03 Feb 2015
EUROPEAN COMMISSION DAILY NEWS – 03 FEBRUARYBrussels Daily
State aid: Commission opens in-depth investigation into the Belgian excess profit ruling system
The Commission has opened an in-depth investigation into a Belgian tax provision, which allows group companies to substantially reduce their corporation tax liability in Belgium on the basis of so-called “excess profit” tax rulings. In essence, the rulings allow multinational entities in Belgium to reduce their corporate tax liability by “excess profits” that allegedly result from the advantage of being part of a multinational group. At this stage, the Commission has doubts if the tax provision complies with EU state aid rules, which prohibit the granting to certain companies of selective advantages that distort competition in the Single Market. Commissioner Margrethe Vestager in charge of competition policy said: “The Belgian “excess profit” tax system appears to grant substantial tax reductions only to certain multinational companies that would not be available to stand-alone companies. If our concerns are confirmed, this generalised scheme would be a serious distortion of competition unduly benefitting a selected number of multinationals. As part of our efforts to ensure that all companies pay their fair share of tax, we have to investigate this further.” The press release is available here.
Mergers: Commission clears acquisition of sole control over Grohe Group by LIXIL
The European Commission has approved under the EU Merger Regulation the acquisition of sole control over Grohe Group of Luxembourg by LIXIL Group Corporation of Japan. Grohe supplies water technology products for bathrooms and kitchens, in particular sanitary fittings. LIXIL is a supplier of building materials and housing equipment, including sanitary products. LIXIL currently jointly controls Grohe. The Commission concluded that the proposed acquisition would raise no competition concerns, in particular because it has no significant impact on the market structure. The transaction was examined under the simplified merger review procedure. More information is available on the competition website, in the Commission’s public case register under case number M.7491.
Employment: Commission proposes €8.7 million from Globalisation Fund to help media workers in Greece
The European Commission has proposed to mobilise the European Globalisation Adjustment Fund (EGF) to help 1,633 workers made redundant in the media sectors (publishing, programming and broadcasting – names of companies to be added) in Attica (Greece). The funds requested by the Greek authorities, amounting to €8.7 million, will help the workers in their transition to new jobs. The proposals now go to the European Parliament and the EU’s Council of Ministers for approval. Marianne Thyssen, EU Commissioner for Employment, Social Affairs, Skills and Labour Mobility commented: “Today’s decision will help to prepare over 1,600 people for new jobs. Greek workers are going through a difficult period and we must use all the tools we have at our disposal to provide assistance. I am happy we have been able to respond positively to Greece’s request for EGF support to the redundant workers“. See press release.
Pension funds to benefit from a further two year exemption from central clearing requirements
The European Commission has today published a report that recommends granting pension funds a two-year exemption from central clearing requirements for their over-the-counter (OTC) derivative transactions. The report, which is based on an extensive study requested by the European Commission, concludes that central counterparties (CCPs) need this time to find solutions for pension funds. At the same time, the report encourages CCPs to continue working on finding technical solutions in this important matter. Ultimately, the objective is that pension scheme arrangements (PSAs) should use central clearing for their derivatives transactions, as is the case for other financial institutions. This is also imperative for financial stability. Under current arrangements, PSAs – which encompass all categories of pension funds – would have to source cash for central clearing. Given that PSAs hold neither significant amounts of cash nor highly liquid assets, imposing such a requirement on them would require very far-reaching and costly changes to their business model which could ultimately affect pensioners’ income. Current EU law provides for a temporary exemption from the clearing obligation until August 2015. See press release here.
EUROSTAT: Industrial producer prices, domestic market
In December 2014, compared with November 2014, industrial producer prices fell by 1.0% in both the euro area (EA18) and the EU28, according to estimates from Eurostat, the statistical office of the European Union. In November prices decreased by 0.3% in in the euro area and by 0.4% in the EU28. In December 2014, compared with December 2013, industrial producer prices fell by 2.7% in the euro area and by 3.1% in the EU28. The average industrial producer prices for the year 2014, compared with 2013, decreased by 1.5% in both the euro area and the EU28. See press release here.
EU announces new support for sustainable development of Kiribati
EU Commissioner for International Cooperation and Development, Neven Mimica, has today announced new EU support of €23 million for Kiribati, which representsalmost a doubling (an increase of 80%) of previous EU support (between 2008 and 2013.) The new commitment was announced in Brussels as the Commissioner joined the President of Kiribati Anote Tong to sign the National Indicative Plan 2014-2020 for Kiribati under the European Development Fund. Announcing the support, Commissioner Mimica said: “Despite the geographical distance between the EU and Kiribati, I’d like to underline the EU’s ongoing commitment and support to being a firm partner to the country, as well as the Pacific region as a whole: particularly in its fight against climate change.” More information available here.
First Vice-President Frans Timmermans continues Citizens’ Dialogue series in Tallinn
On 3 February 2015, in Tallinn, the Commission organises its fourth Citizens’ Dialogue of the year. These ‘town hall’ style events take place across Europe and give citizens the chance to talk directly with Commissioners and other guest politicians. First Vice-President Frans Timmermans will participate along with Mr Toomas HendrikIlves, President of the Republic of Estonia. At a Citizens’ Dialogue event at the University of Copenhagen last week, Mr Timmermans stressed that these dialogues are a necessary way for the Commission to “break out of the Brussels bubble”. The event takes place from 14:00 to 15:15 at Tallinn University and will be live streamed. During his visit to Tallinn, First Vice-President Timmermans also meets the Estonian Prime Minister Mr Taavi Rõivas, attends a dinner hosted by Ms Urve Palo, the Minister of Economic Affairs and Infrastructure, delivers a keynote speech at the conference ‘Smart Economy & Enterprise-Friendly State – New Growth Strategy of the EU and Opportunities for Estonia’, meets with the members of the EU Affairs, Foreign Affairs and Constitutional Affairs Committees of the Estonian Parliament, and visits the technology company TransferWise.