Mobilisation of the European Globalisation Adjustment Fund: redundancies in the manufacturing of building materials in Spain
PURPOSE: to mobilise the European Globalisation Adjustment Fund (EGF) in respect of redundancies in the manufacturing of building materials in Spain.
PROPOSED ACT: Decision of the European Parliament and of the Council.
CONTENT: the European Globalisation Adjustment Fund (EGF) was established by Council Regulation No 1927/2006 to provide additional support to redundant workers who suffer from the consequences of major structural changes in world trade patterns and to assist them with their reintegration into the labour market.
The Interinstitutional Agreement of 17 May 2006 on budgetary discipline allows for the mobilisation of the European Globalisation Adjustment Fund (EGF) through a flexibility mechanism, within the annual ceiling of EUR 500 million over and above the relevant headings of the financial framework.
The Commission services have carried out a thorough examination of the application submitted by Spain to mobilise the EGF. The main elements of the assessment are as follows:
Spain: EGF/2013/004 ES/Comunidad Valenciana: on 22 May 2013, Spain submitted application EGF/2013/004 ES/Comunidad Valenciana building materials for a financial contribution from the EGF, following redundancies in 140 enterprises operating in the NACE Revision 2 Division 23 (Manufacture of other non-metallic mineral products) in the NUTS II region of Comunidad Valenciana (ES52) in Spain.
The application was supplemented by additional information up to 17 July 2013.
In order to establish the link between the redundancies and major structural changes in world trade patterns due to globalisation, Spain argues that at worldwide level, production of other non-metallic mineral products in 2011 (3 055.6 million tonnes) doubled since 2001. In 2001, China was the largest producer (661 million tonnes) and the EU the second largest (329 million tonnes). Ten years later both positions were unchanged. However, whereas Chinese production increased by 312 % during the decade, EU production fell by 12 %.
The Commission considers that the redundancies in the 140 enterprises involved in manufacturing activities in NACE 2 rev 2 Division 23 ('manufacture of other non-metallic mineral products') in the NUTS II region of Comunidad Valenciana (ES52) can be linked, as required by Article 2 of Regulation (EC) No 1927/2006, to major structural changes in world trade patterns, which have led to an increase in imports into the EU of other non-metallic mineral products and to a reduction in the EU share of production of other non-metallic mineral products at worldwide level.
To date, the sector covering the manufacture of other non-metallic mineral products has been the subject of four EGF applications, three of which were submitted by Spain following redundancies in the NUTS II region of Comunidad Valenciana.
Spain submitted this application under the intervention criteria of Article 2(b) of Regulation (EC) No 1927/2006, which requires at least 500 redundancies over a nine-month period in enterprises operating in the same NACE Revision 2 Division in one region or two contiguous regions at NUTS II level in a Member State.
The application cites 630 redundancies in 140 enterprises operating in the NACE Revision 2 Division 23 (Manufacture of other non-metallic mineral products) in the NUTS II region of Comunidad Valenciana (ES52) during the nine-month reference period 14 June 2012 to 14 March 2013.
After a thorough examination of this application, the Commission has concluded in accordance with Article 10 of Regulation (EC) No 1927/2006 that the conditions for a financial contribution under this Regulation are met.
On the basis of the application from Spain, the proposed contribution from the EGF to the coordinated package of personalised services (including expenditure to implement the EGF) is EUR 840 000, representing 50 % of the total cost.
IMPACT ASSESSMENT: no impact assessment was carried out.
FINANCIAL IMPLICATION: considering the maximum possible amount of a financial contribution from the EGF under Article 10(1) of Regulation (EC) No 1927/2006, as well as the scope for reallocating appropriations, the Commission proposes to mobilise the EGF for the total amount referred to above, to be allocated under heading 1a of the financial framework.
The proposed amount of financial contribution will leave more than 25 % of the maximum annual amount earmarked for the EGF available for allocations during the last four months of the year.
By presenting this proposal to mobilise the EGF, the Commission initiates the simplified trialogue procedure, as required by Point 28 of the Interinstitutional Agreement of 17 May 2006, with a view to securing the agreement of the two arms of the budgetary authority on the need to use the EGF and the amount required. The Commission invites the first of the two arms of the budgetary authority that reaches agreement on the draft mobilisation proposal, at appropriate political level, to inform the other arm and the Commission of its intentions. In case of disagreement by either of the two arms of the budgetary authority, a formal trialogue meeting will be convened.
The Commission presents separately a transfer request in order to enter in the 2013 budget specific commitment appropriations, as required in Point 28 of the Interinstitutional Agreement of 17 May 2006. Appropriations allocated to the EGF budget line in the 2013 budget will be used to cover the amount of EUR 840 000 needed for the present application.