Just recently, Europe's attention has been centred on three major issues: problems with the fledgling European Commission, the signature and ratification of the Constitution, and the possible opening of accession negotiations with Turkey. Various other highly important affairs have seen significant changes, but they've been relegated to the second division for now, at least in the eyes of the public. Our bulletin follows them regularly (you won't find such full and speedy information anywhere else), and I intend to take stock of the main dossiers the Prodi Commission will bequeath to the Barroso Commission; but this exercise has been held up by the delays in the latter taking up its functions. For the time being, I will just state briefly which dossiers I plan to come back to.
1. Industrial policy. This one's well known: Germany was unhappy with they way the Commission was dealing with it, because it felt that it wasn't doing enough to react to the risk of the disindustrialisation of Europe: Romano Prodi met Chancellor Schröder, and reassured him that he saw the manufacturing industry as a priority, and an estimable Commission document emerged from this. But the positions of principle were hard to translate into practice, because the disorganisation of the Commissioner in charge of the dossier (Mr Liikanen), the too-late arrival of his successor (Mr Rehn) and the departure of the Director General (Mr Mingasson) held up the initiatives. In the meantime, France and Germany moved the issue over to intergovernmental level, with a disconcerting tendency to alternate between agreement and disagreement. In fact, the Commission's role here is indispensable, because industrial policy cannot, by its nature, be separated from competition policy (where the Commission makes the decisions) and the single market rules (for which the Commission acts as guarantor). Commissioner Bolkestein managed, in his last hours, to bring the Volkswagen dossier before the Court of Justice (the region's powers in the management of the company). Everything is on the table. In the Barroso Commission, the industrial policy portfolio will go to Mr Verheugen, and the internal market to Mr McCreevy, but competition remains open.
2. The liberalisation of services and services of general interest (SGIs). These two dossiers, which are politically and socially extremely sensitive (see this column of 29 September), have an enormous economic dimension to them. There is much manoeuvring underway. The Dutch Presidency would like to see an initial Council decision on the liberalisation of services (Bolkestein directive) by the end of the year, but it is likely to be disappointed. Upholders of SGIs are vocal in their disparagement of the risks the liberalisation directive could occasion to the services of general interest, and they call for caution and precautions. In the European Parliament, the debate is a lively one. "Confrontations Europe", the association chaired by Philippe Herzog, does very useful work in allowing all interested parties to speak out and providing a forum for positions to be discussed. It published a brochure (Number 20 in the "Options" series), in which Mr Herzog himself goes further than to discuss the battle he fought in the previous parliament (he was rapporteur for SGIs), but also outlines the prospects for SGIs in the EU, and defines a work programme for 2004-2006. At the Commission, Ms Houtman was supposed to hang on to the SGI dossier as part of her new duties with the "Internal Market" DG, which will ensure balance and knowledge of the dossier. All of the elements of the debate have been brought together, and the Constitution will provide extra clarity.
3. Corporate taxation. This dossier is closely linked to the one on industrial policy (see point 1). The stances of those who are opposed to "tax competition" between Member States and those who see it as normal remain a long way apart on principles, but in practice, they are moving towards compromise. One lot thinks that tax rates on company profits should be aligned in order to avoid "tax dumping", the other that harmonisation should only apply to the tax base. A formula between the two, which calls for just a tax ceiling, is taking shape, and the extreme positions have relaxed somewhat. For example, nobody is still defending the idea of blocking EU regional aid to countries with very low corporate taxation; but at the same time, the time for which a company cannot relocate any installation which has received European funding will be raised from five years to seven. The dossier is still a delicate, difficult and controversial one, and the Barroso Commission should put its cards on the table.
It might also want to take a closer look at the revitalisation of the Lisbon Strategy (the Kok report has just been presented), and significant developments concerning the European area of freedom, security and justice. The Commission must be prepared to play its part to the full in all of the dossiers I have mentioned, and many more besides. (F.R.)