Legislative up-date 69. Month : May - June 1998

TABLE OF CONTENTS

1.0 ELECTRONIC COMMERCE
1.1 Commission and industry - discussion of global communications
1.2 Commission - proposed directive in the pipeline on electronic commerce
1.3 Council - agreement on conditional access directive
1.4 Parliament - discussion of globalisation and the information society
1.5 Parliament - adoption of Report on digital signatures and encryption
1.6 Commission - adoption of Communication on electronic commerce and indirect taxation

2.0 CONVERGENCE
2.1 Commission and Parliament - status of Convergence debate

3.0 INTERNET [CONTENT] REGULATION
3.1 Council - agreement finally reached on protection of minors
3.2 Council - agreement on safe use of the Internet

4.0 COPYRIGHT
4.1 Council - Working Group makes slow progress on the proposal
4.2 Parliament - Legal Affairs Committee to hold ‘hearing’ on copyright
4.3 Parliament - discussion of copyright proposal commences

5.0 MEDIA OWNERSHIP
5.1 Council of Europe - drafting commenced of Recommendation on media concentration
5.2 Parliament - MEPs call for directive on media concentration

6.0 ADVERTISING POLICY
6.1 Commission study on advertising to children
6.2 Commission and Member States -Kick-off for the Commercial Communications Expert Group
6.3 Commission request for industry information commercial communications and the internet
6.4 Parliament discussion imminent on commercial communications
6.5 Commission - study to be embarked upon on advertising infringements

7.0 AUDIOVISUAL
7.1 Commission and Member States - Contact Committee meets on broadcasting directive
7.2 Council and Commission - Follow-up to audio-visual conference
7.3 Commission - approval of French state aid for film production
7.4 Commission - tender in MEDIA II programme

8.0 ENVIRONMENT
8.1 Commission and industry - voluntary environmental agreement
8.2 Commission - ban on rechargeable batteries

9.0 GENERAL
9.1 Commission - cultural policy
9.2 Council - failure to gain compromise on worker participation
9.3 Presidency - Year 2000 millennium bug conference
9.4 Austria and Commission - fixed book (dis)agreement!



1.0 ELECTRONIC COMMERCE

1.1 Commission and industry - discussion of global communications
An Industry Round Table took place on the 29 June in Brussels involving around 80 CEOs from industry worldwide, and the Commission. Participants agreed to establish a Global Business Dialogue. A steering group will meet in the Autumn chaired by Thomas Middelhoff of Bertelsmann. EPC Member Nigel Stapleton, who made a presentation on copyright at the meeting will be on the Steering Group. The aim of the 29 June meeting was to discuss obstacles experienced by industry to the development of global communications and new electronic services. Although there was discussion of how the private sector could develop a leading role in the identification of potential policy issues and legal and other barriers which may emerge in the development of global communications and new electronic services, Dr Bangemann did not get the go ahead he wanted for an International Internet Charter. Specific issues such as the following will instead be addressed by the Global Business Dialogue where the emphasis on self-regulation will prevail except in areas such as copyright:-

consumer protection
intellectual property protection
data privacy protection
liability
definition and jurisdiction identification
illegal and harmful content
security and authentication
internet governance and management
taxation and customs duties
right of access

Sub-Committees on new technologies in the Council of Europe are looking into principles of universal service and access and of consumer privacy.

OECD meets in October to discuss international guidelines on electronic commerce and there will be an international conference involving industry on international co-ordination in early March 1999 in Austria, where the discussion will be continued. Also feeding into the debate is the Report from the Council’s Ad-Hoc Group on Electronic Commerce, Globalisation and the Information Society (which was set up by the Telecommunications Council), which discussed many of the issues listed above.

1.2 Commission - proposed directive in the pipeline on electronic commerce
DG XV is in the process of drafting a general directive on electronic commerce, to cover issues such as liability, application of contract law, the exercise of regulated professions etc. The Commission is expected to adopt the proposal in August or in the early Autumn.

1.3 Council - agreement on conditional access directive
The Council has reached political agreement on the proposal for the legal protection of services based on, or consisting of, conditional access. The Official Common Position is expected to be adopted shortly.

1.4 Parliament - discussion of globalisation and the information society
On 3 June EMAC discussed the Commission’s Communication on Globalisation and the Information Society. The Rapporteur, Franco Malerba urges against over-burdensome regulation and in favour of industry taking the lead in finding solutions to the obstacles to electronic commerce. In its Communication states in its Communication the need to identify the most urgent obstacles to the development of the electronic marketplace and to examine methods for strengthened international co-ordination on the global electronic commerce marketplace and involvement of the private as well as the public sectors. An International Charter is proposed, which would recognise the work of existing international organisations, contribute to simplification and transparency of relevant regulations yet remain non-legally binding.

Malerba’s Working Document, which will be turned into his draft Report, states that principles and codes-of-conduct should be defined, so as to minimise abuse and controversy on the Internet. He also emphasises that there must be significant industry involvement in identifying and proposing solutions. He suggests that the Trans-Atlantic Business Forum (TABD) would provide an industry-led environment where issues could be first discussed between the US and the EU. Malerba’s Report is due to be voted on at the committee meeting of 3 September and at an October Plenary Session.

1.5 Parliament - adoption of Report on digital signatures and encryption
The Legal Affairs Committee has adopted a report by Rapporteur Wolfgang Ullmann (Greens, Germany) on the Commission’s Communication ‘Security and trust in electronic communication - towards a framework for digital signatures and encryption’. The Report supports the Commission’s approach but points to the need to refer to the importance to EU citizens of electronic commerce. It also advocates a legal framework for compatibility and trust in digital signatures. Four amendments have been tabled to Ullmann’s report, which are expected to be voted on at the first Plenary Session in July. The amendments refer to the need for the Commission to examine national measures on liability and to propose where necessary EU rules on liability; rules on access to keys should not be introduced; and points to the need to be wary against abuse of communications systems, especially illegitimate surveillance of citizens.

1.6 Commission - adoption of Communication on electronic commerce and VAT
On 17 June, the Commission adopted a Communication on Electronic Commerce and Indirect Taxation. Its objective is to inform the Council of the work that has been done so far by the Commission and the Member States on taxation issues relevant to electronic commerce. The Communication lists a number of principles which the Commission hopes will guide further study of adapting the EU VAT system to meet the needs of electronic commerce and which should form the basis of the EU’s contribution to the forthcoming debate at the OECD Ministerial Conference which will be held at Ottawa in October 1998.

2.0 CONVERGENCE

2.1 Green Paper Status Report

The Commission has completed its consultation on convergence, and the European Parliament has launched its first Committee discussions on the issue. The Social Affairs Committee, advisory Committee to the EMAC Committee which is the lead Committee, has had a brief discussion of the draft Opinion written by Frieder Wolf (Greens, Germany). The lead Committee EMAC discussed the Green Paper and the working document drafted by Rapporteur Reino Paasilinna (PES, Sweden) on 29 June.

3.0 INTERNET [CONTENT] REGULATION

3.1 Council - agreement finally reached on protection of minors

The Culture Council of 28 May agreed on the ‘Recommendation on the development of the European audiovisual and information services industry by promoting national frameworks aimed at achieving a comparable and effective level of protection of minors and human dignity’, which is the first legal instrument for content of on-line audiovisual and information services. The Recommendation involves creating codes of conduct, support for parental control, effective handling of complaints and comprehensive information to users. The self-regulation that the Recommendation proposes is based on three key elements: the involvement of all interested parties (Government, industry, service and access providers, user associations) in the production of codes of conduct; the implementation of codes of conduct by the industry; and the evaluation of measures taken.

3.2 Council - agreement on safe use of the internet
The Council has reached political agreement on the 4 year plan on promoting safe use of the internet. The plan will provide for financial subsidy for projects to create a safe environment; development of filtering and rating systems and industry self-regulation; encouragement of awareness actions to build on the dissemination of information from access providers to customers and development material for use in the education sector; and support measures such as assessment of legal implications. The EP’s Economic and Monetary Affairs Committee and the Culture Committee have each adopted an Opinion on the Commission’s proposal for the lead Civil Liberties Committee.

4.0 COPYRIGHT

4.1 Council - Working Group makes slow progress on the proposal

The Council Working Group has discussed the proposal for a directive on copyright and related rights in the information society. A first ‘reading’ has been completed of the text. The UK Presidency hoped to stimulated discussion of Article 5 (exceptions to restricted acts) and Article 6 (technical measures), but so far Member States have not committed themselves to hard and fast positions. The UK is not convinced of the necessity for Article 5 and several Member States are concerned that national exceptions would no longer be permitted. The next meeting will be in September under the Austrian Presidency.

4.2 Parliament - Legal Affairs Committee to hold ‘hearing’ on copyright
The Legal Affairs Committee is holding a hearing on 30 June in Brussels on ‘The harmonisation of certain aspects of copyright and related rights in the Information Society’. There will be presentations and interventions from several industry organisations. The Legal Affairs Committee is the lead Committee in the EP dealing with the copyright proposal. Roberto Barzanti (PES, Italy) is the Rapporteur, and he will be writing a draft Report following the hearing. The present date for adoption of the Report in the Legal Affairs Committee is early September. The advisory Committees are EMAC (Rapporteur Bryan Cassidy), the Environment Committee (Draftsman Phillip Whitehead) and the Culture Committee (Draftsman Frau Maren Gunther).

4.3 Parliament - discussion commences of copyright directive commences
EMAC has held a preliminary discussion of the Commission’s proposed directive on copyright. Bryan Cassidy (UK, EPP) who is Draftsman for the lead Legal Affairs Committee pointed in particular to issues of liability and private copying. The Commission representative from DG XV stated in Committee that there should be a “new approach” in the digital age but that existing rules should be respected.

5.0 MEDIA OWNERSHIP

5.1 Council of Europe - drafting commenced of Recommendation on media concentration

Although the European Commission has yet to propose any legislation yet on media concentration, work continues and a new draft is expected before the end of the year. Meanwhile, the Council of Europe is writing a Recommendation on media concentration and pluralism. The sub-committee (‘Expert Group on media concentration’) of the Mass Media Committee of Experts’ has discussed a text on media concentration and measures for pluralism. This text will be eventually be adopted by the Committee of Ministers in the form of a Recommendation, which is a non-binding legal instrument

5.2 Parliament - MEPs call for directive on media concentration
During a brief discussion in the Social Affairs Committee of the Commission’s Green Paper on convergence, Frieder Wolf (Greens, Germany) called for a directive on media convergence “in the light of convergence”. He also stated in his Opinion that there should be clear distinction between convergence of content and convergence of transmission ways. He stated that the public broadcasting sector should be strengthened. Carole Tongue MEP has also recently written a press article advocating the protection by regulation of the public service sector.

During a discussion on convergence in the Culture Committee, Roy Perry (UK, EPP) stated that media ownership should be examined by the Commission. Mr Kuhne, the Draftsman for the Culture Committee’s Opinion, stated that media plurality must be guaranteed, possibly by a directive on media ownership.

6.0 ADVERTISING

6.1 Commission and Member States -Kick-off for Commercial Communications Expert Group

A Working Paper on sales promotions was discussed at the first meeting of the Expert Group on Commercial Communications. The next meeting is not until October 1998, when it is expected that the issue of premiums and promotional gifts will be broached.

Sales promotions are defined as ‘offering preferential terms, with regard to quantity or price, for the purchase of a particular product or service’. The paper states that in some sectors, the economic viability of a product/service is dependent on the ability to use discount promotions and that the sales promotions can be of benefit to consumers from the competitive prices. It points out that costs for industry involved in designing different strategies for each Member State, especially for SMEs. The paper also points to the potential of electronic commerce but that at present the risks of legal action in some Member States preclude a company wishing to use a discounting strategy for taking advantage of the Internet. The paper points out that sales promotions can only be restricted by non-discriminatory national rules, which can be justified in the public interest and are only permissible if they are proportional to the general interest objective.

The Commission’s concludes that it is therefore necessary to examine whether national measures on discounts amount to a restriction on the cross-border provisions of goods and services. The Commission asks the following questions to stimulate discussion:-

is the law and its interpretation as set out above and in the annexed table correct and does any further regulation exist which has not been identified?

does the regulation of discounts have an impact upon the cross-border provision of goods and services?

where the use of discounts is regulated, which public interest objective is intended to be protected?

would you enforce your provisions against suppliers from other M-S whose discount promotions are available in your Member State, whether by virtue of the Internet or otherwise?

what is the best means of achieving an Internal Market in the field of the provision of sales promotion services, particularly in the context of discounts?


At a meeting between industry and the Commission, the Commission stated that if there is opposition to the principle of mutual recognition, this must be made public and openly criticised.

6.2 Commission - request for industry information commercial communications and the internet
The Commission has issued two questionnaires for the response of users and suppliers of commercial communications and consumer and other associations representing receivers of commercial communications services, on the issue of legal issues relating to the use of cross-border commercial communications services in the information society. Response is requested by mid-July to DG XV.

6.3 Parliament - discussion imminent on commercial communications
The European Parliament will start to discuss in July the Commission’s Follow-Up Communication to the Green Paper on Commercial Communications. EMAC is the lead Committee, whose Report will be drafted by Jessica Larive MEP (ELDR, NL). The two advisory Committees are Legal Affairs whose Draftsman is Julio Añoveros Trias de Bes (EPP, Spain) and the Culture Committee, who will submit a letter from Peter Pex (EPP, NL) from the Netherlands. The Environment Committee will not produce an Opinion for EMAC.

6.4 Commission - study to be embarked upon on advertising infringements
The Commission is apparently due to publish in early July in the Official Journal, a study on infringements in certain Member States of advertising time limits laid down in the Broadcasting Directive.

6.5 Commission - Study proposed on advertising to children relating in lieu of decision on infringement cases
The 24 June Commission Cabinet meeting, has failed to reach a decision concerning either the Greek Toy case or the French Loi Evin. Commissioner Monti has stated that action on the Greek Toy Advertising ban might be dropped, pending the results of a study on advertising to children.

It appears that the Commission is using this as a delaying tactic and sources within DG XV have indicated that the study is an unnecessary procedure to delay a decision on the case. There has been no decision yet on the scope, nature or content of this study.

The Commission is split on the issue of the Loi Evin. Commissioner Monti supports taking action against France, and he is reportedly supported by Bonino (Consumer protection policy), Brittan (external relations) and Bangemann (industry and information society). President Santer, Commissioners Flynn (health), Cresson (culture) and Papoutsis (enterprise policy) are opposed. A decision has been postponed pending further negotiations between the Commission and the French Government between now and October.

7.0 AUDIOVISUAL

7.1 Commission and Member States - Contact Committee meets on broadcasting directive

The Contact Committee involving Member State representatives, which was set up by to review the implementation of the Broadcasting Directive will next on 26 June. The following will be discussed:-

Article 3a - (measures which may be taken by a Member State to ensure that broadcasters under its jurisdiction do not broadcast on an exclusive basis events which are regarded by that Member State as being of “major importance for the society”);

Articles 4 &5 (quotas set for the broadcasting of European works);

a review of progress on the Commission-awarded study on parental and teacher control of minors’ access to television programmes

a report on the recent Council agreement on the Commission’s Recommendation on the Protection of Minors;

information on the progress of the consultation process launched by the Green Paper on Convergence.

Oreja’s report on audiovisual

The report of Commissioner Oreja’s High Level group looking at the future of audiovisual in the EU is due out in September.


7.2 Council and Commission- Follow-Up to audio-visual conference
A report on the Birmingham audiovisual conference has been issued to Member States summarising the issues discussed in the working groups and plenary session of the conference. Two questions have been asked to EU Ministers:-

1. What is the most effective way to lever private capital to support the necessary structural changes in the European audio-visual industry?

2. What are the implications for the future regulatory structure for broadcasting?


In the Culture/Audiovisual Council EU Ministers called on the Commission to take the issues forward which were discussed in Birmingham.

7.3 Commission - approval of French State aid for film production
The Commission has approved a French national aid programme for film production, by which any film made in France gains an automatic grant. The aid will be up to 50% of the film budget and film producers will be able to spend 20% of the film budget in other EU Member States. After two years the Commission will assess the scheme, and might subsequently consider how to align national audiovisual aid programmes

7.4 Commission - tender in MEDIA II programme
The Commission has published a tender calling for projects to be submitted for approval, for the support of EU companies producing multimedia projects. This is in the context of the MEDIA II development and distribution programme.

8.0 ENVIRONMENT

8.1 Commission and industry - voluntary environmental agreement

At a meeting on the cross-industry voluntary environmental agreement, associations agreed that environmental achievements should be highlighted before concluding a potential voluntary agreement.

8.2 Commission - ban on rechargeable batteries
The Commission will shortly adopt a proposal to ban nickel cadmium rechargeable batteries. These are used in electric vehicles, emergency lighting, cordless power tools, solar panels and several electronic appliances.

9.0 GENERAL

9.1 Commission - cultural policy

The Commission is drafting a paper on culture, the cultural industries and employment. It analyses cultural practices in Europe, and the related development of employment in culture, and the exploitation of Europe’s cultural wealth.

The Commission has also recently adopted a ‘First European Community Framework Programme in Support of Culture 2000-2004’. It proposes financing for cultural co-operation measures.

9.2 Council - failure to reach compromise on worker participation
The Social Affairs Council failed to make progress on the stumbling block problem concerning worker information and consultation, which is the remaining issue at stake holding up the adoption of the proposed European Company Statute. The UK Presidency’s compromise paper was rejected by Social Affairs Ministers meeting on 4 June.

9.3 Austria and Commission - fixed book (dis)agreement!
Austria has criticised the Commission’s initiative against agreements between publishers and bookshops in Germany and Austria and has presented a written statement to Audiovisual and Culture Ministers

June 1998

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