Brussels wants to be able to force companies to serve the EU first in the event of a crisis

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In the event of a critical shortage, the European executive would have the power to compel manufacturers to give priority to European orders, rather than Chinese or American ones, on pain of fines.

Brussels is due to present in mid-September a draft of a new instrument aimed at protecting the EU’s internal market in the event of a crisis, including, if necessary, forcing producers of strategic goods to serve Europe as a priority.

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In case of critical shortage, the European Executive would have the power to impose on manufacturers to give priority to European orders, compared to Chinese or American ones, under penalty of fines, according to a document consulted this Friday by AFP.

This measure, inspired by existing rules in the United States, is intended as a retaliatory weapon that the EU would prefer not to use, explained a European source. The idea is to dissuade third states from blocking exports of strategic products to Europe, such as the United States, which had banned exports of anti-Covid vaccines during the pandemic.

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Consequence of the pandemic

The deal proposal will be presented on September 13, another European source said. It will then have to be adopted by the European Parliament and member states, a process that will take at least several months, if not a year.

This new instrument to protect the single market was announced by the President of the European Commission, Ursula von der Leyen, in February 2021. She intended to learn from the disruptions in European supply chains caused by the pandemic.

Even before a crisis situation, a surveillance phase could be activated, under the control of the Member States, in case a risk of shortage for a strategic good is identified.

Interested manufacturers could then be asked to provide certain strategic information, for example about their production capabilities. At this stage, the Commission would also like to be able to ask EU countries to set up strategic reserves.

Group purchases

The text, initiated and drawn up by the Commissioner for the Internal Market, Thierry Breton, also aims to limit restrictions on the movement of goods and people between Member States.

It is about avoiding reviving the reestablishment of borders or the requisition of critical products, such as surgical masks, measures adopted in a disorderly manner by the member states during the pandemic.

The text would notably strengthen the notification obligations of such decisions to Brussels. A black list of discriminatory measures, contrary to the rules of the single market, would also be drawn up to reinforce the repression against the offending States.

The draft regulation also provides for giving the Commission the power to make joint purchases on behalf of EU countries, following the model of what has been done with anti-Covid vaccines.

Author: CO with AFP
Source: BFM TV

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