FOCUS EUROPE

Belgian Presidency of the EU – Priorities of the FEB

FEB – European Department
Annex to FEB lnfor No. 20 - 3 June 2010

Getting the EU back on the growth track

E
urope is facing unprecedented challenges. The recently
adopted stabilisation programme – designed to prevent the
‘contagion effect’ of the sovereign debt crisis in the
European Union – shows a strong commitment to the Monetary Union
and to the preservation of financial stability. Now everything should be
done to ensure this programme restores confidence in the euro, as
this is vital for the European economy.
Learning from the
Belgium will take on the Presidency of the European Union in a
turbulent context, to say the least. Since it last held this position, in
2001, far-reaching changes have occurred: The EU was enlarged, the
euro was introduced and the Lisbon Treaty came into force. The
global economy has also evolved considerably over the past decade.
The prosperity of Europe – particularly of Belgium – depends largely
on exports. As a large proportion of global growth is today taking
place outside the EU, it is more than ever essential to target these
markets by pursuing an ambitious international trade policy and
boosting competitiveness. If Europe wants to preserve its role as a

Greek disaster major player on the global scene, an action plan backed by all
Member States and capable of delivering results is a necessity.

However, beyond short-term solutions we should learn from the Greek

FEB’s priorities for the Belgian Presidency of the EU are structured
disaster. The latter shows, in fact, that failure to introduce timely
into four general strategic approaches that the Union should adopt in
structural reforms can be extremely costly and painful. Therefore, a
the medium-term to ensure its future, as well as four more specific
system of genuine economic governance of the euro zone should be
priorities.
established. This should include new mechanisms to ensure the euro
zone’s budgetary sustainability and to reinforce its ability to react
when a crisis strikes. Therefore, a strengthened budgetary pact –
capable of deploying effective measures both in terms of prevention
and in terms of enforcement – as well as the creation of a European
Monetary Fund are essential tools.

Furthermore, the EU can’t go on without strong coordination between

the economic policies of its Member States. This is essential given the
close interdependence of European economies. For countries
experiencing budgetary difficulties, such an approach implies in-depth
reforms aimed at reducing the public debt and the cost of government,
increasing the efficiency of public administration, tackling the problem
of demographic ageing, etc. On the other hand, countries in a
favourable budgetary situation should strive to increase, to some
extent, domestic demand in order to give new impetus to intra-
European trade.

The new European Strategy for Jobs and Growth, the ‘Europe 2020
Strategy’, has paved the way for reforms. It is now up to Member
States to put forward realistic and convincing national reform targets
and programmes. Rudi Thomaes, Thomas Leysen,
Chief Executive Officer, FEB President, FEB
 MAIN CHALLENGES FOR THE EU UNDER THE BELGIAN
PRESIDENCY

The euro zone: reform or decline met:

• Member States should demonstrate full ownership of the European
Strategy’s goals. During the Belgian Presidency, Member States have
1. Economic governance for the euro zone
to prove their ability to implement reforms, and translate them into
The Monetary Union is a key ingredient of European integration.
national targets and national reform programmes fixed in cooperation
Confidence in the euro is vital for companies and consumers alike. By
with the European Commission;
the combined effect of a high debt ratio and major competitiveness
• Furthermore, regular control mechanisms should measure the
problems, other countries – in addition to Greece – might face serious
progress both at the national and European level. In this respect, it is
problems if the financial markets lose confidence in the euro zone.
advisable to carry out a simultaneous evaluation of the progress
Therefore, only decisive structural reforms, at both national and
made under the Europe 2020 Strategy as well as under the Stability
European level, will bring the European Union back on track for growth.
and Growth Pact. The Commission should develop a system for
regular benchmarking between Member States’ policies. On the other
The Stability and Growth Pact remains hand, the European Council should ensure the active involvement of all

an efficient instrument, provided that it Member States. Sanctions should be provided for, and enforced, if a
Member State fails to meet its commitments;
is enforced rigorously. • The European Commission should evaluate Member States’
strategies to deal with the ageing of the population;

The euro zone needs a new governance structure to ensure budgetary • The European budget should be reoriented towards growth and jobs,

sustainability. Furthermore, its capacity to tackle a crisis should be particularly by increasing the amount of resources invested in the

strengthened for example, by setting up a European Monetary Fund. future – e.g. expenditure on R&D.

The Stability and Growth Pact remains an efficient instrument, provided

that it is enforced rigorously. Therefore, it would be advisable to
complete it by a surveillance mechanism – managed by the European
Commission – be it preventive as well as repressive. As far as
prevention is concerned, engaging in a dialogue on the national
budgets with the Commission before they are adopted, could be a
useful tool. As regards repressive measures, adequate reporting and
reliable statistics on public finances are essential. In this field, it would
be appropriate to allow Eurostat to audit the accounts of member
States. Furthermore, sanctions should be applied in the event of
non-compliance with the agreed commitments. Lastly, the Euro Group
should ensure that each of its members undertakes structural reforms
and cost-reduction programmes to tackle public deficits vigorously.

2. Enhanced coordination between economic

policies
Apart from the issue of budgetary stability, the recent turbulences in Confidence in the euro is vital for businesses and consumers alike.
the euro zone have also highlighted the need to strengthen
coordination between economic policies in Europe. Indeed, action is
The transition towards a sustainable economy, more focused on
required on both fronts to get Europe back on the growth track. As
innovation and interconnection, will only be possible if Europe develops
European Council President Herman Van Rompuy pointed out a few
a sound, diversified and competitive industrial base. An effective R&D
months ago, an annual economic growth of at least 2% is necessary to
and innovation policy should play a key role in this respect. Such a
continue to finance the European way of life.
policy is in fact one of the flagship initiatives of the Europe 2020
Therefore, a European Growth Strategy capable of delivering quick results th
Strategy. A first evaluation of the 7 Research and Development
is needed. The Lisbon Strategy did not achieve its objectives. If Europe
Framework Programme will be carried out in October 2010. The FEB
wishes to seize its last chance to remain a key player on the world
believes it is essential to put more focus on the major economic
stage, a new approach is required. The new ‘Europe 2020’ Strategy is
challenges and on leadership of new technology, including clean tech.
in the process of being ratified at European level. Its objectives – for
However, it is not sufficient to increase investment in R&D. Without
example, in terms of investment in R&D or in terms of improving
measures to promote collaboration between universities and
employment rates – are ambitious. In the opinion of the FEB, however,
enterprises, without standardisation and a strong public procurement
this strategy will not be successful unless the following conditions are
policy and without proper attention for the marketing of innovations
and an effective protection of intellectual property rights, competition Furthermore, steps should be taken to generalise and standardise, at
with the emerging economies will be a lost battle. EU-level, the use of an electronic declaration of workers’ cross-border
activities (Belgian Limosa system). This would facilitate the monitoring

Completing (finally) the Internal and control of such activities and reduce the risk of fraudulent
arrangements.
Market The European Employment Strategy should also be further developed.
This strategy promotes a process of reflection and encourages Member
The completion and proper functioning of the States to set specific objectives as part of employment policies that can
Internal Market are essential for Belgian companies meet the challenges posed by the globalisation of
that are strongly export-oriented. The free movement trade as well as by demographic and environmental
of goods, services, capital and persons as well as trends (support for job-seekers; inclusive labour
knowledge offers enormous advantages. The markets; wage restraint policies; increasing
remaining obstacles to free movement should employment rates, particularly among older people
therefore be removed as a matter of urgency. The etc.). In this respect, the concept of flexicurity
unrealised economic potential adds up to between should remain at the centre of the Guidelines for
275 and 350 billion euro. Moreover, it should be Employment.
possible to implement the principles of the Internal
Market more effectively than it has been the case Finally, emphasis should be placed on
until now. simplifying the regulatory framework for
occupational health and safety and
Former European Commissioner Mario Monti has implementing it more efficiently, in accordance
recently published a report on the revitalisation of the with the new EU Strategy for Health and Safety
Single Market (1). The study identifies a number of at Work. In the opinion of the FEB, education
priority action areas (for example, the need to create a and training are essential to increase risk
awareness and prevention.
single market in the digital area or the need to exploit The EU should first implement its ‘Energy
and Climate Package’
the potential for “green growth”). A policy debate on the
Monti Report will take place under the Belgian Presidency within the Combating climate
framework of the Competitiveness Council. In this perspective, the FEB change: The moment of truth
advocates an action plan to translate the conclusions of the report into
concrete measures without delay. Another issue coming up for The fight against climate change is an issue of paramount importance
discussion will be the implementation of the Services Directive. In order for Belgian companies. The adoption of injudicious measures could
to enable our companies to take full advantage of the export opportunities cause irreparable damage to the European economy. Oppositely, a wise
offered by the Directive, the latter should be properly and rapidly policy will lead to the creation of new jobs, new products, new processes
implemented in all the Member States, particularly as regards the and new markets.
introduction of the ‘Points of Single Contact’ and the interoperability of
electronic procedures. FEB is calling for an in-depth evaluation, by the A well-thought-out climate policy will
European Commission and the Member States, of the measures taken
at national level. If appropriate, a debate on these issues will be create new jobs, new products and
organised within the Competitiveness Council. new markets
At European level, an ‘Energy and Climate Package’ – which unilaterally
A flexible and efficient European sets the ambitious target of a 20% reduction of greenhouse gas
labour market emissions – was approved already in December 2008. However, it
should be emphasized that the Copenhagen Conference on Climate
Following FEB, the autonomy of the European social partners is key. This is Change has failed, to date, to create a global ‘level playing field’ or
the case in the light of the Treaty – which provides for consultation of the conditions that would justify pushing up the EU target of a 20% reduction
social partners prior to any legislative initiative – as well as regards the of greenhouse gas emissions. Rather than discuss new figures for
social partners’ action programme. It is therefore advisable not to take targets, the EU should focus on defining a global vision in the area of
any legislative initiative in the areas provided for in the above-mentioned energy, which should be sustainable, cost-effective and capable of
programmes or in the areas covered by the agreements in force. integrating the EU energy, climate and industrial policies.
Combating social security fraud – which results in unfair competition
and social dumping – requires, according to the FEB, an EU initiative. In
this area an improved cross-border coordination between the labour and
social security inspection departments of Member States is necessary in
order to monitor compliance with the measures established by the
‘Posting of Workers Directive’.
The Copenhagen Conference on Climate Change has been a wake-up
call for Europe. Over the past two decades, the global economic
landscape has changed profoundly. At a crucial moment of the
Conference, the United States signed an agreement with China, India,
Brazil and South Africa, exclusive of the EU. This should be a serious
warning sign for Europeans: the first ambition of countries such as the
United States and China is to become market leaders in green
technology. Other issues, such as reducing emissions or funding the
efforts to cope with climate change, seem less important to them. In
addition, the United States and China have recently concluded an
agreement to establish common standards for electric cars. A clever
European strategy in this area will be decisive in terms of creating jobs
in this promising sector. During the Belgian Presidency of the EU,
another International Conference on Climate Change will take place
in Cancun. A new international agreement to create a level playing field
is more necessary than ever. Therefore Europe should adapt its
strategy, avoid making further unilateral commitments
and speak with one voice on this occasion. In the meantime, the
European Union should concentrate on implementing its ‘Energy and
Climate package’. A number of deadlines are foreseen just before or during
the Belgian Presidency of the EU (2). FEB believes that the need to
ensure the competitiveness of European companies should always be
taken into account in this context.
Furthermore, the Directive on Energy Taxation is currently under review.
According to FEB, steps should be taken to ensure, firstly, that any new
taxation measure is geared to strictly environmental objectives and,
secondly, that any additional tax revenue is allocated, as much as
possible, to maintaining and strengthening our competitiveness. Finally,
installations subject to the ETS should be exempted from this energy
taxation in order to avoid double taxation. Last but not least, an
exemption system should be kept in place for enterprises that enter into
voluntary agreements.

SPECIFIC ACTIONS FOR THE BELGIAN PRESIDENCY

EU patent and uniform European

patent jurisdiction
1. The EU patent
Establishing an EU patent system is a priority issue for Belgian industry
and for European industry as a whole, particularly for SMEs, given that
such a system would make it possible to promote investment in
research and development, which contributes to industrial
competitiveness. Currently, a patent covering one or several European
countries – or even all European countries – is still submitted to national
The EU patent will promote investments in R&D.
rules and procedures, with all the legal uncertainties and difficulties this
entails.
2. European patent jurisdiction
It is essential to establish a jurisdictional structure that will eliminate the
An EU patent would enhance the quality of the patents issued in
existing loopholes in the legal protection of inventions. In order to deal
Europe by introducing a centralised examination and issuing system
with actions for infringement of a patent and settle disputes relating to
which would enable a fair and impartial treatment of applications. This
the validity of the EU patent, FEB asks for a centralised, independent
would ensure the uniformity and quality of the patents. Moreover, the
and impartial jurisdiction. It is a matter of urgency to eliminate the
system would significantly reduce the cost of obtaining a patent
deficiencies of the current, purely national system for settling disputes
covering the European territory. Therefore, the FEB calls for the swift
concerning European patents (as well as the future EU patents). This
adoption of the proposed EU patent system.
applies, in particular, to problems linked to the multiplicity of the
It should be stressed that the cost of a European patent is currently
procedures and the high costs which creates uncertainty. Thanks to the
about 11 times higher than that of an American patent and 13 times
establishment of a single jurisdiction, European enterprises will be able to
higher than that of a Japanese patent. This is namely due to translation
achieve very significant savings and benefit from increased legal certainty.
costs, which account for approximately 25% of the costs of a patent.
FEB therefore considers that language requirements, which are not
longer included in the proposed Regulation on the EU patent, should be
Collective redress: The American
linked to the adoption of the new system. Although the current proposal model is not a solution!
provides that the EU patent should be filed – as it is the case for the
European Patent – in one of the three official languages of the The introduction of a collective redress mechanism is currently being
European Patent Office (i.e. English, French or German), FEB discussed, particularly in relation to consumer protection and antitrust law.
advocates the use of a single language, namely English. >>
>> This despite the serious problems that class actions have caused in the
United States, where they have driven numerous companies to
bankruptcy. With the exception of lawyers, nobody benefits from this
kind of procedure as American consumers receive in general little
compensation. Whatever the advocates of class action may say,
Europe is not immune to such excesses: ‘success fees’ and ‘punitive
damages’ are already a matter of fact in the European Union.
Priority should be given to the
enforcement of existing legislation,
Clean technologies will become a
major global industry: Europe can’t
miss this train.
The clean-tech market is booming and is set to become a major global
industry by 2020. The global economies have engaged in a veritable
‘green race’. While Europe still has the leadership, with a 40% share in
the global clean-tech export market, other countries, such as the United
States and China, are multiplying their investments in this sector.

consumer information and ADR. In 2009, China ranked first in terms of investment and financing of
clean energy, accounting for 21% of the USD162 billion invested in total
Like any other dispute, consumer disputes should be settled in this sector worldwide. In the fourth quarter of 2009, China had a 50%
appropriately. However, it would be unreasonable to ‘copy’ the American share in the solar energy market, compared with only 3% three years
model. FEB considers that, on the contrary, priority should be given to ago. In the wind energy sector, China has doubled its capacity, up from
the effective enforcement of existing legislation, consumer information 12,100 MW in 2008 to 25,100 MW in 2009.
and the promotion of alternative dispute resolution (ADR) mechanisms.
The latter have the advantage of providing a Europe can’t afford to miss this opportunity. To stay
solution which is acceptable to all parties. A in the race, it should develop a clean tech
recent study commissioned by the industrial policy that examines the measures
Directorate-General for Health and required to promote European clean tech
Consumer Protection (DG SANCO) solutions worldwide.
evaluates this kind of dispute resolution
system positively (3). In this respect, the FEB formulates five
recommendations:
Nor is it a good idea to introduce • European R&D budgets should
collective redress for damages be more structured and should be targeted, in
resulting from infringements of particular, those sectors in which Europe holds a
antitrust law. Such a move would lead leading position.
to a radical change of the competition • Europe should establish an
policy regarding the current legal integrated venture-capital market in order to
practices in Member States. strengthen access to specialised sources of
Compliance with competition rules – finance for innovation. An in-depth debate on
which is currently guaranteed by public green entrepreneurship in Europe should lead to
authorities – would be transferred to the development of a plan to promote new
business initiatives.
private entities (e.g. consumer The EU should develop a clean-tech
industrial policy. • Europe should carry out a SWOT analysis (6) of its
organisations), as it is the case in the
position on the standardisation of clean tech. The results of this
United States.
assessment should serve as the basis for an action programme
developed in partnership with private actors and the competent
FEB is opposed, in particular, to the introduction of any system that
European bodies for standardisation.
would apply regardless a prior decision of a court or a competition
• The EU diplomatic service that will be set up on the
authority that an infringement has occurred. However, should the
initiative of the EU High Representative for Foreign
European legislator opt for the introduction of collective redress, the
Affairs and Security Policy, Catherine Ashton,
FEB requests that certain conditions are fulfilled. For example, the
should also deal with economic policy issues.
‘loser pays’ principle should be fully applied. The possibility of claiming
European diplomats could function as front-line
punitive damages should be avoided and any system providing for a
ambassadors to promote European clean
‘contingency fee’ for lawyers should be banned. Furthermore, uniform
technologies and assist foreign investors in finding
rules should be established by the EU regarding the right of consumer
suitable European partners in this sector.
organisations to go to court. Last but not least, any action for ‘diffuse
• Europe should develop a strategy to anticipate the
damages’ (4) should be prohibited and an ‘opt-in’ system is essential
sharing and transfer of technologies. »
(5) to avoid contravening the European Convention on Human Rights.
»
Moving rapidly towards a
digital Europe
The Digital Europe Strategy – one of the seven flagship
initiatives of the Europe 2020 Strategy – is particularly important
for the business world. Establishing an EU-wide legal framework
that will enable a rapid migration towards a complete
digitalisation of all the administrative tasks relating to the
logistics chain is essential for Europe’s economic development.

By 2020, 80% of jobs will require ITC skills.

A recent Commission communication (7) outlines several action points
to strengthen electronic commerce in Europe and to promote the
crucial role that Information and Communication Technologies (ICTs)
can play in developing the European economy.

As a matter of fact, the electronic payments market doesn’t function in

practice. The electronic invoicing market is still constrained by
national borders. The emergence of a European interoperability
framework for electronic invoicing should therefore be promoted.
Electronic invoicing would enable
(1) http://ec.europa.eu/bepa/pdf/monti_report_final_10_05_2010_en.pdf.
(2) Key dates during the above-mentioned period concern, among other issues, the
following: the auction of emission rights (30/06/2010), a report on energy-intensive
sectors that are deemed to be particularly at risk of carbon leakage (30/06/2010),
the amount of emission rights to be auctioned (31/12/2010), and the authorised
number of flexibility mechanisms JI/CDM (31/12/2010).

Belgian companies to save more than (3) DG Sanco, Study on the use of Alternative Dispute Resolution in the EU, Final
Report, Civic Consulting, 16/10/2009

€3.5 billion. (http://ec.europa.eu/consumers/redress_cons/adr_study.pdf).

More specifically, the effective implementation of the ‘VAT Directive’,
which guarantees equal treatment of e-invoices and paper invoices,
should be a priority.
The shift to a system whereby invoices can be drawn up, sent, received,
processed, settled and filed electronically would represent a saving of
more than 240 billion euro for European companies (€3.5 billion for
Belgium alone). E-government is also an efficient and cost-effective way
of improving the services for businesses and individuals. Special
attention should be given to ‘capacity interconnection’ in the area of e-
procurement, particularly for PPPs (8). Furthermore, steps should be
taken to promote investment in digital solutions in such areas as
sustainable energy, population ageing and mobility. Finally, the EU has
to meet another major challenge: by 2020, 80% of the jobs will require
ICT skills.
(4) The concept of ‘diffuse damages’ refers to cases where the damage incurred by
each consumer individually is so small that individual compensation is not justified
(e.g. a taxi company that charges excessive fares). In such a case, the judgment in
a class action (a legal proceeding which is authorised in Québec, among other
countries) does not benefit the individual consumers that have incurred the damage
(e.g. the taxi company may be sentenced to transport customers free of charge for
a certain period of time).
(5) An opt-in system implies that the plaintiff explicitly indicates his or her wish to take
part in the action (e.g. by filling in a form). However, plaintiffs who have not joined an
unsuccessful class action (i.e. where the court dismisses the claim) may find that
their rights have been compromised by a proceeding in which they did not take part
– and this is not in conformity with Article 6 of the European Convention on Human
Rights.
(6) SWOT: Strengths Weaknesses Opportunities Threats.
(7) http://ec.europa.eu/information_society/digital-agenda/documents/digital-agenda-
communication-en.pdf.
(8) PPPs: Public Private Partnerships.

Editorial team
MAIN CHALLENGES FOR THE EU UNDER THE BELGIAN PRESIDENCY
- Arnaud Thysen, Deputy Adviser (at@vbo-feb.be)
- Michael Voordeckers, Adviser (mv@vbo-feb.be)
- Sonja Kohnenmergen, Senior Adviser (sk@vbo-feb.be)
- Diane Struyven, Director (ds@vbo-feb.be)
SPECIFIC ACTIONS FOR THE BELGIAN PRESIDENCY
- EU patent:
Nathalie Ragheno, Adviser (nr@vbo-feb.be)
- Class actions:
Diane Struyven, Director (ds@vbo-feb.be)
- Clean technologies:
Birgit Fremault, Adviser (bf@vbo-feb.be)
- Moving rapidly towards a digital Europe:
Jean Baeten, Head of the Tax Affairs Department (jb@vbo-feb.be) and Arnaud Thysen, Deputy Adviser to the European Department (at@vbo-feb.be).

General coordination
Diane Struyven, Michael Voordeckers and Arnaud Thysen

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