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 EPC Members' Newsletter: November 2002

 
EPC MEMBERS’ NOVEMBER NEWSLETTER 116



DATES FOR YOUR DIARY

KEY ISSUES OF THE MONTH
Tobacco Advertising Directive
Market Abuse
Media Pluralism Resolution

ALERT SECTION
Ecommerce Directive Implementation
Database Directive Consultation
GATS on Publishing and Audiovisual Issues

WHAT’S NEW
Electronic Commerce

1.1 Data protection
1.2 Cross-border shopping
1.3 Consumer credit
1.4 Consumer complaints database


Internet Regulation
2.1 Access to environmental information
2.2 Freedom of expression symposium
2.3 Council of Europe media, terrorism and anti-terrorism conference

Copyright
3.1 Digital rights management
3.2 Rightswatch meeting on notice and takedown
3.3 Copyright study

Advertising
4.1 Green Paper on consumer protection
4.2 UK government education initiative

Audiovisual & General Media Policy 
5.1 Results of the latest Culture Council
5.2 TVWF Communication

General
6.1 Lamfalussy extended to banking and insurance sectors
6.2 Corporate social responsibility
6.3 Internal market progress report

UPCOMING EVENTS


DATES FOR YOUR DIARY

December 2-3rd Employment and Social Affairs Council
December 2-3rd Tobacco Advertising Discussion at Health Council of Ministers
December 3rd CEN DRM group meeting, Brussels
December 4th EASA working group on new media
December5-6th Telecoms Council
December 12-13th European Council, Copenhagen
January 7th Rome II hearing, Brussels
 

KEY ISSUES OF THE MONTH

Tobacco Advertising Directive

The directive on Advertising and Sponsorship by Tobacco came to the Parliament plenary session for its first reading this month. The debate on Monday night was heated with statements supporting the EPC position coming from Mr Lechner and Mr Koukiadis amongst many. EPC sent a briefing to all members prior to the group meetings and the debate, reminding MEPs of the minimal cross-border effect of advertising in the printed press.

After the Legal Affairs Committee voted last month to support several amendments removing the press from the scope of the directive, there was confidence that the plenary vote would bring about the same result. However, this was not the case and all of the amendments made by the Legal Affairs Committee were rejected by the Parliament except for two which related to minor issues. David Byrne, the Commissioner for Public Health and Consumer Affairs was very pleased with the result and when questioned by journalists, stated that advertising revenue lost by the ban would be easy to recoup in other areas. He was very confident that the draft directive will not go to second reading and will pass directly to law after the next Health Council meeting.

EPC does not share his view. The latest intelligence we have received is that COREPER (the Committee of Permanent Representatives from Member States) does not think this directive can proceed directly to law without a second reading. Therefore EPC is in a position to continue its lobbying campaign when the directive returns to Parliament for further review.

For more information on this subject please contact the EPC.


Market Abuse

The EPC has submitted a letter to CESR highlighting the role self-regulation plays in the financial press and using the comments by Commissioners and other officials to define exactly what a recommendation (to buy, sell or hold shares) actually entails.

CESR has now published a feedback statement on all the submissions it has received. The areas relating to the press read as follows:

A number of comments were received by CESR from journalists and the media on the scope of CESR's advice and how it would or should apply to them. In particular, they made it clear that they considered some of the rules being proposed by CESR in its first consultation to be inappropriate for their profession, on the grounds that self-regulatory standards covering much of the same ground are already in existence.

CESR has attempted to address these concerns in two ways. Firstly, the new definition of "other information" makes it clear that CESR's requirements will only apply to those journalists producing information which "expressly recommend[s] that a person should buy, sell or hold a financial instrument".

The second measure being proposed by CESR for that sub-section of the media which does find itself within the scope of the requirements, is an explicit carve-out from CESR's detailed requirements relating to fair presentation, if an equivalent self-regulatory code is already in existence. As far as CESR's requirements relating to disclosure of conflicts of interest is concerned, the relevant sub-section of the media will be required to ensure that any conflicts of interest are appropriately disclosed. Where the journalist has significant holdings in the financial instrument about which he writes, he will be required to disclose this fact publicly.

EPC now awaits CESR’s further reaction to the consultation. A copy of the letter and the entire set of responses from stakeholders is available on request.

Meanwhile the EPC has heard back from the European Commission on the role of CESR. In their letter the Commission states that the role of CESR is only “advisory” and that the Commission will take the final decision on the text. EPC will be submitting our concerns on CESR’s advice on third party reporting (as above).


Media Pluralism Resolution

This month has seen several conferences, Parliamentary Questions and debates on media pluralism in the European Parliament. The conferences looked at Media, Power and Democracy, TVWF and the role of the media in the applicant countries.

MEPs are very much of the opinion that there is a lack of cultural diversity in Europe’s media. This opinion, several members of the PSE and Green political groups produced wording for a Parliament resolution on media pluralism. This was debated in Parliament this month. Prior to the debate, EPC sent out a briefing to all MEPs giving its long-standing opposition to a media ownership directive.

At the debate, many MEPs spoke of the need for legislation in this area and urged the Commission to develop new laws which will ensure cultural diversity. The Commission replied that it does not actually have competence to act in this area and that it does not have any plans to produce legislation which will ensure media pluralism.

Nevertheless, Parliament produced a resolution asking for the Commission to safeguard media pluralism; launch a consultation to assess the effect new media has on the market; write an updated Green Paper on the subject by the end of 2003; examine the possibility for new legislation in this area and push for the new European Convention to have an article which would emphasise the importance of media pluralism.

So far the Commission has not responded to the resolution. A copy of the resolution and the debate in Parliament are available on request.

ALERT SECTION

Ecommerce Directive Implementation

The Commission has asked the EPC to provide it with examples of difficulties encountered by members due to the way the ecommerce has (or has not) been implemented in their member state. Any contributions would help the Commission plan any revisions it might plan to make, although Margot Frohlinger has ruled out the possibility of changes in the near future.

GATS on Publishing and Audiovisual Issues

A hearing took place this month to discuss the applications from 3rd states received by the EU for relaxation of trade restrictions. Applications have been received in the areas of publishing and audiovisual issues. The Commission is asking for comment by interested parties. The list of 3rd countries who have made applications and the specific applications presented can be obtained on request from EPC.

 

WHAT’S NEW

Electronic Commerce

1.1 Data protection

Eurochambres, the Association of European Chambers of Commerce, has released a press statement demanding that the data protection directive be revised. Eurochambres cites lack of implementation in some member states, lack of harmonization in key areas such as notification and the lack of transparency of the Article 29 group as reasons to change the existing directive.

Eurochambres calls for more consultation of business stakeholders and member state support of self-regulation in order to make the implementation of the directive more successful.

1.2 Cross-border shopping

The Commission released the results of two studies into attitudes to cross-border shopping this month. One study focused on B2C shopping and the other on B2B.

Of those surveyed, only 13% had made a cross-border purchase in the last year and 55% had not seen or heard cross border advertising in the same period. Cross border sales for companies interviewed made up a very small percentage of their turnover.

The Commission is using this survey to gather data to support it’s work on the need for harmonization of rules relating to consumer protection throughout Europe. Citing the results, health and consumer commissioner David Byrne said “Encouragingly, the potential for cross-border shopping to take-off does appear to be there, both on the part of business and consumers. There seems to be a real appetite among small and medium-sized enterprises, who are currently deterred by the maze of laws in operation”.

1.3 Consumer credit

The Commission has released a ‘questions and answers’ paper on the issue of consumer credit, which was discussed this month in Council for the first time. Most relevant for the EPC was the issue of databases. The question was asked “Cross-border information from databases is regulated in the consumer credit directive. Is the Commission considering regulating the data bases itself?” The Commission’s position on this is “Databases are already supervised by national law based on the data protection directive. The Commission does not plan to propose additional rules.
The directive will not regulate the modus operandi of databases. The idea is to have "mutual recognition" of these modes of operation. EPC will continue to follow this issue closely.

1.4 Consumer complaints database

A meeting in Denmark, organized by the Council Presidency and involving Europe’s consumer organizations, business and government officials has decided to co-ordinate information on consumer statistics in the Member States and to create a network of consumer organizations across Europe. The Danish Minister for Business and Economic affairs said, “Good conditions for consumers improve competition and promote economic growth. However, the needs of consumers change, and so do market conditions. Therefore, the Danish EU Presidency considers this conference to be an important step towards a targeted consumer policy.”

The Commission also supported the creation of a database, claiming that this would help the analysis of both hard and soft consumer data. The idea will be discussed at the next health Council on 2nd and 3rd December.


Internet Regulation

2.1 Access to environmental information

The European Parliament and the Environment Council have reached agreement on a directive which gives the public increased access to environmental information held by public authorities in the EU. This leads the EU closer to ratification of the Aarhus agreement which gives the public the right to consultation on environmental issues. Most of the information will be disseminated via the internet. Final agreement on the proposal should take place in the new year.

2.2 Freedom of expression symposium

Freedom of expression on the internet was the subject of an international symposium held as part of the preparation for the World Summit on the Information Society (WSIS) that will take place in Geneva and Tunis in 2003 and 2005 respectively. The symposium, which took place in Paris, discussed the opportunities and obstacles to be overcome in cyberspace and whether definition of standards was necessary. The conclusions of the meeting will be available soon. Papers which formed the base of the discussion are now available on the UNESCO website at www.unesco.org.

2.3 Council of Europe media, terrorism and anti-terrorism conference

The Council of Europe held a conference this month on the media, terrorism and anti-terrorism measures. The conference looked at how terrorism was reported and was given examples of this by someone from the BBC and the Algerian state broadcaster. In a later session government representatives from Spain and Russia gave their perspective on the same subject. In the afternoon a session looking at how to reconcile freedom of expression with the fight against terrorism took place. The programme and speaking notes can be found on the Council of Europe website at www.coe.int.


Copyright

3.1 Digital rights management

EPC attended a Commission-sponsored seminar this month on the issue of digital rights management systems and how they can help combat piracy whilst ensuring successful take-up of broadband. Presentations were made by representatives of the publishing industry, the film industry and the music industry.

It was suggested that a series of interoperable DRMs be developed which would also include a watermark so that analogous hardware could detect if a copy was being made and prevent it.

Demonstrations were given of websites with DRM technology already used by music companies to sell streamed and downloaded music. It would seem that the music industry is the furthest ahead with its use of DRM technology. As well as the sites introduced at the meeting, EMI has launched a website to sell its music content but combat piracy of its work.

Unfortunately, the only conclusion the participants were able to agree on was that the public needs to be better educated in the benefits of DRM and copyright awareness. A full report of the meeting is available on request.

3.2 Rightswatch meeting on notice and takedown

EPC attended a meeting on notice and takedown. The Rightswatch Forum is a group of rightsholders, ISPs, content providers and users who have come together, sponsored by the Commission, to try to develop guidelines on the issue of notice and takedown. Three working groups representing the North of Europe, South of Europe and UK had met to consider what procedures would be the most efficient and fair.

The suggested options gave suggestion for fast track procedures for takedown, formats for the submission of complaints by the rightsholder, prior notice to the content provider requirements and whether there was any necessity for legislative underpinning to protect ISPs in the event of a law suit by a content provider.

Once again, the debate was heated, which was to be expected given the disparate groups represented. No conclusions were arrived at, although EPC has received a questionnaire to complete on some of the more contentious issues with a view to reaching consensus. A copy of the full report is available on request.

3.3 Copyright study

The Commission has awarded a contract to present a study on “The contribution of copyright and related rights to the European economy”. The award has been made to a Finnish organization which should produce the study before the end of 2003. EPC will follow progress closely and ensure that members receive the results as soon as possible.


Advertising

4.1 Green Paper on consumer protection

The Environment Committee of the Parliament voted on the report by Mrs Patrie on the Commission’s follow-up to the Green Paper on Consumer Protection. This has caused much controversy in the Parliament because the Environment Committee is forging ahead with its work despite the fact that the Legal Affairs Committee has not yet produced a report. The Patrie report including the amendments adopted has several areas which the EPC disagrees with. These include a general disinclination to accept that self-regulatory codes are the best way to ensure a high level of consumer protection and a request that the Commission investigate all other means available first; the postponement of the sales promotion regulation until legislation is developed in this area and the approach to consumer detriment cases on an individual basis rather than using the definitions already established through the ECJ.

The Committee is proposing to take the report to plenary but the Legal Affairs Committee is not willing to allow this. The Rapporteur for Legal Affairs, Mrs Thyssen will present her report for the first time at the beginning of December.

4.2 UK government education initiative

The UK government has launched a campaign called media smart this month. The project is back by a wide range of broadcasters, advertisers and trade associations. It was developed by the National Confederation of Parent-Teacher Associations and will be sent out to primary schools shortly.

The programme is targeted at younger children in order to make them more media literate and less vulnerable to unscrupulous advertisers. In launching the programme Tessa Jowell, the Education Secretary focused on the need for responsible behaviour through self-regulation. She highlighted the project as an example of this responsible behaviour. Interestingly she contradicted many UK MPs who have been calling for a ban on advertising to children by stating that less advertising would have a negative effect on the quality of children’s television.


Audiovisual & General Media Policy

5.1 Results of the latest Culture Council

Discussions at this month’s Culture Council revolved around the free movement of cultural works and the content of interactive material. A resolution was adopted on the content of interactive material which invited the Commission and Member States to collect information and experiences on interactive content and implement good practice in the matter and to see how interactive content can be used to promote and disseminate cultural and linguistic diversity in Europe.

Agreement was also reached in Council to discuss a possible in-depth review of the directive on television without frontiers. During the debate, British, Austrian, Portuguese and Italian delegations were in favour of self-regulation. Spain preferred co-regulation. Portugal felt that there was a need to introduce public services into the discussions on the review of the directive but Spain opposed this position. The Netherlands emphasised the need to consult with the audiovisual sector. France, Finland and Germany were more concerned with market liberalisation and barely mentioned the question of cultural diversity. Talking after the meeting, Commissioner Reding welcomed the discussions and looked forward to the review being an important part of the Greek and Italian Presidencies’ work.

5.2 TVWF Communication

The Commission adopted a report this month, which reviews article 4 and 5 of the TVWF Directive. Articles 4 and 5 of the Directive were included to encourage broadcasters to show more European programmes and more works by independent producers. According to the communication, broadcasters are already meeting the targets set by the Commission and there has been a marked increase in the number of programmes shown by independent producers across Europe. Vivien Reding, the Commissioner for Education and culture commented that, "the report shows that there is a positive and dynamic trend in television broadcasting of European works".


General

6.1 Lamfalussy extended to banking and insurance sectors

The President of the Parliament’s Economic and Monetary Affairs Committee has voiced her concern at the Council decision to extend the Lamfalussy process (which the Market Abuse Directive will be the first to pass through) to the banking and insurance sectors. In a press release she stated, “I fail to understand why the Council wishes to proceed so rapidly with this. To my mind, there is absolutely no reason for such urgency. On the contrary, we have not yet had any practical experience of the Lamfalussy process, and I feel that it would be premature to rush ahead and already extend it beyond its original scope before we know if, and how, it works".

Members of the European Parliament have already expressed concern that this method might not be as democratic as it could be. The main problem comes after the Directive has passed through Parliament and Council and is at the secondary legislation stage. Many MEPs believe that the Parliament will not be able to control the activities of the Commission and groups like CESR who will develop these rules.

In a resolution adopted this week the Parliament has asked for a ‘call-back’ option to be introduced into the procedure. This would give it the right to review implementing measures it felt went against the spirit of the original directive.

6.2 Corporate social responsibility

Following the release of its follow-up paper on CSR, the Commission has set up a European multi-stakeholder forum which will sit for the first time early next year. Its mandate is to examine ways of fostering greater awareness about CSR issues and to look at guidelines in the area. The emphasis is very much on a voluntary approach for business.

In the initial debates on the Green Paper a large body of opinion had called for mandatory social and environmental reporting, which was not proposed by the Commission in its follow-up paper. The Employment Committee of the Parliament is now preparing a report on the follow-up Communication which will be discussed in Committee in the New Year.

6.3 Internal market progress report

The Danish Presidency released a statement on progress made in the integration of the internal market after the first meeting of the new Competitiveness Council this month.

In his statement the minister said “It is 15 years since the idea of an internal market was put on the agenda. It is nearly ten years since the internal market got under way. The internal market is one of the most ambitious targets ever set in the EU's history. In those sectors where we have achieved our aim, the advantages for European consumers and companies have been enormous. The internal market has resulted in more and better products at lower prices, free movement across borders and, not least, enhanced competitiveness. At the same time we can see that, unfortunately, there are still many difficult questions which must be answered before we have a complete internal market.”
MEP Malcom Harbour for the Legal Affairs Committee of the European Parliament has also prepared a report on the progress made in the internal market. The main conclusion of his report is that there must be more effort made to encourage member states to implement decisions already taken and a more flexible approach to bringing this about.

UPCOMING EVENTS

December 3rd European Leadership Forum. Paris

December 3rd ETNO Conference on Broadband. Brussels

December 3-5th Streaming Media and Content Management. London

January 7th – Commission hearing on Rome II, Brussels

February 6th 2ns SMS Meets TV Seminar. Lisbon

12th –13th May 2003 – EPC Meeting, Athens

15-16th May 2003 5th Annual TV Meets the Web Seminar. Amsterdam

 
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