asked the Secretary of State for Trade if he will make a statement on the outcome of the discussions within the EEC on the question of the United Nations code of conduct for liner conferences.

My precedessor in the previous Administration gave the House on 22 February a report on the Transport Council of 20 February at which certain compromise proposals from the Presidency and the Commission for a common EEC position were discussed—[Vol. 963, c. 259–61.] It has now proved possible to reach a final agreement on the basis of these proposals. A Council regulation embodying a common Community approach was formally adopted in Brussels on 15 May.The regulation opens the way for member States to become contracting parties to the code, subject to a number of reservations and internal Community arrangements. New legislation will be required before the United Kingdom can accede to the code convention.The essence of the Community position is that the member States will not apply the code's cargo-sharing provisions and certain other of its rigid features in conference trades with other OECD countries parties to the code—provided these countries offer reciprocity. These arrangements are without prejudice to the opportunities for participation in these trades by national lines of developing countries in accordance with the principles reflected in the relevant part of the code. In trades between the EEC and developing countries parties to the code, developing country lines will enjoy full codist rights. The shares of trade falling to Community lines will be redistributed on a commercial basis and the lines of other OECD countries will—subject to reciprocity—be able to participate in this redistribution process. Conciliation will be available in the case of disputes.Other provisions of the regulation deals with the treatment of lines from one member State established in another under the right of establishment provisions of the EEC Treaty and the basis on which the code's national line veto right is used.The United Kingdom welcomes the common position which has been achieved within the Community and hopes that it will facilitate a more general solution among developed and developing countries to this difficult issue.

asked the Secretary of State for Wales what steps he proposes to take by way of implementation of the recommendations of the council for the Welsh language with regard to the teaching of, and general support for, the language.

My right hon. Friend will be considering carefully the recommendations made by the council for the Welsh language in its six reports, all of which affect general support for the Welsh language and some specifically the teaching of it. I cannot be more specific at present.

asked the Chancellor of the Exchequer whether he will take steps to ensure that thoroughbred racing bloodstock in the United Kingdom pays VAT on the same terms and conditions as in France and the Irish Republic and other Community countries; and if he will make a statement.

I am well aware that some aspects of the VAT treatment of bloodstock in France and the Irish Republic provide their industries with a competitive advantage as compared with the United Kingdom's. Some of these are in our view in conflict with the terms of the EEC sixth Council directive on the harmonisation of VAT. The Government certainly intend to try to secure equal treatment within the Community as a whole, consistent with the terms of the directive.

asked the Chancellor of the Exchequer if he will make a statement about the meeting of the Finance Council in Brussels on 14 May.

The EEC Finance Council met in Brussels on 14 May under French presidency. The main subject under discussion was the question of how Community policies as a whole, including the Community budget, could best assist greater convergence of economic performance between member States. This followed a remit from the European Council of 12–13 March. This discussion gave me an opportunity to make clear the wish of the new United Kingdom Government to work closely and harmoniously with our fellow members for the successful development of the European Community, of which we are a committed member.I had, however, to make it clear that it is an unsustainable position that two of the least prosperous members of the Community, the United Kingdom and Italy, will in 1980 be far and away the largest net contributors to the Community Budget. The European Council next month must focus attention on the problem, and I emphasised the need for it to be put forward in such a way that Heads of Government would be able to take decisions so that solutions could be applied without delay.The Council adopted a decision empowering the Commission to contract loans for the purpose of promoting investment within the Community which is consistent with priority Community objectives in the infrastructure and energy sectors. Ministers discussed the effects of the disruption of the oil market on the Community's economic prospects, and will return to this subject at their next meeting.It was decided to defer until the June meeting of the Finance Council further consideration of a regulation concerning interest rebates on loans granted in connection with the European monetary system.The Council had an exchange of views about the macro-economic implications of work sharing, and commissioned further work on this subject.