Fiscal compact signed

Mon, Mar 19, 2012, 00:00

EU LAW:ON MARCH 2nd, the Taoiseach signed the fiscal compact, along with 24 of the 27 European Union member states. This treaty binds the signatories to certain fiscal rules – which Ireland by and large already followed, unlike some other EU member states, such as Germany and France. Many consider, however, that the fiscal compact could interfere with our Government’s ability to control the country’s budget.

Attorney General Máire Whelan SC has advised the Government that the Irish Constitution requires that a referendum be held to approve the fiscal compact. By contrast with the Lisbon Treaty, even if the Irish people vote no, the fiscal compact will enter into force in the EU member states that have approved it, provided it has been ratified by at least 12 euro member states. Only those countries that have ratified the treaty will be eligible to access the permanent bailout fund to be launched later this year.

There is concern that a No vote could, in the short term, impact on the financial markets’ confidence in Ireland’s ability to fund itself; and, in the long term, send a negative signal regarding Ireland’s commitment to the euro.

On January 26th, the European Commission asked Ireland to modify how it applies the vehicle registration tax (VRT) to vehicles less than three months old or having less than 3,000km on their clocks. At the moment, anyone importing such vehicles into Ireland must pay the same VRT as those buying new vehicles in Ireland. This system does not take into account the fact that a vehicle starts to lose its value as soon as it is bought or brought into use. Imported vehicles are, therefore, more heavily taxed than similar vehicles already registered in Ireland, which the commission considers a breach of European law.

On March 5th, the commission launched a public consultation on how to break the “glass ceiling” for women on company boards, which could ultimately see Irish companies being required to meet quotas for the minimum number of women on their boards. A commission study has shown that, based on current statistics, it would take more than 40 years to reach a boardroom gender balance of at least 40 per cent female. Ireland’s record on gender balance is not strong – only 9 per cent of board members at the largest publicly listed companies are women according to the commission’s statistics (ninth out of the 27 EU member states).

Finally, a controversial amendment to Irish copyright law (dubbed the “Irish Sopa” after similar US legislation that was ultimately cancelled) was signed by Minister of State Sean Sherlock on February 29th. The Government claims that the amendment is necessary to bring Irish copyright law in line with requirements under EU law. Copyright holders will now be able to apply to court for injunctions against “intermediaries” (which includes internet service providers and social networking sites such as Facebook), where they suspect websites are being used to infringe their copyright. There is considerable concern, particularly in the tech community, that the lack of guidance around the amendment will cause legal uncertainty and could see courts ordering “intermediaries” to cut off internet users’ access to websites.

Compiled by Maureen O’Neill and Victoria Balaguer, from the Irish Society for European Law