EC: BRUSSELS BEAVERS AHEAD. - The EC may establish many directives whether it has UK consent or not.

by Peter Wilsher.
Last Updated: 31 Aug 2010

The EC may establish many directives whether it has UK consent or not.

While the Maastricht ratification row grinds on in Britain's increasingly tetchy and parochial Parliament, it is easy for stay-at-homes to believe that the European Community has somehow gone into a profound sleep. But such comfortable insouciance is not available to those actually out there attempting to do business in the single market. They know only too well that, behind the big political debates, the Brussels beehive is as energetic as ever, with projects that will continue to have a profound effect on jobs, profits and corporate opportunity, even if the grand projects, like common defence arrangements and the uniform currency, never get off the ground.

Take, for example, the tricky area of labour law. Padraig Flynn, the social affairs commissioner, is well aware of John Major's problems, and has promised a 'period of reflection' until Maastricht is safely out of the Westminster snake pit. But in the Berlaymont backrooms all sorts of ideas are being readied for action, and however sincere may be the Prime Minister's promise that he has 'opted' us out of social Europe, the reality is that we shall not be able to stop the future backwash.

To start with, a lot of the proposed new rules, like those regulating hours for adult and child workers, are not subject to a British veto at all - if the other members of the Council of Ministers so decide, they can be pushed through by majority vote. And even where we do have the ultimate right to say 'no', that may not be a universally effective barrier. Demands for multinationals to set up consultative works councils, and to give much more warning of proposals affecting their workforce - both of which have been fanned to blood heat by Hoover's decision to switch jobs from well-cushioned Burgundy to lower-paid, less rigorously-protected Glasgow - can, in theory, be blocked by UK intransigence. But, in practice, as UNICE, the European employers' association recognises, many cross-border companies, even those headquartered this side of the Channel, will find it easier to give their UK workers the same consideration that they have had to grant to their overseas colleagues.

Another significant file that is currently being dusted off - and is not even remotely affected by the Maastricht outcome - is the one devoted to tidying up Europe's wildly inconsistent bankruptcy laws. The last attempt to impose some form of standardisation foundered in the early 1980s, when the emphasis was still on creditors' rights in a liquidation. But now the focus has shifted more towards protecting saveable firms from their creditors while they get back on their feet, and here there is almost complete absence of common ground. It is perfectly possible, under existing arrangements, that the same business could be judged ruined under German rules, perfectly healthy by a French court, and sick but ripe for rehabilitation by an Italian judge. With more and more managements trying to operate with assets in all three countries, and others, there is a vigorous movement under way to impose some order. This Britain has every reason to endorse and see extended further - if only because the draft proposals so far concentrate mainly on court-initiated procedures and fail to embrace the variety, much more common here, where creditors take the initiative. Sorting that out will probably need some creative re-interpretation of the Treaty of Rome's Article 220 (the one that treats courts and tribunals as paramount, and the rest nowhere). But it would be worth quite a lot of concerted effort to clear out this peculiarly dusty corner.

More immediate and even more tangled are the many unresolved issues left behind by the European Court's historic 1990 judgment which decreed that men and women must enjoy equal benefits under their company pension schemes. The most important of these, due to be clarified this summer, concerns the amount of retrospective adjustment that will be entailed. Huge sums are at stake - some estimates put the total cost of potential back-pay claims at nearly £200 billion, with £50 billion for Britain alone - and governments tried desperately, via Maastricht, to impose much tighter limits. But that seems to be one of the many treaty provisions that have got lost, and the whole problem is now back in front of the Luxembourg judges. Meanwhile large parts of the Community pensions industry remain effectively paralysed, with certain issues worryingly unresolved.

There is something else stirring in Brussels that will soon affect them and all other organisations and institutions that enter into contracts with the public. After 16 years of desultory discussion, EC consumer affairs ministers have finally agreed to crack down on the kind of obfuscatory small print which is mainly there to curtail people's equitable rights. Among the targets are bank agreements, the imposition of currency surcharges by package tour operators, and all those sonorous warnings, in documents, on public transport and even on supermarket walls, that customers use the services 'at their own risk'. Once the legislation comes into effect, all such arrangements will, at least in principle, be open to legal challenge. But as usual there is a substantial breathing space - the rules become operative only in December 1994.

Do not be fooled, though, by any appearance of non-activity. It suits Brussels to look innocently quiescent in this difficult time. There is a rude awakening in store, however, for any Euro-sceptic who rashly believes it dead.

Peter Wilsher is a freelance consultant and writer.

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