On Thursday 28 May, the EU27 ministers responsible for Competitiveness will hold two first political debates on legislation considered crucial for the bloc’s competitiveness, namely on the Industrial Accelerator Act (IAA) and the 28th regime for European companies.
They will also adopt a series of conclusions or EU Council draft recommendations, notably on sustainable tourism (see EUROPE 13868/8) or the role of science in diplomacy (see EUROPE 13875/9).
On Friday, they will discuss the Horizon Europe programme and how it ties in with the European Competitiveness Fund, but will not yet be able to agree on a partial general approach, as the Cyprus Presidency of the Council of the EU had hoped for.
While broad convergence has emerged on the structure of the programme, its objectives, the architecture and content of the four pillars, as well as on the majority of the provisions relating to participation and implementation, essential questions remain regarding a limited number of politically sensitive elements, such as the definition of strategic priorities, including the alignment between Horizon Europe and the European Competitiveness Fund, European partnerships, widening, and bottom-up collaborative research and innovation, according to a Presidency note.
Link to the note on Horizon Europe: https://aeur.eu/f/m25
In the afternoon, they will also discuss EU space policy and the state of play of the EU Space Act (see EUROPE 13867/2). “This proposal is seen as a major step towards a more coherent European framework for space, reducing fragmentation and improving legal clarity”, a diplomatic source said on Wednesday 27 May.
It aims to strengthen the competitiveness, safety, resilience and sustainability of the European space sector. The ministers will also exchange views on the role of space for Europe’s economic security, resilience and competitiveness in a context of geopolitical uncertainty.
First political test for the IAA. While the Cyprus Presidency hopes to propose an initial compromise text during its mandate on the draft regulation proposed by the Commission on 4 March (see EUROPE 13821/1), the ministers’ public discussion should provide political guidance on this still controversial file.
Intended to protect key industrial sectors such as heavy industry, electric vehicles or clean technologies from unfair international competition, the regulation is also seen as potentially leading to higher costs for businesses. The integration of global trading partners into European preference schemes also remains the subject of debate.
“We hope to identify points of convergence and persistent concerns regarding the balance between industrial competitiveness, decarbonisation objectives, openness to investment and the integrity of the single market”, a diplomatic source summed up.
These differences, both on the international partners to be included and on the number of sectors to be protected, are giving rise to differing positions “as to the practical feasibility of the proposed measures to simplify procedures and, more generally, to accelerate industrial growth”, the source added.
On the 28th regime, proposed on 18 March, and the creation of EU Inc. (see EUROPE 13861/12), the aim will also be to gather the ministers’ first impressions, as this file is also regarded as a lever for the EU’s competitiveness. The debate should, among other things, provide “answers to the questions being asked by the Member States, in particular concerning the legal basis of the proposal”, the source said.
Heavy industry. Before their formal meeting, around 20 Member States will meet for a breakfast with representatives of energy-intensive industries as part of the meeting of the informal Ministerial Alliance.
The ministers will then present to their colleagues the key messages emerging from the discussions, which will focus on the following subjects, according to a French note, which requested this information point: addressing the challenges linked to the implementation of European legislation, including the risks of circumvention, in order to strengthen European policies supporting strategic energy-intensive industries. Concrete cases of application will be discussed, notably trade defence instruments, the Carbon Border Adjustment Mechanism (CBAM) and the Industrial Accelerator Act (IAA).
A representative of CEFIC, the European Chemical Industry Council, will also be invited to speak at the formal EU Council meeting.
The EU Council is expected to present an assessment of the current economic situation of the European chemical industry, company closures and consolidations, as well as the impact of the conflict in Iran. Supporting the work of the Critical Chemical Alliance will also be discussed.
“We will then set out our view on the Industrial Accelerator Act and the potential of the future Biotech II legislation, which, in our opinion, should be renamed legislation on bio-based industries and legislation on the circular economy, which is essential for investment in chemical recycling”, the organisation says.
“As regards energy, we will advocate much more uniform national implementation of the guidelines on indirect State aid and the CISAF, as well as for implementation of the Commission recommendation on electricity charges and taxes”, it adds.
CEFIC will also express, among other issues, its concerns regarding the need to increase the percentage of revenues from the 'ETS' system returned to industry for decarbonisation.
Electronic declaration. The subject will be the focus of an information point. The Cyprus Presidency is trying to make progress towards an agreement between the Member States and the European Parliament on the electronic declaration of posted workers and last week proposed new avenues to the member countries, notably concerning the information to be entered in electronic posting forms. The Presidency is ideally aiming for a political agreement in Coreper on 10 June, to be followed swiftly by an agreement in trilogue with the European Parliament. (Original version in French by Solenn Paulic with Nadège Delépine)