Commission ‘wise’ to sue EU countries over state aid vetoes

Date: 07/03/02

By Peter Chapman

DUTCH Secretary of State for Europe Dick Benschop says the European Commission is right to sue EU member states - including the Netherlands - over their efforts to block decisions banning illegal state aid.

In an unprecedented move, the Union executive last week launched legal action against a joint veto of a Brussels decision to ban state aid to Portuguese pig farmers.

Commissioners said they would take member states to court to stop countries exploiting part of the EU's Treaty that allows them to challenge controversial state-aid decisions in 'exceptional circumstances'.

Benschop, one of outgoing Prime Minister Wim Kok's chief confidants, told European Voice the court challenge was 'a wise' thing to do. 'This is a newly found article of the Treaty - a rather obscure one. That should not be misused,' he said. 'We have an internal market, we have rules on competition. State aid is part of the hard core of the European Union. There are community competencies in this field that we should safeguard.'

Speaking ahead of next week's Barcelona summit, he said the EU should set new deadlines to ensure the promises made two years ago in Lisbon to create the most competitive economy in the world by 2010 do not fizzle out.

'In this climate of economic uncertainty the significance for business and consumers that we stick to our targets and make Lisbon happen are very important,' he said.

Key areas for reform include the EU's pensions systems, financial services, energy, innovation and R&D.

On energy markets, Benschop predicts a compromise with the French to allow the Union to press ahead with opening industrial markets, while taking longer to free up competition in consumer markets.

'That is a good step forward,' he said, adding that the Commission's threat to use the 'method of last resort' to force market-opening under its own competition powers had 'put pressure on the process'.

He also said the EU should be given one more chance before the 21 May Internal Market Council to strike a deal on the controversial community patent.

The system - meant to be in place by the end of 2001 - was originally intended to be a vital piece in the Lisbon jigsaw puzzle.

But since the Lisbon agenda was set, the drive to establish a single European patent system has been hindered by in-fighting over the language regime and the role of local patent offices.

Benschop says France, Germany and Portugal were to blame for blocking a Belgian compromise on the patent, tabled at last year's Laeken summit, that could have broken the deadlock.

This plan would have seen patents translated into one of the European Patent Office's official languages (English, French

or German) - with scope for the initial application to be made in a local EU language. But Benschop says member states should not accept a poor compromise in May if it would hike the costs of registering an invention instead of slashing them.

Rather, he said, the EU should 'stop the present exercise' and those countries ready to move forward should go it alone through so-called 'enhanced cooperation' - EU jargon for letting countries opposed to the system opt out while others press ahead.

'If we create an institution that is not efficient enough or too costly we are not bringing the 2010 goal any nearer,' he said, adding that experience with the euro and the Schengen visa accord proved that countries on the outside eventually shake off their opposition. 'In the end they are in.'

Whether Benschop will be around to see the Community patent take shape is not clear. Elections in May based on proportional representation are likely to result in a reshuffle of ministerial jobs when a new coalition is formed in the summer.

French counterpart Pierre Moscovici said recently that Benschop will 'sans doute' one day be the Dutch prime minister.

But Benschop, a member of the ruling PvdA socialist party, is only certain to stay in his current job for a couple of months during a transition period.

'In the Netherlands you can't foresee where you will end up - but I will remain in politics,' Benschop said.

Dutch Secretary of State for Europe, Dick Benschop, says the European Commission is right to sue EU Member States, including the Netherlands, over their efforts to block decisions banning illegal state aid.