European Parliament resolution of 15 March 2018 on the situation in the Maldives (2018/2630(RSP))

P8_TA(2018)0079 RC-B8-0168/2018

The European Parliament,

–  having regard to its previous resolutions on the situation in the Maldives, particularly those of 16 September 2004(1), 30 April 2015(2), 17 December 2015(3) and 5 October 2017(4),

–  having regard to the statements by the spokesperson of the EEAS of 2 February 2018 on the decision of the Supreme Court of the Maldives of 1 February 2018(5), and of 6 February 2018 on the situation in the Maldives(6),

–  having regard to the joint local statement of 30 January 2018 of the Delegation of the European Union in agreement with the EU Heads of Missions resident in Colombo and accredited to the Maldives on the renewed arrest of MP Faris Maumoon(7),

–  having regard to the International Covenant on Civil and Political Rights (ICCPR), to which the Maldives is a party,

–  having regard to the International Covenant on Economic, Social and Cultural Rights (ICESCR), to which the Maldives is also a party,

–  having regard to the EU Guidelines on the Death Penalty,

–  having regard to the official mission to the Maldives of the European Parliamentary Delegation for Relations with the Countries of South Asia from 29 to 31 October 2017,

–  having regard to the statement of UN High Commissioner for Human Rights, Zeid Ra’ad Al Hussein, of 7 February 2018,

–  having regard to the statement issued on 6 February 2018 by the Bureau of the European Parliament’s South Asia Delegation on the situation in the Maldives,

–  having regard to the Foreign Affairs Council conclusions on the Maldives, as adopted by the Council at its 3598th meeting on 26 February 2018,

–  having regard to the Universal Declaration of Human Rights,

–  having regard to the meeting of the UN Secretary-General with Mohamed Asim, Foreign Minister of the Republic of Maldives, on 28 September 2017 expressing concern over the political situation in the country,

–  having regard to the statement of the International Association of Lawyers (UIA) on 7 March 2018, expressing grave concern about the rule of law and the state of the independence of the judiciary in the Maldives,

–  having regard to Rules 135(5) and 123(4) of its Rules of Procedure,

A.  whereas the first democratic elections in 2008 and the adoption of a new constitution had raised high hopes that the Maldives would overcome decades of authoritarian rule and move towards a democratic system, but recent developments pose a serious threat to the realisation of this prospect;

B.  whereas opposition party members, independent journalists and human rights defenders report increased threats and attacks from authorities, police and extremist groups; whereas concerns have been raised over the highly politicised Maldivian judiciary, which over the years has abused its powers and acted in favour of the current ruling party and against opposition politicians; whereas there is mounting evidence indicating that criminal charges brought against political opponents of President Abdulla Yameen Abdul Gayoom (hereinafter President Yameen) may have been politically motivated; whereas former President Maumoon Abdul Gayoom was arrested in February 2018;

C.  whereas the first round of presidential elections is due to take place in September 2018; whereas the President has invited the international community to observe the electoral process;

D.  whereas on 1 February 2018 a decision of the Supreme Court of the Maldives annulled the criminal proceedings against leading politicians and admitted that the trials against them had been unfair; whereas the ruling ordered for the immediate release of nine persons, including eight opposition political leaders, including the exiled Mohamed Nasheed, and for the reinstatement of 12 suspended Members of Parliament; whereas the Government retains a majority in Parliament as long as the 12 MPs remain stripped of their seats;

E.  whereas on 5 February 2018, following the decision of the Supreme Court, President Yameen declared a 15-day state of emergency; whereas with the declaration of the state of emergency a large number of human rights and fundamental freedoms enshrined in the Constitution were suspended, including the rights of peaceful assembly and freedom from unlawful arrest and detention;

F.  whereas two presiding judges of the Supreme Court, including the Chief Justice, were arrested, causing the remaining presiding judges to annul the original order; whereas in clear disregard for the independence of the judiciary, members of the judiciary and political opponents have been arbitrarily detained;

G.  whereas despite the peaceful protest of hundreds of citizens, the state of emergency was extended by Parliament for a further 30 days on 20 February 2018, a move that was deemed unconstitutional by the Maldives Prosecutor-General but upheld by the Supreme Court; whereas the vote to extend the state of emergency was forced through Parliament in the absence of a quorum;

H.  whereas the Foreign Affairs Council has followed with concern the recent deterioration of the situation in the Maldives, issuing calls on all in the country, in particular law enforcement forces, to act with restraint; whereas a joint statement was delivered at the 37th Session of the Human Rights Council on behalf of over 40 countries, including all EU Member States, on 8 March 2018, calling on the Government of the Maldives to restore constitutional rights and the independence of the courts, expressing its support for the proper functioning of the country’s Parliament and urging the Government to release political prisoners and their families;

I.  whereas civil society activists and human rights defenders in the Maldives continue to face threats and intimidation from extremists, and judicial harassment by the authorities, as in the case of Shahindha Ismail, Executive Director of the Maldivian Democracy Network, who was targeted by news articles, death threats and a police investigation because of her advocacy against religious fundamentalism and radicalisation;

J.  whereas President Yameen has repeatedly declared his intention to resume the practice of state-sanctioned executions, ending a 60-year moratorium; whereas Maldivian law, in contravention of international law, allows minors to be sentenced to a delayed death penalty, to be carried out when the minor reaches the age of 18; whereas in at least three cases, specifically those of Hussein Humaam Ahmed, Ahmed Murrath and Mohamed Nabeel, the Supreme Court of Maldives has confirmed death sentences for condemned individuals whose trials failed to uphold internationally recognised standards of fair trial, and who are now at imminent risk of execution;

K.  whereas in recent years the Maldives have shifted towards a radical version of Islam; whereas there are also concerns about increasing radical Islamist militancy and about the number of radicalised young men and women alleged to have joined ISIS;

L.  whereas the International Federation of Journalists (IFJ), Reporters Without Borders (RSF) and the Committee to Protect Journalists (CPJ) released a joint statement on 15 February 2018 expressing their deep concern over the restrictions of, and threats against, media and press freedom in the Maldives; whereas, on 4 February 2018, the deputy leader of the ruling Progressive Party of Maldives (PPM), Abdul Raheem Abdullah, called on the security forces to immediately shut down Raajje TV, accusing it of giving airtime to opposition leaders;

M.  whereas the EU has long-standing relations with the Maldives, notably in areas such as the fight against climate change, and hundreds of thousands of European tourists travel to the Maldives every year;

1.  Expresses its deep concern over the serious and deteriorating political and human rights situation in the Maldives, and the increasingly authoritarian rule of President Yameen and his Government; takes positive note of the Council Conclusions on the Maldives of 26 February 2018;

2.  Calls on the Government of the Maldives to lift the state of emergency immediately, to respect the institutions and their competencies as provided for in the Constitution, and to respect the fundamental rights of all people, including the right to freedom of expression and assembly, as well as the rule of law; expresses its growing concern over the recent actions of the Government, which seriously damage and undermine democracy, and run counter to the Maldives’ Constitution and the country’s international human rights obligations; condemns the continued intimidation of, and threats against, journalists, bloggers and human rights defenders in the Maldives; urges the Maldivian authorities to guarantee the safety of all civil society activists, human rights defenders and media workers in the country, to enable them to carry out their work safely and without impediment, to investigate threats against them, and to prosecute the perpetrators; deplores the crackdown on political opponents in the Maldives, and calls on the Government to drop all charges against all those being held for political reasons and release them immediately and unconditionally;

3.  Welcomes the decision of the Supreme Court of the Maldives of 1 February 2018 to annul the criminal proceedings against leading politicians and to reinstate 12 Members of Parliament; calls on the Maldivian authorities to abide by the ruling;

4.  Strongly condemns any interference with the work of the Supreme Court of the Maldives and the arrests of the presiding judges; calls for their immediate and unconditional release; is concerned about the increasing breakdown of the principle of separation of the executive, judicial and other powers in the Maldives; calls on the responsible authorities to take immediate steps to restore and uphold the principles enshrined in its Constitution;

5.  Reiterates its call on the Government to ensure the full independence and impartiality of the judiciary, and to guarantee all citizens the right to fair and transparent justice that is free of political influence; condemns the interference with the work of the Supreme Court and the actions taken against the judiciary and judges; calls on the Government to guarantee that lawyers are able to perform all of their professional functions without intimidation, hindrance, harassment or improper interference;

6.  Reiterates its call on the Maldivian Government to engage in an inclusive dialogue with the leaders of all political parties; recalls that such dialogue paves the way for credible, transparent and inclusive elections; considers that the EU should actively continue to support UN facilitation of such dialogue;

7.  Calls on regional actors to work with EU countries to help deliver political and democratic stability in the Maldives;

8.  Believes that the only way to reverse the deterioration in democracy, human rights and freedoms in the Maldives is through a process of genuine dialogue involving all political parties and other civic leaders; further believes that, as a first step towards reconciliation, the Government must release all opposition politicians currently held in jail;

9.  Reiterates the EU’s firm opposition to the death penalty, in all cases and without exception; strongly condemns the announcement of the reintroduction of the death penalty in the Maldives, and urges the Government and Parliament of the Maldives to respect the moratorium on the death penalty that has been in place for more than 60 years; calls for the universal abolition of capital punishment, and calls on the Government to revoke all capital punishment charges against juveniles and to prohibit the execution of juvenile offenders;

10.  Strongly criticises the fact that the practice of non-Muslim faiths is severely punishable in the Maldives; expresses concern that the Religious Unity Act is being used to limit freedom of expression in the Maldives;

11.  Expresses concern about the impact the current situation may also have on the security of foreign residents and visitors; calls on the VP/HR, the EU delegation to the Maldives and Member States’ delegations to coordinate closely their travel advice in this regard;

12.  Calls for the immediate and unconditional release of all persons detained arbitrarily, many of whom are journalists and peaceful protestors; condemns all and any use of force by the authorities; calls on all Maldivian authorities, in particular law enforcement authorities, to act with restraint; calls on the authorities to investigate all those suspected of being responsible for the offences that have been committed, and to hold them accountable;

13.  Calls on the EU to make full use of all instruments at its disposal to promote respect for human rights and democratic principles in the Maldives, including, possibly, the suspension of EU financial assistance to the country pending the resumption of the rule of law and abidance by democratic principles; calls on the Council to introduce targeted measures and sanctions against those in the country undermining human rights, and to freeze the assets abroad of, and impose travel bans on, certain members of the Maldivian Government and their leading supporters in the Maldivian business community;

14.  Calls on the Maldivian Government to profoundly reform the judiciary, to establish the impartiality of the Judicial Service Commission, to re-establish the independence of the Prosecutor General, and to respect due process of law and the right to a fair, impartial and independent trial;

15.  Recognises that, under the Constitution, elections must be held in 2018; stresses that immediate action should be taken to ensure that these elections are transparent and credible, that voters are given a genuine choice and that parties are able to campaign freely;

16.  Instructs its President to forward this resolution to the Vice-President of the Commission / High Representative of the Union for Foreign Affairs and Security Policy, the Council, the Commission, the governments and parliaments of the Member States, the Secretary-General of United Nations and the Government of the Maldives.

(1) OJ C 140 E, 9.6.2005, p. 165. (2) OJ C 346, 21.9.2016, p. 60. (3) OJ C 399, 24.11.2017, p. 134. (4) Texts adopted, P8_TA(2017)0383. (5) https://eeas.europa.eu/headquarters/headquarters-homepage/39275/statement-spokesperson-decision-supreme-court-maldives_en (6) https://eeas.europa.eu/headquarters/headquarters-homepage/39413/statement-spokesperson-situation-maldives_en (7) https://eeas.europa.eu/delegations/sri-lanka/39021/joint-local-statement-renewed-arrest-mp-faris-maumoon_en

European Parliament resolution of 15 March 2018 on the arrest of human rights defenders in Sudan, notably the case of Sakharov Prize laureate Salih Mahmoud Osman (2018/2631(RSP))

P8_TA(2018)0080 RC-B8-0159/2018

The European Parliament,

–  having regard to its previous resolutions on Sudan,

–  having regard to the statement of 9 February 2018 by its Vice-President responsible for the Sakharov Prize Network and by the Chair of its Human Rights Subcommittee on the Sakharov Laureate Salih Mahmoud Osman,

–  having regard to the local statement of 11 January 2018 by the Heads of Mission of EU Embassies on the recent protests in Khartoum,

–  having regard to UN Security Council resolution 2400 (2018), adopted at its 8177th meeting on 8 February 2018,

–  having regard to the statement of 31 January 2018 by the President of the UN Security Council in connection with the Security Council’s consideration of the item entitled ‘Reports of the Secretary-General on the Sudan and South Sudan’,

–  having regard to the statement by the UN Resident and Humanitarian Coordinator in Sudan on the abduction of an aid worker in Darfur, issued in Khartoum on 9 October 2017,

–  having regard to the International Covenant on Civil and Political Rights,

–  having regard to Article 5 of the Universal Declaration of Human Rights and Article 7 of the International Covenant on Civil and Political Rights, both of which provide that no one shall be subjected to torture or to cruel, inhuman or degrading treatment or punishment,

–  having regard to the statement of 27 June 2016 by the spokesperson of the Vice-President of the Commission / High Representative of the Union for Foreign Affairs and Security Policy (VP/HR) on the Sudanese Government’s announcement of a four-month unilateral cessation of hostilities,

–  having regard to the revised Cotonou Partnership Agreement,

–  having regard to the African Charter on Human and Peoples’ Rights of June 1981,

–  having regard to Rules 135(5) and 123(4) of its Rules of Procedure,

A.  whereas the situation in Sudan continues to constitute a threat to international peace and security in the region; whereas the Sudanese authorities have carried out a crackdown on peaceful protest, civil society and human rights defenders;

B.  whereas in connection with sporadic protests that began around Sudan on 7 January 2018 over a rise in the cost of food and medicines, at least 140 opposition party members, human rights defenders, students and women’s rights activists have been arrested and detained by the Sudanese National Intelligence and Security Services (NISS); whereas protests have been met with an excessive use of force by Sudanese forces, leading to the death of one protester and injuries to several others, in addition to a nationwide crackdown on journalists and activists; whereas the clashes in January and February 2018 are the latest examples of constant abuses in the country;

C.  whereas those arrested include political opponents, with three Sudanese Congress Party leaders arbitrarily arrested and detained; whereas other opponents arrested include Mohamed Mukhtar al-Khatib, the political secretary of the Sudanese Communist Party; Mohamed Abdalla Aldoma, the deputy chairperson of the National Umma Party; Mohamed Farouk Salman, a leading member of the Sudan National Alliance; and two members of the Sudanese Communist Party central committee, Mohieldeen Eljalad and Sidgi Kaballo;

D.  whereas Sudanese NISS forces arrested Salih Mahmoud Osman – the Vice-President of the Darfur Bar Association, a member of the Democratic Lawyers Association, a human rights lawyer who has promoted the establishment of the rule of law and advocated for legal reform through the National Assembly of Sudan, and recipient of the 2007 Sakharov Prize – at his law firm on 1 February 2018; whereas he was recently transferred to Dabak prison, 20 km north of Khartoum, and the authorities have refused to provide information on his health and denied visits to his lawyer and family;

E.  whereas following the arrest of Salih Mahmoud Osman, the EU Head of Delegation to Sudan initiated a démarche with the Sudanese Ministry of Foreign Affairs and an appeal was made by the EU’s Special Representative for Human Rights, Stavros Lambridinis, to the 37th session of the UN Human Rights Council on 27 February 2018;

F.  whereas a number of women activists have likewise fallen victim to this campaign of mass arrests; whereas women’s rights defenders are being subjected to sexual violence, prosecution and violent punishments imposed by government security forces; whereas women’s organisations are kept under close surveillance and are campaigning against laws which generally discriminate against women;

G.  whereas in mid-February 2018 the Sudanese Government announced the release of 80 detainees, including Rawa Jaafar Bakhit, Nahid Jabrallah, Amel Habani, Hanan Hassan Khalifa and Mohamed Abdalla Aldoma following ill-treatment while in detention; whereas the head of the NISS conditioned the release of other detainees on their promise to stop organising protests; whereas these declarations are contrary to Sudan’s international human rights commitments; whereas, however, several prominent human rights defenders and opposition political activists remain in prison, including Osman Salih and Amjeed Fareed, a human rights defender who has been in detention in Khartoum since 18 January 2018; whereas those detained have not been charged with any crime and have not been brought before a court of law;

H.  whereas human rights defenders and civil society organisations, including lawyers and bar associations, play a central role in ensuring democracy, human rights, the rule of law, stability and sustainable development;

I.  whereas the activities of civil society organisations and opposition political parties are severely restricted, and the NISS prevents civil society organisations and opposition parties from holding many events; whereas international NGOs are regularly expelled from the country and are targets for pressure and intimidation by the government;

J.  whereas the National Security Law of 2010 and the amendment to Article 151 of the Constitution adopted on 5 January 2015 have conferred wide-ranging powers of arrest and detention on the NISS, enabling it to hold suspects for as long as four and a half months without any scope for judicial review; whereas it is alleged that these powers are being used to arbitrarily arrest and detain people who, in many cases, are tortured and subjected to other ill-treatment; whereas, under the same law, NISS officers are immune from prosecution for any act committed in the course of their duties, which has created a culture of general impunity;

K.  whereas in May 2016, the Government of Sudan rejected the UN’s recommendations calling on it to repeal the impunity provisions of the 2010 National Security Law and to arrange for independent inquiries to be launched with a view to prosecutions for crimes under international law and breaches of human rights committed by members of the NISS, the armed forces and the police;

L.  whereas several of the human rights defenders who have been detained have been subjected to torture and ill-treatment; whereas detainees held in custody by the NISS are especially at risk of ill-treatment; whereas the NISS is known for its ill-treatment and torture of detainees;

M.  whereas the ongoing violence by government forces, pro-government militia groups and anti-government armed groups forms the backdrop to continued harassment, arbitrary arrests, incommunicado detentions and the alleged torture of human rights defenders by Sudanese military and security forces;

N.  whereas the European External Action Service (EEAS) has declared the easing of sanctions by the United States as an important step in overall efforts to reintegrate Sudan into the international community, and has signalled that the EU stands ready to accompany Sudan in this process; whereas during the first ever mission to Sudan of Parliament’s Subcommittee on Human Rights in December 2017, the Sudanese Government expressed a willingness to re-engage with the international community; whereas Salih Mahmoud Osman has on several occasions visited EU institutions, including the European Parliament, in order to express strong reservations about the EU’s re-engagement with Sudan;

O.  whereas the Sudanese authorities prevented Mohamed Aldoma from travelling and seized his passport while he was en route to Cairo for medical treatment on 8 March 2018, following ill-treatment while in detention;

P.  whereas Sudan is ranked 174th out of 180 in the World Press Freedom Index; whereas press and media freedoms continue to be severely restricted by the authorities and by the Press and Publications Act, which provides for restrictions such as censorship, the seizure and confiscation of newspapers, closures of media outlets and internet cut-offs; whereas newspapers are regularly censored and confiscated after being printed, which imposes economic sanctions over and above the political sanctions;

Q.  whereas the right to freedom of religion continues to be restricted and the law criminalises apostasy, blasphemy and conversion from Islam to other religions; whereas on 21 February 2018 the journalist Shamael al-Nur, working for the daily newspaper Al-Tayyar, was charged with apostasy for having written an editorial on the cuts in national health spending, a charge which carries the death penalty in Sudan;

R.  whereas the International Criminal Court issued arrest warrants for the Sudanese President Omar Hassan Ahmad al-Bashir on 4 March 2009 and 12 July 2010;

1.  Expresses deep concern at the ongoing persecution of human rights defenders and civil society in Sudan, particularly involving violations of freedom of expression, freedom to demonstrate, freedom of assembly and religious freedom, and the intimidation of human rights defenders, journalists and NGOs opposed to the regime;

2.  Calls for the immediate and unconditional release of the Sakharov Laureate Salih Mahmoud Osman, as well as of any other human rights defenders, civil society activists and opposition activists who are being held solely as a result of their legitimate and peaceful work in defence of human rights and democracy;

3.  Condemns in the strongest possible terms the practice of torture and ill-treatment towards any detained persons; insists that the conditions of all detainees must comply with international standards, including the UN Body of Principles for the Protection of All Persons under Any Form of Detention or Imprisonment;

4.  Calls on the Sudanese authorities to investigate the use of violence against peaceful demonstrators, torture and ill-treatment, and to bring the perpetrators to justice; emphasises that any purported information collected as a result of torture and ill-treatment must never be admissible as evidence in legal proceedings;

5.  Deplores the targeting and abuse of all human rights defenders and activists in Sudan, and calls on the authorities to guarantee in all circumstances that they are able to carry out their legitimate activities without fear of reprisals and free of all restrictions, including judicial harassment;

6.  Urges the Sudanese Government to immediately cease the violations of the rights of political opposition parties and human rights defenders to the freedoms of expression, association and assembly; calls for the fundamental human rights of all people in Sudan to be respected and protected;

7.  Expresses its concern at the continual and frequent violations of women’s rights in Sudan, with particular regard to Article 152 of the Criminal Code; calls on the Sudanese authorities to sign without delay and ratify the Convention on the Elimination of All Forms of Discrimination Against Women;

8.  Underlines its continued commitment to the protection mechanism for human rights defenders at risk; calls on the EEAS to continue to improve its implementation of the EU Guidelines on Human Rights Defenders, by fully utilising all means at its disposal in Sudan; emphasises that EU delegations must prioritise support in their local calls for proposals under the European Instrument for Democracy and Human Rights (EIDHR) for those human rights defenders most at risk, thereby ensuring effective and targeted support;

9.  Requests that the EEAS and the EU Delegation to Sudan report back to Parliament on actions taken to provide protection and support for human rights defenders; calls for united EU and Member State action in support of human rights defenders at risk;

10.  Reiterates that it is imperative that key laws, including the 2010 National Security Act and laws regulating media and civil society, are reviewed and reformed, in order to bring them into line with international standards which uphold the freedoms of expression, assembly and association;

11.  Reminds Sudan of its obligations as a UN Member and urges it to comply with UN Security Council Resolution 1593 (2005), which requires cooperation with the International Criminal Court (ICC); reaffirms its demand that the Sudanese President Omar al-Bashir complies with international law in accordance with the conventions and treaties to which Sudan is a party, and supports the role of the ICC in pursuing the charges against him of war crimes, crimes against humanity and genocide;

12.  Urges Sudan to ensure respect for human rights and fundamental freedoms in accordance with the Universal Declaration of Human Rights and the UN Declaration on Human Rights Defenders;

13.  Shares the concerns expressed by Salih Mahmoud Osman that the current focus on migration may divert the EU’s attention away from human rights matters;

14.  Calls, therefore, on the EEAS to resume issuing statements in response to widespread human rights violations by actors of the state and militias, as well as statements concerning the shrinking space for civil society, in order to demonstrate that the EU remains deeply concerned about the human rights situation in Sudan;

15.  Strongly requests that the EU and its Member States ensure that the implementation of projects with the Sudanese authorities observe the ‘Do no harm’ principle, which would rule out cooperation with actors responsible for human rights violations;

16.  Invites the EU and its Member States to provide support to those within Sudan who are genuinely seeking change, and to provide civil society organisations with technical assistance and capacity-building programmes to improve their human rights advocacy and rule of law capabilities and enable them to contribute more effectively to the improvement of human rights in Sudan;

17.  Calls on the EU and its Member States to continue their commitment to support the efforts of the African Union to bring peace to Sudan and the Sudanese people; expresses its support, in this regard, for the renewal of the mandate of the UN-African Union Mission in Darfur (UNAMID) up to June 2018;

18.  Instructs its President to forward this resolution to the Council, the Commission, the Government of Sudan, the African Union, the United Nations Secretary-General, the Co-Presidents of the ACP-EU Joint Parliamentary Assembly and the Pan-African Parliament (PAP).

European Parliament resolution of 15 March 2018 on mercy killings in Uganda (2018/2632(RSP))

P8_TA(2018)0081 RC-B8-0165/2018

The European Parliament,

–  having regard to the Universal Declaration of Human Rights of 10 December 1948, to which Uganda is a signatory,

–  having regard to the ACP-EU Partnership Agreement (‘Cotonou Agreement’) and in particular to Article 8(4) thereof on non-discrimination,

–  having regard to the Constitution of the Republic of Uganda,

–  having regard to the International Convention on the Rights of the Child (CRC), adopted on 20 November 1989, in particular to Articles 2 and 6 thereof, which explicitly stipulate the principle of non-discrimination, including on grounds of disability, and the right to life,

–  having regard to the United Nations Convention on the Rights of Persons with Disabilities (CRPD), adopted in 2006, in particular to Article 32 thereof, which states that all parties must include disabilities and persons with disabilities in their international cooperation efforts,

–  having regard to the latest resolutions of the UN Human Rights Council on the human rights of persons with disabilities of 14 April 2014 and 14 July 2014,

–  having regard to Article 19 of the Treaty on the Functioning of the European Union (TFEU), Article 6 of the Treaty on European Union (TEU) and Article 14 of the Convention for the Protection of Human Rights and Fundamental Freedoms, which prohibit all forms of discrimination, as well as Articles 21 and 26 thereof, which set out the rights of people with disabilities,

–  having regard to the resolution of the ACP-EU Joint Parliamentary Assembly on the inclusion of persons with disabilities in developing countries, adopted on 23 November 2011,

–  having regard to the World Report on Disability published by the World Health Organisation (WHO) and the World Bank in June 2011,

–  having regard to the OHCHR report of 8 April 2016, ‘Committee on the Rights of Persons with Disabilities considers report of Uganda’,

–  having regard to United Nations General Assembly (UNGA) Resolutions 65/186 and 64/131 on ‘Realising the Millennium Development Goals for persons with disabilities towards 2015 and beyond’,

–  having regard to the EU Guidance Note on Disability and Development for EU Delegations and Services,

–  having regard to the 2030 Agenda and the Sustainable Development Goals (SDGs) adopted in New York on 25 September 2015,

–  having regard to Uganda’s review report of 1 July 2016 on the implementation of the 2030 Agenda entitled ‘Ensuring that no one is left behind’, which was presented to the UN High-level Political Forum in New York,

–  having regard to its resolution of 19 January 2006(1) on disability and development,

–  having regard to its previous resolutions on Uganda,

–  having regard to Rules 135(5) and 123(4) of its Rules of Procedure,

A.  whereas ‘mercy killing’ in Uganda is a practice whereby parents of disabled children kill or allow them to die by starving them or denying them medical attention because of the belief that these children are better off dead than having to endure a painful and incurable disability;

B.  whereas Uganda is not the only country struggling with this problem; whereas many developing countries have made significant, though incomplete, progress on including people with disabilities in development projects;

C.  whereas some parents confess that the act of ‘mercy killing’ is necessary to save disabled children from severe suffering throughout their lives; whereas despite the testimony of some mothers or survivors, the practice remains a taboo;

D.  whereas the social stigma in Uganda is so strong that the mothers and children are rejected by the community, which attributes them a low social status and denies them full participation in society; whereas there is pressure on mothers to kill their own children after years of struggling with the effort and sacrifices related to caring for a disabled child;

E.  whereas beliefs held about children born with disabilities put them at greater risk of violence and murder than non-disabled children; whereas children with disabilities remain subject to various forms of violence, discrimination and marginalisation due to negative attitudes, superstition, neglect and social norms and practices; whereas the greatest threat to children with disabilities is posed by misleading beliefs regarding their condition, including that the presence of the child will lead to more children suffering from disabilities;

F.  whereas clans and extended families put mothers under too much pressure, seeking to understand the causes of disability and casting blame on the mother; whereas, in some cases, mothers have been expelled from their husbands’ households for producing disabled children;

G.  whereas doctors and medical workers fail to understand or explain the nature and the cause of the child’s frailty, and whereas the healthcare system is not sufficiently equipped to diagnose and treat many types of disabilities that could be minimised or even eliminated; whereas the denial of basic rights to children with disabilities, such as access to healthcare, education, support and rehabilitation, severely hinders their ability to develop their full potential;

H.  whereas Uganda is one of the 162 states party to the CRPD; whereas Uganda ratified the Convention and its Optional Protocol on 25 September 2008 without reservations; whereas Uganda committed itself to accord the same rights to persons with disabilities as to all other citizens;

I.  whereas in April 2016, the UN Committee on the Rights of Persons with Disabilities reviewed Uganda’s record on the implementation of the CRPD, and concluding observations and recommendations were drawn up, according to which ‘the Committee notes with concern that legislation and policies fail to provide protection for the rights of children with disabilities’ and ‘is also concerned about the absence of information on the situation of deaf and deaf-blind children, and about measures to ensure their protection and inclusion in society’;

J.  whereas the Government of Uganda has a number of general laws and policies that contain clauses on disability; whereas the country has disability-specific legislation; whereas the definition of disability can vary from one piece of legislation to another;

K.  whereas two of the greatest obstacles to the inclusion of disabled people in Ugandan society are their invisibility and negative attitudes towards them; whereas having children with disabilities is a reason for social exclusion for the family and in particular the mothers, as children with disabilities are seen as a source of shame and weakness for the family;

L.  whereas few state-run support facilities exist for parents of disabled children in parts of rural Uganda and whereas as a consequence families, in particular single mothers, often find it difficult to adequately care for their disabled children;

M.  whereas there are no official figures available as neither the police nor the justice system in Uganda investigate the phenomenon; whereas the lack of data makes the fight against the practice of ‘mercy killing’ difficult;

N.  whereas the work of civil society groups and human rights defenders is crucial to guaranteeing the rights of marginalised and vulnerable groups; whereas non-governmental organisations in Uganda are facing several difficulties and obstacles in providing services to children with disabilities and their parents; whereas many misconceptions surrounding children with disabilities pose a challenge to development efforts and the work of human rights monitors in Uganda;

O.  whereas associations for persons with disabilities have a particular role to play in representing and communicating the specific interests of people with disabilities to politicians and the general public; whereas there is a lack of information available to make the general public aware of cultural practices that stigmatise and hinder the development of persons with disabilities and their enjoyment of the same rights as all other persons in society;

1.  Strongly condemns the unjustifiable and inhumane killing of children and new-borns with disabilities; expresses its utmost concern over the ‘mercy killing’ of disabled children in Uganda and all countries affected; calls for an end to such acts of violence, cruelty and torture towards children;

2.  Calls on the authorities of Uganda and all countries affected by the ‘mercy’ and ritual killing of children to commit to tackling the harmful superstitious beliefs perpetuating the targeting of children;

3.  Recalls that the primary responsibility of a state is to protect its citizens, including vulnerable groups; reminds the Ugandan authorities of their obligation to comply with the Constitution of their country, in particular Articles 21, 32 and 35(1), the latter stating that persons with disabilities have a right to respect and human dignity and the state and society shall take appropriate measures to ensure they realise their full mental and physical potential;

4.  Recalls the specific duty of the Ugandan Parliament towards people with disabilities, embedded in Article 35(2) of the Constitution, by virtue of which the Parliament should enact laws appropriate for the protection of persons with disabilities; calls on the Ugandan Government to support all actions undertaken in favour of the improvement of the civil and human rights of disabled people;

5.  Calls for support for the families of persons with disabilities so that they can raise their children at home; calls on the Ugandan Government to develop quality support services for the families of children with disabilities throughout the country, including sufficient financial support and benefits for families to take good care of their disabled children;

6.  Calls on the authorities to ensure social awareness and information on the situation of disable people, and training courses to ensure support, information and advice for parents and care-givers of children with disabilities, in order to facilitate the participation of these children in the community;

7.  Calls on the Government of Uganda to ensure medical doctors who come into direct contact with people with disabilities and their medical problems are adequately educated and sensitised to the needs of these patients;

8.  Welcomes the creation in 2007 of the Equal Opportunities Commission Act, which aims at promoting equal opportunities for marginalised groups, including persons with disabilities;

9.  Welcomes the creation of the Uganda Human Rights Commission (UHRC) under the 1995 Constitution of the Republic of Uganda; recalls its role, among others, to create and sustain the awareness in society of the provisions of this constitution as the fundamental law of the people of Uganda and to monitor the government’s compliance with international human rights obligations;

10.  Calls on the UHRC to develop a concrete national plan to guide its monitoring function and to promote more structured and institutionalised interaction with all disabled persons’ organisations in the country;

11.  Urges the authorities to ensure registration of all children at birth, including those with disabilities;

12.  Calls on the Ugandan authorities to strengthen efforts to raise awareness of the rights and dignity of children with disabilities in Uganda; underlines, in this connection, the important role of education to combat stigmatisation; stresses emphatically the key role of associations for persons with disabilities in raising awareness about the inclusion of people with disabilities and the challenges they face;

13.  Stresses that the media should play a more active role in challenging stereotypes and promoting inclusion; calls upon international, national and local decision makers to ensure and promote awareness-raising via the media, educational policies and public campaigns;

14.  Expresses grave concern at the increasing number of physical attacks on human rights defenders and civil society groups, such as the Human Rights Awareness and Promotion Forum; urges the Ugandan authorities to guarantee the safety of human rights defenders, prosecute attacks against them and enable them to carry out their work free of threats and impediments;

15.  Calls on the Commission and the Member States to support the efforts of the Government, NGOs and civil society of Uganda to formulate and implement policies to address the needs and rights of persons with disabilities, based on non-discrimination and social inclusion, and equal access to healthcare and other social services;

16.  Calls for an exchange of good practices among both developing and developed countries; asks the Commission to develop a platform together with other international donors in order to exchange good inclusion practices for children with disabilities; calls upon the Commission to fully fulfil its commitments under Article 32 of the CRPD;

17.  Calls on the EU to take advantage of the political leverage provided by development aid programmes, namely budget support programmes, to enhance the defence and promotion of human rights in Uganda; calls on the Commission to verify if better assistance can be granted, either through funding or coordination with local institutions, to improve medical support to children with disabilities in order to extend urgently needed support to their families;

18.  Stresses that inclusion policies should be promoted in all relevant UN and international fora, as the issue of disability is currently absent in many high-level international discussions and must be placed high on the political agenda;

19.  Instructs its President to forward this resolution to the Council, the Commission, the Vice-President of the Commission / High Representative of the Union for Foreign Affairs and Security Policy, the President of the Republic of Uganda, the Speaker of the Ugandan Parliament and the African Union and its institutions.

(1) OJ C 287 E, 24.11.2006, p. 336.

European Parliament legislative resolution of 15 March 2018 on the draft Council decision denouncing the Partnership Agreement in the fisheries sector between the European Community and the Union of the Comoros (14423/2017 – C8-0447/2017 – 2017/0241(NLE))

P8_TA(2018)0082 A8-0058/2018

(Consent)

The European Parliament,

–  having regard to the draft Council decision (14423/2017),

–  having regard to the Partnership Agreement in the fisheries sector between the European Community and the Union of the Comoros(1),

–  having regard to the request for consent submitted by the Council in accordance with Article 43 and Article 218(6), second subparagraph, point (a), of the Treaty on the Functioning of the European Union (C8‑0447/2017),

–  having regard to its non-legislative resolution of 15 March 2018(2) on the draft decision,

–  having regard to Rule 99(1) and (4) and Rule 108(7) of its Rules of Procedure,

–  having regard to the recommendation of the Committee on Fisheries and the opinion of the Committee on Development (A8-0058/2018),

1.  Gives its consent to the denunciation of the Agreement;

2.  Instructs its President to forward its position to the Council, the Commission and the governments and parliaments of the Member States and of the Union of the Comoros.

(1) OJ L 290, 20.10.2006, p. 7. (2) Texts adopted of that date, P8_TA(2018)0083.

European Parliament non-legislative resolution of 15 March 2018 on the draft Council decision denouncing the Partnership Agreement in the fisheries sector between the European Community and the Union of the Comoros (14423/2017 – C8-0447/2017 – 2017/0241(NLE) – 2017/2266(INI))

P8_TA(2018)0083 A8-0055/2018

The European Parliament,

–  having regard to the draft Council decision (14423/2017),

–  having regard to the Partnership Agreement in the fisheries sector between the European Community and the Union of the Comoros(1),

–  having regard to the request for consent submitted by the Council in accordance with Article 43 and Article 218(6), second subparagraph, point (a), of the Treaty on the Functioning of the European Union (C8-0447/2017),

–  having regard to its legislative resolution of 15 March 2018(2) on the draft decision,

–  having regard to Council Regulation (EC) No 1005/2008 of 29 September 2008 establishing a Community system to prevent, deter and eliminate illegal, unreported and unregulated fishing, amending Regulations (EEC) No 2847/93, (EC) No 1936/2001 and (EC) No 601/2004 and repealing Regulations (EC) No 1093/94 and (EC) No 1447/1999(3) (‘the IUU Regulation’), particularly Article 8(8) thereof,

–  having regard to Rule 99(2) of its Rules of Procedure,

–  having regard to the report of the Committee on Fisheries and the opinion of the Committee on Development (A8-0055/2018),

A.  whereas the Partnership Agreement in the fisheries sector between the European Community and the Union of the Comoros (hereinafter ‘the Comoros’) provides for its termination by either party in the event of serious circumstances, such as failure to comply with undertakings made by the parties with regard to combating illegal, unreported and unregulated (IUU) fishing;

B.  whereas illegal fishing is a major threat to global marine resources, given that it depletes fish stocks, destroys marine habitats, puts honest fishers at an unfair disadvantage, and destroys the livelihoods of coastal communities, particularly in developing countries;

C.  whereas the EU should take all possible steps to ensure that sustainable fisheries agreements entered into with third countries bring mutual benefits to the EU and the third countries concerned, including their local populations and their fisheries sectors;

D.  whereas the overall aim of the Protocol concluding the Partnership Agreement in the fisheries sector between the European Community and the Union of the Comoros was to enhance fisheries cooperation between the EU and the Comoros in the interests of both parties, by establishing a partnership framework within which to pursue a sustainable fisheries policy while exploiting fishery resources in a sustainable way in the Comorian exclusive economic zone, as well as to secure an appropriate share, corresponding to the interests of the EU fleets, of the fishing surpluses available;

E.  whereas the first fisheries agreement between the EEC and the Comoros dates back to 1988 and whereas the fleets of EEC/EU Member States have since then been given access to fishing opportunities under a series of implementing protocols;

F.  whereas according to the UNCTAD report entitled ‘Fishery Exports and the Economic Development of Least Developed Countries’, sectoral cooperation has not progressed beyond a rudimentary state, with very little impact on the fishing industry, landing conditions, monitoring and surveillance capacity, scientific development, or the technical training of fishers and observers; whereas the price that the EU pays to the Comoros per tonne of fish (tuna) is roughly 15 % of the estimated wholesale price per tonne;

G.  whereas the Comoros was notified on 1 October 2015 of the possibility of its being identified as a non-cooperating third country for failure to exert adequate control of vessels registered under the Comorian flag; whereas, having been identified as a non-cooperating country in May 2017 and listed as such in July 2017 by the EU, which issued a ‘red card’, the country has still failed to take the corrective measures needed to resolve the problems identified and to combat IUU fishing;

H.  whereas the previous protocol to the fisheries agreement with the Comoros expired on 30 December 2016 and was not renewed because the Comoros had failed to give any undertaking to combat IUU fishing; whereas the protocol was endowed with a financial envelope of EUR 600 000 a year, of which EUR 300 000 were earmarked for the support of the fisheries policy of the Comoros with a view to promoting sustainability and sound management of fisheries resources in its waters;

I.  whereas the EU is firmly committed to combating illegal fishing and any form of business stemming from it, and that commitment is set out in the IUU regulation;

J.  whereas the EU and its Member States are pursuing cooperation with the Comoros in several sectors; whereas the EU’s denunciation of the fisheries Partnership Agreement can be reversed (if the necessary corrective measures are taken) and whereas the denunciation of this agreement does not rule out future negotiation of another agreement or any other form of partnership in the fisheries sector;

K.  whereas combating IUU fishing does not depend solely on identifying non-cooperating third countries, but, on the contrary, requires that ways be found to remedy situations brought to light; whereas unless it receives outside assistance, the Comoros will be unable to improve its marine management policies for fishery resources in particular, including as regards landing conditions, monitoring and surveillance capacity, scientific development, and the technical training of fishers and observers;

L.  whereas the 2030 Agenda for Sustainable Development and the Sustainable Development Goals (SDGs) incorporated, for the first time, a goal related to the conservation and sustainable use of seas and marine resources (Goal 14);

1.  Regrets that the Comoros has failed to take the corrective measures needed to resolve the problems identified and to combat IUU fishing, despite being warned by the EU;

2.  Reiterates the importance of effective flag state control, the absence of which is a root cause of IUU fishing; considers that the Comoros should meet its obligations under international law with respect to the supervision and control of vessels flying its flag; strongly believes that this lack of supervision and authorisation to fish enables such vessels to engage in IUU fishing with impunity;

3.  Takes the view that the Comoros should remain engaged with the EU and seize this opportunity to put in place the measures necessary to improve its ability to address illegal fishing;

4.  Deplores the fact that in almost 30 years of fisheries agreements between the EU and the Comoros – one component of which has been geared to cooperation and support for the development of the Comorian fisheries sector – it has not proved possible to achieve more tangible results in the sector’s development, including in fields such as monitoring and surveillance capacity, scientific development, and technical training for fishers and observers;

5.  Maintains that the available development cooperation instruments, especially the European Development Fund (EDF), need to be dovetailed more effectively with overall support for capacity development in the fisheries sector;

6.  Recalls that the Comoros has a duty, under the fisheries Partnership Agreement signed with the EU and other international instruments, as well as within the framework for the achievement of the 2030 Agenda and the SDGs, to respect the principles of good governance in fisheries and responsible fishing, maintain fish stocks and preserve the marine ecosystem in its exclusive economic zone;

7.  Stresses the need to fight IUU fishing globally and to create incentives for states to take their responsibilities seriously and implement necessary reforms in their fisheries sectors;

8.  Maintains that combating IUU fishing must not hinge entirely on identifying non-cooperating third countries and that, in order truly to fight illegal fishing in all its forms, it is necessary to find ways of helping countries, in particular small island developing states, of which the Comoros is one, so as to enable them to alter their marine management policies;

9.  Agrees with the Commission and the Council on the need to apply the measures referred to in Article 38(8) of the IUU Regulation for the denunciation of any standing bilateral fisheries agreement with the Comoros, which provides for termination of the agreement in the event of failure to comply with undertakings made by it with regard to combating IUU fishing;

10.  Notes the other consequences referred to in Article 38(8) of the IUU Regulation, concerning prohibitions on chartering, reflagging and private agreements, among others;

11.  Maintains, however, that such denunciation must not mark the end of cooperation between the EU and the Comoros in the fisheries sector; urges the Commission to seek to ensure that this relationship can be reactivated as soon as possible, proceeding from the premise that fishing communities and small-scale artisanal fisheries should be considered central to the country’s development and that, to that end, investment and technical assistance should be promoted in the following areas:

12.  Calls for the inclusion of a clause whereby, should the Comoros remedy its shortcomings, the procedure would be stopped and the red card withdrawn, thus enabling the EU fleet to return;

13.  Calls on the Commission to take the appropriate steps to bring about a return to normal by improving the effectiveness of measures to combat IUU fishing and letting the EU fleet go back to the fishing zone once the terms of a new protocol have been renegotiated;

14.  Calls on the Commission and Council, each within its remit, to keep Parliament fully informed without delay of such developments as might occur in this process;

15.  Instructs its President to forward this resolution to the Council, the Commission, and the governments and parliaments of the Member States and of the Union of the Comoros.

(1) OJ L 290, 20.10.2006, p. 7. (2) Texts adopted, P8_TA(2018)0082. (3) OJ L 286, 29.10.2008, p. 1.

European Parliament legislative resolution of 15 March 2018 on the proposal for a decision of the European Parliament and of the Council on a common framework for the provision of better services for skills and qualifications (Europass) and repealing Decision No 2241/2004/EC (COM(2016)0625 – C8-0404/2016 – 2016/0304(COD))

P8_TA(2018)0084 A8-0244/2017

(Ordinary legislative procedure: first reading)

The European Parliament,

–  having regard to the Commission proposal to Parliament and the Council (COM(2016)0625),

–  having regard to Article 294(2) and Articles 165 and 166 of the Treaty on the Functioning of the European Union, pursuant to which the Commission submitted the proposal to Parliament (C8‑0404/2016),

–  having regard to Article 294(3) of the Treaty on the Functioning of the European Union,

–  having regard to the opinion of the European Economic and Social Committee of 15 February 2017(1),

–  after consulting the Committee of the Regions,

–  having regard to the provisional agreement approved by the committees responsible under Rule 69f(4) of its Rules of Procedure and the undertaking given by the Council representative by letter of 20 December 2017 to approve Parliament’s position, in accordance with Article 294(4) of the Treaty on the Functioning of the European Union,

–  having regard to Rule 59 of its Rules of Procedure,

–  having regard to the joint deliberations of the Committee on Employment and Social Affairs and the Committee on Culture and Education under Rule 55 of the Rules of Procedure,

–  having regard to the report of the Committee on Employment and Social Affairs and the Committee on Culture and Education (A8-0244/2017),

1.  Adopts its position at first reading hereinafter set out;

2.  Calls on the Commission to refer the matter to Parliament again if it replaces, substantially amends or intends to substantially amend its proposal;

3.  Instructs its President to forward its position to the Council, the Commission and the national parliaments.

Position of the European Parliament adopted at first reading on 15 March 2018 with a view to the adoption of Decision (EU) 2018/… of the European Parliament and of the Council on a common framework for the provision of better services for skills and qualifications (Europass) and repealing Decision No 2241/2004/EC

(As an agreement was reached between Parliament and Council, Parliament's position corresponds to the final legislative act, Decision (EU) 2018/646.)

(1) OJ C 173, 31.5.2017, p. 45.

European Parliament legislative resolution of 15 March 2018 on the proposal for a regulation of the European Parliament and of the Council amending Regulation (EU) No 1295/2013 establishing the Creative Europe Programme (2014 to 2020) (COM(2017)0385 – C8-0236/2017 – 2017/0163(COD))

P8_TA(2018)0085 A8-0369/2017

(Ordinary legislative procedure: first reading)

The European Parliament,

–  having regard to the Commission proposal to Parliament and the Council (COM(2017)0385),

–  having regard to Article 294(2) and the first indent of Article 167(5) of the Treaty on the Functioning of the European Union, pursuant to which the Commission submitted the proposal to Parliament (C8‑0236/2017),

–  having regard to Article 294(3) of the Treaty on the Functioning of the European Union,

–  having regard to the opinion of the European Economic and Social Committee of 18 October 2017(1),

–  after consulting the Committee of the Regions,

–  having regard to the provisional agreement approved by the committee responsible under Rule 69f(4) of its Rules of Procedure and the undertaking given by the Council representative by letter of 31 January 2018 to approve Parliament’s position, in accordance with Article 294(4) of the Treaty on the Functioning of the European Union,

–  having regard to Rule 59 of its Rules of Procedure,

–  having regard to the report of the Committee on Culture and Education (A8-0369/2017),

1.  Adopts its position at first reading hereinafter set out;

2.  Calls on the Commission to refer the matter to Parliament again if it replaces, substantially amends or intends to substantially amend its proposal;

3.  Instructs its President to forward its position to the Council, the Commission and the national parliaments.

Position of the European Parliament adopted at first reading on 15 March 2018 with a view to the adoption of Regulation (EU) 2018/… of the European Parliament and of the Council amending Regulation (EU) No 1295/2013 establishing the Creative Europe Programme (2014 to 2020)

(As an agreement was reached between Parliament and Council, Parliament's position corresponds to the final legislative act, Regulation (EU) 2018/596.)

(1) Not yet published in the Official Journal.

Amendments adopted by the European Parliament on 15 March 2018 on the proposal for a regulation of the European Parliament and of the Council amending Regulation (EC) No 726/2004 as regards the location of the seat of the European Medicines Agency (COM(2017)0735 – C8-0421/2017 – 2017/0328(COD))(1)

P8_TA(2018)0086 A8-0063/2018

(Ordinary legislative procedure: first reading)

Text proposed by the Commission   Amendment Amendment 1 Proposal for a regulation Recital 2 (2)  Having regard to Article 50(3) of the Treaty on European Union, the European Medicines Agency should take its new seat as from the date on which the Treaties cease to apply to the United Kingdom or from 30 March 2019, whichever is the earlier. (2)  Having regard to Article 50(3) of the Treaty on European Union, the European Medicines Agency (“the Agency”) should take its new seat from 30 March 2019. Amendment 2 Proposal for a regulation Recital 3 (3)  To ensure the proper functioning of the European Medicines Agency in its new location, a headquarters agreement should be concluded before the European Medicines Agency takes up its new seat. (3)  To ensure the proper functioning of the Agency in its new location, a headquarters agreement should be concluded as soon as possible. The headquarters agreement should include the most appropriate terms and conditions for the successful relocation of the Agency and its staff members to Amsterdam. Amendment 3 Proposal for a regulation Recital 3 a (new) (3a)  In order to ensure the Agency’s full business continuity, the temporary location in Amsterdam should be provided as of 1 January 2019 and the permanent headquarters of the Agency should be completed by 15 November 2019. Amendment 4 Proposal for a regulation Recital 3 b (new) (3b)  It is to be welcomed that the new location of the Agency is in line with the preferences of its current staff members and that the Dutch authorities are making efforts to ensure that the double transfer will not jeopardise the operational effectiveness, continuity and uninterrupted functioning of the Agency. However, the double relocation of the Agency to Amsterdam means that the Agency will have to temporarily de-prioritise certain activities, such as its work on paediatric medicines and public health issues including its work on anti-microbial resistance and flu pandemics, while it resides in the temporary location. The delays that the Dutch government has already announced, which have pushed back the handover of the permanent building, on which construction work has not yet started, raise concerns about potential further delays. The relocation to the temporary building should be limited to 10,5 months to ensure that the Agency will be able to operate again at its full capacity as of 16 November 2019 and avoid further loss of expertise. Amendment 5 Proposal for a regulation Article 1 – paragraph 1 – introductory part In Regulation (EC) No 726/2004, the following Article 71a is inserted: In Regulation (EC) No 726/2004, the following Article 71a and Article 71b are inserted: Amendment 6 Proposal for a regulation Article 1 – paragraph 1 Regulation (EC) No 726/2004 Article 71a Article 71a Article 71a The Agency shall have its seat in Amsterdam, the Netherlands. The Agency shall have its seat in Amsterdam, the Netherlands. The Commission and the competent authorities of the Netherlands shall take all necessary measures to ensure that the Agency can move to its temporary location no later than 1 January 2019 and that it can move to its permanent location no later than 16 November 2019. The Commission and the competent authorities of the Netherlands shall submit a written report to the European Parliament and the Council on the progress on the adjustments of the temporary premises and on the construction of the permanent building three months after the entry into force of this Regulation, and every three months thereafter, until the Agency has moved into its permanent headquarters. Amendment 7 Proposal for a regulation Article 1 – paragraph 1 Regulation (EC) No 726/2004 Article 71 b (new) Article 71b A headquarters agreement allowing the Agency to take up its duties at the premises approved by the European Parliament and the Council shall be concluded within three months from ... [date of entry into force of this Regulation]. Amendment 8 Proposal for a regulation Article 2 – paragraph 2 This Regulation shall apply from the date on which the Treaties cease to apply to the United Kingdom or from 30 March 2019, whichever is the earlier. This Regulation shall apply from 30 March 2019. Amendment 15 Proposal for a regulation Statement (new) ‘ATTACHMENT TO REGULATION 2018/... STATEMENT OF THE EUROPEAN PARLIAMENT The European Parliament regrets that its role of co-legislator has not been duly taken into account since it was not involved in the procedure leading to the selection of the new seat of the European Medicines Agency. The European Parliament wishes to recall its prerogatives as co-legislator and insists on the full respect of the ordinary legislative procedure in relation to the location of bodies and agencies. As the only directly elected Union institution and representative of the Union’s citizens, it is the first guarantor of the respect of the democratic principle in the Union. The European Parliament condemns the procedure followed for the selection of the new location of the seat, which has de facto deprived the European Parliament of its prerogatives since it was not effectively involved in the process, but is now expected to simply confirm the selection made for the new location of the seat by means of the ordinary legislative procedure. The European Parliament recalls that the Common Approach annexed to the Joint Statement of the European Parliament, Council and European Commission on decentralised agencies signed in 2012 is legally non-binding, as acknowledged in the Statement itself and that it was agreed without prejudice to the legislative powers of the institutions. Therefore, the European Parliament insists that the procedure followed for the selection of a new location for the agencies will be revised and not used anymore in this form in the future. Finally, the European Parliament wishes to recall as well that in the Inter-institutional Agreement of 13 April 2016 on Better Law-Making1 the three institutions committed to sincere and transparent cooperation while recalling the equality of both co-legislators as enshrined in the Treaties. __________________ 1 OJ L 123, 12.5.2016, p. 1.’

(1) The matter was referred back for interinstitutional negotiations to the committee responsible pursuant to Rule 59(4), fourth subparagraph (A8-0063/2018).

European Parliament legislative resolution of 15 March 2018 on the proposal for a Council directive on a Common Consolidated Corporate Tax Base (CCCTB) (COM(2016)0683 – C8-0471/2016 – 2016/0336(CNS))

P8_TA(2018)0087 A8-0051/2018

(Special legislative procedure – consultation)

The European Parliament,

–  having regard to the Commission proposal to the Council (COM(2016)0683),

–  having regard to Article 115 of the Treaty on the Functioning of the European Union, pursuant to which the Council consulted Parliament (C8‑0471/2016),

–  having regard to the reasoned opinions submitted, within the framework of Protocol No 2 on the application of the principles of subsidiarity and proportionality, by the Danish Parliament, Dáil Éireann, Seanad Éireann, the Luxembourg Chamber of Representatives, the Maltese Parliament, the Netherlands Senate, the Netherlands House of Representatives and the Swedish Parliament, asserting that the draft legislative act does not comply with the principle of subsidiarity,

–  having regard to Rule 78c of its Rules of Procedure,

–  having regard to the report of the Committee on Economic and Monetary Affairs and the opinion of the Committee on Legal Affairs (A8-0051/2018),

1.  Approves the Commission proposal as amended;

2.  Calls on the Commission to alter its proposal accordingly, in accordance with Article 293(2) of the Treaty on the Functioning of the European Union;

3.  Calls on the Council to notify Parliament if it intends to depart from the text approved by Parliament;

4.  Asks the Council to consult Parliament again if it intends to substantially amend the Commission proposal;

5.  Instructs its President to forward its position to the Council, the Commission and the national parliaments.

Text proposed by the Commission   Amendment Amendment 1 Proposal for a directive Recital 1 (1)  Companies which seek to do business across frontiers within the Union encounter serious obstacles and market distortions owing to the existence and interaction of 28 disparate corporate tax systems. Furthermore, tax planning structures have become ever-more sophisticated over time, as they develop across various jurisdictions and effectively take advantage of the technicalities of a tax system or of mismatches between two or more tax systems for the purpose of reducing the tax liability of companies. Although those situations highlight shortcomings that are completely different in nature, they both create obstacles which impede the proper functioning of the internal market. Action to rectify these problems should therefore address both these types of market deficiencies. (1)  Companies which seek to do business across frontiers within the Union encounter serious obstacles and market distortions owing to the existence and interaction of 28 disparate corporate tax systems. In times of globalisation and digitalisation, taxation of in particular financial and intellectual capital on a source base is becoming increasingly harder to retrace and easier to manipulate. Furthermore, tax planning structures have become ever-more sophisticated over time, as they develop across various jurisdictions and effectively take advantage of the technicalities of a tax system or of mismatches between two or more tax systems for the purpose of reducing the tax liability of companies. The mainstream digitalisation of many sectors of the economy coupled with the fast developing digital economy calls into question the suitability of the Union corporate tax models designed for brick and mortar industries, including with regard to the extent that valuation and calculation criteria could be re-invented to reflect the commercial activities of the 21st century. Although those situations highlight shortcomings that are completely different in nature, they all create obstacles which impede the proper functioning of the internal market and give rise to distortions between large companies and small and medium-sized enterprises. A new standard for a corporate tax base for the Union should therefore address those types of market deficiencies while respecting the aims of long-term legal clarity and certainty and the principle of tax neutrality. More convergence between national tax systems will lead to a significant decrease in costs and administrative burden for businesses operating cross-border within the Union. While taxation policy is a national competence, Article 115 of the Treaty on the Functioning of the European Union clearly stipulates that the Council should, acting unanimously in accordance with a special legislative procedure and after consulting the European Parliament and the Economic and Social Committee, issue directives for the approximation of such taxation laws, regulations or administrative provisions of the Member States as directly affect the establishment or functioning of the internal market. Amendment 2 Proposal for a directive Recital 2 (2)  To support the proper functioning of the internal market, the corporate tax environment in the Union should be shaped in accordance with the principle that companies pay their fair share of tax in the jurisdiction(s) where their profits are generated. It is therefore necessary to provide for mechanisms that discourage companies from taking advantage of mismatches amongst national tax systems in order to lower their tax liability. It is equally important to also stimulate growth and economic development in the internal market by facilitating cross-border trade and corporate investment. To this end, it is necessary to eliminate both double taxation and double non-taxation risks in the Union through eradicating disparities in the interaction of national corporate tax systems. At the same time, companies need an easily workable tax and legal framework for developing their commercial activity and expanding it across borders in the Union. In that context, remaining cases of discrimination should also be removed. (2)  To support the proper functioning of the internal market, the corporate tax environment in the Union should be shaped in accordance with the principle that companies pay their fair share of tax in the jurisdiction(s) where their profits are generated and where companies have permanent establishment. Taking into account the digital change in the business environment, it is necessary to ensure that companies which generate revenues in a Member State without having a physical permanent establishment but having a digital permanent establishment in that Member State should be treated in the same way as companies having a physical permanent establishment. It is therefore necessary to provide for mechanisms that discourage companies from taking advantage of mismatches amongst national tax systems in order to lower their tax liability. It is equally important to also stimulate growth and economic development in the internal market by facilitating cross-border trade and corporate investment. To this end, it is necessary to eliminate both double taxation and double non-taxation risks in the Union through eradicating disparities in the interaction of national corporate tax systems. At the same time, companies need an easily workable tax and legal framework for developing their commercial activity and expanding it across borders in the Union. In that context, remaining cases of discrimination should also be removed. Consolidation is an essential element of the CCCTB system, since the major tax obstacles faced by companies of the same group that operate cross-border in the Union can only be tackled in that way. Consolidation eliminates transfer pricing formalities and intra-group double taxation. Amendment 3 Proposal for a directive Recital 3 (3)  As pointed out in the proposal of 16 March 2011 for a Council Directive on a Common Consolidated Corporate Tax Base (CCCTB)7 , a corporate tax system which treats the Union as a single market for the purpose of computing the corporate tax base of companies would facilitate cross-border activity for companies resident in the Union and promote the objective of making it a more competitive location for investment internationally. The proposal of 2011 for a CCCTB focussed on the objective of facilitating the expansion of commercial activity for businesses within the Union. In addition to that objective, it should also be taken into account that a CCCTB can be highly effective in improving the functioning of the internal market through countering tax avoidance schemes. In this light, the initiative for a CCCTB should be re-launched in order to address, on an equal footing, both the aspect of business facilitation and the initiative's function in countering tax avoidance. Such an approach would best serve the aim of eradicating distortions in the functioning of the internal market. (3)  As pointed out in the proposal of 16 March 2011 for a Council Directive on a Common Consolidated Corporate Tax Base (CCCTB)7 , a corporate tax system which treats the Union as a single market for the purpose of computing the corporate tax base of companies would facilitate cross-border activity for companies resident in the Union and promote the objective of making it a more competitive location for investment internationally especially for small and medium-sized enterprises. The proposal of 2011 for a CCCTB focussed on the objective of facilitating the expansion of commercial activity for businesses within the Union. In addition to that objective, it should also be taken into account that a CCCTB can be highly effective in improving the functioning of the internal market through countering tax avoidance schemes. In this light, the initiative for a CCCTB should be re-launched in order to address, on an equal footing, both the aspect of business facilitation and the initiative's function in countering tax avoidance. Once implemented in all Member States, a CCCTB would ensure that taxes are paid where profits are generated and where companies have permanent establishment. Such an approach would best serve the aim of eradicating distortions in the functioning of the internal market. Improving the internal market is a key factor for encouraging growth and job creation. The introduction of a CCCTB would improve economic growth and result in more jobs in the Union by reducing harmful tax competition between companies. __________________ __________________ 7 Proposal for a Council Directive COM(2011)0121 final/2 of 3.10.2011 on a Common Consolidated Corporate Tax Base. 7 Proposal for a Council Directive COM(2011)0121 final/2 of 3.10.2011 on a Common Consolidated Corporate Tax Base. Amendment 4 Proposal for a directive Recital 4 (4)  Considering the need to act swiftly in order to ensure a proper functioning of the internal market by making it, on the one hand, friendlier to trade and investment and, on the other hand, more resilient to tax avoidance schemes, it is necessary to divide the ambitious CCCTB initiative into two separate proposals. At a first stage, rules on a common corporate tax base should be agreed, before addressing, at a second stage, the issue of consolidation. (4)  Considering the need to act swiftly in order to ensure a proper functioning of the internal market by making it, on the one hand, friendlier to trade and investment and, on the other hand, more resilient to tax avoidance schemes, it is very important to ensure simultaneous entry into force of the Directive on a Common Corporate Tax Base and the Directive on a Common Consolidated Corporate Tax Base. Because such a change of regime is a significant step in the completion of the internal market, it needs flexibility in order to be properly executed from the outset. Hence, as the internal market encompasses all Member States, the CCCTB should be introduced in all Member States. If the Council fails to adopt a unanimous decision on the proposal to establish a CCCTB, the Commission should issue a new proposal based on Article 116 of the Treaty on the Functioning of the European Union, whereby the European Parliament and the Council act in accordance with the ordinary legislative procedure to issue the necessary legislation. As a last resort, an enhanced cooperation should be initiated by Member States which should be open at any time to non-participating Member States in accordance with the Treaty on the Functioning of the European Union. It is regrettable, however, that no sufficiently detailed assessment has been conducted in respect of either the CCTB or CCCTB proposals in terms of the impact on Member States' corporate tax revenue on a country-by-country basis. Amendment 5 Proposal for a directive Recital 5 (5)  Many aggressive tax planning structures tend to feature in a cross-border context, which implies that the participating groups of companies possess a minimum of resources. On this premise, for reasons of proportionality, the rules on a CCCTB should be mandatory only for groups of companies of a substantial size. For that purpose, a size-related threshold should be fixed on the basis of the total consolidated revenue of a group which files consolidated financial statements. In addition, in order to better serve the aim of facilitating trade and investment in the internal market, the rules on a CCCTB should also be available, as an option, to those groups that fall short of the size-related threshold. (5)  Many aggressive tax planning structures tend to feature in a cross-border context, which implies that the participating groups of companies possess a minimum of resources. On this premise, for reasons of proportionality, the rules on a common base should be mandatory initially only for companies which belong to a group of a substantial size. For that purpose, a size-related starting threshold of EUR 750 million should be fixed on the basis of the total consolidated revenue of a group which files consolidated financial statements. Since this Directive sets a new standard for the corporate tax base for all businesses in the Union, the threshold should be lowered to zero over a maximum period of seven years. In order to better serve the aim of facilitating trade and investment in the internal market, the rules on a common corporate tax base should also be available in the first phase, as an option, to companies which do not meet those criteria. Amendment 6 Proposal for a directive Recital 5 a (new) (5a)  All things being equal the switch to a common consolidated corporate tax base could result in losses or gains of fiscal revenues for Member States. In order to compensate losses, a temporary compensation mechanism should be created, financed by the fiscal surplus from those Member States that experience gains in fiscal revenue due to the new regime. Compensation should be adjusted each year to take into account national or regional decisions taken prior to the entry into force of this Directive. The Commission should be required to propose the removal or the change of the compensation system after a period of seven years, and to set the ceilings for compensation. Amendment 7 Proposal for a directive Recital 5 b (new) (5b)  In order to avoid the existing allocation of the tax burden between small and medium-sized enterprises (SMEs) and multinational corporations as mentioned in the European Parliament resolution of 25 November 2015 on tax rulings and other measures similar in nature or effect, a common corporate tax base has the aim of not putting SMEs at a competitive disadvantage, thereby creating a level playing field for them. The principal tax authority can provide SMEs with the necessary tools to help them to comply with the administrative and organisational requirements that an opt-in to the CCCTB entails. Amendment 8 Proposal for a directive Recital 6 (6)  Eligibility for the consolidated tax group should be determined in accordance with a two-part test based on (i) control (more than 50 percent of voting rights) and (ii) ownership (more than 75 percent of equity) or rights to profits (more than 75 percent of rights giving entitlement to profit). Such a test would ensure a high level of economic integration between group members. To guarantee the integrity of the system, the two thresholds for control and ownership or profit rights should be met throughout the tax year; otherwise, the failing company should leave the group immediately. To prevent a manipulation of the tax results through companies entering and leaving the group within a short-term, there should also be a minimum requirement of nine consecutive months for establishing group membership. (6)  It is necessary to define the concept of a permanent establishment situated in the Union and belonging to a taxpayer who is resident for tax purposes within the Union. Too often, multinational companies make arrangements to transfer their profits to favourable tax regimes without paying any tax or paying very low rates of tax. The concept of a permanent establishment would provide a precise, binding definition of the criteria to be met if a multinational company is to prove that it is situated in a given country. That will compel multinational companies to pay their taxes fairly. The aim would be to ensure that all concerned taxpayers share a common understanding and to exclude the possibility of a mismatch due to divergent definitions. Similarly, it is important to have a common definition of permanent establishments situated in a third country, or in the Union but belonging to a taxpayer who is resident for tax purposes in a third country. If transfer pricing gives rise to profit shifting into a low tax jurisdiction, a system that awards profit via a formula apportionment is preferable. The Union can establish an international standard for modern and efficient corporate taxation by adopting such a system. The Commission should draft guidelines for the transitional phase in which formulary apportionment coexists with other allocation methods in dealing with third countries, while ultimately formulary apportionment should be the standard method of allocation. The Commission should make a proposal to set up a Union model of a tax treaty which could ultimately replace the thousands of bilateral treaties concluded by each of the Member States. Amendment 9 Proposal for a directive Recital 6 a (new) (6a)  Digital goods tend to be highly mobile and intangible. Studies have shown that the digital sector is highly involved in aggressive tax planning practices, since many business models do not require physical infrastructure in order to carry out transactions with customers and make profits. That allows the biggest digital companies to pay taxes of close to zero on their revenue. The treasuries of the Member States lose billions of euros in tax revenues from not being able to tax digital multinationals. To tackle that real and urgent social injustice, current corporate tax law needs to be expanded to include a new digital permanent establishment nexus based on a significant digital presence. A level-playing field is needed for similar business models to address the tax challenges that arise from the context of digitalisation, without hampering the potential of the digital sector. Particular account should be taken in that respect of the work carried out by the OECD on an internationally consistent set of rules. Amendment 10 Proposal for a directive Recital 10 (10)  The formula apportionment for the consolidated tax base should comprise three equally weighted factors, namely labour, assets and sales by destination. Those equally weighted factors should reflect a balanced approach to distributing taxable profits amongst the relevant Member States and should ensure that profits are taxed where they are actually earned. Labour and assets should therefore be allocated to the Member State where the labour is performed or the assets are located, and would thereby give appropriate weight to the interests of the Member State of origin, whilst sales should be allocated to the Member State of destination of the goods or services. To account for differences in the levels of wages across the Union and thus allow for a fair distribution of the consolidated tax base, the labour factor should comprise both payroll and the number of employees (i.e. each item counting for half). The asset factor, on the other hand, should comprise all fixed tangible assets, but not intangible and financial assets because of their mobile nature and the resulting risk that the rules of this Directive could be circumvented. Where, due to exceptional circumstances, the outcome of the apportionment does not fairly represent the extent of business activity, a safeguard clause should provide for an alternative method of income allocation. (10)  The formula apportionment for the consolidated tax base should comprise four equally weighted factors, namely labour, assets, sales by destination, and collection and use of personal data of online platforms and services users (the latter referred to herein as the ‘data factor’). Those equally weighted factors should reflect a balanced approach to distributing taxable profits amongst the relevant Member States and should ensure that profits are taxed where they are actually earned. Labour and assets should therefore be allocated to the Member State where the labour is performed or the assets are located, and would thereby give appropriate weight to the interests of the Member State of origin, whilst sales should be allocated to the Member State of destination of the goods or services. To account for differences in the levels of wages across the Union and thus allow for a fair distribution of the consolidated tax base, the labour factor should comprise both payroll and the number of employees (i.e. each item counting for half). The asset factor, on the other hand, should only comprise tangible assets. Where, due to exceptional circumstances, the outcome of the apportionment does not fairly represent the extent of business activity, a safeguard clause should provide for an alternative method of income allocation. Amendment 11 Proposal for a directive Recital 10 a (new) (10a)  The formula for the apportionment of the consolidated tax base needs to fully reflect the economic activity that has taken place in each Member State, by duly taking full account of potential significant differences between their economies. Where the formula results in an imbalanced apportionment that fails to reflect the economic activity, a dispute resolution mechanism could remedy such a situation. In light of the foregoing, the Commission should assess the possible establishment of a dispute resolution mechanism in order to ensure the proper resolution of disputes when different Member States are involved. Amendment 12 Proposal for a directive Recital 11 (11)  Due to their specificities, certain sectors, such as the financial and insurance sector, the oil and gas sector as well as shipping and air transport, need an adjusted formula for the apportionment of the consolidated tax base. deleted Amendment 13 Proposal for a directive Recital 14 (14)  This Directive builds upon Council Directive 2016/xx/EU on a common corporate tax base (which lays down a common set of corporate tax rules for computing the tax base) and focusses on the consolidation of tax results across the group. It would thus be necessary to deal with the interaction between the two legislative instruments and cater for the transition of certain elements of the tax base into the new framework of the group. Such elements should include, in particular, the interest limitation rule, the switch-over clause and controlled foreign company legislation as well as hybrid mismatches. (14)  This Directive builds upon Council Directive 2016/xx/EU on a common corporate tax base (which lays down a common set of corporate tax rules for computing the tax base) and focusses on the consolidation of tax results across the group. It is thus necessary to deal with the interaction between the two legislative instruments and cater for the transition of certain elements of the tax base into the new framework of the group. Such elements should include, in particular, the interest limitation rule, the switch-over clause and controlled foreign company legislation as well as hybrid mismatches. Member States should not be prevented from introducing additional anti-tax avoidance measures in order to reduce the negative effects of shifting profits to low-tax third countries. Amendment 14 Proposal for a directive Recital 16 (16)  In order to supplement or amend certain non-essential elements of this Directive, the power to adopt acts in accordance with Article 290 of the Treaty on the Functioning of the European Union should be delegated to the Commission with respect of (i) taking into account changes to the laws of Member States concerning the company forms and corporate taxes and amend Annexes I and II accordingly; (ii) laying down additional definitions; and (iii) supplementing the rule on the limitation of interest deductibility with anti-fragmentation rules, to better address the tax avoidance risks which may emerge within a group. It is of particular importance that the Commission carry out appropriate consultations during its preparatory work, including at expert level. The Commission, when preparing and drawing up delegated acts, should ensure a simultaneous, timely and appropriate transmission of relevant documents to the European Parliament and the Council. (16)  In order to supplement or amend certain non-essential elements of this Directive, the power to adopt acts in accordance with Article 290 of the Treaty on the Functioning of the European Union should be delegated to the Commission with respect of (i) taking into account changes to the laws of Member States concerning the company forms and corporate taxes and amend Annexes I and II accordingly; (ii) laying down additional definitions; (iii) supplementing the rule on the limitation of interest deductibility with anti-fragmentation rules, to better address the tax avoidance risks which may emerge within a group; and (iv) issuing guidelines for the transitional phase in which formulary apportionment coexists with other allocation methods in dealing with third countries. It is of particular importance that the Commission carry out appropriate consultations during its preparatory work, including at expert level, and it should take into account the European Parliament's annual resolution. The Commission, when preparing and drawing up delegated acts, should ensure a simultaneous, timely and appropriate transmission of relevant documents to the European Parliament and the Council. Amendment 15 Proposal for a directive Recital 17 (17)  In order to ensure uniform conditions for the implementation of this Directive, implementing powers should be conferred on the Commission (i) to adopt annually a list of third country company forms that are similar to the company forms listed in Annex I; (ii) to lay down detailed rules on the calculation of the labour, asset and sales factors, the allocation of employees and payroll, assets and sales to the respective factor and the valuation of assets; (iii) to adopt an act establishing a standard form of the notice to create a group; and (iv) to lay down rules on the electronic filing of the consolidated tax return, the form of the consolidated tax return, the form of the single taxpayer's tax return and the supporting documentation required. Those powers should be exercised in accordance with Regulation (EU) No 182/2011 of the European Parliament and of the Council12. (17)  In order to ensure uniform conditions for the implementation of this Directive, implementing powers should be conferred on the Commission (i) to adopt annually a list of third country company forms that are similar to the company forms listed in Annex I; (ii) to lay down detailed rules on the calculation of the labour, asset and sales factors and the data factor, the allocation of employees and payroll, the allocation of collected personal data and exploited personal data, assets and sales to the respective factor and the valuation of assets; (iii) to adopt an act establishing a standard form of the notice to create a group; and (iv) to lay down rules on the electronic filing of the consolidated tax return, the form of the consolidated tax return, the form of the single taxpayer's tax return and the supporting documentation required. The Commission should design those uniform tax return formats in cooperation with the tax administrations of the Member States. Those powers should be exercised in accordance with Regulation (EU) No 182/2011 of the European Parliament and of the Council12. __________________ __________________ 12 Regulation (EU) No 182/2011 of the European Parliament and of the Council of 16 February 2011 laying down the rules and general principles concerning mechanisms for control by Member States of the Commission’s exercise of implementing powers (OJ L 55, 28.2.2011, p. 13). 12 Regulation (EU) No 182/2011 of the European Parliament and of the Council of 16 February 2011 laying down the rules and general principles concerning mechanisms for control by Member States of the Commission’s exercise of implementing powers (OJ L 55, 28.2.2011, p. 13). Amendment 16 Proposal for a directive Recital 18 (18)  Since the objectives of this Directive, namely to improve the functioning of the internal market through countering practices of international tax avoidance and to facilitate businesses in expanding across borders within the Union, cannot be sufficiently achieved by the Member States acting individually and in a disparate fashion because coordinated action is necessary to obtain these objectives, but can rather, by reason of the fact that the Directive targets inefficiencies of the internal market that originate in the interaction between disparate national tax rules which impact on the internal market and discourage cross-border activity, be better achieved at Union level, the Union may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty on European Union. In accordance with the principle of proportionality, as set out in that Article, this Directive does not go beyond what is necessary in order to achieve those objectives, especially considering that its mandatory scope is limited to groups beyond a certain size. (18)  Since the objectives of this Directive, namely to improve the functioning of the internal market through countering practices of international tax avoidance and to facilitate businesses, in particular SMEs, in expanding across borders within the Union, cannot be sufficiently achieved by the Member States acting individually and in a disparate fashion because coordinated action is necessary to obtain these objectives, but can rather, by reason of the fact that the Directive targets inefficiencies of the internal market that originate in the interaction between disparate national tax rules which impact on the internal market and discourage cross-border activity, be better achieved at Union level, the Union may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty on European Union. In accordance with the principle of proportionality, as set out in that Article, this Directive does not go beyond what is necessary in order to achieve those objectives, especially considering that its mandatory scope is limited to groups beyond a certain size. Amendment 17 Proposal for a directive Recital 20 (20)  The Commission should be required to review the application of the Directive five years after its entry into force and report to Council on its operation. Member States should be required to communicate to the Commission the text of the provisions of national law which they adopt in the field covered by this Directive, (20)  Since this Directive contains an important change to corporate taxation rules, the Commission should be required to conduct a thorough assessment of the application of the Directive five years after its entry into force and report to the European Parliament and the Council on its operation. That implementation report should include at least the following points: the impact of the system of taxation provided for in this Directive on Member States’ revenues, the advantages and disadvantages of the system for SMEs, the impact on a fair tax collection between Member States, the impact on the internal market as a whole, with particular regard to possible distortion of competition between companies subject to the new rules laid down in this Directive, and the number of undertakings that fall within the scope during the transition period. The Commission should be required to review the application of this Directive 10 years after its entry into force and report to the European Parliament and the Council on its operation. Member States should be required to communicate to the Commission the text of the provisions of national law which they adopt in the field covered by this Directive, Amendment 18 Proposal for a directive Recital 20 a (new) (20a)  In order to achieve a full and consistent consolidation and prevent new opportunities for arbitrage arising from accounting inconsistencies between Member States, it is necessary to adopt clear, consistent and objective criteria for calculating the consolidated tax base. To that end, the Commission should propose the necessary adjustments to the relevant provisions of this Directive concerning the definition and calculation of the consolidated tax base. Amendment 19 Proposal for a directive Recital 20 b (new) (20b)  The Commission should consider additional studies that analyse the potential impact of the CCCTB on the corporate tax revenues of individual Member States, and potential competitive disadvantages for the Union in relation to third countries. Amendment 20 Proposal for a directive Article 1 – paragraph 1 1.  This Directive establishes a system for the consolidation of the tax bases, as referred to in Council Directive 2016/xx/EU14, of companies that are members of a group and lays down rules on how a common consolidated corporate tax base shall be allocated to Member States and administered by the national tax authorities. 1.  This Directive establishes a common base for the taxation in the Union of certain companies and lays down rules for the calculation of that base, including rules on measures to prevent tax avoidance and on measures relating to the international dimension of the proposed tax system. _______________ 14 [full title of the Directive (OJ L [ ], [ ], p. [ ])]. Amendment 21 Proposal for a directive Article 2 – paragraph 1 – introductory part 1.  The rules of this Directive shall apply to a company that is established under the laws of a Member State, including its permanent establishments in other Member States, where the company meets all of the following conditions: 1.  The rules of this Directive shall apply to a company that is established under the laws of a Member State, including its permanent and digital permanent establishments in other Member States, where the company meets all of the following conditions: Amendment 22 Proposal for a directive Article 2 – paragraph 1 – point c (c)  it belongs to a consolidated group for financial accounting purposes with a total consolidated group revenue that exceeded EUR 750 000 000 during the financial year preceding the relevant financial year; (c)  it belongs to a consolidated group for financial accounting purposes with a total consolidated group revenue that exceeded EUR 750 000 000 during the financial year preceding the relevant financial year. That threshold shall be lowered to zero over a maximum period of seven years; Amendment 23 Proposal for a directive Article 2 – paragraph 3 3.  A company that meets the conditions of points (a), (b) and (d) of paragraph 1, but does not meet the conditions of point (c) of that paragraph, may opt, including for its permanent establishments situated in other Member States, to apply the rules of this Directive for a period of five tax years. That period shall automatically be extended for successive terms of five tax years, unless there is a notice of termination as referred to in the second subparagraph of Article 47. The conditions under points (a), (b) and (d) of paragraph 1 shall be met each time the extension takes place. 3.  A company that meets the conditions of points (a), (b) and (d) of paragraph 1, but does not meet the conditions of point (c) of that paragraph, may opt, including for its permanent establishments situated in other Member States, to apply the rules of this Directive. Amendment 24 Proposal for a directive Article 2 – paragraph 4 4.  The rules of this Directive shall not apply to a shipping company under a special tax regime. A shipping company under a special tax regime shall be taken into account for the purpose of determining the companies which are members of the same group as referred to in Articles 5 and 6. deleted Amendment 25 Proposal for a directive Article 3 – paragraph 1 – point 23 (23)  'consolidated tax base' means the result of adding up the tax bases of all group members, as calculated in accordance with Directive 2016/xx/EU; (23)  'consolidated tax base' means the consolidated net taxable revenue of the group members, as calculated on a consistent accounting basis applicable to all group members in accordance with Directive 2016/xx/EU; Amendment 26 Proposal for a directive Article 3 – paragraph 1 – point 28 a (new) (28a)  'data factor' means the collection and exploitation for commercial purposes of personal data of online platforms and services users in one or more Member States. Amendment 27 Proposal for a directive Article 4 – paragraph 3 3.  Where the place of effective management of a group member engaged in shipping or in inland waterways transport is aboard a ship or boat, the group member shall be considered to be resident for tax purposes in the Member State of the home harbour of the ship or boat, or, where there is no such home harbour, in the Member State of residence for tax purposes of the operator of the ship or boat. deleted Amendment 28 Proposal for a directive Article 4 – paragraph 4 4.  A resident taxpayer shall be subject to corporate tax on all income derived from any source, whether inside or outside the Member State where it is resident for tax purposes. 4.  A resident taxpayer shall be subject to corporate tax on all income generated by any activity, whether inside or outside the Member State where it is resident for tax purposes. Amendment 29 Proposal for a directive Article 4 – paragraph 5 5.  A non-resident taxpayer shall be subject to corporate tax on all income from an activity carried on through a permanent establishment in a Member State. 5.  A non-resident taxpayer shall be subject to corporate tax on all income from an activity carried on through a permanent establishment, including through a digital permanent establishment, in a Member State. A digital permanent establishment of a taxpayer shall be determined in accordance with the conditions and criteria listed in Article 5 of Council Directive ... on a Common Corporate Tax Base1a. _______________ 1a Council Directive ... on a Common Corporate Tax Base (OJ L ..., ..., p. ...). Amendment 30 Proposal for a directive Article 5 – paragraph 1 – point a (a)  it has a right to exercise more than 50 % of the voting rights; and (a)  it has a right to exercise voting rights exceeding 50 %; and Amendment 31 Proposal for a directive Article 6 – paragraph 2 a (new) 2a.  Permanent establishments shall include digital permanent establishments in accordance with the conditions and criteria listed in Article 5 of Council Directive ... on a Common Corporate Tax Base1a. _______________ 1a Council Directive ... on a Common Corporate Tax Base (OJ L ..., ..., p. ...). Amendment 32 Proposal for a directive Article 7 – paragraph 1 1.  The tax bases of all members of a group shall be added together into a consolidated tax base. 1.  The tax basis of a consolidated group shall be determined as if it were one single entity. For that purpose, the aggregate tax basis of the group shall be retreated in order to eliminate all profits or losses including those arising from any transaction, whatever its nature, between two or more entities within the group. Amendment 33 Proposal for a directive Article 7 – paragraph 2 2.  Where the consolidated tax base is negative, the loss shall be carried forward and be set off against the next positive consolidated tax base. Where the consolidated tax base is positive, it shall be apportioned in accordance with Chapter VIII. 2.  Where the consolidated tax base is negative, the loss shall be carried forward and be set off against the next positive consolidated tax base for a maximum period of five years. Where the consolidated tax base is positive, it shall be apportioned in accordance with Chapter VIII. Amendment 34 Proposal for a directive Article 9 – paragraph 2 2.  Groups shall apply a consistent and adequately documented method for recording intra-group transactions. Groups may change the method only for valid commercial reasons and only at the beginning of a tax year. 2.  Groups shall apply a consistent and adequately documented method for recording intra-group transactions. Groups may change the method only for valid commercial reasons and only at the beginning of a tax year. All such transactions shall be eliminated from the tax base as a result of the consolidation carried out pursuant to Article 7(1). Amendment 35 Proposal for a directive Article 9 – paragraph 3 3.  The method for recording intra-group transactions shall enable all intra-group transfers and sales to be identified at the lowest cost for assets not subject to depreciation or the value for tax purposes for depreciable assets. deleted Amendment 36 Proposal for a directive Article 9 – paragraph 4 4.  Intra-group transfers shall not change the status of self-generated intangible assets. deleted Amendment 37 Proposal for a directive Article 23 – paragraph 1 – subparagraph 1 Where, as a result of a business reorganisation, one or more groups, or two or more group members, become part of another group, any unrelieved losses of the previously existing group or groups shall be allocated to each of the group members in accordance with Chapter VIII and on the basis of the factors as they stand at the end of the tax year in which the business reorganisation takes place. Unrelieved losses of the previously existing group or groups shall be carried forward for future years. Where, as a result of a business reorganisation, one or more groups, or two or more group members, become part of another group, any unrelieved losses of the previously existing group or groups shall be allocated to each of the group members in accordance with Chapter VIII and on the basis of the factors as they stand at the end of the tax year in which the business reorganisation takes place. Unrelieved losses of the previously existing group or groups shall be carried forward for a maximum period of five years. Amendment 38 Proposal for a directive Article 23 – paragraph 2 2.  Where two or more principal taxpayers merge within the meaning of points (i) and (ii) of Article 2(a) of Council Directive 2009/133/EC15 , any unrelieved losses of a group shall be allocated to its members in accordance with Chapter VIII, on the basis of the factors as they stand at the end of the tax year in which the merger takes place. Unrelieved losses shall be carried forward for future years. 2.  Where two or more principal taxpayers merge within the meaning of points (i) and (ii) of Article 2(a) of Council Directive 2009/133/EC15, any unrelieved losses of a group shall be allocated to its members in accordance with Chapter VIII, on the basis of the factors as they stand at the end of the tax year in which the merger takes place. Unrelieved losses shall be carried forward for a maximum period of five years. __________________ __________________ 15 Council Directive 2009/133/EC of 19 October 2009 on the common system of taxation applicable to mergers, divisions, partial divisions, transfers of assets and exchanges of shares concerning companies of different Member States and to the transfer of the registered office of an SE or SCE between Member States (OJ L 310, 25.11.2009, p. 34). 15 Council Directive 2009/133/EC of 19 October 2009 on the common system of taxation applicable to mergers, divisions, partial divisions, transfers of assets and exchanges of shares concerning companies of different Member States and to the transfer of the registered office of an SE or SCE between Member States (OJ L 310, 25.11.2009, p. 34). Amendment 39 Proposal for a directive Article 28 – paragraph 1 – subparagraph 1 The consolidated tax base shall be shared between the group members in each tax year on the basis of a formula for apportionment. In determining the apportioned share of a group member A, the formula shall take the following form, giving equal weight to the factors of sales, labour and assets: The consolidated tax base shall be shared between the group members in each tax year on the basis of a formula for apportionment. In determining the apportioned share of a group member A, the formula shall take the following form, giving equal weight to the factors of sales, labour, assets and the data factor: Amendment 40 Proposal for a directive Article 28 – paragraph 1 – formula Text proposed by the Commission Amendment Amendment 41 Proposal for a directive Article 28 – paragraph 1 – subparagraph 1 a (new) Where one or more factors do not apply due to the nature of a taxpayer’s activities, all other applicable factors should be proportionally re-weighted in the formula in order to maintain an absolute equal weight given to each applicable factor. Amendment 42 Proposal for a directive Article 28 – paragraph 5 5.  When determining the apportioned share of a group member, equal weight shall be given to the factors of sales, labour and assets. 5.  When determining the apportioned share of a group member, equal weight shall be given to the factors of sales, labour, assets and the data factor. Amendment 43 Proposal for a directive Article 28 – paragraph 5 a (new) 5a.  One half of the data factor shall consist of the total volume of personal data of online platform and services users collected per Member State by a group member as its numerator and the total volume of personal data of online platforms and services users collected per Member State by the group as its denominator, and the other half of the data factor shall consist of the total volume of personal data of online platforms and services users exploited per Member State by a group member as its numerator and the total volume of personal data of online platforms and services users exploited per Member State by the group as its denominator. Amendment 44 Proposal for a directive Article 28 – paragraph 5 b (new) 5b.  The volume of personal data collected pursuant to the data factor shall be measured at the end of the tax year in each Member State. Amendment 45 Proposal for a directive Article 28 – paragraph 5 c (new) 5c.  The definition of the collection and exploitation for commercial purposes of personal data in the context of the data factor shall be determined in accordance with Regulation (EU) 2016/679. Amendment 46 Proposal for a directive Article 29 Article 29 deleted Safeguard clause As an exception to the rule set out in Article 28, if the principal taxpayer or a competent authority considers that the outcome of the apportionment of the consolidated tax base to a group member does not fairly represent the extent of the business activity of that group member, the principal taxpayer or competent authority may request the use of an alternative method for calculating the tax share of each group member. An alternative method can be used only if, following consultations among the competent authorities and, where applicable, discussions held in accordance with Articles 77 and 78, all these authorities agree to that alternative method. The Member State of the principal tax authority shall inform the Commission about the alternative method used. Amendment 47 Proposal for a directive Article 38 – paragraph 1 1.  Sales of goods shall be included in the sales factor of the group member located in the Member State where the dispatch or transport of the goods to the person acquiring them ends. Where that place cannot be determined, the sales of goods shall be attributed to the group member located in the Member State of the last identifiable location of the goods. 1.  Sales of goods shall be included in the sales factor of the group member located in the Member State where the dispatch or transport of the goods to the person acquiring them ends. Where that place cannot be determined or the group member has no taxable nexus, the sales of goods shall be attributed to the group member located in the Member State of the last identifiable location of the goods. Amendment 48 Proposal for a directive Article 43 Article 43 deleted Shipping, inland waterways transport and air transport The revenues, expenses and other deductible items of a group member whose principal business is the operation of ships or aircraft in international traffic or the operation of boats engaged in inland waterways transport shall be excluded from the consolidated tax base and not be apportioned in accordance with the rules laid down in Article 28. Instead, those revenues, expenses and other deductible items shall be attributed to that group member on a transaction-by-transaction basis and be subject to adjustments for pricing in accordance with Article 56 of Directive 2016/xx/EU. Participations in and by the group member shall be taken into account for the purpose of determining whether there is a group as referred to in Articles 5 and 6. Amendment 49 Proposal for a directive Article 46 – paragraph 2 2.  The notice referred to in paragraph 1 shall cover all group members, except for the shipping companies referred to in Article 2(4). 2.  The notice referred to in paragraph 1 shall cover all group members. Amendment 50 Proposal for a directive Article 48 – paragraph 2 The Commission may adopt an act establishing a standard form of the notice to create a group. That implementing act shall be adopted in accordance with the examination procedure referred to in Article 77(2). The Commission shall adopt an act establishing a standard form of the notice to create a group. That implementing act shall be adopted in accordance with the examination procedure referred to in Article 77(2). Amendment 51 Proposal for a directive Article 55 – paragraph 1 The Commission may adopt acts laying down rules on the electronic filing of the consolidated tax return, on the form of the consolidated tax return, on the form of the single taxpayer's tax return and on the supporting documentation required. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 77(2). The Commission shall adopt acts laying down rules on the electronic filing of the consolidated tax return, on the form of the consolidated tax return, on the form of the single taxpayer's tax return and on the supporting documentation required. The Commission shall design those uniform tax return formats in cooperation with the tax administrations of the Member States. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 77(2). Amendment 52 Proposal for a directive Article 65 – paragraph 1 1.  Where the competent authority of the Member State in which a group member is resident for tax purposes or situated in the form of a permanent establishment disagrees with a decision of the principal tax authority made pursuant to Articles 49 or 56(2) or (4) or the second subparagraph of Article 56(5) may challenge that decision before the courts of the Member State of the principal tax authority within a period of three months. 1.  Where the competent authority of the Member State in which a group member is resident for tax purposes or situated in the form of a permanent establishment, including in the form of a digital permanent establishment, disagrees with a decision of the principal tax authority made pursuant to Articles 49 or 56(2) or (4) or the second subparagraph of Article 56(5) may challenge that decision before the courts of the Member State of the principal tax authority within a period of three months. Amendment 53 Proposal for a directive Article 65 – paragraph 2 a (new) 2a.  The Commission shall analyse whether the establishment of a dispute resolution mechanism would further increase the effectiveness and efficiency of the settlement of disagreements between Member States. The Commission shall submit a report thereon to the European Parliament and the Council, including, if appropriate, a legislative proposal. Amendment 54 Proposal for a directive Article 67 – paragraph 1 1.  Appeals against amended tax assessments or tax assessments made pursuant to Article 54 shall be heard by an administrative body that according to the law of the Member State of the principal tax authority is competent to hear appeals at first instance. That administrative body shall be independent from the tax authorities in the Member State of the principal tax authority. Where there is no such administrative body in that Member State, the principal taxpayer may lodge a judicial appeal directly. 1.  Appeals against amended tax assessments or tax assessments made pursuant to Article 54 shall be heard by an administrative body that according to the law of the Member State of the principal tax authority is competent to hear appeals at first instance. That administrative body shall be independent from the tax authorities in the Member State of the principal tax authority. Where there is no such administrative body in that Member State, or where the principal taxpayer prefers to do so, the principal taxpayer may lodge a judicial appeal directly. Amendment 55 Proposal for a directive Article 67 – paragraph 5 5.  The administrative body referred to in paragraph 1 shall decide on the appeal within six months. If no decision is received by the principal taxpayer within that period, the decision of the principal tax authority shall be deemed to have been confirmed. 5.  If seized of an appeal, the administrative body referred to in paragraph 1 shall decide on the appeal within six months. If no decision is received by the principal taxpayer within that period, the decision of the principal tax authority shall be deemed to have been confirmed. Amendment 56 Proposal for a directive Article 69 – paragraph 2 2.  Where paragraph 1 applies, the exceeding borrowing costs and EBITDA shall be calculated at the level of the group and comprise the results of all group members. The amount of EUR 3 000 000 referred to in Article 13 of Directive 2016/xx/EU shall be increased to 5 000 000. 2.  Where paragraph 1 applies, the exceeding borrowing costs and EBITDA shall be calculated at the level of the group and comprise the results of all group members. The amount of EUR 1 000 000 referred to in Article 13 of Directive 2016/xx/EU shall be increased to 5 000 000. Amendment 57 Proposal for a directive Article 71 Article 71 deleted Loss relief and recapture 1.  Article 41 of Directive 2016/xx/EU on loss relief and recapture shall automatically cease to apply when this Directive comes into force. 2.  Transferred losses which have not yet been recaptured when this Directive enters into force shall remain with the taxpayer to which they have been transferred. Amendment 58 Proposal for a directive Article 72 – paragraph 1 For the purposes of this Directive, the reference to the statutory corporate tax rate that the taxpayer would have been subject to in the first subparagraph of Article 53(1) of Directive 2016/xx/EU shall not apply and shall be replaced by the average statutory corporate tax rate applicable amongst all Member States instead. For the purposes of this Directive, the switch-over rules laid down in Article 53 of Directive 2016/xx/EU shall apply. Amendment 59 Proposal for a directive Article 73 – paragraph 1 For the purposes of this Directive, the scope of controlled foreign company legislation under Article 59 of Directive 2016/xx/EU shall be limited to relations between group members and entities that are resident for tax purposes, or permanent establishments that are situated, in a third country. For the purposes of this Directive, the scope of controlled foreign company legislation under Article 59 of Directive 2016/xx/EU shall be limited to relations between group members and entities that are resident for tax purposes, or permanent establishments, including digital permanent establishments, that are situated in a third country. Amendment 60 Proposal for a directive Article 74 – paragraph 1 For the purposes of this Directive, the scope of the rules on hybrid mismatches under Article 61 of Directive 2016/xx/EU shall be limited to relations between group members and non-group members that are associated enterprises, as referred to in Article 56 of Directive 2016/xx/EU. For the purposes of this Directive, the scope of the rules on hybrid mismatches and related arrangements applies as defined under Article 61 of Directive 2016/xx/EU. Amendment 61 Proposal for a directive Article 76 Article 76 Article 76 Informing the European Parliament Informing the European Parliament 1.  The European Parliament shall organise an interparliamentary conference to evaluate the CCCTB regime, taking into account the outcomes of the tax policy discussions held under the procedure of the European Semester. The European Parliament shall communicate its opinion and conclusions thereon by means of a resolution addressed to the Commission and the Council. The European Parliament shall be informed of the adoption of delegated acts by the Commission, of any objection formulated to them, and of the revocation of that delegation of powers by the Council. 2.   The European Parliament shall be informed of the adoption of delegated acts by the Commission, of any objection formulated to them, and of the revocation of that delegation of powers by the Council. Amendment 62 Proposal for a directive Article 78 a (new) Article 78a Compensation mechanism In order to compensate for sudden shocks to tax revenues across Member States arising from fiscal gains and losses directly and solely caused by the switch to the new regime introduced by this Directive, the Commission shall establish a dedicated compensation mechanism, operational from the entry into force of this Directive. Compensation shall be adjusted each year to take into account national or regional decisions taken prior to the entry into force of this Directive. The compensation mechanism shall be financed by the fiscal surplus from those Member States that experience gains in fiscal revenues, and shall be set for an initial period of seven years. After that period, the Commission shall assess the need for the compensation mechanism to continue operating, and accordingly decide to terminate or renew it once for another maximum period of two years. Amendment 63 Proposal for a directive Article 79 Article 79 Article 79 Review Implementation report and review The Commission shall, five years after the entry into force of this Directive, review its application and report to the Council on the operation of this Directive. The report shall in particular include an analysis of the impact of the mechanism set up in Chapter VIII of this Directive on the apportionment of the tax bases between the Member States. The Commission shall, five years after the entry into force of this Directive, assess its application and report to the European Parliament and the Council on the operation of this Directive. That implementation report shall in particular include an analysis of the impact of the mechanism set up in Chapter VIII of this Directive on the apportionment of the tax bases between the Member States. In drawing the conclusions of such an implementation report or in the context of the next multi-annual financial framework, the Commission shall propose the terms and conditions to allocate a part of the fiscal revenues generated from the common consolidated corporate tax base to the general budget of the Union in order to proportionally reduce Member States contributions to the same budget. The Commission shall, 10 years after the entry into force of this Directive, review its application and report to the European Parliament and the Council on the operation of this Directive. Amendment 64 Proposal for a directive Article 80 – paragraph 1 – subparagraph 1 Member States shall adopt and publish, by 31st December 2020 at the latest, the laws, regulations and administrative provisions necessary to comply with this Directive. They shall forthwith communicate to the Commission the text of those provisions. Member States shall adopt and publish, by 31 December 2019 at the latest, the laws, regulations and administrative provisions necessary to comply with this Directive. They shall forthwith communicate to the Commission the text of those provisions. Amendment 65 Proposal for a directive Article 80 – paragraph 1 – subparagraph 2 They shall apply those provisions from 1st January 2021. They shall apply those provisions from 1 January 2020.

European Parliament legislative resolution of 15 March 2018 on the proposal for a Council directive on a Common Corporate Tax Base (COM(2016)0685 – C8-0472/2016 – 2016/0337(CNS))

P8_TA(2018)0088 A8-0050/2018

(Special legislative procedure – consultation)

The European Parliament,

–  having regard to the Commission proposal to the Council (COM(2016)0685),

–  having regard to Article 115 of the Treaty on the Functioning of the European Union, pursuant to which the Council consulted Parliament (C8‑0472/2016),

–  having regard to the reasoned opinions submitted, within the framework of Protocol No 2 on the application of the principles of subsidiarity and proportionality, by the Danish Parliament, Dáil Éireann, Seanad Éireann, the Luxembourg Chamber of Representatives, the Maltese Parliament, the Netherlands Senate, the Netherlands House of Representatives and the Swedish Parliament, asserting that the draft legislative act does not comply with the principle of subsidiarity,

–  having regard to Rules 78c of its Rules of Procedure,

–  having regard to the report of the Committee on Economic and Monetary Affairs and the opinion of the Committee on Legal Affairs (A8-0050/2018),

1.  Approves the Commission proposal as amended;

2.  Calls on the Commission to alter its proposal accordingly, in accordance with Article 293(2) of the Treaty on the Functioning of the European Union;

3.  Calls on the Council to notify Parliament if it intends to depart from the text approved by Parliament;

4.  Asks the Council to consult Parliament again if it intends to substantially amend the Commission proposal;

5.  Instructs its President to forward its position to the Council, the Commission and the national parliaments.

Text proposed by the Commission   Amendment Amendment 1 Proposal for a directive Recital 1 (1)  Companies which seek to do business across frontiers within the Union encounter serious obstacles and market distortions owing to the existence and interaction of 28 disparate corporate tax systems. Furthermore, tax planning structures have become ever-more sophisticated over time, as they develop across various jurisdictions and effectively take advantage of the technicalities of a tax system or of mismatches between two or more tax systems for the purpose of reducing the tax liability of companies. Although those situations highlight shortcomings that are completely different in nature, they both create obstacles which impede the proper functioning of the internal market. Action to rectify those problems should therefore address both types of market deficiencies. (1)  Companies which seek to do business across frontiers within the Union encounter serious obstacles and market distortions owing to the existence and interaction of 28 disparate corporate tax systems. In times of globalisation and digitalisation, taxation of in particular financial and intellectual capital on a source base is becoming increasingly harder to retrace and easier to manipulate. Furthermore, tax planning structures have become ever-more sophisticated over time, as they develop across various jurisdictions and effectively take advantage of the technicalities of a tax system or of mismatches between two or more tax systems for the purpose of reducing the tax liability of companies. The mainstream digitalisation of many sectors of the economy coupled with the fast developing digital economy calls into question the suitability of the Union corporate tax models designed for brick and mortar industries, including with regard to the extent that valuation and calculation criteria could be re-invented to reflect the commercial activities of the 21st century. Although those situations highlight shortcomings that are completely different in nature, they all create obstacles which impede the proper functioning of the internal market and give rise to distortions between large companies and small and medium-sized enterprises. A new standard for a corporate tax base for the Union should therefore address those types of market deficiencies while respecting the aims of long-term legal clarity and certainty and the principle of tax neutrality. More convergence between national tax systems will lead to a significant decrease in costs and administrative burden for businesses operating cross-border within the Union. While taxation policy is a national competence, Article 115 of the Treaty on the Functioning of the European Union clearly stipulates that the Council should, acting unanimously in accordance with a special legislative procedure and after consulting the European Parliament and the Economic and Social Committee, issue directives for the approximation of such taxation laws, regulations or administrative provisions of the Member States as directly affect the establishment or functioning of the internal market. Amendment 2 Proposal for a directive Recital 2 (2)  To support the proper functioning of the internal market, the corporate tax environment in the Union should be shaped in accordance with the principle that companies pay their fair share of tax in the jurisdiction(s) where their profits are generated. It is therefore necessary to provide for mechanisms that discourage companies from taking advantage of mismatches amongst national tax systems in order to lower their tax liability. It is equally important to also stimulate growth and economic development in the internal market by facilitating cross-border trade and corporate investment. To this end, it is necessary to eliminate both double taxation and double non-taxation risks in the Union through eradicating disparities in the interaction of national corporate tax systems. At the same time, companies need an easily workable tax and legal framework for developing their commercial activity and expanding it across borders in the Union. In that context, remaining cases of discrimination should also be removed. (2)  To support the proper functioning of the internal market, the corporate tax environment in the Union should be shaped in accordance with the principle that companies pay their fair share of tax in the jurisdiction(s) where their profits are generated and where companies have permanent establishment. Taking into account the digital change in the business environment, it is necessary to ensure that companies which generate revenues in a Member State without having a physical permanent establishment but having a digital permanent establishment in that Member State should be treated in the same way as companies having a physical permanent establishment. It is therefore necessary to provide for mechanisms that discourage companies from taking advantage of mismatches amongst national tax systems in order to lower their tax liability. It is equally important to also stimulate growth and economic development in the internal market by facilitating cross-border trade and corporate investment. To this end, it is necessary to eliminate both double taxation and double non-taxation risks in the Union through eradicating disparities in the interaction of national corporate tax systems. At the same time, companies need an easily workable tax and legal framework for developing their commercial activity and expanding it across borders in the Union. In that context, remaining cases of discrimination should also be removed. Consolidation is an essential element of the CCCTB system, since the major tax obstacles faced by companies of the same group that operate cross-border in the Union can only be tackled in that way. Consolidation eliminates transfer pricing formalities and intra-group double taxation. Amendment 3 Proposal for a directive Recital 3 (3)  As pointed out in the proposal of 16 March 2011 for a Council Directive on a Common Consolidated Corporate Tax Base (CCCTB)7 , a corporate tax system which treats the Union as a single market for the purpose of computing the corporate tax base of companies would facilitate cross-border activity for companies resident in the Union and promote the objective of making it a more competitive location for investment internationally. The proposal of 2011 for a CCCTB focussed on the objective of facilitating the expansion of commercial activity for businesses within the Union. In addition to that objective, it should also be taken into account that a CCCTB can be highly effective in improving the functioning of the internal market through countering tax avoidance schemes. In this light, the initiative for a CCCTB should be re-launched in order to address, on an equal footing, both the aspect of business facilitation and the initiative's function in countering tax avoidance. Such an approach would best serve the aim of eradicating distortions in the functioning of the internal market. (3)  As pointed out in the proposal of 16 March 2011 for a Council Directive on a Common Consolidated Corporate Tax Base (CCCTB)7 , a corporate tax system which treats the Union as a single market for the purpose of computing the corporate tax base of companies would facilitate cross-border activity for companies resident in the Union and promote the objective of making it a more competitive location for investment internationally especially for small and medium-sized enterprises. The proposal of 2011 for a CCCTB focussed on the objective of facilitating the expansion of commercial activity for businesses within the Union. In addition to that objective, it should also be taken into account that a CCCTB can be highly effective in improving the functioning of the internal market through countering tax avoidance schemes. In this light, the initiative for a CCCTB should be re-launched in order to address, on an equal footing, both the aspect of business facilitation and the initiative's function in countering tax avoidance. Once implemented in all Member States, a CCCTB would ensure that taxes are paid where profits are generated and where companies have permanent establishment. Such an approach would best serve the aim of eradicating distortions in the functioning of the internal market. Improving the internal market is a key factor for encouraging growth and job creation. The introduction of a CCCTB would improve economic growth and result in more jobs in the Union by reducing harmful tax competition between companies. __________________ __________________ 7 Proposal for a Council Directive COM (2011)0121 final/2 of 3.10.2011 on a Common Consolidated Corporate Tax Base. 7 Proposal for a Council Directive COM (2011)0121 final/2 of 3.10.2011 on a Common Consolidated Corporate Tax Base. Amendment 4 Proposal for a directive Recital 3 a (new) (3a)  The Commission, in its communication of 21 September 2017 entitled ‘A fair and efficient tax system in the European Union for the Digital Single Market’, believes that a CCCTB offers the basis to address the tax challenges posed by the digital economy. Amendment 5 Proposal for a directive Recital 4 (4)  Considering the need to act swiftly in order to ensure a proper functioning of the internal market by making it, on the one hand, friendlier to trade and investment and, on the other hand, more resilient to tax avoidance schemes, it is necessary to divide the ambitious CCCTB initiative into two separate proposals. At a first stage, rules on a common corporate tax base should be enacted, before addressing, at a second stage, the issue of consolidation. (4)  Considering the need to act swiftly in order to ensure a proper functioning of the internal market by making it, on the one hand, friendlier to trade and investment and, on the other hand, more resilient to tax avoidance schemes, it is very important to ensure simultaneous entry into force of the Directive on a Common Corporate Tax Base and the Directive on a Common Consolidated Corporate Tax Base. Because such a change of regime is a significant step in the completion of the internal market, it needs flexibility in order to be properly executed from the outset. Hence, as the internal market encompasses all Member States, the CCCTB should be introduced in all Member States. If the Council fails to adopt a unanimous decision on the proposal to establish a CCCTB, the Commission should issue a new proposal based on Article 116 of the Treaty on the Functioning of the European Union, whereby the European Parliament and the Council act in accordance with the ordinary legislative procedure to issue the necessary legislation. As a last resort, an enhanced cooperation should be initiated by Member States which should be open at any time to non-participating Member States in accordance with the Treaty on the Functioning of the European Union. It is regrettable that no sufficiently detailed assessment has been conducted in respect of either the CCTB or CCCTB proposals in terms of the impact on Member States' corporate tax revenue on a country-by-country basis. Amendment 6 Proposal for a directive Recital 5 (5)  Many aggressive tax planning structures tend to feature in a cross-border context, which implies that the participating groups of companies possess a minimum of resources. On this premise, for reasons of proportionality, the rules on a common base should be mandatory only for companies which belong to a group of a substantial size. For that purpose, a size-related threshold should be fixed on the basis of the total consolidated revenue of a group which files consolidated financial statements. In addition, to ensure coherence between the two steps of the CCCTB initiative, the rules on a common base should be mandatory for companies which would be considered as a group should the full initiative materialise. In order to better serve the aim of facilitating trade and investment in the internal market, the rules on a common corporate tax base should also be available, as an option, to companies which do not meet those criteria. (5)  Many aggressive tax planning structures tend to feature in a cross-border context, which implies that the participating groups of companies possess a minimum of resources. On this premise, for reasons of proportionality, the rules on a common base should be mandatory initially only for companies which belong to a group of a substantial size. For that purpose, a size-related starting threshold of EUR 750 million should be fixed on the basis of the total consolidated revenue of a group which files consolidated financial statements. Since this Directive sets a new standard for the corporate tax base for all businesses in the Union, the threshold should be lowered to zero over a maximum period of seven years. In order to better serve the aim of facilitating trade and investment in the internal market, the rules on a common corporate tax base should also be available in the first phase, as an option, to companies which do not meet those criteria. Amendment 7 Proposal for a directive Recital 6 (6)  It is necessary to define the concept of a permanent establishment situated in the Union and belonging to a taxpayer who is resident for tax purposes within the Union. The aim would be to ensure that all concerned taxpayers share a common understanding and to exclude the possibility of a mismatch due to divergent definitions. On the contrary, it should not be seen as essential to have a common definition of permanent establishments situated in a third country, or in the Union but belonging to a taxpayer who is resident for tax purposes in a third country. This dimension should better be left to bilateral tax treaties and national law due to its complicated interaction with international agreements. (6)  It is necessary to define the concept of a permanent establishment situated in the Union and belonging to a taxpayer who is resident for tax purposes within the Union. Too often, multinational companies make arrangements to transfer their profits to favourable tax regimes without paying any tax or paying very low rates of tax. The concept of a permanent establishment would provide a precise, binding definition of the criteria to be met if a multinational company is to prove that it is situated in a given country. That will compel multinational companies to pay their taxes fairly. The aim would be to ensure that all concerned taxpayers share a common understanding and to exclude the possibility of a mismatch due to divergent definitions. Similarly, it is important to have a common definition of permanent establishments situated in a third country, or in the Union but belonging to a taxpayer who is resident for tax purposes in a third country. If transfer pricing gives rise to profit-shifting into a low tax jurisdiction, a system that awards profit via a formula apportionment is preferable. The Union can establish an international standard for modern and efficient corporate taxation by adopting such a system. The Commission should draft guidelines for the transitional phase in which formulary apportionment coexists with other allocation methods in dealing with third countries, while ultimately formulary apportionment should be the standard method of allocation. The Commission should make a proposal to set up a Union model of a tax treaty which could ultimately replace the thousands of bilateral treaties concluded by each of the Member States. Amendment 8 Proposal for a directive Recital 6 a (new) (6a)  Digital goods tend to be highly mobile and intangible. Studies have shown that the digital sector is highly involved in aggressive tax planning practices, since many business models do not require physical infrastructure in order to carry out transactions with customers and make profits. That allows the biggest digital companies to pay taxes of close to zero on their revenue. The treasuries of the Member States lose billions of euros in tax revenues from not being able to tax digital multinationals. To tackle that real and urgent social injustice, current corporate tax law needs to be expanded to include a new digital permanent establishment nexus based on a significant digital presence. A level playing field is needed for similar business models to address the tax challenges that arise from the context of digitalisation, without hampering the potential of the digital sector. Particular account should be taken in that respect of the work carried out by the OECD on an internationally consistent set of rules. Amendment 9 Proposal for a directive Recital 8 (8)  Taxable revenues should be reduced by business expenses and certain other items. Deductible business expenses should normally include all costs relating to sales and expenses linked to the production, maintenance and securing of income. To support innovation in the economy and modernise the internal market, deductions should be provided for research and development costs, including super-deductions, and those should be fully expensed in the year incurred (with the exception of immovable property). Small starting companies without associated enterprises which are particularly innovative (a category which will in particular cover start-ups) should also be supported through enhanced super-deductions for research and development costs. In order to ensure legal certainty, there should also be a list of non-deductible expenses. (8)  Taxable revenues should be reduced by business expenses and certain other items. Deductible business expenses should normally include all costs relating to sales and expenses linked to the production, maintenance and securing of income. To support innovation in the economy and modernise the internal market, deductions should be provided and taxpayers should receive a tax credit for genuine expenses of research and development relating to expenses in respect of staff, subcontractors, agency workers and freelancers, and those should be fully expensed in the year incurred (with the exception of immovable property). A clear definition of genuine expenses of research and development is needed to avoid misuse of the deductions. In order to ensure legal certainty, there should also be a list of non-deductible expenses. Amendment 10 Proposal for a directive Recital 9 (9)  Recent developments in international taxation have highlighted that, in an effort to reduce their global tax liability, multinational groups of companies have increasingly engaged in tax avoidance arrangements leading to base erosion and profit shifting, through excessive interest payments. It is therefore necessary to limit the deductibility of interest (and other financial) costs, in order to discourage such practices. In that context, the deductibility of interest (and other financial) costs should only be allowed without restrictions to the extent that those costs can be offset against taxable interest (and other financial) revenues. Any surplus of interest costs should however be subject to deductibility restrictions, to be determined by reference to a taxpayer’s taxable earnings before interest, tax, depreciation and amortisation (‘EBITDA’). (9)  Recent developments in international taxation have highlighted that, in an effort to reduce their global tax liability, multinational groups of companies have increasingly engaged in tax avoidance arrangements leading to base erosion and profit shifting, through excessive interest payments. It is therefore necessary to limit the deductibility of interest (and other financial) costs, in order to discourage such practices. In that context, the deductibility of interest (and other financial) costs should only be allowed without restrictions to the extent that those costs can be offset against taxable interest (and other financial) revenues. Any surplus of interest costs should however be subject to deductibility restrictions, to be determined by reference to a taxpayer’s taxable earnings before interest, tax, depreciation and amortisation (‘EBITDA’). Member States could further restrict the amount of the deductibility of interest and other financial costs to ensure a higher level of protection. Amendment 11 Proposal for a directive Recital 10 (10)  The fact that interest paid out on loans is deductible from the tax base of a taxpayer whilst this is not the case for profit distributions creates a definitive advantage in favour of financing through debt as opposed to equity. Given the risks that this entails for the indebtedness of companies, it is critical to provide for measures which neutralise the current bias against equity financing. In this light, it is envisaged to give taxpayers an allowance for growth and investment according to which increases in a taxpayer's equity should be deductible from its taxable base subject to certain conditions. Thus, it would be essential to ensure that the system does not suffer cascading effects and to this end, it would be necessary to exclude the tax value of a taxpayer's participations in associated enterprises. Finally, to make the scheme of the allowance sufficiently robust, it would also be required to lay down anti-tax avoidance rules. (10)  The fact that interest paid out on loans is deductible from the tax base of a taxpayer whilst this is not the case for profit distributions creates a definitive advantage in favour of financing through debt as opposed to equity. Given the risks that this entails for the indebtedness of companies, it is critical to provide for measures which neutralise the current bias against equity financing, by limiting the possibility of deducting interest paid out on loans from the tax base of a taxpayer. Such an interest limitation rule constitutes an appropriate and sufficient tool for that purpose. Amendment 12 Proposal for a directive Recital 12 (12)  In order to discourage the shifting of passive (mainly, financial) income out of highly-taxed companies, any losses that such companies may incur at the end of a tax year should be presumed to mostly correspond to the results of trading activity. Based on that premise, taxpayers should be allowed to carry losses forward indefinitely without restrictions on the deductible amount per year. Since the carry-forward of losses is intended to ensure that a taxpayer pays tax on its real income, there is no reason to place a time limit on carry forward. Regarding the prospect for a loss carry-back, no such a rule would need to be introduced because that this is relatively rare in the practice of Member States, and tends to lead to excessive complexity. Furthermore, an anti-abuse provision should be laid down in order to prevent, thwart or counter attempts to circumvent the rules on loss deductibility through purchasing loss-making companies. (12)  In order to discourage the shifting of passive (mainly, financial) income out of highly-taxed companies, any losses that such companies may incur at the end of a tax year should be presumed to mostly correspond to the results of trading activity. Based on that premise, taxpayers should be allowed to carry losses forward during a period of five years with restrictions on the deductible amount per year. Regarding the prospect for a loss carry-back, no such a rule would need to be introduced because that this is relatively rare in the practice of Member States, and tends to lead to excessive complexity. Council Directive (EU) 2016/11641a lays down a general anti-abuse rule in order to prevent, thwart or counter attempts to circumvent the rules on loss deductibility through purchasing loss-making companies. That general rule should also be systematically taken into account in the application of this Directive. _________________ 1a Council Directive (EU) 2016/1164 of 12 July 2016 laying down rules against tax avoidance practices that directly affect the functioning of the internal market (OJ L 193, 19.7.2016, p. 1). Amendment 13 Proposal for a directive Recital 13 (13)  In order to facilitate the cash-flow capacity of businesses – for instance, by compensating start-up losses in a Member State with profits in another Member State – and encourage the cross-border expansion within the Union, taxpayers should be entitled to temporarily take into account the losses incurred by their immediate subsidiaries and permanent establishments situated in other Member States. For that purpose, a parent company or head office located in a Member State should be able to deduct from its tax base, in a given tax year, the losses incurred in the same tax year by its immediate subsidiaries or permanent establishments situated in other Member States in proportion to its holding. The parent company should then be required to add back to its tax base, considering the amount of losses previously deducted, any subsequent profits made by those immediate subsidiaries or permanent establishments. As it is vital to safeguard national tax revenues, the deducted losses should also be reincorporated automatically if this has not already occurred after a certain number of years or if the requisites to qualify as an immediate subsidiary or permanent establishment are no longer met. deleted Amendment 14 Proposal for a directive Recital 15 (15)  It is crucial to provide for appropriate anti-tax avoidance measures in order to reinforce the resilience of the rules on a common base against aggressive tax planning practices. Specifically, the system should include a general anti-abuse rule (‘GAAR’), supplemented by measures designed to curb specific types of avoidance. Given that GAARs have the function of tackling abusive tax practices that have not yet been dealt with through specifically targeted provisions, they fill in gaps, which should not affect the applicability of specific anti-avoidance rules. Within the Union, GAARs should be applied to arrangements that are not genuine. It is furthermore important to ensure that the GAAR apply in a uniform manner to domestic situations, cross-border situations within the Union and cross-border situations involving companies established in third countries, so that their scope and results of application do not differ. (15)  It is crucial to provide for appropriate anti-tax avoidance measures in order to reinforce the resilience of the rules on a common base against aggressive tax planning practices. Specifically, the system should include a strong and effective general anti-abuse rule (‘GAAR’), supplemented by measures designed to curb specific types of avoidance. Given that GAARs have the function of tackling abusive tax practices that have not yet been dealt with through specifically targeted provisions, they fill in gaps, which should not affect the applicability of specific anti-avoidance rules. Within the Union, GAARs should be applied to arrangements that are not genuine. It is furthermore important to ensure that the GAAR apply in a uniform manner to domestic situations, cross-border situations within the Union and cross-border situations involving companies established in third countries, so that their scope and results of application do not differ. Amendment 15 Proposal for a directive Recital 17 (17)  Taking into account that the effect of hybrid mismatches is usually a double deduction (i.e. deduction in both states) or a deduction of the income in one state without inclusion in the tax base of another, such situations clearly affect the internal market by distorting its mechanisms and creating loopholes for tax avoidance practices to flourish. Given that mismatches generate from national differences in the legal qualification of certain types of entities or financial payments, they normally do not occur amongst companies which apply the common rules for calculating their tax base. Mismatches would however persist in the interaction between the framework of the common base and national or third-country corporate tax systems. To neutralise the effects of hybrid mismatch arrangements, it is necessary to lay down rules whereby one of the two jurisdictions in a mismatch deny the deduction of a payment or ensures that the corresponding income is included in the corporate tax base. (17)  Taking into account that the effect of branch and hybrid mismatches is usually a double deduction (i.e. deduction in both states) or a deduction of the income in one state without inclusion in the tax base of another, such situations clearly affect the internal market by distorting its mechanisms and creating loopholes for tax avoidance practices to flourish. Given that mismatches generate from national differences in the legal qualification of certain types of entities or financial payments, they normally do not occur amongst companies which apply the common rules for calculating their tax base. Mismatches would however persist in the interaction between the framework of the common base and national or third-country corporate tax systems. To neutralise the effects of hybrid mismatches or related arrangements, Directive (EU) 2016/1164 lays down rules on hybrid mismatches and reverse hybrid mismatches. Those rules should be systematically taken into account in the application of this Directive. Amendment 16 Proposal for a directive Recital 17 a (new) (17a)  Member States should not be prevented from introducing additional anti-tax avoidance measures in order to reduce the negative effects of shifting profits to low-tax third countries, which do not necessarily automatically exchange tax information in accordance with Union standards. Amendment 17 Proposal for a directive Recital 17 b (new) (17b)  Member States should have in place a system of penalties for infringements by undertakings of national provisions adopted in accordance with this Directive as provided for in national law and should inform the Commission thereof. Amendment 18 Proposal for a directive Recital 19 (19)  In order to supplement or amend certain non-essential elements of this Directive, the power to adopt acts in accordance with Article 290 of the Treaty on the Functioning of the European Union should be delegated to the Commission with respect of (i) taking into account changes to the laws of Member States concerning the company forms and corporate taxes and amend Annexes I and II accordingly; (ii) laying down additional definitions; (iii) enacting detailed rules against tax avoidance in a number of specified fields relevant to the allowance for growth and investment ; (iv) defining the concepts of legal and economic ownership of leased assets in more detail; (v) calculating the capital and interest elements of lease payments and the depreciation base of leased assets; and (vi) defining more precisely the categories of fixed assets subject to depreciation. It is of particular importance that the Commission carry out appropriate consultations during its preparatory work, including at expert level. The Commission, when preparing and drawing up delegated acts, should ensure a simultaneous, timely and appropriate transmission of relevant documents to the European Parliament and the Council. (19)  In order to supplement or amend certain non-essential elements of this Directive, the power to adopt acts in accordance with Article 290 of the Treaty on the Functioning of the European Union should be delegated to the Commission with respect of (i) taking into account changes to the laws of Member States concerning the company forms and corporate taxes and amend Annexes I and II accordingly; (ii) laying down additional definitions; (iii) defining the concepts of legal and economic ownership of leased assets in more detail; (iv) calculating the capital and interest elements of lease payments and the depreciation base of leased assets; (v) defining more precisely the categories of fixed assets subject to depreciation; and (vi) issuing guidelines for the transitional phase in which formulary apportionment coexists with other allocation methods in dealing with third countries. It is of particular importance that the Commission carry out appropriate consultations during its preparatory work, including at expert level. The Commission, when preparing and drawing up delegated acts, should ensure a simultaneous, timely and appropriate transmission of relevant documents to the European Parliament and the Council. Amendment 19 Proposal for a directive Recital 19 a (new) (19a)  The Commission should monitor the uniform implementation of this Directive in order to avoid situations in which the competent authorities of the Member States each enforce a different regime. Furthermore, the lack of harmonised accounting rules in the Union should not lead to new opportunities for tax planning and arbitrage. Therefore, the harmonisation of accounting rules could strengthen the common regime, especially if and when all Union businesses fall under that regime. Amendment 20 Proposal for a directive Recital 23 (23)  The Commission should be required to review the application of the Directive five years after its entry into force and report to the Council on its operation. Member States should be required to communicate to the Commission the text of the provisions of national law which they adopt in the field covered by this Directive, (23)  Since this Directive contains an important change to corporate taxation rules, the Commission should be required to conduct a thorough assessment of the application of the Directive five years after its entry into force and report to the European Parliament and the Council on its operation. That implementation report should include at least the following points: the impact of the system of taxation provided for in this Directive on Member States’ revenues, the advantages and disadvantages of the system for small and medium-sized enterprises, the impact on a fair tax collection between Member States, the impact on the internal market as a whole, with particular regard to possible distortion of competition between companies subject to the new rules laid down in this Directive, and the number of undertakings that fall within the scope during the transition period. The Commission should be required to review the application of this Directive 10 years after its entry into force and report to the European Parliament and the Council on its operation. Member States should be required to communicate to the Commission the text of the provisions of national law which they adopt in the field covered by this Directive, Amendment 21 Proposal for a directive Article 1 – paragraph 1 1.  This Directive establishes a system of a common base for the taxation of certain companies and lays down rules for the calculation of that base. 1.  This Directive establishes a system of a common base for the taxation in the Union of certain companies and lays down rules for the calculation of that base, including rules on measures to prevent tax avoidance and on measures relating to the international dimension of the proposed tax system. Amendment 22 Proposal for a directive Article 2 – paragraph 1 – introductory part 1.  The rules of this Directive shall apply to a company that is established under the laws of a Member State, including its permanent establishments in other Member States, where the company meets all of the following conditions: 1.  The rules of this Directive shall apply to a company that is established under the laws of a Member State, including its permanent and digital permanent establishments in other Member States, where the company meets all of the following conditions: Amendment 23 Proposal for a directive Article 2 – paragraph 1 – point c (c)  it belongs to a consolidated group for financial accounting purposes with a total consolidated group revenue that exceeded EUR 750 000 000 during the financial year preceding the relevant financial year; (c)  it belongs to a consolidated group for financial accounting purposes with a total consolidated group revenue that exceeded EUR 750 000 000 during the financial year preceding the relevant financial year. That threshold shall be lowered to zero over a maximum period of seven years; Amendment 24 Proposal for a directive Article 2 – paragraph 3 3.  A company that meets the conditions of points (a) and (b) of paragraph 1, but does not meet the conditions of points (c) or (d) of that paragraph, may opt, including for its permanent establishments situated in other Member States, to apply the rules of this Directive for a period of five tax years. That period shall automatically be extended for successive terms of five tax years, unless there is a notice of termination as referred to in Article 65(3). The conditions under points (a) and (b) of paragraph 1 shall be met each time the extension takes place. 3.  A company that meets the conditions of points (a) and (b) of paragraph 1, but does not meet the conditions of points (c) or (d) of that paragraph, may opt, including for its permanent establishments situated in other Member States, to apply the rules of this Directive. Amendment 25 Proposal for a directive Article 2 – paragraph 4 4.  The rules of this Directive shall not apply to a shipping company under a special tax regime. A shipping company under a special tax regime shall be taken into account for the purpose of determining the companies which are members of the same group as referred to in Article 3. deleted Amendment 26 Proposal for a directive Article 3 – paragraph 1 – point a (a)  it has a right to exercise more than 50 % of the voting rights; and (a)  it has a right to exercise voting rights exceeding 50%; and Amendment 27 Proposal for a directive Article 4 – paragraph 1 – point 12 (12)  'borrowing costs' means interest expenses on all forms of debt, other costs economically equivalent to interest and expenses incurred in connection with the raising of finance, as defined in national law, including payments under profit participating loans, imputed interest on convertible bonds and zero coupon bonds, payments under alternative financing arrangements, the finance cost elements of finance lease payments, capitalised interest included in the balance sheet value of a related asset, the amortisation of capitalised interest, amounts measured by reference to a funding return under transfer pricing rules, notional interest amounts under derivative instruments or hedging arrangements related to an entity's borrowings, the defined yield on net equity increases as referred to in Article 11 of this Directive, certain foreign exchange gains and losses on borrowings and instruments connected with the raising of finance, guarantee fees for financing arrangements, arrangement fees and similar costs related to the borrowing of funds; (12)  'borrowing costs' means interest expenses on all forms of debt, other costs economically equivalent to interest and expenses incurred in connection with the raising of finance, as defined in national law, including payments under profit participating loans, imputed interest on convertible bonds and zero coupon bonds, payments under alternative financing arrangements, the finance cost elements of finance lease payments, capitalised interest included in the balance sheet value of a related asset, the amortisation of capitalised interest, amounts measured by reference to a funding return under transfer pricing rules, notional interest amounts under derivative instruments or hedging arrangements related to an entity's borrowings, certain foreign exchange gains and losses on borrowings and instruments connected with the raising of finance, guarantee fees for financing arrangements, arrangement fees and similar costs related to the borrowing of funds; Amendment 28 Proposal for a directive Article 4 – paragraph 1 – point 30 a (new) (30a)  'non-cooperative tax jurisdiction' means a jurisdiction to which any of the following apply: (a)  the jurisdiction does not fulfil international transparency standards; (b)  potential preferential regimes exist within the jurisdiction; (c)  a tax system with no corporate income tax or a close to zero corporate tax rate exists within the jurisdiction; Amendment 29 Proposal for a directive Article 4 – paragraph 1 – point 30 b (new) (30b)  'economic substance' means factual criteria, including in the context of the digital economy, which can be used to define the taxable presence of an undertaking, such as the existence of human and physical resources specific to the entity, its management autonomy, its legal reality, the revenues it generates and, where appropriate, the nature of its assets; Amendment 30 Proposal for a directive Article 4 – paragraph 1 – point 30 c (new) (30c)  'letterbox company' means any type of legal entity which has no economic substance and which is set up purely for tax purposes; Amendment 31 Proposal for a directive Article 4 – paragraph 1 – point 30 d (new) (30d)  'royalty cost' means costs arising from payments of any kind made as a consideration for the use of, or the right to use, any copyright of literary, artistic or scientific work, including cinematograph films and software, any patent, trade mark, design or model, plan, secret formula or process, or for information concerning industrial, commercial or scientific experience, or any other intangible asset; payments for the use of, or the right to use, industrial, commercial or scientific equipment shall be regarded as royalty costs; Amendment 32 Proposal for a directive Article 4 – paragraph 1 – point 30 e (new) (30e)  'transfer prices' means the prices at which an undertaking transfers tangible goods or intangible assets or provides services to associated undertakings; Amendment 33 Proposal for a directive Article 4 – paragraph 1 – point 31 (31)  'hybrid mismatch' means a situation between a taxpayer and an associated enterprise or a structured arrangement between parties in different tax jurisdictions where any of the following outcomes is attributable to differences in the legal characterisation of a financial instrument or entity, or in the treatment of a commercial presence as a permanent establishment: (31)  'hybrid mismatch' means a hybrid mismatch as defined in point (9) of Article 2 of Directive (EU) 2016/1164; (a)  a deduction of the same payment, expenses or losses from the taxable base occurs both in the jurisdiction in which the payment has its source, the expenses are incurred or the losses are suffered and in the other jurisdiction ('double deduction'); (b)  a deduction of a payment from the taxable base in the jurisdiction in which the payment has its source without a corresponding inclusion for tax purposes of the same payment in the other jurisdiction ('deduction without inclusion'); (c)  in case of differences in the treatment of a commercial presence as a permanent establishment, non-taxation of income which has its source in a jurisdiction without a corresponding inclusion for tax purposes of the same income in the other jurisdiction ('non-taxation without inclusion'). A hybrid mismatch only arises to the extent that the same payment deducted, expenses incurred or losses suffered in two jurisdictions exceed the amount of income that is included in both jurisdictions and which can be attributed to the same source. A hybrid mismatch also includes the transfer of a financial instrument under a structured arrangement involving a taxpayer where the underlying return on the transferred financial instrument is treated for tax purposes as derived simultaneously by more than one of the parties to the arrangement, who are resident for tax purposes in different jurisdictions, giving rise to any of the following outcomes: (a)  a deduction of a payment connected with the underlying return without a corresponding inclusion for tax purposes of such payment, unless the underlying return is included in the taxable income of one the parties involved; (b)  a relief for tax withheld at source on a payment derived from the transferred financial instrument to more than one of the parties involved; Amendment 34 Proposal for a directive Article 4 – paragraph 1 – point 32 (32)  'structured arrangement' means an arrangement involving a hybrid mismatch where the mismatch is priced into the terms of the arrangement or an arrangement that has been designed to produce a hybrid mismatch outcome, unless the taxpayer or an associated enterprise could not reasonably have been expected to be aware of the hybrid mismatch and did not share in the value of the tax benefit resulting from the hybrid mismatch; deleted Amendment 35 Proposal for a directive Article 4 – paragraph 1 – point 33 a (new) (33a)  'digital permanent establishment' means a significant digital presence of a taxpayer that provides services in a jurisdiction directed towards consumers or businesses in that jurisdiction, in accordance with the criteria laid down in Article 5(2a); Amendment 36 Proposal for a directive Article 4 – paragraph 1 – point 33 b (new) (33b)  'European tax identification number' or 'TIN' means a number as defined in the Commission's Communication of 6 December 2012 containing an Action plan to strengthen the fight against tax fraud and tax evasion. Amendment 37 Proposal for a directive Article 4 – paragraph 2 The Commission may adopt delegated acts in accordance with Article 66 in order to lay down definitions of more concepts. The Commission may adopt delegated acts in accordance with Article 66 in order to update current definitions or lay down definitions of more concepts. Amendment 38 Proposal for a directive Article 5 – paragraph 1 – introductory part 1.  A taxpayer shall be considered to have a permanent establishment in a Member State other than the Member State in which it is resident for tax purposes when it has a fixed place in that other Member State through which it carries on its business, wholly or partly, including in particular: 1.  A taxpayer shall be considered to have a permanent establishment which includes a digital permanent establishment in a Member State other than the jurisdiction in which it is resident for tax purposes when it has a fixed place of business or a digital presence in that other Member State through which it carries on its business, wholly or partly, including in particular: Amendment 39 Proposal for a directive Article 5 – paragraph 1 – point f a (new) (fa)  a digital platform or any other digital business model based on the collection and exploitation of data for a commercial purpose. Amendment 40 Proposal for a directive Article 5 – paragraph 2 a (new) 2a.  If a taxpayer resident in one jurisdiction provides access to or offers a digital platform such as an electronic application, database, online marketplace, or storage room, or offers search engine or advertising services on a website or in an electronic application, that taxpayer shall be deemed to have a digital permanent establishment in a Member State other than the jurisdiction in which it is resident for tax purposes if the total amount of revenue of the taxpayer or associated enterprise due to remote transactions generated from aforementioned digital platforms in the non-resident jurisdiction exceeds EUR 5 000 000 per year and where any of the following conditions is met: (a)  at least 1000 registered individual users per month domiciled in a Member State other than the jurisdiction in which the taxpayer is resident for tax purposes have logged in or visited the taxpayer's digital platform; (b)  at least 1000 digital contracts have been concluded per month with customers or users that are domiciled in the non-resident jurisdiction in a taxable year; (c)  the volume of digital content collected by the taxpayer in a taxable year exceeds 10 % of the group’s overall stored digital content. The Commission shall be empowered to adopt delegated acts in accordance with Article 66 amending this Directive by adjusting the factors set out in points (a), (b) and (c) of this paragraph on the basis of progress in international agreements. If in addition to the revenue based threshold set out in the first subparagraph of this paragraph, one or more of the three digital factors set out in points (a), (b) and (c) of this paragraph are applicable to a taxpayer in the relevant Member State, the taxpayer shall be deemed to have a permanent establishment in that Member State. A taxpayer shall be required to disclose to the tax authorities all information relevant to the determination of permanent establishment or digital permanent establishment in accordance with this Article. Amendment 41 Proposal for a directive Article 9 – paragraph 3 – subparagraph 1 In addition to the amounts which are deductible as costs for research and development in accordance with paragraph 2, the taxpayer may also deduct, per tax year, an extra 50% of such costs, with the exception of the cost related to movable tangible fixed assets, that it incurred during that year. To the extent that costs for research and development reach beyond EUR 20 000 000, the taxpayer may deduct 25% of the exceeding amount. For research and development costs not exceeding EUR 20 000 000 and that relate to staff including wages, subcontractors agency workers and freelancers, the taxpayer shall receive a tax credit of 10 % of the costs incurred. Amendment 42 Proposal for a directive Article 9 – paragraph 3 – subparagraph 2 By way of derogation from the first subparagraph, the taxpayer may deduct an extra 100% of its costs for research and development up to EUR 20 000 000 where that taxpayer meets all of the following conditions: deleted (a)  it is an unlisted enterprise with fewer than 50 employees and an annual turnover and/or annual balance sheet total that does not exceed EUR 10 000 000; (b)  it has not been registered for longer than five years. If the taxpayer is not subject to registration, the period of five years may be taken to start at the moment that the enterprise either starts, or is liable to tax for, its economic activity; (c)  it has not been formed through a merger; (d)  it does not have any associated enterprises. Amendment 43 Proposal for a directive Article 11 [...] deleted Amendment 44 Proposal for a directive Article 12 – paragraph 1 – point b (b)  50 % of entertainment costs, up to an amount that does not exceed [x] % of revenues in the tax year; (b)  50 % of ordinary and necessary entertainment costs directly related to, or associated with, the business of the taxpayer, up to an amount that does not exceed [x] % of revenues in the tax year; Amendment 45 Proposal for a directive Article 12 – paragraph 1 – point c (c)  the transfer of retained earnings to a reserve that forms part of the equity of the company; (c)  the transfer of retained earnings to a reserve that forms part of the equity of the company, other than earnings retained to a reserve by cooperative enterprises and cooperative consortia, both during the current activity of the company and after its expiration, in accordance with national tax rules; Amendment 46 Proposal for a directive Article 12 – paragraph 1 – point j a (new) (ja)  expenses to beneficiaries situated in countries appearing on the EU list of non-cooperative jurisdictions for tax purposes (also known as ‘tax havens’); Amendment 47 Proposal for a directive Article 13 – paragraph 2 – subparagraph 1 Exceeding borrowing costs shall be deductible in the tax year in which they are incurred for maximum of 30 % of the taxpayer's earnings before interest, tax, depreciation and amortisation (‘EBITDA’) or for a maximum amount of EUR 3 000 000, whichever is higher. Exceeding borrowing costs shall be deductible in the tax year in which they are incurred for maximum of 10% of the taxpayer's earnings before interest, tax, depreciation and amortisation ('EBITDA') or for a maximum amount of EUR 1 000 000, whichever is higher. Amendment 48 Proposal for a directive Article 13 – paragraph 2 – subparagraph 2 For the purposes of this Article, where a taxpayer is permitted or required to act on behalf of a group, as defined in the rules of a national group taxation system, the entire group shall be treated as a taxpayer. In those circumstances, exceeding borrowing costs and the EBITDA shall be calculated for the entire group. The amount of EUR 3 000 000 shall also be considered for the entire group. For the purposes of this Article, where a taxpayer is permitted or required to act on behalf of a group, as defined in the rules of a national group taxation system, the entire group shall be treated as a taxpayer. In those circumstances, exceeding borrowing costs and the EBITDA shall be calculated for the entire group. The amount of EUR 1 000 000 shall also be considered for the entire group. Amendment 49 Proposal for a directive Article 13 – paragraph 6 6.  Exceeding borrowing costs that cannot be deducted in a given tax year shall be carried forward without time limitation. 6.  Exceeding borrowing costs that cannot be deducted in a given tax year shall be carried forward for a period of five years. Amendment 50 Proposal for a directive Article 14 a (new) Article 14a Specific exemptions Earnings retained to a reserve by cooperatives and consortia, both during the current activity of a company and after its expiration, as well as the benefits granted by cooperatives and consortia to their own members, are deductible whenever the deductibility is allowed by fiscal national law. Amendment 51 Proposal for a directive Article 29 Article 29 Article 29 Exit taxation Exit taxation 1.   An amount equal to the market value of transferred assets, at the time of exit of the assets, less their value for tax purposes, shall be treated as accrued revenues in any of the following circumstances: For the purposes of this Directive, exit taxation rules laid down in Directive (EU) 2016/1164 shall apply. (a)  where a taxpayer transfers assets from its head office to its permanent establishment in another Member State or in a third country; (b)  where a taxpayer transfers assets from its permanent establishment in a Member State to its head office or another permanent establishment in another Member State or in a third country, to the extent that, due to the transfer, the Member State of the permanent establishment no longer has the right to tax the transferred assets; (c)  where a taxpayer transfers its tax residence to another Member State or to a third country, except for those assets which remain effectively connected with a permanent establishment in the first Member State; (d)  where a taxpayer transfers the business carried on by its permanent establishment from a Member State to another Member State or to a third country, to the extent that, due to the transfer, the Member State of the permanent establishment no longer has the right to tax the transferred assets. 2.  The Member State to where the assets, tax residence or the business carried on by a permanent establishment are transferred shall accept the value established by the Member State of the taxpayer or of the permanent establishment as the starting value of the assets for tax purposes. 3.  This Article shall not apply to asset transfers related to the financing of securities, assets posted as collateral or where the asset transfer takes place in order to meet prudential capital requirements or for the purpose of liquidity management where those assets are set to revert to the Member State of the transferor within a period of 12 months. Amendment 52 Proposal for a directive Article 41 – paragraph 1 1.  Losses incurred in a tax year by a resident taxpayer or a permanent establishment of a non-resident taxpayer may be carried forward and deducted in subsequent tax years, unless otherwise provided by this Directive. 1.  Losses incurred in a tax year by a resident taxpayer or a permanent establishment of a non-resident taxpayer may be carried forward and deducted in subsequent tax years, up to a maximum period of five years. Amendment 53 Proposal for a directive Article 42 Article 42 deleted Loss relief and recapture 1.  A resident taxpayer that is still profitable after having deducted its own losses pursuant to Article 41 may additionally deduct losses incurred, in the same tax year, by its immediate qualifying subsidiaries, as referred to in Article 3(1), or by permanent establishment(s) situated in other Member States. This loss relief shall be given for a limited period of time in accordance with paragraphs 3 and 4 of this Article. 2.  The deduction shall be in proportion to the holding of the resident taxpayer in its qualifying subsidiaries as referred to in Article 3(1) and full for permanent establishments. In no case shall the reduction of the tax base of the resident taxpayer result in a negative amount. 3.  The resident taxpayer shall add back to its tax base, up to the amount previously deducted as a loss, any subsequent profits made by its qualifying subsidiaries as referred to in Article 3(1) or by its permanent establishments. 4.  Losses deducted pursuant to paragraphs 1 and 2 shall automatically be reincorporated into the tax base of the resident taxpayer in any of the following circumstances: (a)  where, at the end of the fifth tax year after the losses became deductible, no profit has been reincorporated or the reincorporated profits do not correspond to the full amount of losses deducted; (b)  where the qualifying subsidiary as referred to in Article 3(1) is sold, wound up or transformed into a permanent establishment; (c)  where the permanent establishment is sold, wound up or transformed into a subsidiary; (d)  where the parent company no longer fulfils the requirements of Article 3(1). Amendment 54 Proposal for a directive Article 45 a (new) Article 45a Effective tax contribution For as long as the threshold laid down in point (c) of Article 2(1) remains in place, Member States shall monitor and publish the effective tax contribution of small and medium-sized enterprises and multinational enterprises across the Member States, so that Member States can ensure a level playing field for similar companies within the Union and mitigate the administrative burden and costs for small and medium-sized enterprises. Amendment 55 Proposal for a directive Article 53 – paragraph 1 – subparagraph 1 By way of derogation from points (c) and (d) of Article 8, a taxpayer shall not be exempt from tax on foreign income that the taxpayer received as a profit distribution from an entity in a third country or as proceeds from the disposal of shares held in an entity in a third country where that entity in its country of tax residence is subject to a statutory corporate tax rate lower than half of the statutory tax rate that the taxpayer would have been subject to, in connection with such foreign income, in the Member State of its residence for tax purposes. By way of derogation from points (c) and (d) of Article 8, a taxpayer shall not be exempt from tax on foreign income that does not arise from active business and that the taxpayer received as a profit distribution from an entity in a third country or as proceeds from the disposal of shares held in an entity in a third country where that entity in its country of tax residence is subject to a statutory corporate tax rate lower than 15%, in connection with such foreign income, in the Member State of its residence for tax purposes. Amendment 56 Proposal for a directive Article 53 – paragraph 2 2.  Where paragraph 1 applies, the taxpayer shall be subject to tax on the foreign income with a deduction of the tax paid in the third country from its tax liability in the Member State where it is resident for tax purposes. The deduction shall not exceed the amount of tax, as computed before the deduction, which is attributable to the income that may be taxed. 2.  Where paragraph 1 applies, the taxpayer shall be subject to tax on the foreign income with a deduction of the tax paid in the third country from its tax liability in the Member State where it is resident for tax purposes. The deduction shall not exceed the amount of tax, as computed before the deduction, which is attributable to the income that may be taxed. In order to benefit from the deduction, the taxpayer shall be required to prove to its tax authorities that the foreign income arises from an active business, which could be done through a certificate to that effect provided by the foreign tax authorities. Amendment 57 Proposal for a directive Article 58 Article 58 Article 58 General anti-abuse rule General anti-abuse rule 1.   For the purposes of calculating the tax base under the rules of this Directive, a Member State shall disregard an arrangement or a series of arrangements which, having been put in place for the essential purpose of obtaining a tax advantage that defeats the object or purpose of this Directive, are not genuine, having regard to all relevant facts and circumstances. An arrangement may comprise more than one step or part. For the purposes of this Directive, the general anti-abuse rule laid down in Directive (EU) 2016/1164 shall apply. 2.  For the purposes of paragraph 1, an arrangement or a series thereof shall be regarded as non-genuine to the extent that they are not put in place for valid commercial reasons that reflect economic reality. 3.  Arrangements or a series thereof that are disregarded in accordance with paragraph 1 shall be treated, for the purpose of calculating the tax base, by reference to their economic substance. Amendment 58 Proposal for a directive Article 59 – paragraph 1 – subparagraph 1 – introductory part An entity, or a permanent establishment of which the profits are not subject to tax or are exempt from tax in the Member State of its head office’, shall be treated as a controlled foreign company where the following conditions are met: The Member State of a taxpayer shall treat an entity, or a permanent establishment of which the profits are not subject to tax or are exempt from tax in that Member State as a controlled foreign company where the following conditions are met: Amendment 59 Proposal for a directive Article 59 – paragraph 1 – subparagraph 1 – point b (b)  the actual corporate tax paid by the entity or permanent establishment on its profits is lower than the difference between the corporate tax that would have been charged on the profits of the entity or permanent establishment in accordance with the rules of this Directive and the actual corporate tax paid on those profits by the entity or permanent establishment. (b)  profits of the entity are subject to a corporate tax rate lower than 15 %; that rate shall be assessed on the basis of the profit before implementation of the operations introduced by these countries to reduce the taxable base subject to the rate; that rate shall be revised each year in line with economic developments in world trade. Amendment 60 Proposal for a directive Article 59 – paragraph 1 – subparagraph 2 For the purposes of point (b) of the first subparagraph, in computing the corporate tax that would have been charged on the profits of the entity according to the rules of the Directive in the Member State of the taxpayer, the income of any permanent establishment of the entity that is not subject to tax or is exempt from tax in the jurisdiction of the controlled foreign company shall not be taken into account. deleted Amendment 61 Proposal for a directive Article 59 – paragraph 2 2.  Where an entity or permanent establishment is treated as a controlled foreign company under paragraph 1, non-distributed income of the entity or permanent establishment shall be subject to tax to the extent that it is derived from the following categories: 2.  Where an entity or permanent establishment is treated as a controlled foreign company under paragraph 1, the Member State of the taxpayer shall include in the tax base: (a)  the non-distributed income of the entity or the income of the permanent establishment which is derived from the following categories: (a)   interest or any other income generated by financial assets; (i)   interest or any other income generated by financial assets; (b)   royalties or any other income generated from intellectual property; (ii)   royalties or any other income generated from intellectual property; (c)   dividends and income from the disposal of shares; (iii)   dividends and income from the disposal of shares; (d)   income from financial leasing; (iv)   income from financial leasing; (e)   income from insurance, banking and other financial activities; (v)   income from insurance, banking and other financial activities; (f)   income from invoicing companies that earn sales and services income from goods and services purchased from and sold to associated enterprises and add no or little economic value. (vi)   income from invoicing companies that earn sales and services income from goods and services purchased from and sold to associated enterprises and add no or little economic value. The first subparagraph shall not apply to a controlled foreign company that is resident or situated in a Member State or in a third country that is party to the EEA Agreement where the controlled foreign company has been set up for valid commercial reasons that reflect economic reality. For the purposes of this Article, the activity of the controlled foreign company shall reflect economic reality to the extent that that activity is supported by commensurate staff, equipment, assets and premises. This point shall not apply where the controlled foreign company carries on a substantive economic activity supported by staff, equipment, assets and premises, as evidenced by relevant facts and circumstances. Where the controlled foreign company is resident or situated in a third country that is not party to the EEA Agreement, Member States may decide to refrain from applying the preceding subparagraph, or (b)  the non-distributed income of the entity or permanent establishment arising from non-genuine arrangements which have been put in place for the essential purpose of obtaining a tax advantage. For the purposes of this point, an arrangement or a series thereof shall be regarded as non-genuine to the extent that the entity or permanent establishment would not own the assets or would not have undertaken the risks which generate all, or part of, its income if it were not controlled by a company where the significant people functions, which are relevant to those assets and risks, are carried out and are instrumental in generating the controlled company’s income. Amendment 62 Proposal for a directive Article 59 – paragraph 3 – subparagraph 1 An entity or permanent establishment shall not be treated as a controlled foreign company as referred to in paragraph 1 where not more than one third of the income accruing to the entity or permanent establishment falls within categories (a) to (f) of paragraph 2. Where, under the rules of a Member State, the tax base of a taxpayer is calculated in accordance with point (a) of paragraph 2, the Member State may opt not to treat an entity or permanent establishment as a controlled foreign company under paragraph 1 if one third or less of the income accruing to the entity or permanent establishment falls within categories under point (a) of paragraph 2. Amendment 63 Proposal for a directive Article 59 – paragraph 3 – subparagraph 2 Financial undertakings shall not be treated as controlled foreign companies under paragraph 1 where not more than one third of the income accruing to the entity or permanent establishment from categories (a) to (f) of paragraph 2 comes from transactions with the taxpayer or its associated enterprises. Where, under the rules of a Member State, the tax base of a taxpayer is calculated in accordance with point (a) of paragraph 2, the Member State may opt not to treat financial undertakings as controlled foreign companies if one third or less of the entity's income from categories under point (a) of paragraph 2 comes from transactions with the taxpayer or its associated enterprises. Amendment 64 Proposal for a directive Article 59 – paragraph 3 a (new) 3a.  Member States may exclude from the scope of point (b) of paragraph 2 an entity or permanent establishment: (a)  with accounting profits of no more than EUR 750 000, and non-trading income of no more than EUR 75 000; or (b)  of which the accounting profits amount to no more than 10 percent of its operating costs for the tax period. For the purpose of point (b) of the first subparagraph, the operating costs may not include the cost of goods sold outside the country where the entity is resident, or the permanent establishment is situated, for tax purposes and payments to associated enterprises. Amendment 65 Proposal for a directive Article 61 Article 61 Article 61 Hybrid mismatch Hybrid mismatch To the extent that a hybrid mismatch between Member States results in a double deduction of the same payment, expenses or losses, the deduction shall be given only in the Member State where such payment has its source, the expenses are incurred or the losses are suffered. For the purposes of this Directive, rules laid down in Article 9 of Directive (EU) 2016/1164 concerning hybrid mismatches shall apply. To the extent that a hybrid mismatch involving a third country results in a double deduction of the same payment, expenses or losses, the Member State concerned shall deny the deduction of such payment, expenses or losses, unless the third country has already done so. To the extent that a hybrid mismatch between Member States results in a deduction without inclusion, the Member State of the payer shall deny the deduction of such payment. To the extent that a hybrid mismatch that involves a third country results in a deduction without inclusion: (a)  if the payment has its source in a Member State, that Member State shall deny the deduction, or (b)  if the payment has its source in a third country, the Member State concerned shall require the taxpayer to include such payment in the taxable base, unless the third country has already denied the deduction or has required that payment to be included. To the extent that a hybrid mismatch between Member States involving a permanent establishment results in non-taxation without inclusion, the Member State in which the taxpayer is resident for tax purposes shall require the taxpayer to include in the taxable base the income attributed to the permanent establishment. To the extent that a hybrid mismatch involving a permanent establishment situated in a third country results in non-taxation without inclusion, the Member State concerned shall require the taxpayer to include in the taxable base the income attributed to the permanent establishment in the third country. 4.  To the extent that a payment by a taxpayer to an associated enterprise in a third country is set off directly or indirectly against a payment, expenses or losses which due to a hybrid mismatch are deductible in two different jurisdictions outside the Union, the Member State of the taxpayer shall deny the deduction of the payment by the taxpayer to an associated enterprise in a third country from the taxable base, unless one of the third countries involved has already denied the deduction of the payment, expenses or losses that would be deductible in two different jurisdictions. 5.  To the extent that the corresponding inclusion of a deductible payment by a taxpayer to an associated enterprise in a third country is set off directly or indirectly against a payment which, due to a hybrid mismatch, is not included by the payee in its taxable base, the Member State of the taxpayer shall deny the deduction of the payment by the taxpayer to an associated enterprise in a third country from the taxable base, unless one of the third countries involved has already denied the deduction of the non-included payment. 6.  To the extent that a hybrid mismatch results in a relief for tax withheld at source on a payment derived from a transferred financial instrument to more than one of the parties involved, the Member State of the taxpayer shall limit the benefit of such relief in proportion to the net taxable income regarding such payment. 7.  For the purposes of this Article, 'payer' means the entity or permanent establishment where the payment has its source, the expenses are incurred or the losses are suffered. Amendment 66 Proposal for a directive Article 61a – title Tax residency mismatches Reverse hybrid mismatches Amendment 67 Proposal for a directive Article 61 a – paragraph 1 To the extent that a payment, expenses or losses of a taxpayer who is resident for tax purposes in both a Member State and a third country, in accordance with the laws of that Member State and that third country, are deductible from the taxable base in both jurisdictions and that payment, those expenses or losses can be set-off in the Member State of the taxpayer against taxable income that is not included in the third country, the Member State of the taxpayer shall deny the deduction of the payment, expenses or losses, unless the third country has already done so. For the purposes of this Directive, Member States shall treat reverse hybrid mismatches in accordance with Article 9a of Directive (EU) 2016/1164. Amendment 68 Proposal for a directive Article 65 a (new) Article 65 a European tax identification number The Commission shall present a legislative proposal for a harmonised, common European taxpayer identification number by 31 December 2018, in order to make automatic exchange of tax information more efficient and reliable within the Union. Amendment 69 Proposal for a directive Article 65 b (new) Article 65 b Mandatory automatic exchange of information on tax matters In order to guarantee full transparency and the proper implementation of this Directive, the exchange of information on tax matters shall be automatic and mandatory, as laid down by Council Directive 2011/16/EU1a. Member States shall allocate adequate staff, expertise and budget resources to their national tax administrations as well as resources for the training of tax administration staff focusing on cross-border tax cooperation, and on automatic exchange of information in order to ensure full implementation of this Directive. ____________ 1a Council Directive 2011/16/EU of 15 February 2011 on administrative cooperation in the field of taxation and repealing Directive 77/799/EEC (OJ L 64, 11.3.2011, p. 1). Amendment 70 Proposal for a directive Article 66 – paragraph 2 2.  The power to adopt delegated acts referred to in Articles 2(5), 4(5), 11(6), 32(5) and 40 shall be conferred on the Commission for an indeterminate period of time from the date of entry into force of this Directive. 2.  The power to adopt delegated acts referred to in Articles 2(5), 4(5), 5(2a), 32(5) and Article 40 shall be conferred on the Commission for an indeterminate period of time from the date of entry into force of this Directive. Amendment 71 Proposal for a directive Article 66 – paragraph 3 3.  The delegation of power referred to in Articles 2(5), 4(5), 11(6), 32(5) and 40 may be revoked at any time by the Council. A decision to revoke shall put an end to the delegation of the power specified in that decision. It shall take effect the day following the publication of the decision in the Official Journal of the European Union or at a later date specified therein. It shall not affect the validity of any delegated acts already in force. 3.  The delegation of power referred to in Articles 2(5), 4(5), 5(2a), 32(5) and Article 40 may be revoked at any time by the Council. A decision to revoke shall put an end to the delegation of the power specified in that decision. It shall take effect the day following the publication of the decision in the Official Journal of the European Union or at a later date specified therein. It shall not affect the validity of any delegated acts already in force. Amendment 72 Proposal for a directive Article 66 – paragraph 5 5.  A delegated act adopted pursuant to Articles 2(5), 4(5), 11(6), 32(5) and 40 shall enter into force only if no objection has been expressed by the Council within a period of [two months] of notification of that act to the Council or if, before the expiry of that period, the Council has informed the Commission that it will not object. That period shall be extended by [two months] at the initiative of the Council. 5.  A delegated act adopted pursuant to Articles 2(5), 4(5), 5(2a), 32(5) and Article 40 shall enter into force only if no objection has been expressed by the Council within a period of [two months] of notification of that act to the Council or if, before the expiry of that period, the Council has informed the Commission that it will not object. That period shall be extended by [two months] at the initiative of the Council. Amendment 73 Proposal for a directive Article 66 a (new) Article 66a Measures against tax treaty abuses Member States shall amend their bilateral tax treaties in accordance with this Directive to ensure such treaties contain all of the following: (a)  a clause ensuring that both parties to the treaty undertake to laying down measures whereby tax is to be paid where economic activities are taking place and where value is created; (b)  an addendum to clarify that the objective of bilateral treaties, beyond avoiding double taxation is also to fight tax evasion and aggressive tax planning; (c)  a clause for a principal purpose test based on a general anti-avoidance rule. Amendment 74 Proposal for a directive Article 68 a (new) Article 68a Monitoring The Commission shall monitor and publish its findings on the uniform implementation of this Directive to ensure homogeneous interpretation of its measures by Member States. Amendment 75 Proposal for a directive Article 69 Article 69 Article 69 Review Implementation report and review The Commission shall, five years after the entry into force of this Directive, review its application and report to the Council on the operation of this Directive. The Commission shall, five years after the entry into force of this Directive assess the operation of this Directive. Notwithstanding the first subparagraph, the Commission shall, three years after the entry into force of this Directive, examine the functioning of Article 11 and consider adjustments to the definition and calibration of the AGI. The Commission shall undertake a thorough analysis of how the AGI can encourage companies that are entitled to opt for applying the rules of this Directive to finance their activities through equity. The Commission shall communicate its findings in an implementation report to the European Parliament and the Council. The report shall include an analysis of all of the following elements: (a)   the impact of this system on Member States tax revenues; (b)  the advantages and disadvantages of the system for small and medium-sized enterprises; (c)   the impact on a fair tax collection between Member States; (d)   the impact on the internal market as a whole, with particular regard to possible distortion of competition between companies subject to the new rules laid down in this Directive. (e)   the number of undertakings that are in the scope in the transition period. The Commission shall, 10 years after the entry into force of this Directive, review its application and report to the European Parliament and the Council on the operation of this Directive. The Commission shall communicate its findings to Member States with the aim to take those findings into account for the design and implementation of national corporate tax systems. The Commission shall communicate its findings in a report to the European Parliament and Member States with the aim of taking those findings into account for the design and implementation of national corporate tax systems accompanied, if appropriate, by a legislative proposal to amend this Directive. Amendment 76 Proposal for a directive Article 70 – paragraph 1 – subparagraph 1 Member States shall adopt and publish, by 31st December 2018 at the latest, the laws, regulations and administrative provisions necessary to comply with this Directive. They shall forthwith communicate to the Commission the text of those provisions. Member States shall adopt and publish, by 31 December 2019 at the latest, the laws, regulations and administrative provisions necessary to comply with this Directive. They shall forthwith communicate to the Commission the text of those provisions. Amendment 77 Proposal for a directive Article 70 – paragraph 1 – subparagraph 2 They shall apply those provisions from 1st January 2019. They shall apply those provisions from 1 January 2020.

European Parliament resolution of 15 March 2018 on general guidelines for the preparation of the 2019 budget, Section III – Commission (2017/2286(BUD))

P8_TA(2018)0089 A8-0062/2018

The European Parliament,

–  having regard to Article 314 of the Treaty on the Functioning of the European Union,

–  having regard to Article 106a of the Treaty establishing the European Atomic Energy Community,

–  having regard to Council Regulation (EU, Euratom) No 1311/2013 of 2 December 2013 laying down the multiannual financial framework for the years 2014-2020(1),

–  having regard to the Interinstitutional Agreement of 2 December 2013 between the European Parliament, the Council and the Commission on budgetary discipline, on cooperation in budgetary matters and on sound financial management(2),

–  having regard to Regulation (EU, Euratom) No 966/2012 of the European Parliament and of the Council of 25 October 2012 on the financial rules applicable to the general budget of the Union and repealing Council Regulation (EC, Euratom) No 1605/2002(3),

–  having regard to Council Decision 2014/335/EU, Euratom of 26 May 2014 on the system of own resources of the European Union(4),

–  having regard to the general budget of the European Union for the financial year 2018(5) and the joint statements agreed between Parliament, the Council and the Commission annexed thereto,

–  having regard to the Council Conclusions of 20 February 2018 on the 2019 budget guidelines (06315/2018),

–  having regard to Rule 86a of its Rules of Procedure,

–  having regard to the report of the Committee on Budgets (A8-0062/2018),

A.  whereas negotiations on the 2019 Union budget, the last under the current parliamentary term, will run in parallel with the negotiations on the next multiannual financial framework (MFF) and the reform of the EU own resources system; whereas 2019 will mark the sixth year of the 2014-2020 MFF;

B.  whereas the two arms of the budgetary authority should endeavour to reach an ambitious and comprehensive agreement on the 2019 budget in the Conciliation Committee, in order to positively influence the parallel negotiations and enable an agreement on the post-2020 MFF and own resources by the end of this parliamentary term;

C.  whereas following the December 2017 agreement to launch the second phase of negotiations, the Brexit process should not have a direct impact on the 2019 budget, as in accordance with the joint report of the EU and the UK(6), the UK will contribute to, and participate in, the implementation of the Union annual budgets for the years 2019 and 2020 as if it had remained in the Union;

D.  whereas growing populist and extremist movements in all Member States have provided and fuelled misleading information about the EU and its budget, highlighting the need for better and more transparent information;

E.  whereas after years of negative perception by citizens of the management of the financial, social and economic crisis, today’s improving economic outlook, which is the result of coordinated efforts to put Europe on the path of economic recovery, allows for more generous budgetary planning;

F.  whereas the Council has repeatedly contradicted itself over the last few years, by presenting new political priorities for the EU but showing itself unwilling to provide for fresh appropriations to finance them; whereas new political priorities and upcoming challenges for the EU should be financed by fresh appropriations and not by reducing existing successful programmes;

G.  whereas towards the end of the current financial programming period the implementation of the multiannual programmes will reach cruising speed, and the need for adequate financial resources is therefore increasing;

Responses to challenges for the EU and citizens’ expectations

1.  Acknowledges the recovery from the consequences of the financial, economic and social crisis, strengthened as a result of EU and Member State efforts to create growth and jobs which must be further consolidated so as to generate a positive influence on the day-to-day lives of EU citizens, many of whom have been hit hard by the crisis for several years; calls for a particular focus on young people and people at risk of poverty or unemployment to ensure that they feel the beneficial effects, thus preventing social and regional inequalities from continuing to grow; stresses, in this context, that a special focus should nevertheless be placed on the different regions’ capacity to take advantage of the increasing growth;

2.  Emphasises that, according to Eurostat data and contrary to populist narrative, EU citizens are optimistic about the future of the EU; stresses that the Union should fulfil its tasks and responsibilities and do more to improve the lives of its citizens, both now and in the future, but also to protect them against unfair trade and economic practices in the global market, while helping them to reap its benefits; stresses that the challenges of climate change and international security threats must be tackled; believes that in order to fulfil these expectations and commitments, the EU must, within the remit of its competences, perform better, so as to support the creation of sustainable growth and jobs and narrow the gap in living standards between EU citizens in all its regions, while fully adhering to the EU 2020 strategy, the UN Sustainable Development Goals and the Paris Agreement; stresses the need to prepare the European economy and EU citizens for the opportunities of digitalisation; considers that tackling the root causes of migration and putting an end to various kinds of discrimination, such as discrimination against women and LGBTI people, also represent important challenges for 2019;

Preparing a sustainable future and reinforced solidarities within and outside the Union

A sustainable future

3.  Believes that the 2019 EU budget should reinforce all the relevant instruments for tackling youth unemployment, especially in EU regions that are lagging economically, paying particular attention to the improvement of entrepreneurial and professional skills and mobility, recognition of qualifications at all levels of education and vocational training, and support to growth, competitiveness, job creation, investments in infrastructure, innovation, research and SMEs; stresses that youth unemployment, which has a high social impact, is one of the greatest challenges at European level;

4.   Believes that the priorities for the 2019 EU budget should be growth, innovation, competitiveness, security, the fight against climate change, the transition to renewable energy and migration;

5.  Supports the widening of opportunities for young people to participate in solidarity activities; calls for the swift roll-out and thorough implementation of the European Solidarity Corps following its adoption envisaged for 2018;

6.  Welcomes the fact that, at the strong request of Parliament, the result of the conciliation on the 2018 EU budget was to increase the originally proposed specific allocation for the Youth Employment Initiative (YEI) by EUR 116,7 million of fresh appropriations, bringing its total amount to EUR 350 million in 2018, but points to the need to improve the implementation of funding that is lagging behind; opposes the Commission’s interpretation, in its technical update of financial programming 2019-2020 following adoption of the 2018 budget, of the financial programming for the year 2018, which views this reinforcement as frontloading of appropriations in years to come, and expects the Commission to fulfil the promises it made to Parliament at the end of the 2017 conciliation period; expects the 2019 draft budget to demonstrate greater ambition to fight youth unemployment, finding the right balance between the real evolution of absorption capacity in that area and political will to demonstrate support for this issue; recalls the Commission commitment to proposing a further increase in YEI funding through an amending budget should the absorption capacity of the YEI in 2018 allow for such an increase; insists that the Member States and the Commission match offers of employment, education or training with participant profiles and labour market demand in order to place participants in sustainable employment;

7.  Calls on the Commission to make available, for the 2019 procedure, the financial data on implementation of the YEI broken down by national share, to complement the data reporting expressed in the form of total costs that is already publicly available; urges the Commission to improve synergies between the YEI, the European Social Fund and the national budgets of the Member States to ensure that the YEI does not become a substitute for national funding for young people not in education, employment or training (NEETs);

8.  Stresses that, in the light of the celebration of its 30th anniversary, Erasmus+ remains the leading programme to foster youth mobility, teach key European values and inculcate them in young people, together with the EU’s culture programmes, as demonstrated by the volume of applications received which exceed the funding available; believes that the 2019 Erasmus+ budget needs to be increased further (at least doubled) to meet the eligible demand for this programme, notably that linked to lifelong learning;

9.  Believes that research, competitiveness and SMEs are key to enabling economic growth and job creation; underlines the importance, therefore, of providing EU companies, especially SMEs, with a favourable environment for innovation, research and investments in order to create an EU economy that is genuinely competitive on a global level; stresses the importance of an increased budget under Heading 1a and the extension of funding for successful programmes, such as Horizon 2020 and programmes that support SMEs, including the EU programme for the Competitiveness of Enterprises and Small and Medium-sized Enterprises (COSME), which have far more applicants than recipients of funding; stresses the importance of considering the specific requirements and low administrative resources of SMEs when designing SME programmes; considers this to be necessary in view of the rapidly changing and highly competitive world and the profound changes in all sectors brought on by digitalisation; acknowledges that the European Structural and Investment Funds (ESI Funds) also contribute to all these priorities;

10.  Stresses that investments in research and innovation represent a precondition for achieving genuine competitiveness in the EU; regrets that, as a result of an alarmingly low application success rate, fewer high-quality projects in the field of research and innovation are receiving EU funding; stresses, in this context, that an adequate level of appropriations must be ensured for Horizon 2020;

11.  Stresses the potential for economic growth stemming from the technological transformation and calls for the EU budget to have an appropriate role in supporting the digitalisation of European industry and the promotion of digital skills and entrepreneurship;

12.  Recognises that SMEs remain the backbone of the European economy and will continue to play a decisive role in creating jobs and growth across the EU; calls, in this respect, for COSME appropriations to be increased in 2019, given the success of this programme;

13.  Welcomes the extension and enhancement of the European Fund for Strategic Investments (EFSI), whose increased guarantee fund plays a key role in reducing the investment gap in the EU; recalls that the EFSI guarantee fund has been financed partly at the expense of Horizon 2020 and the Connecting Europe Facility (CEF), even though both are long-term, future-oriented programmes; underlines Parliament’s long-standing position that any new initiatives must be financed by new appropriations and not by redeployments, and that the damage done to existing programmes must be corrected through the annual budgetary procedure; reiterates that the cuts in those programmes should be reversed as far as possible;

14.  Stresses that the extended EFSI should make significant progress in 2019 towards delivering on better geographical coverage, so that all regions can benefit equally from the leverage provided by the EU budget guarantee; calls on the Member States to implement structural reforms that improve the investment environment and local capacities for successful implementation of EFSI support in all regions;

15.  Welcomes the Member States’ recent commitment to a renewed EU defence agenda, which seeks to enhance both hard and soft power, and considers it to be in line with the security concerns of citizens, in the light of rising global instability exacerbated by new types of threats; supports the recent Commission initiative to launch the European Defence Industrial Development Programme (EDIDP), as a first stage of the European Defence Fund; requires the EDIDP to be financed exclusively by unallocated margins and/or special instruments and not, therefore, by redeployments from existing programmes;

16.  Underlines that tackling internal security must remain one of the Union’s main priorities and calls for reinforced funding for this evolving policy; is convinced that the EU needs to invest more in the strengthening and management of its borders, enhancing cooperation between law enforcement agencies and national authorities and fighting terrorism, radicalisation and organised crime, by implementing an adequate and modern digital information system; underlines, in this respect, the role played by the Internal Security Fund (ISF) and the need to adequately fund agencies in the areas of borders, security and justice; recalls that the financial envelope of this instrument was reduced significantly for 2018;

17.  Calls for increased funding to combat the phenomenon of radicalisation which breeds violent extremism within the Union; considers that this objective can be achieved by promoting integration and combating discrimination, racism, xenophobia, fundamentalism, hate speech and hate scripts;

18.  Welcomes the role played by the Asylum, Migration and Integration Fund (AMIF); calls for adequate budgeting for this fund in 2019 in order to support the dignified reception of asylum seekers in the Member States, fair return strategies, resettlement programmes, legal migration policies and promotion of effective integration of third country nationals, and to tackle irregular migration; reaffirms the importance of possessing targeted financial means to tackle the root causes of the migrant and refugee crisis; stresses, to this end, that the EU budget must fund measures in the countries of origin of migrants and in the host countries of refugees, including, but not limited to, measures to tackle poverty, unemployment, educational and economic challenges, and instability;

19.  Calls on the Commission to present a proposal which would provide for the expression of financial solidarity at EU level to victims of acts of terrorism and their families;

20.  Recalls the importance of EU agencies in ensuring the implementation of EU legislative priorities and thereby accomplishing EU policy objectives, such as those related to competitiveness (employment, sustainable growth, the Energy Union), migration (asylum, cross-border management), support for fundamental rights (data protection), and security (cybercrime, drugs, fraud, money laundering, terrorism, judicial cooperation, police cooperation, support for information systems on a large scale); expects the negotiations on the 2019 budget to lead to realistic and adequate operational and administrative funding of the EU agencies and other EU bodies, enabling them to accomplish their duties, including their growing tasks and increased workload; calls for the allocation of adequate resources to ensure the proper implementation and functioning of the European Public Prosecutor’s Office; calls, more generally, for a thorough assessment of the strategic interest and tasks of all agencies and the possibility of grouping agencies according to the strategic nature of their mission and results; reiterates that 2018 marks the last year of the implementation of the 5 % reduction in staff numbers and the ‘redeployment pool’; expects the Commission and Council to refrain from cutting agencies’ resources further in the 2019 budget;

21.  Considers that the 2019 budget, at a time when key actors, such as the US, are unwilling to implement their commitments to fight climate change under the Paris Agreement, must place the EU squarely at the forefront of this challenge, one of the greatest of our generation, by providing additional financial support to initiatives such as the LIFE Climate Action programme, ECOPOTENTIAL and Clean Sky; underlines that expenditures in this respect should be considered long-term investments rather than costs and that both the European Court of Auditors and the Economic and Financial Affairs Council have ascertained that the EU is falling short of its climate financing target; calls on the Commission to fulfil the objectives of the Paris Agreement and the EU’s own long-term climate goals by meeting the 20 % climate spending target in the current MFF (2014-2020); stresses, in this regard, that the contribution for 2019 should significantly overshoot the overall target in order to offset the lower allocations made during the first years of the MFF, and that the climate change mainstreaming mechanism should be fully optimised;

Reinforced solidarities to address social, territorial and global challenges

22.  Believes that the EU budget should contribute to the efforts made by Member States in areas such as unemployment and healthcare, by setting aside adequate funding for programmes that set out to fight inequalities, alleviate the worst forms of poverty, specifically for the most isolated and fragile populations, notably children, and enable citizens to acquire the necessary skills to adapt to digitalisation;

23.  Insists on the need to reinforce support to the Union programmes which foster growth and creation of long-term quality jobs, in particular for young people, complementing Member States’ efforts to guarantee diversified professional qualifications instead of precocious specialisation, as a means to increase resilience and enable societal adaptation while addressing demographic regression, skilled labour shortages in certain sectors and the sustainability of welfare systems; notes that consideration of specific, tailor-made measures might prove useful in the sectors and/or regions that are most affected or that have become much more vulnerable;

24.  Recalls the significant ageing of the population and the increase in those in need of special and dedicated care, in particular the elderly; calls on the Commission to introduce further support measures to address demographic challenges and reiterates its support to initiatives such as villages for people with dementia, where appropriate care is provided from an early stage;

25.  Believes that gender-related discrimination, notably on the labour market, is not only incompatible with the values of the EU, but also constitutes a serious impediment to economic growth as it disempowers women from engaging in meaningful employment; underlines the key contribution of women’s empowerment in achieving more inclusive, equitable and peaceful societies whose growth is more sustainable; expects the 2019 budget to support women’s entrepreneurship and encourage access for women to EU funding, such as under the COSME and Horizon 2020 programmes, and to broaden cohesion policy to support further investments in education, childcare and healthcare infrastructure, helping women to reconcile private and professional life;

26.  Reiterates its concern about delays to the implementation of cohesion policy, which is the expression of the EU’s territorial solidarity and its main investment policy, but acknowledges that 2017 was the first year in which the implementation of ESI Fund programmes was accelerated and expects that this trend will continue in 2018 and 2019; believes that sufficient levels of payment appropriations should be provided in order for implementation to proceed smoothly;

27.  Recalls the important contribution the Union has made to encouraging peace and reconciliation in Ireland, in particular through the PEACE and INTERREG programmes, which are targeted to Northern Ireland and border counties in the South; calls for the full observance of the framework of the commitments previously assumed, as in the case of the Good Friday Agreement, in respect of the rule of law and democracy; calls on the Commission and the Member States to continue its support for the peace process through the continued funding of the PEACE and associated programmes;

28.  Points out that the common agricultural policy (CAP) is one of the cornerstones of European integration, which has ensured safe, high-quality food supply for European citizens, the proper functioning of the agricultural single market and the sustainability of rural regions for many years; recalls that CAP funds contribute in particular to the agricultural profitability and stability of the EU;

29.  Calls on the Commission to continue to support farmers across Europe in coping with unexpected market volatility and in securing safe, high-quality food supplies; requests that appropriate attention be paid to small-scale farms and fisheries;

30.  Considers that regionalisation and socio-economic objectives need to play a greater role under the common fisheries policy and that the scope of the European Maritime and Fisheries Fund must be broadened; calls on the Commission to facilitate access to and simplify the procedures for funding; expresses particular concern about the potential adverse impact the UK’s withdrawal from the EU will have on fisheries, particularly for neighbouring coastal Member States;

31.  Welcomes the proposal to extend the scope of and reinforce the Union’s Civil Protection Mechanism; is of the opinion that strengthening the Civil Protection Mechanism is of the utmost importance in order to provide a more rapid and coherent response in the field of civil protection at Union level, in the areas of prevention, preparedness and response to natural and man-made disasters within and outside the Union;

32.  Expects ongoing procedures and measures to be enhanced in the implementation of the budget, in the light of the resource constraints that have arisen and the calls for the EU to assume greater responsibilities, so as to ensure that financial commitments are met in a timely and cost-effective manner;

33.  Believes that EU agencies, programmes and policies involved in or relating to the management of migration and refugee flows and border control should be provided with adequate financial and human resources to deal with the current refugee crisis, for which Member States are also expected to take responsibility in accordance with the principle of burden-sharing and the Geneva Conventions; is convinced that the EU, in order to find a long-term solution, should also demonstrate its external solidarity in fostering conditions for peace and prosperity in the countries of origin, by placing greater emphasis on investments and development policies, notably through the implementation of the European Fund for Sustainable Development (EFSD), the Development Cooperation Instrument (DCI) and the Humanitarian Aid Instrument; recognises the importance and distinct value of development policy, with priorities such as poverty eradication, education, health and economic development; underlines the need to support UNRWA actions and programmes; underlines that one of the conditions for preserving stability and prosperity in the EU is a stable EU Neighbourhood; calls on the Commission, therefore, to ensure that priority is given to investments in the EU Neighbourhood in order to support efforts to tackle the main issues faced by this area – migration, refugee challenges and development in the Southern Neighbourhood and instability in the Eastern Neighbourhood – which is partly due to a Russian foreign policy not in line with international law and democratic and human rights standards; emphasises that new political priorities and upcoming challenges for the EU, such as security and defence, should be financed by fresh appropriations and not by cutting existing policies and programmes which are both successful and important, such as development and humanitarian aid and neighbourhood policy; stresses, furthermore, that security and development policies have a mutual influence on one another and that both are important conditions for the construction of a functioning state, as well as functioning administrative structures without corruption and minimum standards in the social, health, and economic sectors;

34.   Reiterates its position that the satellite budgetary mechanisms, such as trust funds and other similar instruments, circumvent the budgetary procedure, undermine the transparency of budgetary management and infringe upon the right of Parliament to exercise effective scrutiny of expenditures; considers, therefore, that these external instruments, created in the past few years, must be incorporated into the Union budget, and that alternative solutions must be found to enable the Union to react promptly to emergency and post-emergency situations at international level;

35.  Stresses that the Instrument for Pre-Accession Assistance (IPA) should primarily facilitate political and economic reforms in enlargement countries, among other objectives; invites the Commission, in this context, to further evaluate IPA funds in its 2019 budget proposal, taking into account the deteriorating political situation in Turkey and the urgent need to tackle growing radicalisation in the Balkan states;

Expectations for the 2019 procedure

36.  Invites the Commission to continue to act as an honest mediator at every single stage of the procedure, and to implement faithfully and accurately the budgetary authority decisions;

37.  Welcomes the fact that, following the mid-term revision of the MFF, and contrary to the Council conclusions of 20 February 2018 on the budget guidelines for 2019, the 2018 procedure showed that the budgetary authority can fully exercise its prerogatives to determine the level and content of the EU budget through the annual budgetary procedure;

38.  Believes that as the arm of the budgetary authority directly elected by citizens, Parliament should fulfil its political role and put forward proposals for Pilot Projects and Preparatory Actions expressing its political vision for the future; commits itself, in this context, to proposing a package of Pilot Projects and Preparatory Actions developed in close cooperation with each of its committees so as to find the right balance between political will and technical feasibility, as assessed by the Commission;

39.  Expects the negotiations on the 2019 budget to be based on shared political ambition and solidarity, and to take into account the added value of EU programmes and policies; believes that this objective can only be realised if the negotiating parties are promptly informed of one another’s positions, start the negotiations at the earliest possible stage and are willing to compromise;

o
o   o

40.  Instructs its President to forward this resolution to the Council, the Commission and the Court of Auditors.

(1) OJ L 347, 20.12.2013, p. 884. (2) OJ C 373, 20.12.2013, p. 1. (3) OJ L 298, 26.10.2012, p. 1. (4) OJ L 168, 7.6.2014, p. 105. (5) OJ L 57, 28.2.2018, p. 1. (6) Joint report from the negotiators of the European Union and the United Kingdom Government of 8 December 2017 on progress during phase 1 of negotiations under Article 50 TEU on the United Kingdom’s orderly withdrawal from the European Union (TF50 (2017) 19 – Commission to EU 27).

European Parliament resolution of 15 March 2018 on the situation in Syria (2018/2626(RSP))

P8_TA(2018)0090 RC-B8-0139/2018

The European Parliament,

–  having regard to its previous resolutions on Syria, in particular that of 18 May 2017 on the EU strategy on Syria(1),

–  having regard to the Universal Declaration of Human Rights of 1948 and other UN human rights treaties and instruments, including the UN Convention on the Rights of the Child,

–  having regard to the Geneva Conventions of 1949 and the additional protocols thereto,

–  having regard to the statements on Syria by the Vice-President of the Commission / High Representative of the Union for Foreign Affairs and Security Policy (VP/HR), Federica Mogherini, and in particular those of 9 July 2017 on a ceasefire in Syria, of 25 November 2017 on the conference of the Syrian Opposition in Riyadh and of 23 February 2018 on the massacre in Eastern Ghouta and to her remarks upon arrival at the Foreign Affairs Council meeting of 26 February 2018,

–  having regard to the joint statements by VP/HR Federica Mogherini and Commissioner Stylianides on the recent attacks in Syria of 3 October 2017, on the humanitarian situation in Eastern Ghouta and Idlib of 20 February 2018 and on the situation in Eastern Ghouta and elsewhere in Syria of 6 March 2018,

–  having regard to the statement by VP/HR Federica Mogherini during its plenary session of 6 February 2018 on the human rights situation in Turkey and the situation in Afrin, Syria,

–  having regard to Council Decision 2011/273/CFSP of 9 May 2011 concerning restrictive measures against Syria(2) and to the Council conclusions of 26 February 2018 on adding two new ministers to the sanctions list,

–  having regard to the joint communication by the Commission and the VP/HR to the European Parliament and the Council of 14 March 2017 entitled ‘Elements for an EU Strategy for Syria’ (JOIN(2017)0011) and to the Council conclusions on Syria of 3 April 2017, which together make up the new EU strategy on Syria,

–  having regard to the Co-Chairs Declaration of 5 April 2017 on the Conference on Supporting the Future of Syria and the Region, and to the previous conferences on the situation in Syria held in London, Kuwait, Berlin and Helsinki,

–  having regard to the statements by UN High Commissioner for Human Rights, Zeid Ra’ad Al Hussein to the Human Rights Council (UNHRC) in Geneva on the situation in Syria, in particular those of 26 February 2018 and 2 March 2018, and to his oral update on the activities of his office and recent human rights developments of 7 March 2018,

–  having regard to the statements attributable to the Spokesman for the Secretary-General on Eastern Ghouta in the Syrian Arab Republic of 20 February and 24 February 2018,

–  having regard to the Charter of the United Nations and to all the UN conventions to which Syria is a State Party,

–  having regard to the UN Security Council (UNSC) resolutions on Syria, in particular Resolution 2254 (2015) of 18 December 2015, Resolution 2393 (2017) of 19 December 2017 on authorisation for cross-border and cross-line aid delivery in Syria and Resolution 2401 (2018) of 24 February 2018 on a 30-day cessation of hostilities in Syria to enable humanitarian aid delivery,

–  having regard to the reports of the Independent International Commission of Inquiry on the Syrian Arab Republic, established by the UNHRC, and to the UNHRC resolutions on the Syrian Arab Republic, in particular that of 5 March 2018 on the deteriorating situation of human rights in Eastern Ghouta,

–  having regard to UN General Assembly Resolution A-71/248 of 21 December 2016 on an International, Impartial and Independent Mechanism to Assist in the Investigation and Prosecution of Those Responsible for the Most Serious Crimes under International Law Committed in the Syrian Arab Republic since March 2011,

–  having regard to the Rome Statute and the founding documents of the International Court of Justice, and those of ad hoc tribunals, including the International Criminal Tribunal for the former Yugoslavia, the International Criminal Tribunal for Rwanda and the Special Tribunal for Lebanon,

–  having regard to the Memorandum on the creation of de-escalation areas in the Syrian Arab Republic, signed by Iran, Russia and Turkey on 6 May 2017,

–  having regard to the report published by the UN Population Fund in 2017 entitled ‘Voices from Syria 2018 – Assessment Findings of the Humanitarian Needs Overview’,

–  having regard to the Carnegie Middle East Center statement of 5 March 2018 on the reported meeting of the head of the Syrian National Security Bureau, Ali Mamlouk, who is included in the EU sanctions list, with the Italian Interior Minister and the Director of the Agency for Information and External Security in Rome, in flagrant violation of Council Decision 2011/273/CFSP of 9 May 2011 concerning restrictive measures against Syria,

–  having regard to Rule 123(2) and (4) of its Rules of Procedure,

A.  whereas Syria’s seven-year civil conflict continues, despite several international efforts to achieve a ceasefire and lay the basis for a negotiated solution; whereas, consequently, the humanitarian situation in the country remains devastating; whereas 13 million people, including 6 million children, are registered as in need of some form of humanitarian aid; whereas 6,1 million people are internally displaced, 3 million civilians live in besieged areas and over 5 million are registered Syrian refugees residing in neighbouring regions; whereas at least 400 000 Syrian lives have been lost during the conflict;

B.  whereas areas and cities such as Idlib, Eastern Ghouta, Yarmouk, Foua, and Kefraya have long suffered blockades with serious consequences for the civilian population and no possibility to deliver humanitarian aid in a sustainable way due to the military offensive and bombardments by the Syrian regime against its own people with the support of Russia and Iran; whereas Eastern Ghouta has been under siege by the Syrian regime and its allies for five years – with civilians, including children, schools and medical facilities subjected to air bombardments, shelling and the use of chemical weapons, causing hundreds of deaths in the area; whereas terrorist groups in Eastern Ghouta have been accused of shelling civilian districts in Damascus;

C.  whereas the situation in Eastern Ghouta is so critical that the UN Secretary-General, António Guterres, has described it as ‘hell on earth’; whereas the people of Eastern Ghouta have been cut off from any form of aid by a blockade since 14 February 2018, when a single convoy reached just 7 200 people out of the 400 000 living in the area; whereas a UN aid convoy finally managed to enter Douma on 5 March 2018, reaching 27 500 people in need of food and medical supplies; whereas the Syrian regime removed critical medical items from the convoy;

D.  whereas on 24 February 2018 the UNSC adopted Resolution 2401, in which the Security Council demanded that all parties to the conflict cease hostilities without delay for at least 30 consecutive days to enable the safe, unimpeded and sustained delivery of humanitarian assistance and medical evacuations of the critically sick and wounded, in accordance with applicable international law; whereas UNSC resolution 2401 has not been implemented by the Syrian regime and the Russian and Iranian forces, despite repeated calls from the international community; whereas the military is using the ‘liberation’ of the region as a pretext to continue targeting civilians; whereas Russia has vetoed 11 UNSC resolutions in recent years, including the one aimed at renewing the UN-OPCW Joint Investigative Mechanism in November 2017, and has played an active role in limiting the content of the resolutions;

E.  whereas these attacks and the use of starvation of civilians through besieging populated areas and forced displacement of the population, including with the aim of demographic change, as war tactics constitute clear breaches of international humanitarian law; whereas obstructing evacuation efforts and the delivery of humanitarian aid and medical care constitute blatant violations of international humanitarian law and of several UNSC resolutions;

F.  whereas Turkey’s Operation Olive Branch in the Kurdish-controlled province of Afrin has added a new dimension to the conflict in Syria, raising additional humanitarian concerns and worries about the negative impacts on the delicate internal balances in Syria and/or the efforts towards a negotiated solution; stresses that a high number of civilian casualties has already been reported and that hundreds more civilian lives are at risk; whereas the VP/HR, on behalf of the EU, has clearly voiced these concerns, calling on the Turkish Government to stop its offensive and highlighting the need to focus on defeating the UN-listed terrorist organisations;

G.  whereas the violations committed during the Syrian conflict by the Assad regime and its allies and by terrorist groups include targeted, indiscriminate attacks on civilians, including with chemical weapons, extrajudicial killings, torture and ill-treatment, enforced disappearances, mass and arbitrary arrests, collective punishment, attacks against medical personnel and the denial of food, water and medical aid; whereas these crimes have so far gone unpunished;

H.  whereas ISIS/Daesh and other jihadist movements have committed atrocities and grave violations of international law, including brutal executions and sexual violence, abduction, torture, forced conversion and enslavement of women and girls; whereas children are recruited and used in terrorist activities; whereas there is serious concern over the use of civilians as human shields in extremist-held areas; whereas these crimes amount to war crimes, crimes against humanity and genocide;

I.  whereas in the current situation the democratic opposition is weakened and civilians are trapped between jihadist terrorists and Islamic fundamentalists on the one hand and supporters of the Assad regime on the other;

J.  whereas on 26 February 2018 the Council added the Minister of Industry and the Minister of Information of the Government of Syria to the list of those targeted by EU restrictive measures against the Syrian regime in view of the gravity of the situation in the country;

K.  whereas it is the obligation of the international community and individual states to hold to account those responsible for violations of international human rights and humanitarian law committed during the Syrian conflict, including through the application of the principle of universal jurisdiction as well as national law; whereas this can be done on the basis either of existing national and international remedies, including national courts and international tribunals, or of ad hoc international criminal tribunals yet to be established; whereas in addition to such personal criminal accountability, states can, under certain conditions, also be prosecuted for breaches of obligations under international treaties and conventions over which the International Court of Justice has jurisdiction, including the 1984 Convention against Torture and Other Cruel, Inhuman or Degrading Treatment or Punishment and the 1948 Convention on the Prevention and Punishment of the Crime of Genocide;

L.  whereas the EU remains committed to the success of the negotiations conducted under the auspices of the UN Special Envoy for Syria, known as the Geneva process; whereas the EU continues to support this process, including through the organisation of the second Brussels Conference on Supporting the Future of Syria and the Region, due to take place on 24 and 25 April 2018;

M.  whereas the Geneva-based negotiations have so far not led to advances in finding a peaceful solution to the crisis in Syria following the 9th round in Vienna on 25 and 26 January 2018; whereas on 4 May 2017, Russia, Iran and Turkey reached a deal in Kazakhstan to establish four de-escalation zones, which have not been respected and protected by the guarantors; whereas the Syrian National Dialogue Congress that took place in Sochi on 30 January 2018 announced the creation of a Constitutional Committee, which has not been accepted by all parties;

N.  whereas the situation in Syria and the lack of a comprehensive, genuine and inclusive political transition continues to impede the full implementation of the EU strategy on Syria, and in particular the substantial assistance that the Union can provide for the reconstruction of the country;

O.  whereas since the outbreak of the war, the EU and its Member States have mobilised more than EUR 10,4 billion towards addressing the humanitarian needs resulting from the Syrian crisis, both internally and externally in the neighbouring region, making the EU the largest donor; whereas the EU has also substantially supported and praised the neighbouring refugee-hosting countries;

1.  Strongly condemns, once again and in the strongest terms, all atrocities and the widespread violations of human rights and international humanitarian law committed during the conflict, and in particular the acts perpetrated by forces of the Assad regime, including with the support of its allies Russia and Iran, as well as by the UN-listed terrorist organisations; deplores the fact that at least 400 000 people have been killed, and thousands more injured, by bombing, shelling and other military means in Syria during seven years of conflict, and that millions have been displaced, with civilians denied access to food, water, sanitation and healthcare as a consequence of lengthy sieges of densely populated areas; expresses its grave concern over the spiralling violence in many parts of the country, as is the case in Eastern Ghouta, Afrin and Idlib;

2.  Deeply regrets the failure of repeated regional and international attempts to end the war, and urges renewed and intensive global cooperation to achieve a peaceful and sustainable solution to the conflict; stresses that the international community has provided insufficient support to the democratic opposition; reaffirms the primacy of the UN-led Geneva process and supports the efforts of the UN Special Envoy for Syria, Staffan de Mistura, to achieve a genuine and inclusive political transition, in line with UNSC Resolution 2254, negotiated by all Syrian parties and with the support of key international and regional actors; underlines the importance of finding a political solution to the conflict; remains committed to the unity, sovereignty, territorial integrity and independence of Syria;

3.  Condemns in the strongest terms the ongoing violence in Eastern Ghouta, despite the unanimous adoption of UNSC Resolution 2401, and urgently calls on all parties, and in particular on the Assad regime, Russia and Iran, to fully and urgently implement and respect that resolution, ensuring the immediate, safe, unimpeded and sustained delivery of humanitarian assistance, the evacuation of the critically ill and wounded, and the alleviation of the suffering of the Syrian people; fully supports the call for all parties to the conflict to cease hostilities without delay for at least 30 consecutive days; reiterates the call on all parties, in particular the Syrian authorities, to adhere to their responsibility to protect the Syrian population and to immediately halt all attacks against civilians in Syria; calls on the guarantors of the ceasefire in the de-escalation areas to follow through with their responsibilities with a view to putting an end to the violence and crimes committed and permitting and guaranteeing unhindered access to these zones; notes the decision by the three Astana Process countries to hold a new summit in April 2018 to discuss Syria and potential steps in the region; stresses that these steps should in no way contradict or undermine the UN-sponsored talks / Geneva process; 3a

4.  Reminds the regimes of Syria, Russia and Iran that they are responsible under international law for the heinous crimes they continue to commit in Syria, and that those perpetrating such crimes, be they states or individuals, will be held to account;

5.  Strongly regrets the repeated Russian vetoes in the UNSC and the fact that no agreement was reached on renewing the mandate of the OPCW-UN Joint Investigative Mechanism before it expired on 17 November 2017; considers this attitude by a permanent member of the UNSC with a special responsibility for maintaining international peace and security to be shameful; stresses that, in the eyes of the world, the obstruction of international investigations is more a sign of guilt than anything else;

6.  Expresses deep concern at Turkey’s intervention in areas of Syria which are controlled by Kurdish forces; continues to be seriously worried about the escalating situation in Afrin, including the possible confrontation between Turkish forces and Assad or Russian forces and rising tensions with the United States; calls on the Turkish Government to withdraw its troops and play a constructive role in the Syrian conflict, which is also in Turkey’s national interests; echoes the position of the VP/HR that the opening of new fronts in Syria is not in the interest of Turkey’s security and warns against further deterioration of the country’s humanitarian crisis; demands full respect for humanitarian law, including the protection of civilians, and calls for a ceasefire throughout Syria, therefore including Afrin;

7.  Reaffirms its support for the efforts of the Global Coalition against Daesh; underlines that the Coalition and Syrian partner forces have made significant progress in the campaign to defeat Daesh in Syria; recalls that any measures taken to combat Daesh and other UNSC-recognised terrorist groups must comply strictly with international law; calls on the Member States and their allies to ensure transparency, accountability and full compliance with international humanitarian and human rights law;

8.  Urges, once again, safe, timely and unhindered humanitarian access throughout the whole territory of Syria and welcomes UNSC Resolution 2393, which renewed the authorisation for cross-border and cross-conflict-line humanitarian access to Syria for a further 12 months (until 10 January 2019); encourages the UN and its implementing partners to continue to take steps to scale up humanitarian deliveries to hard-to-reach and besieged areas, including by using, as effectively as possible, border crossings under UNSC Resolution 2165 (2014); supports the call for humanitarian mine action to be accelerated as a matter of urgency throughout Syria and reminds all parties to the conflict that hospital and medical personnel are explicitly protected under international humanitarian law; deplores the various cases of sexual abuse and misconduct found to have occurred within international aid organisations, including the sexual exploitation of Syrian refugees by those delivering aid on behalf of the UN and well-known international organisations; strongly declares that there should be no tolerance for such acts; urges a thorough investigation and stresses that all those responsible must be punished;

9.  Stresses that there should be no tolerance or impunity for the horrific crimes committed in Syria, including those committed against religious, ethnic and other groups and minorities; reiterates its call for independent, impartial, thorough and credible investigations and prosecutions of those responsible and supports the work of the International, Impartial and Independent Mechanism (IIIM) on international crimes committed in the Syrian Arab Republic since March 2012; notes with satisfaction the EU’s decision to provide EUR 1,5 million in financial support to the mechanism through its Instrument contributing to Stability and Peace (IcSP); stresses, however, that support will be needed beyond the 18-month duration of the programme; underlines the importance of Member States meeting their pledges, and expects the issue of IIIM funding to be raised and settled at the second Brussels Conference on Supporting the Future of Syria and the Region; calls, furthermore, for support for civil society organisations and NGOs, which are collecting and helping to preserve evidence of human rights abuses and violations of humanitarian law;

10.  Remains convinced that there can be no effective conflict resolution or sustainable peace in Syria without accountability for the crimes committed and calls for the adoption of an EU accountability strategy towards the atrocity crimes committed in Syria; reiterates its support for the principle of universal jurisdiction in tackling impunity and welcomes the steps taken by a number of EU Member States to this effect; welcomes also initiatives by Member States to make grave violations of international law an offence under their national laws; reiterates its call for the EU and its Member States to explore, in close cooperation with like-minded countries, the possibility of creating a Syrian war crimes tribunal, pending a successful referral to the ICC; notes the important work of the European Network of contact points in respect of persons responsible for genocide, crimes against humanity and war crimes and calls on the VP/HR and the Directorate-General for Justice and Consumers to support and include the Network in future accountability efforts for Syria;

11.  Demands respect by all for the right of ethnic and religious groups and minorities in Syria, including Christians and anyone displaced, to continue to live in or return to their historical and traditional homelands in dignity, equality and safety, and to fully and freely practise their religion and beliefs without being subjected to any kind of coercion, violence or discrimination; supports interreligious dialogue in order to promote mutual understanding and counter fundamentalism;

12.  Remains distressed by the continued disappearance of human rights defender and Sakharov Prize laureate Razan Zaitouneh, who was reportedly kidnapped in Douma in December 2013 by the armed group Jaysh al-Islam; calls for an EU task force to be established in order to coordinate and enhance efforts to seek her whereabouts and ensure her release;

13.  Calls on the VP/HR to undertake all efforts to reinvigorate the UN-mediated peace talks and to demand a more active role in these negotiations, making use of the EU’s financial capacity and willingness to commit significant resources to Syria’s reconstruction; urges the VP/HR to more closely involve and actively back Syrian civil society and those who want a democratic, pluralistic and inclusive Syria in her endeavours for the future of the Syrian people, starting with the second Brussels Conference, to be held on 24 and 25 April 2018; encourages the VP/HR to work with the Syrian people to develop localised reconstruction strategies for the various regions of Syria; underlines that the EU should consider all available options in working with its international partners, including aerial aid drops and the establishment of no-fly zones under a UNSC resolution;

14.  Welcomes the holding of the EU-hosted Second Brussels Conference with the aim of expressing and putting into practice the full political and economic support of the international community for the Geneva process for the Syrians in need and the countries hosting Syrian refugees; acknowledges the impressive solidarity demonstrated by Jordan, Lebanon and Turkey towards refugees, and calls for EU and Member States’ financial support aimed at addressing the urgent needs of refugees and their host communities to be stepped up; cautions against starting any reconstruction efforts before a UN-negotiated political agreement involving all parties is in place; calls on the VP/HR to more fully include civil society organisations in this conference; calls, in this respect, for increased support for peaceful and democratic Syrian civil society organisations and human rights defenders, including through the Madad Fund, the Instrument contributing to Stability and Peace, and the European Instrument for Democracy and Human Rights; calls on the international community to fulfil its outstanding pledges of humanitarian support in Syria and the neighbouring countries;

15.  Stresses that the EU’s efforts in providing humanitarian support and planning for the future of Syria are commendable; recalls that, in line with the EU strategy, the EU has committed not to provide assistance to the reconstruction of Syria unconditionally, but only once a comprehensive, genuine and inclusive political transition, negotiated by the Syrian parties in the conflict on the basis of UNSC Resolution 2254 and the Geneva Communiqué, is firmly underway; underlines that the Assad regime, Putin’s Russia and Iran bear primary responsibility for the economic consequences of their military interventions; notes that any reconstruction commitments, based on a bottom-up approach and the successful empowerment of local actors, thereby excluding known terrorist groups, must be leveraged towards peace and accountability;

16.  Strongly condemns the use of children in combat or terrorist attacks; stresses the fundamental importance of protecting children and prioritising their access to education, including for refugee children in neighbouring countries, and of supporting the psychological rehabilitation of these traumatised children;

17.  Expresses concern at the reported return of 66 000 refugees to Syria in 2017 and underlines the need to fully respect the principle of non-refoulement; stresses that Syria is not safe for refugee returns and that the EU must not support such returns; reiterates its call on the Member States to honour their own commitments, including those laid down in the New York Declaration, and ensure responsibility-sharing, allowing refugees fleeing Syrian war zones to find protection beyond the immediate neighbouring region, including through resettlement and humanitarian admission schemes;

18.  Welcomes the addition on 26 February 2018 of two Syrian ministers to the list of those targeted by EU restrictive measures against the Syria regime, who were appointed in January 2018 and bear responsibility for repressive action against the Syrian people; urges all Member States to ensure full compliance with Council Decision 2013/255/CFSP on restrictive measures against Syria, in particular the freezing of assets of individuals listed therein and the restrictions on admission of persons benefiting from or supporting the regime in Syria; condemns the recent reports of violations of this decision and reminds Member States of their obligation under international law to ensure the arrest and detention of suspects of atrocity crimes present on their territory; calls for targeted sanctions to be imposed on Russia and Iranian officials following their targeted and deliberate actions against the civilian populations in Eastern Ghouta as well as in the rest of Syria;

19.  Instructs its President to forward this resolution to the Vice-President of the Commission / High Representative of the Union for Foreign Affairs and Security Policy, the Council, the Commission, the governments and parliaments of the Member States, the United Nations, the members of the International Syria Support Group and all the parties involved in the conflict, also ensuring translation of this text into Arabic.

(1) Texts adopted, P8_TA(2017)0227. (2) OJ L 121, 10.5.2011, p. 11.

European Parliament resolution of 15 March 2018 on US measures on EU farm support under the CAP (in the context of Spanish olives) (2018/2566(RSP))

P8_TA(2018)0091 RC-B8-0137/2018

The European Parliament,

–  having regard to the interim decision taken by the US Department of Commerce, which has imposed a tariff on Spanish olives after concluding that the subsidies that the olive producers received in the EU meant that olive products could be imported into the US at below market price,

–  having regard to the question to the Commission entitled ‘US attack on EU farm support under the CAP (in the context of Spanish olives)’ (O-000006/2018 – B8-0007/2018),

–  having regard to Regulation (EU) No 1307/2013 of the European Parliament and of the Council of 17 December 2013 establishing rules for direct payments to farmers under support schemes within the framework of the common agricultural policy and repealing Council Regulation (EC) No 637/2008 and Council Regulation (EC) No 73/2009(1),

–  having regard to Rules 128(5) and 123(2) of its Rules of Procedure,

A.  whereas the decision to impose tariffs of varying percentages on olive products exported by Spanish firms is based on the idea that aid to the olive sector granted under the common agricultural policy (CAP) could constitute unfair competition vis-à-vis US producers;

B.  whereas the decision calls into question, in an unfair and arbitrary manner, all the EU’s farming support programmes and could potentially affect all recipients of payments under the CAP;

C.  whereas there are serious doubts about whether the formula used by the US investigators to calculate the preliminary antidumping margin is compatible with the WTO rules;

D.  whereas the Commission has affirmed on several occasions that the support measures targeted by the countervailing duty (CVD) investigations (including the basic payment scheme, promotion measures and payments for young farmers) are not trade-distorting;

E.  whereas subsidies allocated from the CAP to primary producers of table olives in Spain qualify as ‘green box’ support according to Annex II of the WTO Agreement on Agriculture, since they are decoupled from production and are non-trade-distorting;

F.  whereas the CAP measures under investigation are not product-specific and therefore not countervailable under Article 2 of the WTO Agreement on Subsidies and Countervailing Measures;

G.  whereas the investigation launched into the Spanish olives case is one of the numerous trade defence investigations already opened by the US;

H.  whereas the CAP has been transformed by means of several reforms in order to bring most support measures into line with the WTO’s green box requirements, and it is currently designed so as to ensure full compliance with WTO agreements, after switching from a coupled to a decoupled support system;

I.  whereas the US is also a significant user of green box subsidies in agriculture;

J.  whereas the US has imposed provisional antidumping duties of an average of 17,13 % on the three Spanish companies under investigation, and countervailing duties of an average of 4,47 % on any Spanish exported products;

K.  whereas the provisional measures risk triggering a spiral of defence investigations by the US and other countries into green box subsidies for agricultural products; whereas that would ultimately damage EU and US producers; whereas this escalation puts long-established and carefully negotiated WTO agreements at risk;

L.  whereas the Spanish manufacturers could lose the US market, while competitors from third countries would benefit from the export gap caused by the US decision;

M.  whereas the economic impact on the Spanish olive sector, if these tariffs become permanent, is estimated by the sector to be between EUR 350 and 700 million over the next five to ten years, which could potentially lead to the end of Spanish ripe olive exports;

N.  whereas the competitiveness of the Spanish exports, whose market share has progressively increased in the US in recent years, is the result of efforts made by these companies to reduce costs by means of investment in cutting-edge technology and quality improvements, and is not a consequence of European subsidies;

O.  whereas the increase in Spanish exports to the US (+ 20 % since 2013) has enabled the creation of thousands of jobs and provided economic relief to areas of Andalusia that were among the hardest hit by the economic crisis;

1.  Calls on the US authorities to withdraw their interim decision and re-establish a mutually constructive approach in this domain to the mutual benefit of producers and consumers on both continents;

2.  Expresses its serious concerns about the negative consequences that the US countervailing procedure may have for the whole European agricultural model;

3.  Calls on the Commission to take all necessary diplomatic steps, both at bilateral level and in the WTO, to defend our system of CAP support, which is regarded by the WTO as non-trade-distorting and which has been approved under the WTO green box procedure;

4.  Asks the Commission to study the possibility of challenging any final US decision before the WTO;

5.  Calls on the Commission to continue assisting the Spanish olive sector and the Government of Spain in order to ensure that WTO rules are fully respected by the US authorities in the course of these investigations;

6.  Asks the Commission to give clear advice and strong support to the Spanish olive sector, which has been affected by the US investigations;

7.  Calls on the Commission to join forces with the Spanish authorities and the Spanish olive sector and to continue exchanging all relevant information with the US authorities in order to prevent the imposition of any unjustified measure;

8.  Instructs its President to forward this resolution to the Commission and the US authorities.

(1) OJ L 347, 20.12.2013, p. 608.