15.3.2000 EN C 75/1Official Journal of the European Communities
II
(Preparatory Acts)
ECONOMIC AND SOCIAL COMMITTEE
Opinion of the Economic and Social Committee on the `Initiative of the Federal Republic of
Germany and the Republic of Finland with a view to the adoption of a Council Regulation on
insolvency proceedings, submitted to the Council on 26 May 1999'(1)
(2000/C 75/01)
On 22 July 1999 the Council decided to consult the Economic and Social Committee, under Article 262
of the Treaty establishing the European Community, on the above-mentioned initiative.
The Section for the Single Market, Production and Consumption, which was responsible for preparing
the Committee's work on the subject, adopted its opinion on 14 December 1999. The rapporteur was
Mr Ravoet.
At its 369th plenary session (meeting of 26 January 2000), the Economic and Social Committee adopted
the following opinion by 97 votes to 2.
1. Introduction 2.1.2. Insurance undertakings, credit institutions, investment
undertakings holding funds or securities for third parties,
and collective investment undertakings, which are already1.1. The present proposal for a regulation repeats
subject to special arrangements, are excluded from the scopeword-for-word the provisions of the Brussels Convention of
of the regulation.23 November 1995 on insolvency proceedings, with the
exception of Chapter V of the Convention concerning
interpretation by the Court of Justice.
1.2. The purpose of the initiative is to speed up implementation
of the Convention and to make it directly applicable in
2.2. Proposed systemthe Member States, in order to improve insolvency proceedings
with cross-border implications.
2.2.1. The system introduced by the regulation represents
2. General comments a compromise between:
2.1. Scope -- the principle of the uniqueness and universality of insolvency,
which implies that a business declared insolvent is
subject to single proceedings the effects of which are2.1.1. The proposed regulation applies to collective insolacknowledged
by all Member States; andvency proceedings -- regarding either a natural or a legal
person -- and entailing the partial or total divestment of the
debtor and the appointment of a liquidator. The proceedings
involved are listed for each Member State in an annex. -- the principle of the territorial and plural nature of insolvencies,
under which proceedings may be initiated in each
country where the debtor holds assets, and the effects of
which are restricted to that country.(1) OJ C 221, 3.8.1999, p. 8.
C 75/2 EN 15.3.2000Official Journal of the European Communities
2.2.2. The text thus introduces the principle of main 2.4.2. Moreover, the liquidator in the main proceedings is
empowered, as long as no secondary proceedings have beenproceedings, opened in the country where the debtor's centre
of main interests is located, which are recognised and effective opened, to exercise within the territory of the other Member
States all the powers conferred on him by the law of the statein the other Member States with no further formalities. Unless
proved otherwise, the centre of interest of companies is in which proceedings have been opened. In this way, he may
remove the debtors' assets from the territory of the state inpresumed to lie where their registered offices are located.
which they are situated, unless they are subject to third parties'
rights in rem or reservation of title. In exercising his powers,
however, the liquidator must comply with the law of the state2.2.3. The courts of a Member State other than that in
in which he is taking action.which the centre of main interests is located are empowered
to open insolvency proceedings only if the debtor possesses
an establishment within that state. The effects of the proceedings
are limited to the debtor's assets located there. When 2.4.3. Judgements in insolvency proceedings handed down
opened after the main proceedings have already begun, such by the court which ordered that the proceedings be opened
proceedings are referred to as secondary proceedings and must are recognised with no further formalities. Such judgements
necessarily be winding-up proceedings. are enforced in accordance with the rules laid down by the
Brussels Convention of 27 September 1968 on Jurisdiction
and the Enforcement of Judgements in Civil and Commercial
2.2.4. Opening of secondary proceedings may be requested Matters. Under these rules, judgements given in a contracting
by the liquidator in the main proceedings, or by any other state and enforceable in that state may be enforced in another
person or authority empowered to make such a request under state when, on the application of any interested party, the
the law of the country in which the request is made. order for its enforcement has been issued there.
2.2.5. Guarantees are provided to ensure that the main and
the secondary proceedings can be conducted simultaneously.
They entail, for example, the duty of the different liquidators
3. Specific commentsto communicate information, the option available to the
liquidator in the main proceedings to request that the secondary
proceedings be stayed, and the transfer of any remaining
assets from the secondary proceedings to the total assets in the
main proceedings.
3.1. Appropriateness of the initiative
3.1.1. The Committee is in principle in favour of a Com-2.3. Law applicable
munity regulation to overcome the difficulties raised by
insolvencies with an international dimension and, thereby, to
speed up the implementation of the 1995 Brussels Convention
2.3.1. The law applicable to the proceedings and their
on Insolvency Proceedings. The initiative should make an
effects is in principle that of the Member State in which the
effective contribution to integrating national economies into
proceedings are, or are to be, opened. The same applies to
the single market.
the conditions for the opening, closure and conduct of
proceedings.
3.1.2. The initiative is all the more welcome in that it is the
first taken by the Council in the field of civil proceedings not2.3.2. Specific rules are provided to resolve specific probdirectly
related to consumer protection, employing for thislems. One such is employment contracts: here it is stipulated
purpose the new provisions introduced by the Treaty ofthat the effects of insolvency proceedings on such contracts
Amsterdam.shall be governed solely by the Member State law applicable
to the contract of employment. Other rules concern the effects
of proceedings on reservation of title, set-off, third parties'
rights in rem and contracts relating to immovable property. 3.1.3. The Committee would however emphasise the need
to avoid an excessively complex system which might prove
unworkable in practice. It is evident that most of the provisions
contained in the proposed regulation are highly complex.
2.4. Recognition of proceedings
3.1.4. The Committee would also emphasise the need for
the regulation to apply throughout the European Union. It2.4.1. Under the terms of the draft regulation, any judgement
opening insolvency proceedings handed down in a therefore hopes that the United Kingdom, Ireland and Denmark
will join in the planned arrangements, making use of theMember State is to be recognised within the territory of the
others. This does not, however, prevent secondary proceedings opportunities available to them under the protocols to the
Treaty of Amsterdam.from being opened.
15.3.2000 EN C 75/3Official Journal of the European Communities
3.2. Objective 3.4.4. Moreover, the possibility of opening secondary proceedings
could render the main proceedings meaningless in
economic terms.
3.2.1. The Committee must stress that insolvency proceedings
are not intended only to settle liabilities and share assets 3.4.5. The introduction of single proceedings would, on
among creditors. Other objectives must be pursued, such as the other hand, serve to boost the chances of success of action
the survival of viable businesses and the safeguarding of jobs. to put failing businesses back on their feet.
In this regard, the Committee is pleased to note that the draft
regulation is not restricted to winding-up proceedings alone,
but also extends to procedures aimed at rescuing companies
(cf. Annex A). 3.5. Scope
3.5.1. The exclusion of credit institutions, insurance enter3.2.2.
The Committee nevertheless regrets that the proprises,
investment undertakings and collective investment
posed regulation does not remove the distortions caused by
undertakings from the scope of the proposed regulation is to
differences in national law. Similarly, it fails to set common
be welcomed. These entities are subject to specific rules and a
objectives for all the Member States. While representing a
single source of supervision -- by the country in which the
degree of progress, therefore, the proposed arrangements are
company has its registered office -- which clearly could not
extremely modest and unambitious.
fit in with a system recognising a plurality of procedures with
limited territorial effects.
3.3. Rapidity
3.6. Recognition and enforceability of judgements
3.6.1. Seeking decisions to order enforcement may slow3.3.1. One of the main criticisms generally levelled against
down proceedings and entail unnecessary cost. The Committeeinsolvency proceedings is their excessive length. Here, the
therefore believes that judgements handed down under theCommittee regrets that the planned regulation fails to reflect
terms of the draft regulation should be automatically enforce-the concern to accelerate proceedings, for example by proposable.
In this regard, it warmly welcomes the current work ating to introduce uniform machinery to this end in all the
Community level to up-date and simplify the provisions of theMember States.
1968 Brussels Convention on jurisdiction and enforcement
of judgements, and to incorporate these provisions in a
regulation.
3.4. Planned system
3.6.2. The Committee believes that the regulation should
provide for recognition within the EU of judgements prohibiting
persons having contributed to the failure of their own
3.4.1. The Committee regrets that the planned regulation
businesses, through negligent or improper management, from
does not simply enshrine the principle of the uniqueness and
exercising certain activities.
universality of insolvency within the European Union: this
would mean that a business declared insolvent would be
subject to single proceedings, the effects of which would be
recognised by all Member States. The European Commission 3.7. Comments on articles
did in fact express its support for this approach when the
Brussels Convention was finalised in 1995.
3.7.1. Article 16: it would seem that the provision contained
in paragraph 2 is to be interpreted in the light of
Article 3(4). Should Article 16(2) not contain a direct reference3.4.2. While it may be understandable that a system of this
to this provision?kind cannot be set up at world level, the same is certainly not
true for the EU countries, which form a single market -- a
concept which, by its very nature, should exclude the possi- 3.7.2. Article 18(1): it might be clearer to refer to preserbility
of secondary insolvency. vation measures `contrary to the exercise of these powers'.
3.4.3. The universality of insolvency approach is unquestionably
that most likely to guarantee equality of creditors and 4. Conclusion
rapid and rational organisation of liquidation. Indeed, the
system envisaged -- which provides for simultaneous conduct
of main and secondary proceedings, the effects of which would 4.1. Notwithstanding its reservations, the Committee considers
the text to be preferable to a total absence of rulesbe restricted to a single Member State -- may well in practice
raise insurmountable problems. governing insolvencies with an international dimension. It
C 75/4 EN 15.3.2000Official Journal of the European Communities
would however stress that it can only be a step towards a fuller main proceedings, and to provide broader opportunities for
securing stay of secondary proceedings.and more ambitious measure. Efforts must in particular be
pursued to ensure that the principle of the uniqueness and
4.3. The Committee is pleased to note that an evaluationuniversality of insolvency is acknowledged.
clause was added to the Brussels Convention shortly before it
was finalised. Under this provision, the system as set up may
be evaluated at the request of a contracting state and in any
4.2. The Committee therefore feels that at the very least, case ten years after its implementation (Article 53). A similar
the emphasis of the text should be shifted to strengthening provision should be inserted into the proposed regulation.
main rather than secondary proceedings. One way of doing However, in the Committee's view, this evaluation should take
place after five years.this might be to reinforce the powers of the liquidator in the
Brussels, 26 January 2000.
The President
of the Economic and Social Committee
Beatrice RANGONI MACHIAVELLI
Opinion of the Economic and Social Committee on the `Communication from the Commission
to the Council, the European Parliament, the Economic and Social Committee and the Committee
of the Regions -- The European Airline Industry: from Single Market to Worldwide Challenges'
(2000/C 75/02)
On 20 May 1999 the European Commission decided to consult the Economic and Social Committee,
under Article 262 of the Treaty establishing the European Community, on the above-mentioned
communication.
The Section for Transport, Energy, Infrastructure and the Information Society, which was responsible for
preparing the Committee's work on the subject, adopted its opinion on 21 December 1999. The
rapporteur was Mr von Schwerin.
At its 369th plenary session of 26 and 27 January 2000 (meeting of 26 January) the Committee adopted
the following opinion with 116 votes in favour and three abstentions.
1. Introduction 1.3. The Commission considers that European airlines have
developed innovative strategies in order to adapt themselves
to market growth and competition challenges. During the
last decade they have achieved considerable productivity
improvements, which now permits the sector to create new
1.1. In its Communication The European Airline Industry: jobs. However, the sector still suffers from a high degree of
From Single Market to Worldwide Challenges the Commission fragmentation and financial fragility when compared to its
looks at the current state of the European airline industry, the main competitors, notably North American carriers.
need for continuing improvement of the competitiveness of
European airlines and the past ten years of liberalisation of air
transport.
1.2. The aim of the communication is to assess the progress 1.4. Liberalisation and globalisation make the market
increasingly competitive and require airlines to undertake largemade and to identify the initiatives which can contribute to
the competitiveness of the industry. restructuring efforts.