\ • tl --- ; ' I I '',"-·EUROPEAN .COMMUNITIES__ _ ,.)r / DECEMBER 1969 VOLUME 2 No. 12 SUBSCRIPTION AND SINGLE COPY PRICES £. $ FB FF DM Lit. Fl. Annual subscription (Bulletin+ Supplement+ Index) 2.1.6 5.00 250.- 27.80 20.- 3 120 18.- Bulletin (incl. Supplement) 0.4.0 0.50 25.- 2.80 2.- 310 1.80 Supplement to Bulletin or Index 0.2.6 0.30 15.- 1.70 1.20 180 1.10 The annual subscription runs from 1 January to 31 December of each year. Payment ta be made only to the agents in the countries listed on p. 3 of the cover. For air subscription rates, please apply to the agents. -- 12-1969 BULLETIN of the European Communities SECRETARIAT OF THE COMMISSION This Bulletin is published monthly by the Secretariat of the Com­ mission of the European Communities (200, rue de la Loi, 1040 Brussels). It appears in the four Community languages, in English and in Spanish. It gives news of the activities of the Commission and the other institutions of the three Communities: European Coal and Steel Community (ECSC), European Economic Community (EEC) and European Atomic Energy Community (Euratom). This issue covers the activities of the European Communities in October 1969. Contents Page Editorial :Regional policy in the Community, by M. Hans von der Groeben, member of the Commission 5 Speakers' :The major European political problems, by M. Jean Rey, corner · President of the Commission 9 Chapter 1: Strengthening the European Parliament's powers 15 Chapter II: japan- economic power and partner for the Common Market 17 Chapter III: Wine and alcohol: an example of how tax discrimination is eliminated 21 Chapter IV: Establishment and operation of the single market 25 - Free movement of goods 25 - Competition policy 28 - Taxation policy 29 - Freedom of establishment and freedom to provide services 29 - Approximation of legislation and creation of Community law by conventions 31 Chapter V: Towards economic union 33 - Economic, monetary and financial policy 33 - Agricultural policy 35 - Industrial policy 40 - Scientific, technical and nuclear research policy 43 - Energy policy 49 - Transport policy 51 - Regional policy 52 - Social policy 53 Chapter VI: The Community and the Associated States 59 - African States and Madagascar, and overseas countries and territories 59 12. 1969 a Chapter VII: The Community, non-member countries and international organizations 63 - Applications for accession 63 - Bilateral relations 63 - Commercial policy 67 - The Community and developing countries 69 - The Community and international organizations 72 - International agreements in the nuclear field 73 Chapter VIII: Institutions and organs 75 - European Parliament 75 -Council 96 - Commission 99 - Court of Justice 100 - Economic and Social Committee 102 - Audit Committee 105 Chapter IX: European Investment Bank 107 Miscellaneous 109 Published in the Official Gazette 118 Recent publications of the Communities 158 1969 Bulletin: Index to introductory chapters and supplements 161 Supplement: Memorandum on regional policy in the Community 4 12- 1969 Regional policy in the Community by M. Hans von der GROEBEN, member of the Commission The Commission recently transmitted to the Council a proposal for a decision on the organization of Community instruments for regional development. What were the main reasons behind this move? · I I Nowadays the Community has to tackle more and more structural problems created by competition between firms and by technical and social change. The stresses and strains in the Community's economic and monetary system can be attributed to a number of factors, one of these undoubtedly being the structural discrepan­ cies between the economies of the different member countries. A few figures will give a rough idea of their importance. If we divide the Community into industrialized, predominantly agricultural, and semi-industrialized regions, we will find that one third of the Federal Republic of Germany can be regarded as industrialized and almost two thirds as semi-industrialized. Very few regions are still predominantly agricultural. In the ·Benelux countries, industrialization is even more striking; 90% of the popu­ lation lives in industrialized areas. Turning to France and Italy, however, we find that 40% of the population lives in areas which are still predominantly agricultural; and in these two countries industrialized regions account for no more than one-tenth of the total area. This situation entails differences in productivity; and, since prices are now ruled by competition and living standards are tending to become aligned on the highest level, this leads to economic and social pressures which can, in certain: circumstances, aggravate the disequilibrium in relative currency values. There is a danger that the accelerated rate of change in the employ­ ment pattern combined with the introduction of free movement of men, goods and capital inside a large area might mean that the 12. 1969 5 phenomenon-already familiar in the national context-of new industries concentrating in areas which are already developed, thanks to external economies and sophisticated social and technolog­ ical facilities, will tend to drain underdeveloped areas still further and lead to abnormal growth in developed areas. The drift from the land, some stagnation in the volume of employ­ ment in industry, and a rapid increase in employment in the services sector all mean that a solution must be found, as a matter of urgency, to the problem of harmonizing economic structures within the Community. If this is to be done within the framework of an open common market, the Community will have to act. Community action would respect the special competence of the Member States in the matter of regional policy and it would help to initiate or revive plans to develop regions where the difficulties of contributing to overall economic growth are endangering the equilibrium and smooth working of the common market. This could only be done through general programmes with enough financial backing and sufficiently rapid and concentrated to provide the region with the infrastructures and basic activities that would set in motion a development process. This process could then feed on itself and remain viable without the need for continual aid. Community institutions can and must help to bring these instruments together and implement programmes of this kind in regions of the Community which stand in need of them. The Commission feels that Community action should be along the following lines: i) the Commission, in conjunction with each Member State, should examine at regular intervals the situation in the regions in need of a development programme; it should be able to express an opinion on these programmes and, where necessary, use its powers of recommendation to ensure that programmes are drafted, amplified and implemented; 6 12- 1969 ii) with the creation of a Regional Development Committee, it would be possible, at the request of either the Commission or the Member State concerned, to organize a Community discussion of these programmes and, in general, to seek out converging regional policy solutions; iii) an interest rebate fund and a system of guarantees would mean that the channelling of available capital towards development financing in the regions could be improved, notably through the European Investment Bank; iv) private and public investors could help to implement regional development programmes; an improved information service for investors could be provided with the co-operation of institutions and agencies working towards this goal at Community level and appropriate support from the Commission. 12. 1969 7 SPEAKERS' CORNER Before the Summit Conference The major European political problems by M. Jean REY, President of the Commission 1. When the Franco-German co-operation treaty was signed in January 1963, the then President of our Commission, Professor· Hallstein, took it upon himself to say that this agreement was foreign to Community procedure. He was very sharply criticized for this in Bonn and had to face many difficulties-which he did with his usual courage. M. Hallstein was right: bilateral procedures are foreign to the Community procedures. But this is not to say that they are useless, and I would be the last _to utter the least criticism of Franco-German co-operation. We have suffered for a thousand years from discord between France and Germany! It would really be too absurd for us to lament the fact that the French and the Germans are beginning to agree. Nevertheless, Franco­ German co-operation does not and cannot replace Community arrangements. I am absolutely against any kind of big power club in Europe. And when we are told that Europe needs a Big Four-France, Germany, Italy and Britain-! do not hesitate to say that this would be an execrable arrangement. The acceptable arrangement is constituted by the Community procedures, gradually strengthened and enlarged. In the Community procedures, account has been taken of the strength of the Member States. These States are not equally powerful, so they do not have the same powers within the Community either. Votes are weighted in the composi­ tion of the delegations in the Parliament and in voting procedures in the Council. This shows as clearly as possible that a country like Belgium has not as much influence in the Community as a country like France, Germany or Italy. I find this perfectly 12- 1969 proper, and I think that the balances established are good, that they constitute a satisfactory compromise between the responsibili­ ties, the national personalities of our States and their respective influence within the whole. 2. Regarding the connection between the strengthening and the enlargement of the Community, I think that it is completely academic to argue whether one should be put before the other. There are several reasons for this: first of all, the Community will have to be made stronger anyway. Whether the Community is enlarged or not, it must go on, it must gain in power, There are problems ahead which must be solved, whatever happens.