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 The EPC Members' Newsletter

 

Legislative update 89 Month - June 2000

1. ELECTRONIC COMMERCE
1.1 E-commerce Directive to be published soon
1.2 Jurisdiction - more delays for European Parliament's opinion
1.3 VAT - Commission tables proposal to amend EU Directive
to take account of electronic deliveries
1.4 Communications Review - legislative proposals delayed
1.5 Consumer protection - US industry grouping presents draft guidelines
1.6 On-line data protection - EU standardisation committee moves ahead with feasibility study
1.7 Spectrum allocation - EU Member States take mixed approaches
1.8 Distance selling - EU Directive enters in to force
1.9 French Presidency to host IST 2000 conference
1.10 Protection of minors - US law challenges in the courts
1.11 French MP recommends co-regulation to Prime Minister

2. INTERNET (CONTENT) REGULATION
2.1 Protection of minors - Commission publishes study on filtering & rating
2.2 Safe use of the internet - Commission publishes calls for tender

3. COPYRIGHT
3.1 Council of Ministers reaches agreement on draft Directive
3.2 Consumer lobby reacts strongly against political agreement
3.3 On-line copyright clearance systems to be launched in Europe
3.4 Trademarks - Commissioner Bolkestein publishes communiquŽ on exhaustion
3.5 Domain names - public consultation planned for new domains

4. ADVERTISING
4.1 Tobacco advertising - Advocate General recommends annulment of EU Directive
4.2 Commercial Communications Expert Group close to adopting second opinion
4.3 European Parliament group discusses consumer aspects of promotions regulation
4.4 Loi Evin - Commissioner Bolkestein secures concessions from French government
4.5 Tobacco products - Council of Ministers adopts new rules on labelling
4.6 Tobacco advertising - health and consumer protection Commissioner publishes statement
4.7 Internet advertising - FAST promotes guidelines and attracts new members
4.8 Commissioner Bolkestein rules out compulsory advertising filters

5. AUDIOVISUAL AND GENERAL MEDIA POLICY
5.1 MEDIA Plus - European Parliament Committee supports more funding
5.2 Council of Europe - Ministerial conference recommends new action in media regulation
5.3 Digital TV - Parliament calls for mixed approach
5.4 Financial transparency - intense lobbying before adoption of new Directive
5.5 Media education - Council of Europe calls for Europe-wide action
5.6 Conditional access - Council of Europe committee approves draft Convention
5.7 Commissioner Reding calls on industry to adapt to new technologies

6. GENERAL
6.2 Data protection - European Parliament committee gives only
conditional approval of 'safe harbor' agreement
6.3 EU reform - Feira Summit sets framework for reform
6.4 Postal services - Parliament committee remains hostile to liberalisation proposal
6.5 Company law - Council of Ministers adopts common position on take-overs Directive
6.6 Merger Regulation - Commission begins consultation on reform
6.7 Commission proposes to update EU rules on accounting standards
6.8 Fundamental rights - drafting body considers amendments
6.9 European Parliament votes to shorten its plenary sessions in Strasbourg


Dates for your diary

July
9th-11th - Presidency conference on management and legitimate use
of intellectual property, Strasbourg, France
12th - 4th European Commercial Communications Forum, Brussels
19th - 20th - Presidency conference on the financing of public service broadcasting, Lille, France
20th-21st - Informal meeting of Culture and Audiovisual Council, Lille, France

September
6th - Second Forest-Based Industries Forum, Strasbourg, France
11th - 12th - Presidency conference on European cultural industries
in the digital environment, Lyon, France
11th-15th - Children's Programme Exhibition, European Parliament, Brussels

October
19 20th October, EPC Members meeting, Stockholm, Sweden

Note: See http://www.presidence-europe.fr/ for all Presidency events

General enquiries: Angela Mills
Telephone: +44 (0)1865 310 732
Facsimile: +44 (0)1865 310 739
Emma Ascroft
Telephone: +32 2 231 1299
Facsimile: +32 2 230 7658

Press Enquiries: Heidi Lambert
Telephone: +32 2 732 5546
Facsimile: +32 2 735 3603


1 Electronic commerce

1.1 E-commerce Directive to be published soon
The Council of Ministers signed off the final text of the e-commerce Directive on 8 June following Parliament's approval of the common in May without amendment. The final Directive will enter in to force on the day it is published in the Official Journal of the EU. Member States must comply with its provisions within 18 months of this date. The Commission is obliged to undertake a review of the Directive within 3 years.

1.2 Jurisdiction - more delays for European Parliament's opinion
The European Parliament's Legal Affairs Committee has delayed its vote on the second draft report on the Commission's proposal for a Regulation on jurisdiction. Members of the Committee remain divided on what criteria should trigger jurisdiction in the event of cross-border disputes, the same issue which led to the Rapporteur's first draft report being rejected in March. Political groups will meet with the Rapporteur in early July to try and agree compromise amendments. The Committee and plenary votes will take place in September. Draft report available on request.

1.3 VAT - Commission tables proposal to amend EU
Directive to take account of electronic deliveries

The European Commission has published its proposal to adapt EU rules on VAT to deal with e-commerce. The proposal introduces a new category of "electronic services" which include electronically delivered music, publishing, broadcasting and software. As a general rule, VAT will be levied in the country of consumption. The main exception will apply to sales to private individuals when VAT will be levied in the EU country where the seller is established. Sellers established outside the EU will be obliged to register for VAT in at least one EU country when selling to private individuals and annual sales exceed a fixed threshold. The Council of Ministers must adopt the proposal by unanimity after consulting the European Parliament. Text available at: http://europea.eu.int/comm/taxation_customs/proposals/taxation/tax_prop.htm

1.4 Communications Review - legislative proposals delayed
The European Commission failed to table the five legislative proposals necessary to implement the Communications Review before its own deadline of 28 June. Disagreements between the Commission's services persist, mainly on the question of access and interconnection. On data protection too, there is disagreement between Commissioners on whether to operate an opt-in or an opt-out system for unsolicited emails. The Commission hopes to adopt the proposals before the Summer recess. Further details available on request.

1.5 Consumer protection - US industry grouping presents draft guidelines
A group of seven US companies (AOL, AT&T;, Dell, IBM, Microsoft, Network Solutions Inc. & Time Warner) presented jointly agreed guidelines on consumer protection to a workshop hosted by the Federal Trade Commission on alternative dispute resolution (ADR). The group, The Electronic Commerce and Consumer Protection Group, hopes that its draft text will promote a global debate on key issues, such as applicable law. The guidelines contain minimum provisions on customer information and service, privacy and encourage sellers to associate with an ADR system. Further information available at: http://www.ecommercegroup.org

1.6 On-line data protection
- EU standardisation committee moves ahead with feasibility study

The EU standardisation committee, CEN, is moving ahead with its assessment on the feasibility of EU-wide standards on the handling and processing of personal data on-line. The process was begun around 2 years ago but in spite of strong objections from industry, CEN is obliged by a mandate from Member States to complete its assessment. This initiative is being supported by the European Commission. Commissioner Liikanen in particular sees the protection of personal data as key to the take up of new technologies among EU consumers. The feasibility study is due to completed this Summer. Further details available on request.

1.7 Spectrum allocation - EU Member States take mixed approaches
The controversy which followed the UK's auction of spectrum for third generation mobile networks has put the spotlight on the allocation methods chosen by other EU Member States. So far, Germany, The Netherlands and possibly Belgium have chosen to follow the UK and hold an auction. France will allocate new frequencies in June 2001 according to a 'beauty content' as will Portugal. In reaction to criticism of auctions, Competition Commissioner Monti has made it clear that auctions are compatible with EU competition rules as long as they are fair, non-discriminatory and objective. However, he also makes it clear that the Commission will not accept the high prices paid as justifying more concentration in the market.

1.8 Distance selling - EU Directive enters in to force
The EU Directive on consumer protection in distance contracts passed its implementation date on 7 June. The Directive sets minimum standards for consumer information and service, as well as establishing key rights such as a right to withdrawal from a contract and to redress. The provisions of this Directive apply both on- and off-line. Further details available on request.

1.9 French Presidency to host IST 2000 conference
The French Presidency is to host this year's conference on Information Society Technologies (IST) in Nice, 6-8 November. The IST programme is a Commission-funded initiative which supports the development of new technologies in the field of the internet, telecoms and related areas. This year's conference will feature sessions on cybercrime, internet regulation and internet media and entertainment. Further information available at: http://istevent.cec.eu.int

1.10 Protection of minors - US law challenges in the courts
Opponents of the US Childrens' On-line Privacy Protection Act (COPPA) have been successful in the latest stage of their legal challenge. The US appeals court upheld a state judgement that the Act was not compatible with the First Amendment of the US constitution, nor with the concepts of instant access and global reach which are inherent in the internet. The US Justice Department is considering its next move.

1.11 French MP recommends co-regulation to Prime Minister
French MP Christian Paul has submitted a report to Lionel Jospin recommending the creation of an internet law forum which would bring together national officials, stakeholder groups and the private sector. Paul proposes that this independent forum could develop in to a co-regulatory body which would adopt effective and broadly accepted regulatory measures for the internet. Further details available on: http://www.internet.gouv.fr/francais/textesref/pagsi2/lsi/rapportcpaul/sommaire.htm


2 Internet (content) regulation

2.1 Protection of minors - Commission publishes study on filtering & rating
The European Commission has published two studies carried out within the framework of the EU Action Plan Promoting the Safe Use of the Internet. A study on filtering concludes that parents would like more information than is provided by existing self-labelling systems and recommends that they are supplemented with third party rating and new content descriptors. A study on third-party rating concluded that most systems are still in their infancy and will require considerable additional work to make them marketable. Texts available at: http://www.ispo.cec.be/iap

2.2 Safe use of the internet - Commission publishes calls for tender
The European Commission has published a call for proposals under the first phase of the Action Plan Promoting the Safe Use of the Internet. The call invites proposals to disseminate information about the action plan and its projects and will last one year. This is in addition to existing projects which are examining how to improve awareness among internet users, establish a network of hotlines to report illegal content and operational aspects of self-rating and filtering. Details available at: http://www.ispo.cec.be/iap/iapexch.htm


3 Copyright

3.1 Council of Ministers reaches agreement on draft Directive
The Council of Ministers has reached a political agreement on the draft Directive on copyright after over a year of discussions. The agreement gives a limited exception from copyright for temporary copies of works on condition that the intermediary does not "modify the information" or "interfere with the lawful use of technology", although it explicitly allows browsing and certain acts of caching. Member States may introduce measures to oblige rightholders to facilitate access to their works for beneficiaries of exemptions but rightholders will be allowed a certain period in which to negotiate voluntary agreements. The text will be formally adopted as a common position in July or September and then be forwarded to the European Parliament for its second reading. Text available on request.

3.2 Consumer lobby reacts strongly against political agreement
The European consumer lobby, BEUC, has made a public statement criticising the political agreement on copyright (see above) for violating "consumer freedom" and "fundamental rights". BEUC claims that rightsholders would have a "blank cheque" to control access, with governments only having a "supervisory power". The statement also urges the European Parliament to be more discerning in its second reading and not the "fall under the same spell of the all singing all dancing content industry lobby as was the case in the first reading". Statement available at: http://www.beuc.org

3.3 On-line copyright clearance systems to be launched in Europe
A new on-line copyright clearance system called "Info2Clear" will be launched in Brussels in September. The system will enable rightsholders to label their content before it is put on-line and track any infringements. Conditions attached to the use of a work will enable on-line clearance of copyright for users. It is hopes that Info2Clear will recover up to _18m revenue for rightsholders.

3.4 Trademarks - Commissioner Bolkestein publishes communiquŽ on exhaustion
Internal Market Commissioner, Frits Bolkestein, has published a communiquŽ on trademarks in order to end years of disagreement between Member States and the Commission over whether to introduce international exhaustion. The communiquŽ reiterates the Commission's opposition to international exhaustion in spite of heavy lobbying from consumer groups and the fact that eight EU Member States support this change. The Commission maintains that this approach would bring limited benefits to consumers in terms of price reductions and would stifle innovation. Bolkestein is clear that the Commission will not bring forward any proposal to change the current regime. Full details available at: http://europa.eu.int/comm/internal_market/comm/intprop/indprop/index.htm

3.5 Domain names - public consultation planned for new domains
The International Corporation for Assigned Names and Numbers, ICANN, has launched a public consultation on the creation of new top level domains (TLDs) for the internet. The proposal sets out a timetable for the creation of 6-10 new TLDs and suggestions on how to manage the intellectual property aspects of the process. This public consultation ends on 10 July. The rightholders' community is carrying out its own consultation on the IP aspects, with a view to minimising the risks of 'cybersquatting'. Further details available at: http://www.icann.org


4 Advertising

4.1 Tobacco advertising - Advocate General recommends annulment of EU Directive
Advocate General Fennelly of the European Court of Justice (ECJ) has recommended to the Court that it annuls the EU Directive which bans tobacco advertising on the grounds that the measures cannot be said to contribute towards the completion of the single market. Fennelly also concluded that the ban on the advertising of goods sharing a brand name with a tobacco product was disproportionate. In addition, he felt that the ban was an unjustified restriction on the freedom of commercial expression. The final judgement of the full ECJ is expected in September. Opinion and summary available on request.

4.2 Commercial Communications Expert Group close to adopting second opinion
The Commercial Communications Expert Group is expected to adopt its second opinion on 4 July after over a year of discussions on promotions and free gifts. There is now a majority in favour of mutual recognition, partly in reaction to the establishment of the country of origin principle for commercial communications in the electronic commerce Directive. However, there is also increasing support for specific legislative measures in certain areas such as advertising to children, and the advertising of alcohol and cars.

4.3 European Parliament group discusses consumer aspects of promotions regulation
The European Parliament's Commercial Communications Group held its third meeting on 27 June with a consumer-orientated theme. Presentations were heard from Mannesmann D2, McDonalds and the Dutch Ministry of Economic Affairs in support of mutual recognition and the removal of restrictive national measures on promotions. There is strong support among consumer groups and members of the European Parliament to remove national restrictions and provide for mutual recognition so that companies can promote their goods and services across the EU. Full report available on request. Presentations available at: http://www.epccg.org

4.4 Loi Evin - Commissioner Bolkestein secures concessions from French government
Commissioner Fritz Bolkestein has held talks with the French Minister of Culture and Communications, Catherine Tasca, with a view to resolving the long-standing dispute involving the so-called Loi Evin which bans the advertising of alcohol on TV and in the print media. The Commission is understood to have secured an undertaking from the French government that it will revise the law so that its extraterritorial effects are minimised and that its scope is clearer to advertisers operating within France. The government has also promised to consult with European level organisations and companies on its proposed changes. These bilateral talks are expected to continue. The Commission's infringement case remains open, albeit 'on hold' for the time being.

4.5 Tobacco products
- Council of Ministersreaches political agreement on new labelling rules

The Health Council has reached a provisional agreement on stricter EU regulations for the labelling of tobacco products. Tobacco products must carry a health warning covering at least 15% of the packaging and a list of all additives. The Council's position will be formally adopted at a later meeting of the Council. The European Parliament had earlier voted in favour of stronger measures but was overruled by Council. An attempt by MEPs to change the legal base failed at the plenary vote.

4.6 Tobacco advertising
- health and consumer protection Commissioner publishes statement

Health and Consumer Protection Commissioner, David Byrne, has published a statement in support of the recent agreement in the Council of Ministers on the proposal to tighten tobacco labelling regulations (see above). In his statement, Commissioner Byrne stresses that tobacco products "must be regulated through a responsible manufacturing and marketing policy" and that "misleading claims" should be prohibited. Statement available at: http://europa.eu.int/comm/dg24/library/press/press62_en.html

4.7 Internet advertising - FAST promotes guidelines and attracts new members
FAT Europe, the creators of on-line advertising guidelines, used the occasion of the European internet advertising conference in Cannes to promote its guidelines for on-line advertising and seek new members. The guidelines cover technical specifications for on-line adverts, audience measurement methods and advertising targeting techniques. Further details available at: http://www.fasteurope.org

4.8 Commissioner Bolkestein rules out compulsory advertising filters
Commissioner Frits Bolkestein has voiced his opposition to a call from a member of the European Parliament that all televisions be fitted with devises capable of filtering advertising from broadcasts. In response to a written question from Nelly Maes (B, V/ALE), the Commissioner recognised that this technology would appeal to certain viewers but there was no need to make them mandatory and that they could be sold commercially to those who wanted them. He also said that targeted advertising services should be offered as a premium, rather than a mandatory, services. Full question and answer available on request.


5 Audiovisual and general media policy

5.1 MEDIA Plus - European Parliament Committee supports more funding
The European Parliament's Culture Committee has voted in favour of increasing the budget for the next phase of the MEDIA programme by _80m. The Committee's report also makes clear that the programme should be seen more as part of cultural rather than industrial policy, and calls on Member States to ensure that European cultural diversity continues to be protected in the WTO. The Parliament's plenary session will vote on the Committee's recommendation on 4 July. Further details available on request.

5.2 Council of Europe - Ministerial conference recommends new action in media regulation
The latest Ministerial conference of the Council of Europe adopted a declaration on the future media policy. The declaration calls on the Mass Media Committee to promote public service broadcasting in countries where it is poorly developed and to examine the impact of new technologies on media concentration and the "diversity of sources of information". Other issues which feature in the work programme include, a review of existing legislation, action against harmful content and the improvement of media education (see below). Publishing organisations spoke out against regulation of papers on-line when they are not regulated off-line, and against policies on cultural diversity which could have a protectionist effect. Full declaration available at: http://www.humanrights.coe.int/media/activities/minconf/declaration%20(A).htm

5.3 Digital TV - Parliament calls for mixed approach
The European Parliament plenary session adopted its final opinion on the Commission Communication on digital TV. The opinion supported the Commission's proposal to rely more heavily on competition policy to regulate the EU market but recommended that it take in to full account the various stages of development in each Member State and the fact that the EU should encourage actors to grow to a size where they can compete globally, particularly with companies from North America. Parliament also called for "must carry" rules to be extended to new platforms and called on the Commission to examine barriers to free movement of services called by the territorial sale of broadcasting rights. Final opinion available on request.

5.4 Financial transparency - intense lobbying before adoption of new Directive
Commercial broadcasters have undertaken some intense lobbying of the European Commission ahead of its anticipated adoption of the Directive on the transparency of financial transfers between Member States and public undertakings on 12 July. Many broadcasters remain concerned that the Directive may create a loophole for dual funded public service broadcasters.

5.5 Media education - Council of Europe calls for Europe-wide action
The Parliamentary Assembly of the Council of Europe has adopted a report on media education. This report followed a joint hearing with the European Parliament's Culture Committee in March on what could be done on a European level to improve awareness of new media among the young, teachers and those learning about new technologies. The report calls for closer cooperation between teachers, parent groups and media professionals to educate individuals to be discerning about the media services they consume and to combat social exclusion from new technologies. Full report available on request.

5.6 Conditional access - Council of Europe committee approves draft Convention
The Mass Media Committee of the Council of Europe has approved the draft Convention on conditional access services. The Convention will be formally adopted by the Committee of Ministers after the Summer and opened for signature in early November. The Convention covers many aspects of the EU Directive on conditional access which was adopted in 1998. EU Member States should have complied with this Directive by end-May 2000. Draft Convention available on request.

5.7 Commissioner Reding calls on industry to adapt to new technologies
Speaking at the annual conference of the World Association on Newspapers, Commissioner Viviane Reding emphasised current EU policy which aims to encourage the take up of new technologies for content production and to combat social exclusion. In particular, she pointed to the next phase of the MEDIA which will include pilot projects using new technologies and to the eEurope action plan. She also recognised the importance of television as a medium for "the transmission of cultural values and identities" and the important role of public service broadcasting. However, she urged public service broadcasters to "change and adapt" and she reiterated the Commission's position that their funding must be compatible with EU competition rules. Speech available on request.


6 General

6.1 Services - Commission launches consultation on barriers to free movement
The European Commission has published a questionnaire aimed at identifying remaining barriers to cross-border trade and the cost of these barriers to businesses. The results of the survey will be used by the Commission to draft a Communication for publication in the Autumn. Member States called for a full evaluation to be carried out in the conclusions of the Lisbon Summit. Questionnaire available on request.

6.2 Data protection
- European Parliament committee gives only conditional approval of 'safe harbor' agreement

The European Parliament's Committee on Citizens' Freedoms has approved the EU-US 'safe harbor' agreement on the protection of EU data exports but only on condition that key parts of the text are amended. The Committee calls for data subjects to be given an automatic right of appeal to an independent body, a right to compensation for any infringements of the agreement and a right to have incorrect or illegal data cancelled. The plenary session is expected to uphold the Committee's view but the Parliament's opinion is not binding and the Council is expected to approve the deal before the Summer. The Commission is obliged to review the agreement in mid-2001. Further details available on request.

6.3 EU reform - Feira Summit sets framework for reform
The summit meeting of the European Council in Feira, Portugal, adopted conclusions marking the way forward for the institutional and Treaty reforms which will continue under the French Presidency during the second half of this year. The conclusions called for an agreement on institutional and Treaty reform by end-2000 and for the draft Charter on Fundamental Rights to be presented to the Biarritz Summit in October. Member States also called for concerted action to complete the single market in key areas, particularly financial services and the information society. They also endorsed the eEurope action plan proposed by the Commission. Full text of conclusions available on request.

6.4 Postal services - Parliament committee remains hostile to liberalisation proposal
Member of the European Parliament's Committee on Regional Affairs and Transport reacted with hostility to Commission Bolkestein as he presented his proposal for the next phase of postal liberalisation. The majority of members feared that the Commission had not fully assessed the impact of its proposal on employment and rural development, and feared that commercial operators would pick off only the most profitable services and leave national operators to struggle with loss-making services. Only a handful of MEPs spoke out in support of a gradual and managed process of reform which aims to stimulate competition, reduce prices and improve service. The European Parliament will begin its first reading in July.

6.5 Company law - Council of Ministers adopts common position on take-overs Directive
The Council of Ministers has finally adopted its much-delayed common position on the draft Directive governing take-over bids. The Council's work had been delayed by continuing disagreements between Spain and the UK over how the Directive would be implemented in Gibraltar. These have been resolved and the text will now be transmitted to the European Parliament for its second reading in the Autumn. Further details available on request.

6.6 Merger Regulation - Commission begins consultation on reform
The European Commission has published a discussion document outlining areas where it feels the current merger Directive can be made more effective. Shortcomings with existing measures were identified by a latest report on the functioning of the Regulation which noted that many mergers with cross-border effects fall outside its scope. The Commission is seeking the active participation of companies and EU level associations. The consultation will examine in particular amendments introduced in 1997, the impact of future EU enlargements and the cost of EU rules. Document available at: http://europa.eu.int/comm/dg04/lawmerg/merger.htm

6.7 Commission proposes to update EU rules on accounting standards
The European Commission has published a Communication outlining its proposal to phase in new rules on accounting methods by 2005. The intention is to make accounts easily comparable across borders by aligning them with International Accounting Standards Committee norms. The Communication is subject to a public consultation. A draft Directive is expected before end-2000. Proposals to revise other EU accounting Directives are also expected before end-2001. Further information available at: http://europa.eu.int/comm/internal_market/company/account/news/strategy.htm

6.8 Fundamental rights - drafting body considers amendments
The body responsible for drafting the EU Charter of Fundamental Rights has begun considering the 600 amendments tabled to the first 30 articles of the draft Charter. The amendments include one to the daft article on the freedom of expression which would add: "the freedom of the press and information shall be guaranteed with due respect for transparency and pluralism". It is hoped that the amendments can be approved by consensus. A first draft is due to be presented to the Biarritz European Council meeting in October. Further details available on request.

6.9 European Parliament votes to shorten its plenary sessions in Strasbourg
The European Parliament has voted to limit the length of plenary sessions in Strasbourg to 4 days in 2001 by not sitting on Fridays. The Parliament is legally bound by the Treaty to hold 12 sessions a year in Strasbourg. All previous attempts to reduce the number of sessions to less than 12 have been successfully challenged by the French government. However, there are no detailed rules on how many days the session should last and it remains unclear whether France will challenge this decision as well. Dates available on request.