Friday 26 January 2007
EU: General Affairs and External Relations Council
My right honourable friend the Minister for Europe (Geoff Hoon) has made the following Written Ministerial Statement.
My right honourable friend the Foreign Secretary (Margaret Beckett), Sir John Grant (UK Permanent Representative to the EU) and I represented the UK at the General Affairs and External Relations Council (GAERC) in Brussels.
The agenda items covered were as follows:
Lisbon annual progress report: The Council took note of a Commission presentation by Vice-President Margot Wallstrom on the annual progress report on implementation of the Lisbon strategy for jobs and growth.
The Council exchanged views on the basis of the report which included country-specific recommendations on the implementation of economic and employment policies at national level.
AOB: The constitutional treaty: The presidency briefed the Council on preparations for a declaration to mark the 50th anniversary of the Treaties of Rome and on preparations for a report on institutional reform to be discussed at the European Council on 21 and 22 June.
Ukraine: The Council adopted a mandate for a new enhanced agreement between the EU and Ukraine. Negotiations will be launched at an EU-Ukraine Foreign Ministers’ meeting in Kiev on 6 February.
The Council also adopted conclusions acknowledging Ukraine’s European aspirations and welcoming progress made while supporting further economic and political reforms for strengthening democracy, stability and prosperity in the country.
European neighbourhood policy: The Council exchanged views on the basis of a communication presented by External Relations Commissioner, Benita Ferrero-Waldner, on ways of strengthening the European Neighbourhood Policy (ENP).
The Commission’s ideas for strengthening the policy include: creating an economic community through trade integration; facilitating mobility; strengthening political co-operation and enhancing regional co-operation in the East, including the Black Sea.
Sudan: In an exchange of views on funding for the African Union Mission in Sudan (AMIS), the UK announced its decision to provide an additional £15 million this financial year.
The Council adopted conclusions: expressing concern about the security and humanitarian situation in Darfur; condemning the continuing ceasefire violations and calling for an immediate cessation to hostilities; and urging the parties and non-signatories to the Darfur peace agreement to take part in the negotiations.
The conclusions express readiness to consider further measures, including through the UN, against any party which obstructs implementation of UN support for AMIS. The conclusions reaffirmed the EU’s commitment to continue support for AMIS in the transition period leading to the agreed hybrid force in Darfur and confirmed the extension of the EU civilian-military supporting action to AMIS for a period of up to six months, from 1 January 2007. They also highlighted the EU's concern over the destabilising effects of the Darfur conflict on Chad and the Central African Republic and called all parties to implement the comprehensive peace agreement.
Somalia: The Council adopted conclusions calling on all parties to build on the current momentum and reach a durable political settlement enabling Somalia to achieve lasting peace, development and prosperity and urging the resumption of fully functioning political institutions and civil society, as soon as possible.
Iran: The Council discussed implementation of UN Security Council Resolution (SCR) 1737.
Conclusions were adopted welcoming unanimous adoption of UNSCR 1737 and calling on all countries to implement the measures in full and without delay.
To ensure effective implementation of measures in UNSCR 1737 while remaining consistent with EU policy, and recalling the EU policy not to sell arms to Iran, Ministers agreed that the EU should prevent the export to and import from Iran of the goods on the Nuclear Suppliers Group and Missile Technology Control Regime lists; ban transactions with and freeze the assets of individuals and entities covered by the criteria in UNSCR 1737; ban travel to the EU of the individuals covered by these criteria; and take measures to prevent Iranian nationals from studying proliferation sensitive subjects within the EU.
Energy external relations: Commissioner Ferrero-Waldner briefed the Council on a communication setting out priorities for energy policy for 2007-09: the diversification of energy supply; the EU’s energy partnership with Russia; the strengthening of energy relations with the EU’s neighbouring countries and the deepening of energy relations with the major consumer countries such as the United States, China and India on climate protection, energy efficiency and renewable energies.
My right honourable friend the Foreign Secretary highlighted the linkage between climate and energy, emphasising the importance of a coherent EU approach to energy, to address dependency on external energy supplies through improved energy efficiency and to recognise the impact climate security and energy will increasingly have on the EU’s external relations. The EU stood to gain by leading the way. Other partners also underlined the clear links between energy and climate.
Western Balkans: The Council discussed follow-up to the elections in Serbia and the need to support UN Status Envoy Martti Ahtisaari’s proposals on Kosovo, to be presented on 2 February.
The Council adopted conclusions on the European partnership with Montenegro and on Serbia, welcoming the conduct of the parliamentary elections on 21 January and calling for the speedy formation of a government committed to Serbia’s European course.
Middle East peace process: The Council agreed conclusions expressing support for President Abbas and his continued efforts for national unity and calling on all parties to consolidate the ceasefire in Gaza. The conclusions also welcomed the extension of the Temporary International Mechanism for three months which is providing essential relief to a large part of the Palestinian population, in co-ordination with the Office of the President.
Lebanon: The Council adopted conclusions welcoming the international conference in support of Lebanon in Paris on 25 January 2007 and reiterating the EU’s call for full implementation of UNSCR 1701.
Libya: The Council adopted conclusions expressing grave concern at the verdict of the Criminal Court in Libya on 19 December 2006, convicting and sentencing to death in a re-trial five Bulgarian nurses and one Palestinian doctor in connection with the HIV/AIDS case at the Benghazi hospital in 1999. The conclusions also called on the Libyan authorities to find a positive, fair and prompt solution to this case leading to the swift release of the medical workers.
Death penalty: The Council exchanged views on possible further initiatives for a moratorium on the death penalty in international fora, including the United Nations.
AOB: The Council was briefed, under AOB, by Trade Commissioner Peter Mandelson on negotiations with the Gulf Co-operation Council (GCC) on the establishment of an EU-GCC free trade area.
Liability in Damages: Davies Review
My honourable friend the Economic Secretary to the Treasury (Ed Balls) has made the following Written Ministerial Statement.
My Written Statement of 25 October 2006 concerning the Transparency Directive (2004/109/EC) undertook to publish the terms of reference for the Davies review. The terms of reference now follow.
Section 1270 of the Companies Act 2006 establishes a new statutory regime for liability in damages to third parties in respect of disclosures under the Transparency Directive (2004/109/EC). The Government consulted last year on whether the statutory regime should be extended. Responses to the consultation confirmed that this was a complex area in which it is vital to get the policy right, but were not conclusive.
The Government want to strike the right balance between the interests of investors and issuers, providing appropriate incentives to make timely and accurate disclosures in compliance with statutory rules, and an appropriate—but limited—right to recover losses. Section 1270 of the Companies Act amends the Financial Services and Markets Act 2000, inserting a new Section 90B that provides for a power to amend the statutory regime.
The Government appointed Professor Paul Davies, the Cassel Professor of Commercial Law at the London School of Economics in October 2006 to undertake a review of issuer liability. The Davies review will:
consider the law relating to liability in damages of issuers of securities traded on a regulated market or alternative markets (such as AIM or Plus Markets) in respect of statements and publications made to the market and which are incorrect, false or misleading or have not been made promptly;
consider how any such liability may be affected by regulatory obligations attaching to issuers and directors;
consider the case for providing for a specific right to damages by those relying on such statements and publications in the context of securities market activities, in particular: the circumstances that might give rise to a right, against whom a right might be enforceable and the consistency with the effect of corporate governance and conventions, standards or rules affecting the information that issuers publish to shareholders and others and how they publish it;
consider the impacts on: issuers, markets, investors and others; the quantity and quality of information disclosed; and the competitiveness of the UK as a good place to do business;
take into account the liability of issuers and their managements in other centres of financial services in Europe or more widely including the USA; and
make recommendations to the Treasury on whether to exercise the Section 1270 power and, if so, how.
In making recommendations to the Treasury, the review will advise on:
options for a new regime if recommended;
who might bring actions to sue for damages;
the kinds of damages that might be awarded and potential effects of paying those damages on issuers, including effects on their business and employees, directors or senior executives, and on the supply of qualified individuals willing to take on director and non-executive director roles in consequence; and
other related matters.
Pensions: ECJ Ruling
My right honourable friend the Secretary of State for Work and Pensions (John Hutton) has made the following Written Ministerial Statement.
The European Court of Justice has yesterday given its ruling in the case brought by former employees of the Allied Steel and Wire company, who lost pension entitlements when the company became insolvent. We shall of course be studying the judgment of the Court carefully.
The Court considered whether UK legislation in place before the 2004 Pensions Act sufficiently implemented Article 8 of the Insolvency Directive. The UK’s position has always been that the directive does not oblige member states to ensure such pensions are guaranteed in full, nor does it require the taxpayer to underwrite them. The Court has supported the UK's view.
On the question of damages, we note that the Court appears to have given a steer that damages may not be payable. But this is now a matter for the High Court to decide. It would be inappropriate for us to comment further on the case at this stage.
We have every sympathy for those who have lost their pensions and understand the distress this has caused to them and their families. It is in recognition of this that we introduced not only the pension protection fund, but also the financial assistance scheme, which we recently extended substantially.