Strategic or not strategic, that is the question
FEPORT Newsletter – May 2021
In recent written exchanges between a group of organizations of the waterborne sector and the EU Commission, the strategic dimension of the ecosystem has been underlined and acknowledged by both parties.
This being said, many organizations of the waterborne remain concerned by the lack of representation of their industries in a number of important platforms currently setting up policy priorities as well as important criteria with respect to sustainable investments[1].
The COVID-19 crisis has shown how critical are the components of the waterborne sector in Europe to ensure well-functioning supply chains.
The wide variety of public and private subsectors, such as shipping, port authorities, private port companies and terminals, port service providers, shipyards, maritime equipment manufacturers, dredgers, inland waterway transport etc. are also crucial investors in heavy assets, infrastructure and equipment that contribute to the competitiveness of the EU waterborne sector. Hence the importance to involve them in the elaboration of efficient policies that will ensure that supplies to the EU remain under EU control.
COVID-19 crisis has also clearly highlighted that there are serious risks for Europe in being dependent on foreign interests or part of third countries’ strategies. This is especially valid for the strategic waterborne sector.
If Europe considers the waterborne sector as a strategic one as the EU Commission seems to proclaim it, then there is a need for consistency when it comes to the involvement of its representatives when defining the technical screening criteria for Taxonomy.
It is very frustrating for thousands of companies to have no visibility on their future obligations in the framework of the Taxonomy related files. For instance, article 8 of the Taxonomy Regulation requires financial and non-financial organizations covered by the Non-Financial Reporting Directive (NFRD)[2] to include information in their non-financial information statements on how, and to what extent, their business activities (turnover, CapEx and OpEx) align with the Taxonomy Regulation, but until now, corporations which shall have to start disclosing against the first two climate objectives (climate change mitigation and climate change adaptation) in the course of 2022 (possibly covering the financial year 2021) and all six environmental objectives in the course of 2023 (covering the financial year 2022) have no information regarding the kind of data they will need to provide.
While all EU subsectors are certainly willing to support the Taxonomy objectives, the current methodology to adopt these new rules seems to once again ignore the fact that another important priority for the EU Waterborne sector is to remain sustainable, smart but also competitive vis à vis non-EU competitors which do not have the same obligations at such very short notice.
To conclude with a more positive note, many organizations of the waterborne consider that recently proposed Regulation to address distortions caused by foreign subsidies in the Single Market is a good signal indicating that the EU is also conscious that a non-level playing field between EU and non-EU companies is a major threat.
It will be, however, important that the scope of the Regulation concerns all sub sectors of the waterborne sector. This will ensure that all companies/entities receiving foreign subsidies are identified and will ultimately comply with the obligations of the Regulation.
It would be counterproductive that some subsectors seeking support are not included in the scope of what we hope to be an efficient instrument, i.e., the above-mentioned Regulation.
Being qualified as strategic entails recognition, support but also obligations.
[1] “Even though the waterborne sector is an (industrial) ecosystem in itself, it has been inserted in the “Automotive and Mobility Industrial Ecosystem”, without any information on the activities in this ecosystem and without any recognition of the sector’s specificities, needs and challenges.
6 Whilst being presented as one of the core sectors of the European Green Deal, no waterborne transport representative was selected to participate in discussions on sustainable financing and maritime taxonomy. It is regrettable that the European Commission did not organize any follow up workshop before the publication of the COWI CE Delft study as only few sectors had the opportunity to present their priorities during the first workshop. It would very welcome that the revision of the 1st Delegated Act provides more opportunity for inclusive discussions between the EU Commission and the Waterborne sector.
7 By selecting only one of the waterborne stakeholders (IndustriAll European Trade Union) for the Industrial Forum Expert Group, none of the employers from the waterborne sector have been included in this key interlocutor group, despite” mentioned in the joint letter sent by the organizations representing the EU waterborne sector.
[2] Currently the NFRD applies only to EU-incorporated large public interest entities (“PIEs”), which can include organizations in the financial and non-financial sectors with securities traded on a regulated market, in each case if they have more than 500 employees. However, the Commission has announced a review of the NFRD and one issue being considered is whether it is amended to include all listed companies (including SMEs) and/or set the bar precisely at SME level (i.e. above 250 employees). If the scope of the NFRD was extended, this would in turn have a knock-on effect on which organizations need to comply with the disclosure requirements in Article 8 of the Taxonomy Regulation.
Another important point to note is that that companies within the scope of the NFRD will have to disclose even if there are no specific criteria (yet) available to their activities/sector. The content and presentation of the information to be disclosed under Article 8 will be hopefully further specified by the Commission by June 2021 through a delegated act.
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