ELO_Engels 68 30-06-2004 08:21 Pagina 1 M O N T H LY n 68 ■ r EN ELO - European Landowners’ Organization June 2004 Editorial The annual congress of the Friends of the Countryside is always a good time to question our strategies. The ability of rural businessmen and women to adjust to an everchanging world is still the key to their success. Europe is moving ahead within an increasingly diverse world. Agriculture, once the cornerstone of rural Europe, is slowly leaving behind a system of assisted production and is instead now more concerned with environmental constraints and finding a place on open international markets. At the same time forestry, once a traditional countryside activity, is having to cope with low sales prices. How to be a European on Europe's borders 7th Friends of the Countryside Congress - Cork, 20/22 May 2004 Rural businesses and landowners will only be able to adjust to change if they are encouraged to diversify their activities. This is the only way private concerns will survive and, more broadly, the communities in which they are situated. The debate on the future of the countryside is largely dominated by conservation issues. This is a legitimate concern but should not be the only one. Social and economic criteria also require constant attention. It is important to recognize that the prosperity of the rural environment depends on careful preservation of our cultural and natural heritage. It is in the interests of businessmen to protect and enhance the value of their property - continuity is more important than the next harvest. The future depends on innovation, the preservation of biodiversity and fostering values. The Friends of the Countryside must be part of these changes and even anticipate them, if their projects are to succeed. It is a matter of common sense for the Commission and the member states to recognize the need to create the conditions for this success, to avoid cumbersome rules and regulations and protect private property and private enterprise. Thierry de l'ESCAILLE t is no easy task to summarize in a few lines a general assembly and a congress covering a wide number of subjects in great detail. And what words could accurately describe such quintessentially Irish hospitality and warmth to those of our friends who did not have the opportunity of joining us? The FCS organized its 2004 major annual meeting in Cork in the south of the Emerald Isle, with the help of the Irish Friends led by Nick BIELENBERG and Charles KEANE. This was therefore the setting for the visit of senator John DARDIS and of member of the European Convention John BRUTON, also former Irish Prime Minister, who explained to us the status of private property in the Irish Constitution and in the European draft constitutional treaty. These two contributions and the speech by Youssef DIB on what BNP Paribas and FCS have in common were especially stirring and started a lively debate with the audience. I R.G. 1 ELO_Engels 68 30-06-2004 08:21 Pagina 2 EN CONTENTS How to be a European on Europe's borders 1 The European Squirrel Initiative: facts and developments 5 Property rights and hunting rights - an uncertain equation in the countries of the ex- Soviet block 6 Tax on savings 7 "Wetlands of Ireland Distribution, Ecology, Uses and Economic Value" 8 Diary Dates 8 CountrySide is a publication of ELO in English, French, German, Italian and Spanish. Publisher : Thierry de l’ESCAILLE Chief editor : Ronan GIRARD ELO and FCS, another year at the service of private property Thierry de l'ESCAILLE focused his contribution on four major topics which are constantly at the heart of the work these two associations do in Europe: agriculture, the environment, private property and enlargement. 2003 was the year of the reform of the Common Agricultural Policy and of the draft European constitution; 2004 is the year of application of the new agricultural measures country by country, of the possible adoption of the draft constitution and of enlargement. The activity report was thus to be seen against this background. The changes to the CAP are not yet complete but the new concepts drawn up in 2003 are being inserted into the implementing texts: eco-conditionality and decoupling are henceforth to be the lifeblood of European agriculture. What will this mean? It will in particular strip agriculture of part of its 'Community' character; payments will be based on historic references or on regional averages, depending on the choice made by national governments. levy is equal to 50% of the premiums subsequently due. The notion of eco-conditionality could, as the ELO and FCS pointed out, lead to preserving land in a good agricultural state without necessarily producing anything. Growing grass would get you a premium. Question: does this still deserve to be called farming? Moreover the environment has increased in significance in all European policies. It is no longer a single policy in the process of evolving, but now introduces ecological constraints at all levels (agriculture, transport, research, land management etc). Clearly the ELO and FCS endorse this desire to preserve Europe's biodiversity and a pleasant, healthy countryside but it should be firmly established that a countryside with no activity is a dead countryside. The new provisions in the CAP are causing some landowners to invent a new form of farming, and to find new opportunities geared towards the production of environmental services. This is living proof that private enterprise is capable of adapting to change. Property Rights, a national and European concern Transfer of payment rights without land is still possible but the Commission, after repeated warnings from the ELO and FCS, has adopted a system of levies which renders this process unattractive; for a mutually agreed transfer, the The Friends Congress which this year focused on property rights had two VIP guests - the Irish senator John DARDIS and the member of the European convention John BRUTON. Senator DARDIS drew on the founding texts of John DARDIS John BRUTON Rue de Trèves, 67 B - 1040 Bruxelles Tel. : 00 32 (0)2 234 30 00 Fax : 00 32 (0)2 234 30 09 countryside@elo.org Internet Site : www.elo.org 5 Euros 2 ELO_Engels 68 30-06-2004 08:21 Pagina 3 EN the Irish Republic and underlined the importance of the notion of property in a country where the access to land dates back to the 19th and beginning of the 20th centuries. Property rights are recognized and sanctioned by law - for example substantive law enforces the principles of compensation and protection in the event of expropriation by the public authorities. This too had been the philosophy inspiring the former Prime Minister John BRUTON when drafting the European constitutional treaty. He highlighted the protection of property rights in article II-17 of the draft which lists points from the European Charter of Fundamental Rights - to which ELO contributed in 1999-2000. John BRUTON also underlined the codifying role of the draft constitution. The document lists those legal principles where a consensus among the member states is a foregone conclusion, since they are already part of the culture of all of the Union's states. He regretted the current delays in adopting the text, but said this may soon be overcome because the draft could be rechristened the 'Treaty of Union', or any other title which avoids too direct a reference to the idea of a constitution. Broadening the debate, the speaker welcomed the work done by the Convention but underlined the weakness of certain areas, in particular foreign policy; the Union does not really have proper armed forces except for the rather embryonic Eurocorps. Europe may have a flag, an anthem and an (almost) single currency but it still lacks charisma. In his view this could come from a man democratically elected by all Europeans who would thus embody both the people and the territory. The draft constitution is silent on the matter but the increase in the number of member states may make a Commission of 25 Commissioners an unmanageable outfit. Why not redefine the institutions then, in order to make them more pragmatic and legitimate? Many speakers spoke eloquently and with passion about their institutions and about European modernization; they set an example for many of the politicians from the so-called 'big' countries, all too often bogged down in their own strategies to preserve national pride. Johan NORDENFALK As John DARDIS and John BRUTON emphasized, the principles of proportionality and subsidiarity make Europe more united while at the same time granting every decision-making rung a degree of independence. The right decisions should be taken in the right place. FCS and BNP Paribas - more than a marriage of convenience, a mutually beneficial bond In March 2004 Youssef DIB organized a seminar in Geneva on taxation and the transfer of inheritance. At the Cork Congress he went on to speak of the foundations of the partnership between the 'private branch' of BNP-Paribas bank and our organization - which would not have been 3 ELO_Engels 68 30-06-2004 08:22 Pagina 4 EN 40,000 euros per acre - a price which bears no relation to the land's true yield. However in spite of the high prices, tax breaks on land purchased with the proceeds of the sale of other plots also make the Irish market one of the most dynamic. The programme also included a lecture by Roger COOK, secretary general of the European Squirrel Initiative on the invasion of the grey squirrel in Ireland and the UK from the 19th century onwards, and more recently in Italy. This non-native species has not been content with driving out the native red squirrel but also attacks and seriously damages trees. “Lismore Castle” able to attain the level of excellence it currently enjoys without the considerable involvement of Youssef DIB and François DEBIESSE. They were appointed Honorary Friends during the Cork Assembly in recognition of their services. This title was also awarded to Dr Anders WALL who together with FCS created the Anders Wall Foundation prize for a dynamic rural environment. The prize is awarded every year by a panel made up of the Foundation, FCS, the European Commission and Stockholm University. Since 2001 the partnership between BNP-Paribas and FCS has been constructed around the principles of private property, private enterprise and the preservation of our rural environment. With over 45 billion euros, the bank has the largest amount of assets in the Euro zone. This is due to its presence in all international markets and banking professions (business banks, private and retail banks). From this strong base its vocation is to propose to privileged clients total access to the group's know-how through single, personalized contacts. The services proposed include highly confidential skill areas such as charity investment advice. 4 In the long run the ongoing development of the BNP-Paribas/ FCS partnership can make its own contribution to a European policy which respects socio-economic and environmental balances in the countryside. The partnership promotes quality investment in zones which are often suffering from a dwindling population and a decline in activity. After all, without people Europe's countryside cannot preserve its natural and cultural heritage. The Cork Congress - combining business and pleasure The Congress could of course not end without a Gaelic note. On the evening of 22 May the Friends met around a typically Irish dinner before attending a demonstration of dances by a local group. Whoever would have believed it now at all? Some of the friends were won over to the idea that the best way of getting to know a culture is to practice it. And so a bold group got up and tried out a few steps from River Dance. ■ Ronan GIRARD The richness of this rural heritage is particularly evident in Ireland, and visits to the sites prepared by the secretariat and the Irish members were an opportunity to discover it at first hand. It would be difficult to list here all the properties visited by the Friends. From a thoroughbred stud farm to a dairy farm, from whiskey distilleries to historical monuments, botanical gardens and country estates, Irish landowners have always known how to put to their advantage the temperate, wet climate of the south of the island. These unique circumstances as well as speculative pressure make the land some of the most expensive in Europe, sometimes as much as Coordination: François de RADIGUÈS tel: +352 021 190 345 ELO_Engels 68 30-06-2004 08:22 Pagina 5 EN The European Squirrel Initiative: facts and developments he European Squirrel Initiative originated in London in June 2002 at a meeting to discuss the problem of grey squirrels. The meeting was attended by British foresters, conservationists and landowners concerned by the damage to the environment and the potential exteinction of the native Red Squirrel (Scurius vulgaris) caused by the American grey squirrel (S. carolinensis) in Britain. T The initial meeting spent much time discussing possible solutions and eventually came to the conclusion that there was only one way to protect our woodland and its wildlife - and that is the total removal of the American grey squirrel. Control methods developed over 50 years and recommended by the UK authorities have failed to prevent the grey squirrel spreading across almost all of England and Wales and into Scotland. Control on a local scale is not feasible and is of limited utility. It is not a solution. We need to find a way of removing all grey squirrels which is both effective and publicly acceptable. The group quickly realised that the grey squirrel problem is common to three EU Members - the UK, Ireland and Italy - and that therefore a European solution is required to deal with a European problem. In consequence, the group has assumed the name of European Squirrel Initiative (ESI) and intends that the organisation will become truly European as soon as possible. With the help of the European Landowners' Organization (ELO) we Agriculture of the EU Commission, in Cork, in May 2004 within the frame of the general assembly of the Friends of the Countryside to reinforce the European awareness. These meetings were important milestones in ESI's development. They enabled the organisation to share its objectives with European colleagues and to describe some of the dangers of the spread of the grey squirrel. arranged a meeting in Brussels at the end of March 2004. Speakers described the threats to European forests to a group of foresters, conservationists, landowners and officials. Mrs Louise HUXLEY and Dr Michael CAREY in their presentation showed the damaging consequences to forest and forest wildlife in the UK and Ireland caused by allowing the grey squirrel to establish itself. Dr Sandro BERTOLINO then described how the same plague is spreading from the forests of northern Italy, to threaten France, Switzerland, Austria and beyond. A second meeting was organised for European landowners and representatives of the Direction General We need to raise the issue with EU and national Authorities, forestry and conservation bodies and the media to ensure that the threat of the grey squirrel., and the risk to Europe's natural biodiversity is taken seriously. ESI plans to build on the contacts made in Brussels and Cork both by exchanging information and through the development of ESI branches in Italy, Switzerland, Germany and France. ■ Miles BARNE Chairman Further information on www.europeansquirrelinitiative.org 5 ELO_Engels 68 30-06-2004 08:22 Pagina 6 EN Property rights and hunting rights - an uncertain equation in the countries of the ex- Soviet block lthough the relationship between property rights and hunting rights differs from that in the EU of 15, for the countries of the ex-Soviet block it is no longer conceivable for hunting rights to be a state monopoly now they are in the European Union. A However, some of the countries which have joined the EU must now cope with an ambivalent situation regarding hunting rights as part of the broader process of the return of property rights confiscated by communism. The situation varies from Poland - in which the return of property rights and especially hunting rights has been halted and 83% of woodland is now in the hands of the state - to Lithuania, Slovenia and Estonia, to name but a few examples where the process is almost complete but excludes the return of hunting rights to landowners. Even worse, these rights are still state property, and are leased to private individuals, often former apparatchiki, without the agreement or compensation of the landowners. As part of its twinning programme between the rural business organizations in the old and new countries of the European Union, the ELO tackled this question within a Franco-Estonian working party in Paris on 21 April. It was also discussed in the European Working Party on Hunting Rights created by the ELO which met in Bucharest on 26 April in partnership with the International Hunting Council, the National Office of Hunting and Wild Fauna (France) and representatives of the landowners of the countries concerned. Officially, hunting rights have been reinstated for Estonian landowners, but they are subject to particularly strict conditions. Even hunting small game in a personal capacity requires 20 hectares of land; they are not allowed to hunt large game (deer, elk, lynx, bear and wolf). 6 Hunting is allowed in areas of minimum 5 thousand unbroken hectares. Big game hunting rights, which still belong to the state, are leased out to hunting associations which organize hunts for a fee, without any compensation for the landowners on whose land these hunts take place. Moreover, to hunt on one's own land membership of the local hunting association is compulsory. To obtain authorization to organize hunts on his own territory, the Estonian private landlord must own 2/3 of a five thousand hectare area. He will not even 'own' this right because it is leased to him by the state. In practice, in a country where the average property covers 10 hectares, the matter does not even arise. This means the private landowner is stripped of any effective rights to hunt on his own land. The state's confiscation of hunting rights is a left-over from the Soviet past. However, it is necessary for Estonia to move on in order to allow the landowners - who are often farmers and foresters - to free up investment capacity which is so cruelly lacking in the countryside. Although hunters represent only 1% of the country's total population, they participate actively in maintaining the countryside, which needs to preserve its socio-economic dynamism. Many of them have professions linked to the land, and hunting is a complementary activity and a source of necessary income. Hunting rights must not be considered in isolation but as one of the ways of enhancing the value of the countryside. The entry of Estonia into the EU will allow it to evolve further towards a liberal economy, especially as withholding hunting rights could be disputed under the European Declaration of Human Rights, in particular article 1 - 'human rights' - and 11 - 'freedom of association'. Likewise, article II-17 of the future European Constitution to which the ELO contributed protects property rights. The adoption of the constitutional text would send a strong message to the authorities in the member states about the importance and level of protection required for the right to own land and accessory rights. ■ Ando EELMAA Ronan GIRARD ELO_Engels 68 30-06-2004 08:22 Pagina 7 EN Tax on savings n 3 June 2003 the EU Council of Ministers approved the directive on taxation of income from savings and the draft agreement negotiated by Switzerland and the EU, ratified on 21 January 2003. The ECOFIN council met on 9 and 10 March 2004 to take stock of the agreement and the directive. This is the current state of these dossiers: O ■ ■ The agreement concerns the adoption of the European 'tax package', made up of two directives for tax on savings and the payment of interest and charges between companies on the one hand, and a code of conduct for business taxation on the other. rest paid within the same state is not covered. Likewise, interest paid to third states is not covered. However, the interest from non-EU sources is covered, provided a paying agent located in a member state pays them directly to a beneficiary resident in another member state. It is immaterial whether the interest belongs to the private or commercial estate of the beneficiary. On the other hand, legal persons are excluded. According to the draft, the other entities without a legal personality 'taxed according to ordinary law' are also excluded. This restriction to the scope of the directive, leaving the way clear for the creativity of all those wanting to lodge their savings within a structure (domicile companies, trusts, foundations etc), should however be treated with caution. As far as taxation on savings and interest payments are concerned an essential point for our private banking customers - the following are covered by the directive: ■ ■ ■ Real interest: including interest incurred or converted into capital and acquired by the beneficiary on reimbursement or transfer of the financial instrument and - subject to certain conditions - interest distributed by capitalization UCITS. It also covers income earned on transfer, reimbursement or re-purchase of shares in UCITS, if these bodies have invested over 40% of their assets in loan claims. Dividends and the products of investments, innovative financial products (futures) and the products of life insurance contracts are however excluded. It also excludes all eurobond stocks issued before 1 March 2001. Paid by a paying agent based in the EU or a signatory country of the agreement: the paying agent is the economic agent who pays or allocates interest for the immediate profit of the effective beneficiary. This basically means a legal or natural person paying interest in the context of his profession or commercial activity (i.e. banks). A natural person residing in another EU member state: inte- ■ Dividends and investment income, innovative financial products (futures), products of life insurance contracts and eurobonds issued before 1 March 2001 are excluded. Therefore interest paid under the same conditions to legal (and assimilated) persons is also clearly exempt, except to those considered by some countries to be transparent entities (e.g. trusts, foundations). ■ This agreement, which concerns the 15 member states of the EU plus the 10 new member states and the associated and dependent territories from 1 May 2004, allows the coexistence of automatic exchange of information between tax administrations and a withholding tax on income from savings. ■ ■ ■ 12 member states will set up an automatic exchange of information. 3 member states (Austria, Belgium and Luxemburg) will not participate in the exchange of information but will apply tax at source on income from savings. This rate will progressively increase from 15% (as from 1 January 2005 - instead of 1 January 2004 initially) to 20% (on 1 January 2008) then 35% on I January 2011. Associated and dependent territories will require a case by case analysis. ■ Youssef DIB BNP Paribas Summary of main points of the agreement on taxation of savings. 1. This is only a draft agreement which has not yet been ratified by all parties; theoretical date of entry into force 1 January 2005. 2. This agreement covers either the exchange of information (involving 12+10 EU countries) or taxation at source on payment of interest only (3 EU countries and some third countries, from 15% in 2005, then 20% in 2008 and 35% in 2011. 3. Only natural persons resident in the EU and the interest paying agents located in a signatory country of the agreement are involved. 4. Swiss banking secrecy is preserved. 7 ELO_Engels 68 30-06-2004 08:22 Pagina 8 EN "Wetlands of Ireland Distribution, Ecology, Uses and Economic Value" Edited by Marinus L. Otte f there is one aspect of Ireland that everyone agrees upon, it's that it's wet! However, this mild wet climate comes with its advantages and provides the island with the unique Irish landscape. I © Ciara In fact, according to the water poverty index, Ireland ranks as the number eight water richest country in the world, and it is therefore no surprise that it is provided with an abundance of wetlands to study and enjoy. From marshes to turloughs, floodplains to bogs, most Irish people live close to and, hopefully, are familiar with at least one type of wetland, yet these unique and varied ecosystems, with the exception of peatlands, have remained somewhat under documented in the past. This book, which is presented in an academic style, brings together for the first time a number of wetland experts from a range of environmen- tal units in Ireland, including botanists and zoologists from various universities. Topics range from the archaeology and ecology of Irish wetlands to modern day developments and uses of constructed wetlands for the management of wastes. Although lacking in detail on the threats and management of these sites, Wetlands in Ireland does succeed in showing us the richness and diversity of the Irish wetlands. European Commission: the Cassinazza in Northern Italy and Veta La Palma in Southern Spain. Both are private estates whose activities are based on the potential in wetlands. It shows once more that wetlands count as part of Europe's farmland, though their produce is different to that of standard farms and focuses on "third generation products", also known as environmental services - clean water, clean air, biodiversity, open spaces etc which are totally in line with the objectives of the latest CAP reform. ELO is currently working on developing a network of similar private initiatives all over Europe. ■ Ronan GIRARD This book review from the Irish "Heritage Outlook" magazine may remind Countryside readers of the case studies ELO brought to the attention of its network and the Published by University College Dublin ISBN 1 900621 89 4 Diary Dates 2004 18, 19, 20 June The Hague General Assembly " European Landowners' Organisation " 22 June Paris Seminar organised by SAFAgriculteurs de France on the subject, "Choosing financial products - how to dodge the pitfalls" (9am June 22, 8 rue d'Athènes, 75009 Paris) 8 1-2 July Stuttgart, Germany '1st conference on local authority energy management' or how local authorities can simultaneously cope with budget cuts and the need to reduce their impact on the environment, particularly with regard to climate change. 13-14 September Leeds, UK ERP Environment Conference "Business strategy and the environment". 16-17 September Milan Series of ELO conferences Italy - Bulgaria - Romania twinning scheme. 27-28 September (update) Dublin Series of ELO conferences Twinning 'Ireland - Lithuania' Meetings and working parties focusing on developing rural tourism Syngenta International AG Brussels Office Avenue Louise, 240 B - 1050 Brussels Tel : +32.2.642 2727 Fax : +32.2.642 2720