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EU Competitiveness Council

Volume 594: debated on Tuesday 10 March 2015

My noble Friend the Parliamentary Under-Secretary of State for Business, Innovation and Skills, Minister for Intellectual Property, Baroness Neville-Rolfe, has today made the following statement.

The Competitiveness Council took place in Brussels on 2 and 3 March. I represented the UK during the internal market and industry discussion on day one, with Shan Morgan the Deputy Permanent Representative to the EU representing the UK for the research discussion on day two. I also attended a Council breakfast where Vice-President Ansip led a useful informal discussion on the digital single market.

The Council started by discussing and adopting the draft conclusions on single market policy. The text included calling on the Commission to adopt a sectoral approach to services, with the focus being on professional and business services, construction and retail. In the accompanying debate the Commission highlighted the single market as the most important pillar of its €300 billion investment package, pressed the need for single market rules to be adopted far more ambitiously and highlighted the cost of starting up a business as one the problems dampening investment and growth.

Several member states (MS) intervened to highlight the importance of an ambitious and sectoral approach to services liberalisation. MS also emphasised the importance of other sectors such as energy. I spoke about the importance of better enforcement and called for decisive action in the single market strategy. This could include legislation where necessary, but I reminded the Council that any new legislation should be drafted in accordance with better regulation principles. I highlighted the need for action on the regulation of professionals, the provision of indemnity insurance, and legal form and shareholding requirements in particular.

We then discussed the EU investment package which was also debated in relation to research on the following day. The presidency noted that discussions were under way in the ECOFIN Council. Some MS intervened to say that the EFSI (European fund for strategic investment) should address four key points—flexible management, rapid implementation, “additionally” of projects and the need for significant equity component. In response to this, the Commission said the EIB (European Investment Bank) was going to increase its support for SMEs and stressed that the investment package would not just remove funds from the Horizon 2020 package.

The next item related to the Frontrunners initiative by like-minded countries, including the UK, to share good practice in implementing the single market. I intervened to support the project and highlight the work of the UK in the projects on e-commerce and regulated professions.

We then discussed the implementation of transparency reporting requirements in the accounting directive. A number of MS emphasised the importance of a level playing field in extractives transparency reporting, and the important role the Commission has to play in ensuring the US authorities act quickly in bringing forward robust requirements. I intervened to highlight the importance of the EU continuing to show leadership in this area.

The afternoon session started with a discussion on the digital single market and EU industrial competitiveness. The Commission highlighted the importance of digital technologies within industry and set out five specific areas: spreading high-tech and digital technologies into all industrial sectors, not just the most advanced ones; ensuring internet platforms are “not instruments of control but instruments of opportunity”; developing interoperable standards for digital products; ensuring the regulatory framework was fit for digitalisation; and helping MS to address skills shortages so that there are more “digital executives”. MS were supportive of the areas identified by the Commission and there was broad support for the removal of barriers to e-commerce.

I emphasised the importance of industry leading in the development of smart products and of the removal of barriers to start up tech companies. I also highlighted the UK’s digital industrial strategy, and our focus on technology clusters, catapult centres, and improving the skills base including the teaching of coding in all primary schools.

The Commission gave a summary of the responses to the Single Business Act consultation. Most respondents agreed that the top priorities should be reducing administrative burdens and increasing access to finance. The Commission announced that a quarter of funding from the investment plan would be directed towards SMEs and that more information would be presented at the next Competitiveness Council in May. There were no interventions by MS.

The day ended with the Commission giving an outline of the energy union package which was published in February. The package consists of the energy and climate work programme; an “interconnections” communication on meeting the 10% electricity interconnection target; the Commission’s view of key elements of agreement in Paris; and its proposal for the EU’s contributions. The aims of the package are energy security and efficiency. There were no interventions from MS.

The Latvian presidency opened the research day of the Council with a discussion on the annual growth survey (AGS) and the Juncker package’s financial instrument (EFSI). They highlighted the importance of investment in excellent research for growth as recognised in the latest AGS published by the Commission, and the role of the Juncker package to achieve this. They also emphasised the importance of national initiatives and road maps to deliver the European research area.

The UK intervention, while welcoming the AGS’s emphasis on innovation, focused mainly on the investment package. The UK and others called for the investment selection committee to include expertise in the field of R and I investment and that the emphasis of Competitiveness Council discussion should be on ways we can encourage project uptake of the fund. The UK, on the back of significant concerns raised by university stakeholders, also asked the Commission to reassure academia that the “mainstreaming” of social sciences and humanities would continue to take place.

The second policy debate focused on unlocking Europe’s digital potential and alongside this Science 2.0 (AOB). This discussion mirrored one from the previous day on the digital single market but focused on the research aspects. The main discussion was around the need for research and innovation to have access to data and that the necessary systems should surround them, for example, data storage and management. The Commission stressed how rapidly data is growing and that to make the most of these opportunities, Europe needs the skills and a shared vision of the opportunities and gaps in the landscape. Two points were raised by the UK: copyright reform to address academic text and data mining and the need for data protection legislation to not hinder research, ensure the necessary protections and permit us to reap the benefits of big data. This received broad support. A joint UK-Netherlands non-paper on open access was also circulated and received a warm reception from several member states. The presidency concluded the debate by recalling that there would be Competitiveness Council (research) conclusions on this topic in May.

Despite not being on the agenda, the Commission introduced an AOB item on Partnership for Research and Innovation in the Mediterranean Area (PRIMA) initiative, to confirm the formal mechanism by which the initiative will be funded (through article 185 TFEU as a public-public partnership) and to announce that a proposal will be bought forward (this may take some preparation). Under an AOB item on the BONUS programme (which covers research in the Baltic sea), the Commission noted the positive evaluation of the programme and noted that BONUS members are looking at a possible BONUS2. There were no interventions by the UK on BONUS or PRIMA. The European research area (ERA) was only touched on briefly in the Council and over lunch, with the presidency outlining the process so far on the ERA road map and referenced the need to address ERA governance issues (such as the number and structure of expert groups) preparing the way for conclusions on this subject in May.