Author: SME Chamber

Good news for the commerce sector: the
Council has finally given green light to the Commission to launch free trade
negotiations with Japan. The first round of trade talks can be expected soon.
GRTU is a great supporter of an FTA with Japan.

The trade talks between Brussels and
Tokyo should now lead to tangible results for the commerce sector: the
agreement should deliver joint standards and certification schemes for consumer
products as well as the mutual recognition of standards, the removal of
existing tariff barriers, the abolition of beyond-the-border measures, the
liberalisation of distribution services and the relaxation of the rigid zoning
regime in Japan.

Please do not hesitate to refer to the attached EuroCommerce
briefing paper on Japan to inspire any complementary advocacy vis-à-vis your
national MEPs and government throughout the negotiating process.

The EU-Japan relationship is far from
achieving its full potential. Neither side can afford to ignore the opportunity
it offers for greater prosperity and economic stability. The EU and Japan
should work together to achieve a far closer trade and economic relationship.

At a time when global competitiveness
demands the highest levels of efficiency in production, relations between Japan
and the EU should be barrier-free to further mutual growth.

A crucial area for European retailers
in Japan is the importation, certification and labelling of consumer products
for sale. These procedures remain costly and complex, due to the Japanese
authorities' demand for additional product testing, though standards for most
retail products are similar.

The EU and Japan should work on joint
standards and certification schemes for consumer products, and mutual
acceptance of standards and
certification. Hence, products certified for one market by definition, should
also be accepted in the other market, unless particular reasons for not doing
so can be presented. Moreover, food hygiene standards should be established
aligned with internationally accepted standards.

Product labelling is intrinsically
difficult for European retailers in Japan. The Household Product Quality Law
and accompanying voluntary labelling guidelines ("hyojikitei") prescribe in extreme detail e.g. how household
products should be labelled when sold in Japan.

The Malta-EU Steering and Action Committee (MEUSAC) and the
Commerce Department (CD), Ministry for Fair Competition, Small Business and
Consumers (MFCC) will be holding a consultation session on the Proposal for a
Directive of the European Parliament and of the Council on collective
management of copyright and related rights and multi-territorial licensing of
rights in musical works for online uses in the internal market [COM(2012) 372].

The objective of the proposal is to put in place a better
legal framework for the collective management of rights that are administered
by collecting societies on behalf of right-holders such as authors, performers,
producers etc. It will provide for rules to improve the standards of
governance, transparency and financial management of all collecting societies,
thus improving the management of revenues collected on behalf of the
right-holders (creators) as well as enhancing the co-operation between
collecting societies across the EU. It will also set minimum standards, adapted
to the digital world, for collecting societies' multi-territorial licensing of authors'
rights in musical works used for the provision of online services, which allows
for improved and simpler cross-border licensing.

The consultation session will be held on Tuesday, December
18, 2012, between 2:00pm and 3:00pm, at the Multipurpose Hall, Education
Department, Beltissebħ, Floriana.

Building up on its success in assisting
more than 2,000 students with over €7.7 million in tax credits, the Get
Qualified scheme administered by Malta Enterprise is being expanded to support
students and other individuals obtain qualifications required by a wider range
of industries.

Upon successful completion of their course, supported students
are granted a tax credit which may enable them to recover up to 80 per cent of
their expenses in relation to registration fees, examination fees, as well as
fees paid to the university, institution or recognised educational entity.

In this manner, as a result of the
qualifications obtained, students would be better equipped to grasp career
opportunities and invest in further development within those industries showing
a higher potential economic growth. Following the amendments to the scheme,
studies leading to a certificate, diploma, degree or post-graduate degrees
within industries such as advanced manufacturing; maritime; energy, oil and
gas; and life sciences (including health services and veterinary services) will
now be supported.

Engineering courses, for which
support was previously limited to electromechanical engineering, is now being
widened to include other aspects of engineering such as structural engineering.

This will complement the existing
support covering courses related to aviation; economics and statistics;
financial services; crafts and creative industries; chemical and pharmaceutical
industries; information and communication technologies.

A significant amendment is also being
introduced in respect to studies at a doctoral or post-doctoral level, whereby
the Get Qualified scheme will now support all students irrespective of their
area of specialisation.

Students have to submit their
applications by not later than twelve months from the commencement of their
course to be eligible for the tax credit, which is capped depending on the
level of qualification or certification being obtained – with higher amounts
being granted to those obtaining more advanced qualifications.

In recent years, Malta Enterprise has
assisted around 3,500 students with almost €14 million in tax credits to
further their studies and consequently improve their skills and employability
through Get Qualified and similar schemes. Many students who were supported are
today contributing to the Maltese economy by lending the skills and knowledge
acquired to various enterprises in Malta.

The European Agency for Safety and
Health at Work, EU-OSHA (http://osha.europa.eu) aims to raise awareness of the
importance of occupational safety and health (OSH) in SMEs in the EU.

To this effect it kindly asks if you
could dedicate a few minutes of your time to complete an online survey that
will help gauge your access to OSH information. Through the survey you will
also have the opportunity to tell them how you would best like to receive
information on OSH activities.

The survey is available on
https://surveys.employmentresearch.co.uk/surveylogin.asp?k=135306387813

The Review of Directive 2006/114/EC concerning misleading and
comparative advertising (MCAD), which has been published last Tuesday. The Communication provides an overview of how the MCAD is
currently implemented in the Member States, identifies problems in how it is
applied and outlines plans to revise it in the future.

In October 2011 the Commission launched a consultation. In
general, stakeholders supported legislative action.

There was a strong call by other stakeholders for increased
protection for small companies and independent professionals against misleading
marketing practices. According to the Commission, there is a virtual consensus
that a cooperation procedure needs to be developed for cross-border cases of
misleading advertising, as the majority stated that existing enforcement
procedures are not effective.

Moreover, there was similarly strong support for an EU-wide
instrument to protect businesses against the most harmful misleading marketing
practices.  The consultation results show
that almost no Member States have so far taken cross-border action regarding
misleading advertising. Several Member States consider that this is the result
of a lack of a structured cooperation system and the weakness of the MCAD,
which contains only general clauses for assessing whether a commercial
communication is misleading.

Next steps European Commission

Non-legislative action:

Set up, as from now,
an ad hoc network of authorities to step up enforcement of the MCAD and share
information.

 

 

Legislative action: revision of the Directive in order to:

Clarify its scope by
introducing a clearer definition of misleading marketing practices;

Introduce a
black-list of the most harmful misleading marketing practices;

Introduce effective,
proportionate and dissuasive penalties for infringements of the national
provisions adopted in application of the Directive;

Clarify certain
aspects of comparative advertising based on the jurisprudence of the Court of
Justice.

 

 

In the context of the legislative revision, the European
Commission intends to:

Create an enforcement
cooperation procedure (enforcement network) grouping national enforcement
authorities in charge of the legislation protecting businesses to cooperate in
cases of cross-border misleading marketing practices;

Introduce mutual
assistance obligations for the Member States entailing the explicit possibility
of requesting enforcement measures in cross-border situations;

Introduce provisions
that will require Member States to designate an enforcement authority in the
area of business-to-business marketing.

Companies can protect their
competitiveness through a range of means, including in particular trademarks,
designs and patents. However, there is a substantial volume of information,
know-how and innovation steps that are not protectable through intellectual
property rights.

Business information, such as a list of
customers, lists of providers, the price to be offered in a negotiation or bid;
the results of certain market studies; the particulars of a new product to be
launched, is usually treated as confidential.

Following a call for tenders, the
European Commission contracted Baker & McKenzie to carry out a study on the
economic and legal aspects linked with the use, misappropriation and litigation
on confidential business information and trade secrets. 

In this context Baker & McKenzie is
launching a survey aimed at collecting information on how companies manage
their know-how and other information of strategic value for their
competitiveness. The data to be collected from companies from all sizes and
locations within the European Union will help the European Commission to better
evaluate whether there is a need to provide companies, and in particular SMEs,
with better means of reaction against dishonest practices of information
stealing or trade secret theft.

The European Commission encourages any
company to participate in the survey. In order to do so simply send a message
to expressing
your willingness to participate. You will then receive an e-mail providing a
user ID, a password and a link to the webpage of the survey. You will be able
to choose between a number of languages in which to complete the survey.

 

More information is provided in the
following website of the European Commission : http://ec.europa.eu/internal_market/iprenforcement/conferences/index_en.htm

Below is a summary of the Budget
Measures deemed to be most important to business. Please feel free to contact
GRTU to have further information on any of them.

 

Cost of Living Adjustment of €4.08

More incentives towards enterprise

Extension
of High Energy Users Scheme to Gozitan industry.

Revision
of incubation services to start-ups in Kordin. Development of plug in/plug out
facility for ICT and Digital Content Businesses.

SMEs

MicroInvest
is extended for a further two years and businesses employing to 30 people are
now eligible.

Continuation
of MicroCredit and MicroGuarantee.

Scheme
towards the promotion of clusters and networks and to support small local
businesses benefit from the Single Market opportunities

BSTART:
a tax deduction scheme of up to €30,000 for seed capital investment

Entrepreneurship
action plan ranging from Primary Schools to tertiary education

Support
to young people willing to explore business opportunities through a Youth
Entrepreneurship Act.

University
will establish an Observatory to strengthen research on business and the
self-employed

Launch
of short and intensive weekend courses for those interested in starting up
their own business

ERDF
Scheme for Gozitan businesses

Strengthening
of the financial services sector through the establishment of an international
market for pensions and retirement schemes

 

Tourism

Licenced
hotels will benefit from Investment Aid on 15% of capital expenditure (in form
of tax credits)

Incentive
schemes to increaseboutique hotels in Valletta, Imdina and the 3 cities (tax
deductions on investments related to
purchase and development of these sites and MEPA/MTA fees)

Winter
incentive for visiting Gozo

 

Property

The
present choice on paying capital gains tax or 12% final witholding tax is
extended from 7 to 12 years as from 2013

Administrative
reform related to property valuation:

Couples
or persons purchasing the first residential home taking out bank loans will be
able to provide the bank architect property valuation

In
case of properties whose value exceeds €250,000, before signing of contracts
the seller and buyer may request the department to send its architect to issue
price valuation on which stamp duty is paid. This valuation remains valid for 6
months from date of issue.

As from 01/01/2013 removal of stamp duty on
will transfer of property from parents to children.

3.5% stamp duty ceiling for first time buyers
is increased from €116,468.67 to €150,000

First three hundred applicants
will qualify for subsidised 2.5% interest rate on bank loan for First 8 years.
These will receive up to €14,000 in subsidy.

 

Training

Active scheme will focus on those young people
who are on the unemployment register. Following provision of necessary
training, these young people will be offered a work experience of 20 hours in a
sector which best relates to their profile. A pro-rata benefit will apply.

Another scheme will target unemployed young
persons to explore entrepreneurship opportunities. The applicant will be able
to choose selfemployment or membership in a cooperative. Training and mentoring
will be provided, while employers employing up to persons will benefit from a deduction in
social contributions.

An innovative apprenticeship programme which
provides financial incentives to employers and students. Government will pay
SSC on the employer's behalf. Apprentice
stipend will increase from €86 to €95.

Extension of minimum wage scheme, with an
investment of €300,000 in favour of those earning up to 300 euro a week. These
will receive 25 euro a week.

Youth.Inc, target towards young people aged
16-21 is extended to those aged up to 24

Strengthening of professional team behind
Youth.Inc

Job Bridge programme will
provide specialised training to persons with a disability to strengthen their
skill set to adapt to the job market

 

Women and the
job market

Continuation of construction of 4 child care
centres (Naxxar, San Gwann, Gżira and Żurrieq).

Continuation of up to €1,300 tax deduction for
parents sending their children to child care centres

Women returning to work after 5 years or after
having children will maintain one year tax free status

Maternity Leave up to increases 18 weeks

Children's allowance increases
from €350 to €450, and to€527 for families dependent on a minimum wage

 

Income tax

Over
3 years income tax for those currently paying 35% income tax will be reduced as
follows:

32%
(2013)

29%
(2014)

25%
(2015)

 

Energy and
environment

Introduction
of feed-in tariffs for PV panels not supported through other funding:

Installations
of less than 1MW on rooftops: 18c/kWh for 20 years;

Installations
of less on the ground: 17c/kWh for 20
years;

Installations
of less than 1MW on rooftops: 17c/kWh for 20 years; and

Installations
of less than 1MW on the ground: 16ckWh for 20 years.

Plans
for a new PV panel scheme for households

Finalisation
of scheme in favour of families not able to invest in PV panels on their
rooftops

Extension
of Solar Water Heater rebate (40% up to max. €400)

15.25%
rebate up to €1,000 on double glazing and roof insulation.

Increase
in excise duty on fuel consumption of 2c per litre on petrol and diesel and 5
euro per tonne on cement.

 

Capital
Projects

Commencement
of underground carpark and public garden on Sliema Front and works on Paola
square

Restoration
opportunities

Scheme
for the restoration of residential properties which are classified as Grade 1
and 2 in UCAs. This will include provision of 25% on expenditure on such works
up to a max. of €5,000. Properties in Valletta benefit up to 30%.

NGOs
will also benefit from a similar scheme on buildings transferred to them from
Government. Buildings classified Grade 1 and 2 in UCAs are eligible. 25%
rebates up to €2,500.

Individuals
and companies that purchase properties outside UCAs for restoration purposes
will benefit from a 2% deduction in stamp duty. A 20% tax credit of up
to€200,000 related to restoration and development is also applicable

Transport

Euro
5 car registration tax is reduced by a maximum of 30%.

Euro
4 car registration tax is increased by an average of 10%

Tax
rate on N1 commercial vehicles is reduced by 12.5% to incentive purchase of new
cars

500
euro scrappage scheme for new private or commercial (N1) cars on scrappage of
older vehicle

Removal
of registration tax on motorcycles with 250cc engine and 25% reduction on other
engine capacities

Removal
of registration tax on classic cars aged 50 years and over

Classic
care definition is lowered from 35 to 30 years.

Removal
of annual circulation licence for classic cars. Replaced by administrative fee
of €8.

Rebate
scheme of €200 for conversion of cars to autogas.

Reduction
of annual circulation licence for autogas powered cars registered after 2009

Extension
of TM licence regularisation scheme

The
social sector

Energy
benefit: Gas price allowance to increase from €30 to €40.

 Elderly

€300
allowance announced last year for persons aged 80+ is extended to those aged
78+ and eventually to those aged 75+. 1.5 million euro vote per year.

Full
COLA increase to the elderly

Revision
of Supplementary Assistance for those aged 65+ in cases where household income
is below the risk-of-poverty threshold, to ensure that this category is covered
by a higher Supplementary Allowance

The Plenary of the European Parliament has adopted the Terho report on
the green paper ‘Towards an integrated European market for card, internet and
mobile payments'. The report gives a number of recommendations which are very
supportive of our views related to a fair and transparent payment system.

On interchange fees:

"MIFs should be regulated at the European level, with the aim of ensuring
easier access for new market players to cross-border acquiring"

–
Regulation "should not result in an increase of MIFs in any Member State but
rather to a decrease and, perhaps, a reduction towards zero at some later
stage."

–
The European Parliament "calls on the Commission to ensure by regulation that
MIFs no longer distort competition by creating barriers to new market entrants
and innovation"

On cross-border acquiring: Any technical
or legal obstacles to cross-border or central acquiring should be removed.

On surcharging: The report states
that surcharging can be harmful to end-users and that therefore, there should
be one commonly used payment instrument available without surcharge and that
any surcharges used should not exceed the additional direct costs.

The Terho report is what is referred to an own-initiative report, not a
report drafted in reaction to a European Commission Communication, and there
will be a further report on the Commission proposals when they are issued next
year. It is however a very positive sign that the Parliament would support
regulation which takes a strong stance on interchange fees.

Why is MIF such an important issue?

The payments market is on the verge of significant change. New
technologies canoffer low-cost electronic alternatives to cash. The MIF however
presents insurmountable obstacle to realising these potential efficiencies. It
is not so much the differences in fee levels between countries that is
problematic, but rather that the very existence of the MIF prevents market
entry and innovation. It also distorts competition between banks, schemes and
payment means.

The two major card schemes compete with each other by offering the
issuing banks higher MIFs: this simply inflates prices and distorts
competition. The MIF creates unnecessary costs by providing 'free' promotional
services, which consumers often do not want or use. These costs are
nevertheless imposed on merchants, who initially try to absorb them but are
(ultimately) forced to pass them on in all retail prices, which means that even
those paying in cash end up paying for the MIF!

The MIF is not integral to the operation of the payments card system.
This is evidenced by significant differences in MIF levels among European
countries and was found to be the case by the European Court in the MasterCard
appeal decision. The Court also found that the MIF exploits the maximum
willingness of merchants to pay. Banks and schemes have never provided
satisfactory or sufficient justification for the existence of the MIF, or for
its cost level.

Further info:

Full text: http://www.europarl.europa.eu/sides/getDoc.do?pubRef=-//EP//TEXT+REPORT+A7-2012-0304+0+DOC+XML+V0//EN

See
also European Parliament News http://www.europarl.europa.eu/news/en/pressroom/content/20121116IPR55705/html/Towards-common-fees-for-card-payments

The WEEE Directive will remain in the
doldrums. It will not be implemented. Government does not care.  The business community led by GRTU has lost
hope. We have moaned complained groaned written discussed shouted, but to no
avail Government stands tall.

GRTU provides one solace. If Government
or MEPA ever think that on receipt of an infringement notice and subsequent
penalties it will pass these to producers, then it is best known from now! No
producer will pay any fees or penalties if he was paying Eco Contribution. There
is only one way out for Government. Stop tacking eco contribution and the
business community will shoulder it.

Otherwise this is history. Pity that DG
Environment has no clue of the situation in Malta.

Why is government procrastinating? Is
there any valid reason?  Or is it just
money?  The budget this time around shows
a decrease of two and a half million from Eco Contribution. So is there
anything in the pipeline or just continued evasion?

Early this week MEUSAC set up a meeting
regarding the transposition of the revised WEEE Directive. I for one would not
have wanted to be the MEPA representative at that meeting. MEUSAC should have
known better. They should have invited the Permanent Secretary at the Ministry
for Finance to be present. Maybe then he could have given the producers present
some answers.

The revised Directive is much more
demanding and communities are faced with this problem too. A problem endorsed
by a Government that has shied away from its obligations just because someday
he thinks he will make the producer pay twice. Keep on dreaming!