of Belgiumand delivering a Council opinion on the 2015 Stability Programme of Belgium

               Recommendation for a

               COUNCIL RECOMMENDATION

               on the 2015 National Reform Programme of Belgium

                  and delivering a Council opinion on the 2015 Stability Programme of Belgium

               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(2) thereof,

               Having regard to Regulation (EU) No 1176/2011 of the European Parliament and of the Council of 16 November 2011 on the prevention and correction of macroeconomic imbalances
                  2
               , and in particular Article 6(1) thereof,

               Having regard to the recommendation of the European Commission
                  3
               ,

               Having regard to the resolutions of the European Parliament
                  4
               ,

               Having regard to the conclusions of the European Council,

               Having regard to the opinion of the Employment Committee,

               Having regard to the opinion of the Economic and Financial Committee,

               Having regard to the opinion of the Social Protection Committee,

               Having regard to the opinion of the Economic Policy Committee,

               Whereas:

               (1)On 26 March 2010, the European Council agreed to the Commission’s proposal to launch a new strategy for growth and jobs, Europe 2020, based on enhanced coordination of economic policies. The strategy focuses 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, on the basis of the Commission’s proposals, 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 it adopted a decision on guidelines for the employment policies of the Member States. Together these form the ‘integrated guidelines’ which Member States were invited to take into account in their national economic and employment policies.

               (3)On 8 July 2014, the Council adopted a recommendation on Belgium’s National Reform Programme for 2014 and delivered its opinion on Belgium’s updated Stability Programme for 2014. On 28 November 2014, in line with Regulation (EU) No 473/2013
                  5
               , the Commission presented its opinion on Belgium’s draft budgetary plan for 2015
                  6
               .

               (4)On 28 November 2014, the Commission adopted the Annual Growth Survey
                  7
               , marking the start of the 2015 European Semester of economic policy coordination. On the same day, on the basis of Regulation (EU) No 1176/2011, the Commission adopted the Alert Mechanism Report
                  8
               , in which it identified Belgium as one of the Member States for which an in-depth review would be carried out.

               (5)On 18 December 2014, the European Council endorsed the priorities for boosting investment, accelerating structural reforms and pursuing responsible growth-friendly fiscal consolidation.

               (6)On 26 February 2015, the Commission published its 2015 country report for Belgium
                  9
               . This assessed Belgium’s progress in addressing the country-specific recommendations adopted on 8 July 2014. The country report also includes the results of the in-depth review under Article 5 of Regulation (EU) No 1176/2011. The Commission’s analysis leads it to conclude that Belgium is experiencing macroeconomic imbalances which require policy action and monitoring. In particular, developments with regard to the external competitiveness of goods continue to present risks and deserve attention, as renewed deterioration would threaten macroeconomic stability. Further action to ensure the convergence of cost parameters would slow down the decline of employment in the tradable sectors, while tangible progress to narrow the historical cost gap could be reinforced by a tax shift towards non-labour tax bases. Public debt remains high, but several factors temper the associated macroeconomic risks.

               (7)On 30 April 2015, Belgium submitted its 2015 National Reform Programme and its 2015 Stability Programme. To take account of their interlinkages, the two programmes have been assessed at the same time.

               (8)Belgium is currently in the preventive arm of the Stability and Growth Pact and subject to the transitional debt rule for the period 2014-2016. On 27 February 2015, the Commission issued a Report under article 126(3) of the TFEU
                  10
               , as Belgium was not expected to make sufficient progress towards compliance with the debt rule in 2014-2015 and the deficit reference value of 3% of GDP was breached in 2014. The analysis concluded that the debt criterion should be considered as complied with at that time and that the excess of the deficit over the reference value was close, temporary, and exceptional (due to methodological statistical changes). This analysis is still broadly valid. In its 2015 Stability Programme, the government plans a gradual improvement of the structural balance in order to reach a balanced budgetary position in structural terms by 2018. However, the recalculated structural balance
                  11
                 points to a structural deficit of 0.3% of GDP in 2018. The government does not plan to reach the medium-term objective – a surplus of 0.75% of GDP in structural terms – within the programme period. The government debt-to-GDP ratio is expected to peak at 106.9% in 2015 and to gradually decline to 102% in 2018. The macroeconomic scenario underpinning these budgetary projections is plausible. However, the measures needed to support the planned deficit targets from 2016 onwards have not been sufficiently specified. Based on the Commission's 2015 spring forecast, net expenditure growth in 2015 is expected to be in line with the expenditure benchmark. However, there is a risk of some deviation in 2014-2015 mainly resulting from the slippage in 2014. If policy is unchanged, there is also a risk of a significant deviation from the required adjustment path towards the medium-term objective in 2015-2016. Therefore further measures will be needed in both years. Based on its assessment of the Stability Programme and taking into account the Commission's 2015 spring forecast, the Council is of the opinion that there is a risk that Belgium will not comply with the provisions of the Stability and Growth Pact.

               (9)The federal government has agreed a major pension reform aimed at reducing the gap between the effective and statutory retirement ages, and raising the latter. The early retirement age is to be raised further after 2016, to 63 years by 2019, with a minimum careerlength requirement of 42 years. Over the longer term, there are plans to increase the statutory retirement age from 65 to 66 in 2025 and 67 in 2030. The gradual introduction of a credit-based pension system is planned, with adjustment mechanisms that respond to demographic or economic developments such as higher life expectancy or changes in the economic dependency ratio. A successful consolidation strategy offsetting the budgetary impact of an ageing population and safeguarding the long-term sustainability of public finances depends on the swift implementation of this pension reform. Considering that there are still few incentives to support the employability of older workers, these pension reforms would need to be accompanied by employment-support measures and labour market reforms conducive to active ageing.

               (10)The Belgian tax system is characterised by a high overall tax burden, relatively high rates, and narrow bases. The tax burden is heavily skewed towards labour. This results in high labour costs, which discourage job creation, and large tax wedges, which contribute to unemployment traps. In addition, partly to alleviate the high tax rates, tax bases are generally eroded by numerous specific exemptions, deductions, reduced rates, and tax expenditures, which create efficiency losses and introduce distortions and possible loopholes. Certain features of the tax system are environmentally harmful. Given these weaknesses, Belgium has been repeatedly advised to simplify and redesign its tax system in order to rebalance the tax burden, close tax loopholes, and reduce the sometimes harmful differentiation created by taxation niches. So far, limited progress has been made towards a comprehensive tax reform entailing, in particular, a shift from labour towards less growth-distorting tax bases. Tax bases with scope for broadening include environmental and consumption taxes and certain types of financial income. Combining a shift away from labour with taxbase broadening (reviewing existing tax provisions, subsidies, exemptions, and deductions) could improve the overall balance and fairness of the tax system, support employment, competitiveness and social and environmental objectives, and counter tax evasion and aggressive tax planning.

               (11)Structural problems characterising the Belgian labour market continue to result in a chronic underutilisation of labour and low aggregate employment and activity rates. Shortcomings relate mainly to the weak link between wages and productivity and to financial disincentives to work. Belgium also faces shortages of highly skilled workers and skills mismatches. The various government agreements make reference to the need for stronger links between education, training and employment actors so as to improve linguistic, vocational and educational training and develop alternative training for students and the unemployed. Progress is slow, however. The impact of these structural factors on certain groups in the labour market, such as the young and elderly unemployed and those from migrant backgrounds, is particularly pronounced.

               (12)Belgium’s weakened external competitiveness continues to give rise to macroeconomic risks for its economy. The economy is marked by a problem of high labour costs, which have on average outpaced those in neighbouring countries. There is a need to align wage growth more closely with productivity and to make wage-setting more flexible so as to increase the economy’s potential for adjustment. Some targeted measures have been taken to reduce labour costs for specific groups and to narrow the gap between gross and net wages at the bottom of the pay scale. However, closing the gap entirely will require additional action which hinges on reforms of the wagesetting system. The build-up of a cost disadvantage comes with job losses and will eventually provoke a correction if left unaddressed. Other key cost factors for companies are energy costs and the cost of intermediate business services, which are highly regulated and shielded from competition. There is also considerable scope for improving the non-cost dimension of external competitiveness. To safeguard and enhance current welfare levels, more emphasis will have to be put on productivity gains. This requires a sustained push towards products and associated services higher up the value chain, on the basis of stronger performance on innovation and R&D valorisation. Administrative barriers should be reduced and measures should be taken to promote entrepreneurship and unleash business dynamism. The very low start-up rate suggests a business climate that is unfavourable to new activities and expansion. Increasing competition in retail and professional services also represents a challenge. Eliminating public infrastructure bottlenecks and improving the quality and adequacy of the capital stock through additional investments, in particular in the area of road and rail infrastructure, would also strengthen the country’s overall productivity.

               (13)In the context of the European Semester, the Commission has carried out a comprehensive analysis of Belgium’s economic policy and published it in the 2015 country report. It has also assessed the Stability Programme and the National Reform Programme and the follow-up given to the recommendations addressed to Belgium in previous years. It has taken into account not only their relevance for sustainable fiscal and socio-economic policy in Belgium but also their compliance with EU rules and guidance, given the need to strengthen the overall economic governance of the European Union by providing EU-level input into future national decisions. The recommendations under the European Semester are reflected in recommendations 1 to 4 below.

               (14)In the light of this assessment, the Council has examined Belgium’s Stability Programme, and its opinion
                  12
                is reflected in particular in recommendation 1 below.

               (15)In the light of the Commission’s in-depth review and this assessment, the Council has examined the National Reform Programme and the Stability Programme. Its recommendations under Article 6 of Regulation (EU) No 1176/2011 are reflected in recommendations 1 to 4 below.

               (16)In the context of the European Semester the Commission has also carried out an analysis of the economic policy of the euro area as a whole. On the basis of this analysis, the Council has issued specific recommendations for the Member States whose currency is the euro. Belgium should also ensure the full and timely implementation of these recommendations,

               HEREBY RECOMMENDS that Belgium take action in 2015 and 2016 to:

               1.Achieve a fiscal adjustment of at least 0.6 % of GDP towards the medium-term objective in 2015 and in 2016. Use windfall gains to put the general government debt ratio on an appropriate downward path. Complement the pension reform by linking the statutory retirement age to life expectancy. Agree on an enforceable distribution of fiscal targets among all government levels.

               2.Adopt and implement a comprehensive tax reform broadening the tax base, shifting the tax burden away from labour and removing inefficient tax expenditures.

               3.Improve the functioning of the labour market by reducing financial disincentives to work, increasing labour market access for specific target groups and addressing skills shortages and mismatches.

               4.Restore competitiveness by ensuring, in consultation with the social partners and in accordance with national practices, that wages evolve in line with productivity.

               Done at Brussels,

                     For the Council

                     The President

                     (1)
                  OJ L 209, 2.8.1997, p. 1.

                     (2)
                  OJ L 306, 23.11.2011, p. 25.

                     (3)
                  COM(2015) 252

                     (4)
                  P8_TA(2015)0067, P8_TA(2015)0068, P8_TA(2015)0069.

                     (5)
                  OJ L 140, 27.5.2013, p.11.

                     (6)
                  C(2014) 8800 final

                     (7)
                  COM(2014) 902.

                     (8)
                  COM(2014) 904.

                     (9)
                  SWD(2015) 21 final/2

                     (10)
                  COM(2015) 112.

                     (11)
                  The structural balance as recalculated by the Commission based on the information in the Stability Programme, following the commonly agreed methodology.

                     (12)
                  Under Article 5(2) of Council Regulation (EC) No 1466/97.


               EUROPEAN COMMISSION
            Brussels, 18.5.2016
            COM(2016) 325 final
            Recommendation for a
            COUNCIL RECOMMENDATION
            on the 2016 national reform programme of Denmarkand delivering a Council opinion on the 2016 convergence programme of Denmark

               Recommendation for a

               COUNCIL RECOMMENDATION

               on the 2016 national reform programme of Denmark

                  and delivering a Council opinion on the 2016 convergence programme of Denmark

               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 9(2) thereof,

               Having regard to the recommendation of the European Commission,
                  2

               Having regard to the resolutions of the European Parliament,
                  3

               Having regard to the conclusions of the European Council,

               Having regard to the opinion of the Employment Committee,

               Having regard to the opinion of the Economic and Financial Committee,

               Having regard to the opinion of the Social Protection Committee,

               Having regard to the opinion of the Economic Policy Committee,

               Whereas:

               (1)On 26 November 2015, the Commission adopted the Annual Growth Survey
                  4
                marking the start of the 2016 European Semester of economic policy coordination. The priorities of the Annual Growth Survey were endorsed by the European Council on 17-18 March 2016. On 26 November 2015, on the basis of Regulation (EU) No 1176/2011, the Commission adopted the Alert Mechanism Report
                  5
                in which it did not identify Denmark as one of the Member States for which an in-depth review would be carried out.

               (2)The 2016 country report for Denmark
                  6
                was published on 26 February 2016. It assessed Denmark’s progress in addressing the country-specific recommendations adopted by the Council on 14 July 2015 and Denmark’s progress towards its national Europe 2020 targets.

               (3)On 26 April 2016, Denmark submitted its 2016 national reform programme and its 2016 convergence programme. To take account of their interlinkages, the two programmes have been assessed at the same time.

               (4)Relevant country-specific recommendations have been addressed in the programming of the European Structural and Investment Funds for the 2014-2020 period. As foreseen in Article 23 of Regulation (EU) No 1303/2013, where it is necessary to support the implementation of relevant Council recommendations, the Commission may request a Member State to review and propose amendments to its Partnership Agreement and relevant programmes. The Commission has provided further details on how it would make use of this provision in guidelines on the application of the measures linking effectiveness of the European Structural and Investment Funds to sound economic governance
                  7
               .

               (5)Denmark is currently in the preventive arm of the Stability and Growth Pact. In its 2016 convergence programme, the government plans an improvement in the headline balance, reaching a balanced budget in 2020. The medium-term budgetary objective — a deficit of 0.5% of GDP in structural terms — is projected to be achieved in 2016. According to the convergence programme, the government debt-to-GDP ratio is expected to reach 35.1% in 2020. The macroeconomic scenario underpinning these budgetary projections is plausible. Based on the Commission 2016 spring forecast, Denmark is forecast to comply with the recommended fiscal adjustment in 2016 and 2017. Based on its assessment of the convergence programme and taking into account the Commission 2016 spring forecast, the Council is of the opinion that Denmark is expected to comply with the provisions of the Stability and Growth Pact.

               (6)Ensuring labour supply as the population ages is a precondition for sustainable growth in Denmark. A series of substantial labour market reforms in recent years aim particularly at increasing work incentives and improving the efficiency of active labour market policies. These reforms could contribute to achieving Denmark's Europe 2020 employment target and to the sustainability of the Danish welfare model. However, the national Europe 2020 target for social inclusion, aiming at reducing the number of people living in very low work intensity households, is far from being achieved. Labour market inclusion and improving the employability of disadvantaged groups remain a challenge. This particularly applies to people with a non-EU migrant background, including those who have resided longer in Denmark, and young people with low educational attainment. The job-integration measures agreed in the 2016 tripartite negotiations could improve the situation for newly arrived refugees and migrants. However, further measures should still be taken to include other marginalised groups in the labour market more effectively.

               (7)To maintain the relatively high level of welfare provided in Denmark, improved productivity growth is essential. However, productivity growth has been sluggish during the past two decades. One of the contributing factors identified is the continued lack of competition in the domestic services sector, in particular in retail and construction. Denmark therefore needs to increase efforts to improve productivity in the construction sector by removing barriers and ensuring proportionate authorisation schemes where such schemes are considered necessary. It also needs to ease the restrictions on retail establishments, notably by implementing the reforms outlined by the government.

               (8)The overall investment level in Denmark has been low since a sharp drop in private investments during the economic crisis. This partly reflects low residential investment following the burst of the housing bubble and idle capacity in the corporate sector. Boosting investment would help Denmark strengthen economic growth and increase productivity. Barriers to investment have been identified in the services sector and research. The retail and construction sectors are facing barriers to entry, which in return affect competition and productivity growth. Efforts to turn university research results into business innovations could be strengthened.

               (9)In the context of the European Semester, the Commission has carried out a comprehensive analysis of Denmark’s economic policy and published it in the 2016 country report. It has also assessed the convergence programme and the national reform programme and the follow-up given to the recommendations addressed to Denmark in previous years. It has taken into account not only their relevance for sustainable fiscal and socio-economic policy in Denmark but also their compliance with EU rules and guidance, given the need to strengthen the overall economic governance of the European Union by providing EU-level input into future national decisions. The recommendations under the European Semester are reflected in recommendations 1 and 2 below.

               (10)In the light of this assessment, the Council has examined the convergence programme, and its opinion
                  8
                is reflected in particular in recommendation 1 below.

               HEREBY RECOMMENDS that Denmark take action in 2016 and 2017 to:

               1.Respect the medium-term budgetary objective in 2016 and achieve an annual fiscal adjustment of 0.25% of GDP towards the medium-term budgetary objective in 2017.

               2.Enhance productivity and private sector investment by increasing competition in the domestic services sector, in particular by facilitating market entry in retail and construction. Incentivise the cooperation between businesses and universities.

               Done at Brussels,

                     For the Council

                     The President

                     (1)
                  OJ L 209, 2.8.1997, p. 1.

                     (2)
                  COM(2016) 325 final.

                     (3)
                  P8_TA(2016)0058, P8_TA(2016)0059, and P8_TA(2016)0060.

                     (4)
                  COM(2015) 690 final.

                     (5)
                  COM(2015) 691 final.

                     (6)
                  SWD(2016) 74 final.

                     (7)
                  COM(2014) 494 final.

                     (8)
                  Under Article 9(2) of Council Regulation (EC) No 1466/97.