Company statute plan still blocked

Date: 22/10/1998

By Myles Neligan

EU SOCIAL affairs ministers are almost certain to fail in their efforts to set aside their differences on the role of workers in possible pan-European companies when they meet in Luxembourg next week.

Failure to strike a deal would be a blow to the Austrian government, which pledged to broker an agreement to break a 20-year deadlock on the plan for a European Company Statute during its six-month EU presidency.

The proposal is aimed at enabling multinational firms to create pan-European companies which would be legally recognised in all 15 EU countries. But disputes over workers' rights in EU-registered firms have so far held up progress on the initiative. All member states are keen to preserve their own models of worker participation, but Germany's unwillingness to compromise its tradition of including trade union representatives on management boards is the greatest obstacle to an accord.

A compromise put together by the Austrian presidency, which would guarantee stronger worker participation in pan-European firms created by a merger between existing companies, was welcomed by Bonn two weeks ago, but enthusiasm has since waned.

Asked if there would be a deal next week, one official replied: "I would flatly rule that out."

There had been speculation that the chances of agreement had been improved by the decision to appoint Walter Riesler as Germany's new social affairs minister. But observers now say that it will be some weeks before Gerhard Schröder's government finalises its position on the issue.

EU officials believe that an accord may be possible at the next social affairs ministerial meeting on 2 December. "It is a slow process of approximating towards a deal, but we are not quite there yet," said one.

Spain and the Netherlands, which also have grave reservations, would have to be persuaded to sign up to a final compromise with Germany.