Committee on the Internal Market and Consumer Protection Ordinary meeting
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IMCO European Parliament
Follow its sittingsSebastião Bugalho
We esteem that this simplification effort will save up to 5,000,000,000 in costs between now and 2029, and the business wallet as a whole should unlock at least 160,000,000,000 in saving for business each year. So it's definitely something that we should do. Just to finish and to conclude, I have to white light. I apologize to my non-Portuguese colleagues. The fact that our government in Portugal became the first European Union country to launch a national digital business wallet, which has been a pioneer in developing this idea that should be truly European in a nearby future.
So to conclude, we look forward to work with the colleagues, with the rapporteur, and with other political groups so this can be done as soon as possible for us to develop our single market as soon as possible too. Thank you very much.
Marc Angel
Yes. Thank you, chair. And I would also like to thank Veronika Ciflova, the rapporteur, for her excellent work, and I think it's a good basis to further strengthen the Commission's proposal. Indeed, we all know that businesses today face a heterogeneous landscape of digital environments across member states, and a lack of interoperability when it comes to digital public service solutions. And when I look at my own member state, Luxembourg, where due to our small size, we have a lot of cross-border economic activity, companies often have to adapt to and accommodate different requirements and systems when they interact with companies or also public sector bodies from the neighboring countries.
So the European business wallet could hence be a crucial tool to bridge the current heterogeneous landscape and lead to a more coherent European framework with regards to digital identification, authentication, and also data exchange for both the satellite sector, public sector bodies and businesses, thus reduce unnecessary administrative requirements. It would notably simplify cross-border economic activities or specific procedures like know your customer processes, permitting, or public procurement, and ultimately strengthen the internal market. We somewhat regret that there was no impact assessment, as it could have provided a more granular understanding of the needs and constraints regarding the adoption of business wallets. As socialists and democrats, we support a gradual approach with voluntary use for companies, and we hope that by making it a trustworthy tool that covers the specific needs of legal entities, we will see significant uptake. In our view, this means ensuring a high level of data protection, cybersecurity, and interoperability, as well as accessibility and user friendliness.
The transition to digital-by-default interactions should not create barriers to participation in the internal market. We must therefore ensure that European business wallets take into account affordability, user friendliness, and the needs of small and medium enterprises, self employed persons, and users with limited digital skills, including persons with disabilities. Public sector bodies, especially at the regional and local level, should receive support in implementing their obligations with regards to the use of the European business wallets. We welcome the provision specifying that the European business wallet providers need to be established in the European Union and have their principal place of business and main operations in the EU. Considering the role of European business wallets in the EU digital infrastructure, we believe that this can be further strengthened by expanding these requirements to providers of supporting infrastructure, such as cloud providers.
And additionally, we believe that in view of the sensitivity of some of the data handled by the European business wallets, that data should be solely processed and stored within the EU. This will strengthen the European Union's digital sovereignty and reduce vulnerabilities and the risk of dependencies. And we finally think that supervision, as well as the provisions governing business wallets offered in third countries, can be reinforced. We will introduce amendments in this direction, and I'm really looking forward to constructive negotiations with all the colleagues. Thank you very much.
Klara Dostalova
Thank you very much, and I will continue in the Czech language.
First of all, allow me to say thanks to the reporter for her draft, which is going in the right direction. Amendments aimed at the protection of small and medium enterprises can be supported by us. We have consulted this draft also with our digital agency in The Czech Republic, which is in charge, among others, of e-government, and we have a few comments. First of all, what we're missing is a clear solution for the coexistence of this wallet with the existing national systems or the recognition of the existing systems if they are able to provide all of the functions according to this regulation? In the Czech Republic, we have had this sort of system since 2009.
It cost hundreds of millions of crowns. First, we need to clarify the definition of an authorized representative. It must be clear from the text that this position, the position of authorized representative, only applies to the administration of the wallet as such, and it doesn't concern any other legal actions which are binding for the owners of the wallet. Thirdly, what we also need to clarify are the legal effects of deliveries through the wallet. The system is one thing, but the legal effects are another matter.
Procedural rules, such as the administrative code, should not be affected. In The Czech Republic, we have this rule of fiction of service. If a document is delivered into a so-called data box and it's not opened by the owner, it is deemed to be opened on the tenth day. And it's also linked to the fines and things like that, and then the legal effects also stop. But I believe that similar technical matters will also be discussed during the meetings of Shadurapoteers and the technical meetings, and I look forward to cooperation.
Thank you.
Anna Cavazzini
Thank you very much. I think that concludes the round of shadows. But is there any other member wanting to come in? If not, then I give the floor to the commission, and I welcome Christiane from DG Saint Connect. If I'm hi.
Welcome.
Christiane Kirketerp de Viron
Thank you very much. Thank you, Chair, and thank you for inviting the commission to this very important meeting today. We are pleased to see that the draft opinion supports the core aspects of the commission proposal, recognizing the potential of the European business wallet to facilitate the digital transformation of businesses and public administrations, and in particular, maintaining the obligation for all public sector bodies to accept European business wallets is essential to ensure widespread adoption and usability. A fully functional and integrated digital single market is at the heart of the One Europe, One Market strategy. The European business wallets are, therefore, a crucial tool for our businesses to be able to thrive in this environment. The European business wallets complement the other initiatives, such as the recent EU Inc.
Proposal for the Industrial Accelerator Act, and they will play a central role in making the digital by default approach a reality. Because by enabling businesses to operate in a fully digital environment, the business wallets will help to reduce bureaucratic hurdles, increase efficiency, and, of course, enhance the overall competitiveness of the EU companies. However, it's also to be noted that the business wallets are a strategic initiative that goes beyond enhancing the competitiveness of the EU single market. The business wallets play a crucial role in promoting and protecting EU sovereignty in the digital economy. They provide a trusted and secure digital infrastructure for our businesses and public administrations to operate across the entire union.
We share the rapporteur's emphasis on EU sovereignty, and we believe that the European business wallets are a key instrument in achieving this goal. We look forward to continuing our collaboration with the parliament to identify and work on solutions that address any concern and further strengthen the EU sovereignty, and, of course, to make the European business wallet a success for the single market. Thank you.
Anna Cavazzini
Thank you so much. So I think now the ECR shadow or replacement has arrived. If you still wanna speak, Mr. Cavardena?
Stefano Cavedagna
Yeah. Thank you, chair. I would like to speak Italian. Thank you.
Colleagues, I'm representing the shadow rapporteur, Valdini. I'd like to thank the rapporteur for the work before us that's been put in on this file until now, which is a crucial issue for the future of our digital single market. The commission's proposal on European business wallets is an important step in the digitalization process in the European economy to provide a safe, interoperable framework to facilitate digital interaction between economic operators and public administration throughout the entire EU. The proposal introduces an idea of basic functionality, techniques intended to facilitate administrative procedures, to simplify them, improve cross-border working, and enhance the efficiency of the internal market. We think that the business wallet, therefore, is seen as a genuine digital ID for companies.
It can have delegations, credential professional credentials, amongst other things contained, which allows the company to operate digitally throughout the EU with full legal force. If correctly implemented, this instrument could represent a change of paradigm to reduce the current fragmentation that we complain about so often, and to genuinely simplify life for our companies. A few points I'd like to mention, however. From the point of view of ECR, it's crucial that we avoid a good idea such as this becoming a further level of new complexity or new red tape, to put it in simple terms. So the business wallet should remain fully voluntary.
It shouldn't become mandatory, forcing companies to adopt it if they want to operate on the internal market. Secondly, the framework should be proportionate and technologically neutral. SMEs must not be shouldered with excessive costs of compliance or technical requirements, which will be difficult to implement. And we also need to guarantee fair competition between providers. And to conclude, we should respect the role of member states and evaluate or make most of the current national systems to avoid them being substituted or marginalized.
We also need to guarantee reciprocity, fair conditions for the third countries. And this is why the European business wallet has the potential to become a useful and very clear instrument for the internal market. But until we achieve that, well, for that to be achieved, we have to keep it simple, straightforward, and at the service of companies. And that's something we, as a group, will always be in favor of.
Sandro Gozi
No. Thank you. Thanks to all the chair rapporteurs. Of course, we took due note of their proposal, and the rapporteur will come back, in the light also of this discussion. Thank you, chair.
Anna Cavazzini
Good. With that, we come to the next agenda item 12, the 2025 safety gauge report. I guess all of you had a look at it and at the kind of also crazy numbers portrayed or that I laid down in the report. We have, I think, it as a usual annual exercise that we also have the presentation by the commission here in our committee, because, of course, the safety gate report talks about how many products are noncompliant, how our, also, recall system is functioning in the European Union. It has very interesting statistics, so I think it's great that the commission is here to present the findings.
And afterwards, we have the opportunity for the members to ask questions and to come in. And if I'm well informed, I welcome Olivier Miquel, head of unit from DG Justice. Is this correct? Yeah. Hi.
Olivier Miquel
Thank you. Thank you very much, madam chair. Thank you very much, colleagues. So I need a few words on the report. I think we have some slides that we sent in advance with the numbers.
Yes. So maybe we go to the first slide. So, the report indeed was issued on the fifth of March and presented by commissioner McGrath, also put associating as well as national authorities because the enforcers are definitely, of course, the authority. So this is, let's say, presenting the work which is done by these authorities in cooperation with the Commission. And for the first time, we decided to do an interactive report.
So it's not a paper report. It's a much more efficient report. You can go for the product. Can go for the member states. You can go for a period of time, etcetera.
So the first elements, and you spoke, madam chair, about impressive numbers. So this is 4,671 alerts, which have been notified last year in the safety gate system, and this is the highest recorded number since the system was launched in 2003. It is a 13% increase compared to 2024, and more than double the numbers of alerts reported in 2020, two. And 43% of dangerous nonfood products found by member states' national authorities were manufactured in China. So how do we explain this doubling of the number since '22? It means, first of all, that the safety gate system is more and more effective.
It shows as well that the improvement and the reinforcing of the system by the new monitoring and alert tools that we have put in place, notably the web crawler. It's a tool that we put at the disposal of the national authorities to detect offers of dangerous products. We are conducting more and more safety sweeps to check dangerous goods sold online and also the reporting by consumers in the consumer safety gateway. So, moving to the second slide, what are the most frequently reported products? Here, we see that cosmetics is the most notified product category on the safety gate for the third year in a row.
It represents around a third of the alerts validated, and the second one being toys and electrical equipment. The most notifying countries are Italy, Germany, and France. I must say the figure on cosmetic is specifically due to the detection of the presence of a chemical with the nice name of b m h c a, which has been banned. And in fact, since the ban is retroactive, this is why we also see a lot of noncompliant product on the market, and the Italian market sovereign authority is specifically active on this product. This explains why we have this, at least in part, cosmetics and Italy being singled out there.
Then moving to the next slide, what is important to note is the type of risk which are identified, and most of them, they relate to these chemicals. And this is in line also with the fact that you have, in particular, cosmetics as the most notified product. So the accounts that for more than half of all notification, followed by the risk of injuries and the risk of choking. So, again, here, the importance of the chemicals in cosmetics. And we know that there are debates in other parts of the house on the what, let's say, product, what kind of chemical should be banned in cosmetics in parallel.
But this is really something which has been constant in the last years. Moving now to the follow-up notifications. So, moving to the next slide, please. The follow-ups. So after notification has been introduced by a member state's authority in the safety gate, what is important is the action, the follow-up action by the other market surveillance authorities in other member states.
And then they have to act. They have to check whether the product is present on their markets. They have to assess whether the product is dangerous. What is encouraging is that we see that the number of follow-up actions has been going up. We should have more than that, but there is still a sharp increase in the follow-up action with 5,794 of them being notified, and this is a 35% increase compared to previous year.
So, again, it means the system is more effective. It has been reinforced with the general product safety regulation, and there is more information being shared between the market surveillance authorities. And what we see for the beginning of 02/2026, which is not on this graph, is that this ratio of follow-up actions compared to alerts is continuing to increase. So this is reassuring. We are not satisfied with the situation because there should be more follow-up, but this is reassuring.
And, of course, from the commission side, we are trying to support enforcement authorities, enforcement by market surveillance authority, because this is beyond this number. We have to see what we are doing with them. So we want to have more coordinated action by national surveillance authorities. We want to continue the sweep. So, again, having all market surveillance authorities looking at a specific product online, and we want to foster the sharing of information because at the end of the day, what is important is the resources, the capacity of the market surveillance authorities on the ground.
So I will stop here, madam chair. Thank you very much, and we are happy to take any questions.
Anna Cavazzini
Thank you so much for the presentation of the numbers. And I had announced at the beginning, now is the time for the members to come in. If you have questions or remarks, let me know. Mark, and then Pablo. Oh, yeah.
Pablo Arias Echeverría
Thank you very much, sir, and thank you for giving me the slot, the first block. I'm going to speak Spanish. Firstly,
Thank you very much for the presentation. It's true. There's some data that we see as positive with the gates to the safe gate report, and the mechanism of rapid alert. Whilst we see the system is working and cooperation between the different member states is also working, and that is fundamental between the finance and customs authorities, the national competences, and so this cooperation is necessary. What I wanted to ask is how is this cooperation working between these levels of authorities?
Now what we're talking about is technology here. Of course, we can improve the situation through this. Now making it more effective doesn't make it necessarily less risky. There are third countries sending products here. And also thanks to e-commerce and the platforms, however, it's good to know that the system is working.
However, even if we have the technology to further improve the market surveillance, it is also true that to implement technology, you require time. I recall about two legislatures ago, the transport committee approved the new systems for passport controls where the entire body of the traveler was scanned. But these systems are not fully implemented. Part of the Madrid Airport, it has been, but most European airports do not have this technology and these machines in an operational form. So, of course, we have tools and technology and digital tools that can help this process.
How much time will it take to implement? Because, of course, it's important. And of course, if we can improve it, then when will this be actually operational, fully operational?
Thank you. Marc?
Marc Angel
Yes. I would also like to thank on behalf of the S and T for the excellent presentation. And what is very good news, this increase of 35% in follow-up, but also that you say you're not satisfied with that, and that you won't go more. And the incentives you stated to go beyond this 35% are very interesting. And I'm sure that next year, we will then see an even higher follow-up.
My question I have just two little questions. You mentioned in your examples that the main notifying authorities was Italy, Germany, and France. Now these are also one of the biggest member states. Is there a correlation between that? Is it because there's more citizens who report to the authorities, or is it because their authorities are bigger or have more human resources and more financial resources?
Is that would be, my question. And then maybe, also, do you have national authorities who are the notifying authorities or the market surveillance authorities, have they during the last ten years? You know, we fifteen years ago, we have the authority the austerity period where a lot of public services were reduced. And is there a lack of financial resources and human resources in these national authorities? And would you recommend member states to reinforce these authorities?
Thank you.
Thank you. Sandro.
Sandro Gozi
Yeah. Thank you, Chair, and thanks to the representative of the Commission. I understand from the presentation and report that there has been a substantial improvement in the analysis of the commission on the issue of detection of illegal product and cooperation between national authorities. We would like to understand a little bit more, about this. I mean, how frequent are the joint action, the coordinated action of the national authorities to detect the illegal product?
How often do they do it, every month, every three months? I mean, if they are a frequency, how many joint actions have been taken so far and which result they have, productive. Thank you very much.
Elisabeth Grossmann
Thank you for this very interesting report and the very worthwhile work you've done. My question is on the customs authority that's going to be set up. Are you expecting more progress in terms of notification? And what will the cooperation look like between this new authority and the existing structures? Thank you very much, and thank you to the commission for this presentation, which I've listened to.
Virginie Joron
So it's supposed to be stopped nonconforming products coming onto the market, and you say that figures are increasing. I'm listening to your report. I'm an operator for the Patriots on the customs reform. This is a very important issue here, and that is to protect our consumers and the integrity of our single market. But the major dead angle, I think, is that you're not saying where these non-conforming products are coming from.
And that's very important. We're thinking about countries west of Europe and beyond, but we need facts. So, can you tell us where most of these products are coming from? And then figures per country, these alerts come from the competent authorities. So, does this reflect the intensity of checks?
Because if you look at The Netherlands, for example, this is one of the main entry ports for products coming in, Schiphol particularly, and the major port of entry, but we're actually seeing a drop in notification. Does this mean that there are fewer checks? 170 in Poland and the same years later, because we know that there are a lot of investments for warehouses for the big American, the big Chinese companies such as TIMU. Does this mean that the inspections are not keeping up? We know that the commission wants to set up a new market monitoring authority.
We're not very happy about this idea because if member states can't keep check on their markets at the moment, adding a European level is not going to help. So before we add a new structure, should we now make sure that the inspections which are carried out focus when most products come in?
Anna Cavazzini
And I had put myself on the list, and my first question is actually very similar to the previous one. Did you have statistics on where the products actually come from? So are the most noncompliant products from outside the EU, or is this just an image that is not true? Just to know the facts, a little bit steeper or the exact numbers. And then, can you explain a little bit again why there is not an automatic follow-up?
Because you could imagine that there's a problem. There's a lot to safety gate, and then there's automatically a follow-up. So, what is the problem there? Why don't we have a 100% follow-up rate, and how could we achieve that? Thank you so much.
I think that was all the members. Correct? Yeah. Okay. Then I would give you the floor back for answering all of our questions.
Olivier Miquel
Thank you. Thank you very much for this all very relevant question. As regard the cooperation between the member states, authorities, of course, we have to remember that it is for the responsibility of these national authorities, and there can be different authorities dealing with different sectors, in the various member states. And, we could have customs of having market surveillance responsibility as well or not. But this is the responsibility of the member states to organize it.
What we are doing as a commission is to try to ensure this cooperation is working as smoothly as possible. So there was a question on, for instance, how do we support the work between customs and the market surveillance authority. So this is what we are trying to do, for instance, with this coordinated action and this so-called CASP. And we had won this year, indeed, between the customs and the market surveillance authority. And in fact, together, we went to visit, for instance, the Liege Airport a few weeks ago together with our commissioner who went on the ground.
So we really want to foster this cooperation between customs and market surveillance, but also between the different market surveillance authorities. We have a number of these coordinated actions, which are either horizontal, like we had on customs and market surveillance authority cooperation, or by sector focusing on certain also on certain product and on testing. So because, indeed, one of the key points that you made in different intervention is we can have a beautiful system in place, but what is really important is that this market sovereign authority have the necessary resources, training, financing. And what we hear is that, in fact, none of them are telling us they have enough resources. So the question which was asked by several of you, are we asking for, you know, more staff, more resources, more IT equipment for the market surveillance authorities?
The reply is yes. This goes without saying. What we are trying to do is to pull the available resources together by, for instance, sharing resources on testing and knowledge. Then what we share also through the so-called consumer safety network and the safety gate contact points is indeed all this information that we receive. An example that we can give, for instance, you all heard about what happened with this play sand in Europe, and there was a lot of discussion.
So here, because we have established a relation, informal channel of communication with Australia, we received information that there might be a problem with this type of sand. We are sharing immediately this information, and we did that at the end of last year with all the market surveillance authorities. And then there is a discussion between the authorities on, you know, whether our product is dangerous, what are the result of the test, or, for instance, whether we need to develop a testing methodology. And these are our colleagues from DG Grow, because this relates to toys. So we have getting the information, sharing the information, and then working with member states, possibly on testing methodology.
This is what we can do. As there was a question on how frequent these coordinated actions are. Well, it's a kind of program. They last 18 months. So during 18 months, we have a mixture, again, of horizontal and sectoral coordinated action.
We also have to take into account that despite the fact that we try to support member sales authorities, there is also a limit in the capacity of absorption by this market surveillance authority because it requires resources from them to conduct such, you know, enforcement action. For instance, when we had the sweep that we carried out last year also on the platform to identify whether the responsible person is properly indicated. We see that a number of member states are not able to participate or are limited in their participation simply because they have a problem of resources. So we try our best to support them. I mentioned, especially, this web crawler that we have developed, which once a product has been identified in the safety gate as a dangerous product, we are checking URL in order to identify whether the same product reappears on another marketplace, and then we share this information.
Ultimately, it's always the national authorities of the member state who assess whether the product is dangerous or not. There was a question as well on can we have the breakdown of the dangerous product by countries of origin? So this is indeed in the report. It's a very important piece of information. I mentioned in my presentation that 43% of the dangerous product identified in the safety gate are coming from China.
So I think this is also what was hinted at, that we have in mind some country of origin. So this is really in the report. And, yeah, I think first is China, and then, yes. I mean, you can see in the report by clicking on the country exactly the percentages of from each country of origin. There was also a question more in relation to customs.
And, I mean, more generally about the enforcement authorities, here, as you know, we have the colleague from customs, here we, from taxid who might come in on that. But we understand that the question was how I mean, what is the ongoing reflection on enforcement? And in this context, reference was made to the ongoing reflection on the revamp of the market surveillance regulations, the European product act, etc. And as you know, the GPSR is very much aligned with the market surveillance regulation. So indeed, this is an ongoing reflection and we are participating, but this is not yet finalized.
So this is something we are contributing as DG Justice with the lead being DG Grow colleague, how we can strengthen enforcement, especially vis a vis ecommerce platform. So I think I cover more or less the various question, madam chair, but we are happy to follow-up.
Anna Cavazzini
I think so too. Is there any urgent follow-up or anything that was not answered? So everyone looks happy. Then thank you so much for the presentation, and I will definitely have another look. I mean, I just read the summary, but I will also check the numbers of original.
I find this very interesting, and some other numbers. So thanks so much. And, anyhow, to be continued with the several reforms that are coming up this year, in order to also close the last loopholes. So thanks for that. This concludes agenda item 12.
We come to agenda item 13. We talked already about the customs. They were mentioned in some of the questions before. We put on the agenda an exchange of views on the EU coordinated risk assessment on detection equipment. So there was, in January, a report published related to risk assessment of detection equipment used by customs authorities at EU border crossing points.
This was a report prepared by the NICE Corporation Group composed of member states, representatives, the commission, and the EU Agency for Cybersecurity, which have adopted a new ICT supply chain security toolbox. And, we now have the opportunity to listen to the main findings by the commission, and then afterwards having the members coming in with questions and comments. And, of course, yeah, it is very timely because we just concluded the trial log on the union's customs reform, and we'll also vote tomorrow on it. But, yeah, first, let me give the floor to the commission representatives, to Christiane Kerketep de Viron, acting director of DG Connect, and we had you already before, and Matthias Pechka, director from TACSUTE. Welcome to the two of you and your colleagues, of course.
Christiane Kirketerp de Viron
Thank you very much, Cher, and also thank you for the interest you are showing in the work that we are doing on risk assessments. I'm very happy to be here to also, in my capacity as a cyber director, to also share with you some broader aspects around how we do our cybersecurity risk assessments. And of course, I'm here with my good colleague Matthias, who will go into more specific details of the risk assessment on the customs equipment. Now risk assessments are very much at the heart of cybersecurity. It is fundamentally, as you know, cybersecurity. It is about handling threats.
It's about handling risks. And we have done this, of course, and we do this through various risk assessments. These specific risk assessments that we are doing and talking about here are the union-wide coordinated security risk assessments, which are established in our directive that governs the critical infrastructure cybersecurity, so the NIS two directive, where it establishes a role for the commission working with our member states in the NIS Cooperation Group and with our cybersecurity agency, Eneesa, to assess risks within the ICT supply chains of any of the 18 critical sectors that are covered in the NIS two directive. We assess both technical risks and non-technical risks. And behind this jargon, if you will allow me, technical risks are basically risks that pertain to the product or the service, so things that you can do something about and on the as a producer.
And nontechnical risks are other related risks to the products, are the risks that security risks. So it can be risk, for instance, related to dependencies or it can be risk related to, for instance, high-risk suppliers. So suppliers that are related to foreign jurisdictions, risk related to, for instance, foreign interference. Those are, broadly speaking, the two risks that we are assessing in our risk assessments. Of course, we are doing this work on cybersecurity against an ever-aggravating threat landscape.
We see an increase in attacks. We see whether it's for purposes of espionage, disruption, or prepositioning. We are also doing it against an ever-changing technological landscape where, in particular, we see AI capabilities growing very fast. And of course, we are doing this against a change in a changing geopolitical context. So all of this, of course, brings new and stronger risks that need to be addressed.
This is also what has been reflected in the economic security strategy of the commission, but it is also what is very much at the heart of part of the proposal that the commission has tabled for a new cybersecurity act, where we are setting out a methodology to derisk critical ICT supply chain. Our methodology in this work, we are always working, let's say, with a common methodology, a shared methodology. So it is the same methodology, regardless of the sector. What we are doing, as I said, is a risk-based proposed approach where we identify the risk, and we are also making recommendations for mitigating measures. I think the key thing here is always that we seek, of course, proportionality.
We seek to be as targeted as possible, and we always, of course, also take economic aspects into account in this work we are doing. The specific risk assessment here was actually our first NIS 2 union-wide coordinated security risk assessment. We published it together with, of course, the member states in the NIS Cooperation Group back in February, along with the risk assessment on connected vehicles, and we have a number of other risk assessments that are also in the pipeline. And with this, I will pass the floor to my colleague, who will go into more details of the findings of this specific risk assessment.
Matthias Pechke
Thank you, Christiane. Dear Chair, if I may. Thank you very much for this introduction. I think this has made us all familiar with the very basics of this process. We on the side of DG Taxuta, very satisfied with the interest of this committee for customs policy generally, but also more specifically with regard to the customs control equipment instrument, which is the relevant program, on the basis of which this risk assessment was conducted very much obviously in line with the relevant legal provisions, especially article 22 of the NIST two directive as just mentioned by my colleague.
Ensuring the security of the detection equipment has been a challenge, but also a strategic objective for DG Taxud since the start of the current MFF. We manage this dedicated funding program, which is worth €1,000,000,000 in order to co-finance the purchase and upgrade of EU customs equipment operated by the 27 member states. And as such, we are directly responsible for the financing of the deployment of advanced detection technologies, which are considered part of EU critical infrastructure for the EU security and economic security. At the same time, as Christiane has already indicated, and since the start of our CCEI program, we have witnessed a global increase in geopolitical tensions and hostile economic actions and attacks on our cyber and critical infrastructure, and also, more specifically, foreign interference. This prompted an EU reply and the adoption of several initiatives, and notably the EU economic security communication led by my commissioner, Shevchowicz.
The detection equipment and the risk assessment is a key aspect of the economic security as a model for protecting your critical infrastructure and sensitive information. This context becomes even more relevant as we discovered an important EU dependency on third-country manufacturers, with the EU market dominated by non-EU suppliers. And all this made the management of the program and the purchase of the detection equipment quite challenging. DG Taxot provided guidance to the member states. We integrated strict security requirements in the CCI funding mechanism, but the member states' practices continued to be fragmented.
The risk assessment allowed, however, to reach a common understanding and to design a common approach, thanks to the inclusive approach involving all 27 member states. This is part of the governance. We prepare this risk assessment in close cooperation and under the guidance of the lead service for the overall policy framework, which is DG Connect. We closely work together with some other director generals, which are in a similar situation, DG Move, DG Home, to mention only two, and, obviously, it can only be done in close cooperation with the member states, where, as you know, the national security agencies play a key role and are for us also a key interlocutor. What is this detection equipment for?
I think we had prepared a little slideshow. Maybe we can now also show a slide where you see that these are relatively voluminous machines. Can we just move on? Now just go to the next slide, please. And here you see it.
So we are not talking about the small scanning equipment which you are used to seeing at the airports. This is really very, very big stuff which you would find, obviously, for the scanning of containers notably at the level of the ports especially, but also sometimes airports. And the risk assessment has, in looking at the various potential risks, identified 13 generic risk categories in relation to the detection equipment. And I would like to just mention some of them, the key risks which are maybe worth mentioning here, which is the dependency and overreliance on a single or a limited number of manufacturers. As already said, we need to avoid that we end up in vendor lock-in situations.
We know that this can lead to supply chain disruptions, price increases or variations, reduced performance, and reduced innovation, etc. So quite a number of risks connected to it, so a very difficult territory. Another high level risk, which is worth mentioning, is the risk of unauthorized access to equipment data, also the unauthorized access to equipment data affecting the performance of the detection equipment and the integrity of the sensitive information it contains. And remote maintenance, a form of authorized access, which can obviously provide a factor to the access of sensitive trade and EU control data, gather intelligence on EU control policies, or conduct even cyber espionage to gather sensitive information about trade, individuals, or critical infrastructure. And last but not least, malware can also be introduced through the equipment to alter or corrupt data.
And therefore, there are a number of conclusions. One conclusion to be highlighted is the divergence of national procurement practices. This is for sure something we are looking into in order to provide the member states with the relevant guidance. But then there are also a number of mitigating measures highlighted in the report. And then we go please to the next slide where we see them, and I have here six of them on cybersecurity, the implementation of the NEST two directive, and the related measures as mentioned here.
The aim being ultimately to ensure data sovereignty and integrity, network security aligned with the cybersecurity act requirements. A general point on security, as you can see, design security, proof equipment to be used, vetting procedures to be put in place, security clearance to happen through the national security agencies. This is something which we are now very much recommending to member states in the context of the procurement to involve their security agencies to make sure that there is a vetting taking place, and we know that the member states are now following this more and more, capacity building, etcetera. Then the EU approach, the collective situation and awareness, and information sharing, cooperation-oriented measures aligned with the customs reform as it is mentioned here. Supply chain security, not an easy one, as I said, because we are faced with a relatively small number of suppliers.
And, obviously, as I said beforehand, quite a number of them are from outside the EU. Public procurement already mentioned, integration of security aspects in the tender procedures, and then last but not least, a made in EU policy, which we need to put in place as a matter of urgency in order to make sure that we have excellent control over the supply chain, and we have our own champions in this area. To conclude, I would just highlight that we have managed in collaboration with the member states and in the interest of the EU and national security to create with this risk assessment a robust tool to address cybersecurity and security challenges, and we will obviously roll this out. We are in touch with some further actors. We are in contact with the EIB to see what financing instruments are available to build up a made in Europe policy, and we are obviously also looking at the enlargement at the accession process in order to make sure that also the accession countries are fully equipped in good time in order to provide us with, as robust as possible solutions.
Thank you very much, Chair.
Anna Cavazzini
Thank you so much for the two very interesting and insightful presentations. Again, now I have the members or the chance for the members to come in. And I'm looking around. Virginia. Oh, you're yeah.
Yeah. Virginia was the first, and then Pablo.
Virginie Joron
Excuse the. Sorry.
I didn't want to take the priority. However, thank you. Congratulations for the great sincerity and very clear diagnosis from the commission. It is terrible because we've seen all the risks linked to the externalization of our detection resources, and all these elements that are the keys to the access to our internal market. So as a rapporteur for patriots on the customs and the reform of the customs union, I really feel this is important.
And thank you for being so clear. We see all the possible risks, the problems of dependency on third-party countries. You didn't mention names, but we know there are two big companies, states that are China and the U. S, and this creates a dependency with regard to the tools. But you've said this is the problem in your reports and in your presentation.
Let me just recall that during the trialogue, we were able to have the principle of digital sovereignty, and that's the beginning. But DG taxid, you wanted to put in exceptions. Today, you're very clear, and I think you should continue to be as straightforward made in Europe. You should opt for that. You're going to be putting more money into that.
We fully support that because sovereignty is not negotiable, and also data protection. An example that was not referred to by you, which I found problematic, was with these instruments that are often put in place and implemented by foreign companies. We'll have the problem of AI image detection. Are we going to be able to with the new hub that will be put in place soon? And this is a question that comes from the industry, from the sector.
So everyone tries to protect their industry. Isn't there a limit to access to these images, which will also be useful for tomorrow, to control this area and also to meet the concerns of the industry, which is not the market the Europeans would like to get back. And you've said that this focus is on public procurement, but why is it that even today, even this year, certain states have tender offers? With China, for example, we want at least a reciprocity clause because under the pretext of opening the market to China or opening the Chinese market, well, on paper, they open their market, but they put so many rules and red tape in place that the market is not open to European companies. So thank you very much for this presentation.
We fully agree with you. How do we achieve this? We started with a number of recommendations, but I do believe we must go further. We should not be timid about Made in Europe and not stop closing access to certain industries of certain countries who are not playing by the rules and are taking advantage of the naivety we've shown up till now to get gain ground. Thank you.
Paulo?
Pablo Arias Echeverría
Thank you, chair. I'm going to speak in Spanish. Yes.
I agree. This was a very interesting presentation that shed a great deal of light on the issues and the weaknesses that we have within the market. Well, I'm not an expert, and we know that we're talking about critical infrastructures. We've had attacks on these hybrids. They attack the software and then take control of the management software, and they send out false orders or simulate machines, and then they attack hardware.
So these infrastructures, critical infrastructures, if we buy them in third, well, sometimes we buy them in third countries, and the software that goes along with that, that they depend on, are obtained in third countries. And so that would be a clear door, and that leaves the way open and shows a certain vulnerability. So the question goes beyond made in Europe. I agree with that. This is not just an issue of sovereignty, but it is one of security.
So made in Europe is, of course, wonderful, but here, and this is my question, if we had the possibility to have everything we needed within Europe. And I don't think we can say yes to that. I think that's not the case. So we need to see how to promote the capacity of providing for our needs within the European companies with products made in Europe. Software is a huge problem, but not just that.
I don't know if the commission can say something about that, but I agree that we should have made it in Europe and many of the issues you raised. But what I would like to know is whether we have the ability to actually do this in reality. Thank you very much.
Anna Cavazzini
So much I put myself on the list because I didn't see any other queue. Correct? No. So, yeah, also from my side, yeah, again, thanks so much for the numbers, the presentation, and the actions. I have one question on the figures or on facts.
Was there already, until now, any breach of security in any customs detective equipment or not? Just to know if that is actually what it is, more like an abstract risk, or had we already had problems in the past? And then similarly to my colleagues, I wanted to, I mean, for me, it would also make sense to have to buy the stuff in Europe because then we actually know, and, mister mentioned it and so on. The question is how would we operationalize this? And you also had the point on joint procurement, question mark, on your presentation.
Could it not also make sense that similarly to some of the defense products that we also say, okay? We, as the European Union, procure it for the member states or something. I don't know. Does it also make sense? Because then we have a bigger procurer, and we can also just make it probably easier for the member states.
Just to wonder some of these ideas to get a little bit more into detail and what would need to be the steps to make this happen. I can't speak English today, but you know what I mean. Okay. Any more colleagues? No.
Then I give the floor back to you.
Yeah.
Matthias Pechke
Thank you. I will start with the question from the chair. I'm pretty sure that there are responsible colleagues from the national security agencies who are ready to share further information, but I'm not going to do this here. What I can say is that there have been attacks on service, quite a number of them. And we know it's, I mean, we know everybody knows it, that we are under continuous attack in many areas.
So, for sure, also in this area. We have quite a number of actions in preparation. We actually are working on an action plan. And the first I would like to mention is to make the security requirements mandatory. Until now, very much guidance.
We want this to be as strong and legally binding as possible. We want, especially, the member states to be in a position to use the relevant security policy provisions of the procurement framework because there are procedures under the procurement framework which allow for the treatment of particularly sensitive security issues. And this needs to be well understood by all the member states and also put into practice. And one step further for us could be, since we are the entity financing these activities, that we indicate things also through mandatory security requirements. We have already, in the past, as I said, provided guidance on risk assessments.
We are also ready to look into the technical standards as much as possible. In many areas, technical standards exist when it comes to the hardware, but also when it comes to the software. The honorary member over there has mentioned that there is not only a hardware but potentially also a software issue. And he has asked whether we are actually able to further promote the made in Europe. I think we are.
It is, however, a medium- and long-term issue. It is clear. But we also have some European players, which are quite promising. We are in contact with them, and you can be assured that we will continue to work on this avenue. And then, obviously, the integration into EU funding measures to be integrated into the CCI funding process, ensuring that the acquisition of equipment is aligned with a general need to derisk supply chains and to reduce reliance on high risk vendors.
We have a number of ideas of what we can do, and we will now step by step put this into effect in close cooperation with member states who have reached, in the meantime, a better understanding of the issue. We've come a long way. I think this was not the case two, three years ago. Quite different practices. Member states hitting out relatively harshly on specific providers, whereas others were much more lenient.
What we want is a more stringent, more coherent policy, which is in line with our overall objective of interdependent and connected networks. It is clear that we want as much as possible these machines to be interoperable, to be connected. In the future, there will also be the data hub, so there will be further connections that need to be secured. And in on our way to this future evolution, we need to make sure that at the level of all member states, we have resilient systems in place.
Christiane Kirketerp de Viron
Thank you. Maybe just a couple of, I would call them, broader considerations, of course, also from our side on the cybersecurity because, as my colleague, of course, rightfully discussions we've had when we do the risk assessments where we also do the analysis of specific incidents and so on are not things that we would necessarily disclose. I do wanna draw to your attention also the risk or the threat landscape reports of our cybersecurity agency that also looks at the broader sectors that are under, let's say, increased threats, where, in particular, and it's the areas where, of course, we also see this equipment set in particular ports is something that we're looking at with great concerns also because of the role it plays in not only shipping goods, but we've also seen an increased interest around ports related to, for instance, the shipping of military equipment. So all of this, of course, makes it, for when we talk about risks in cybersecurity, really an area of a high level of criticality. I think the other point is also important for us because when we're doing the risk assessments and we establish dependencies and we see that, you know, we're also, of course, looking at what are the alternatives available on the market.
It's an important part of it. And the link there, of course, to also develop the capacities and the capabilities to replace high-risk suppliers is an integrated part of the work that we need to do in order to secure our ICT supply chains. So for us, this is a very important part as well, that we do not discover dependencies, and we simply say, too bad. This means that there are further actions to be taken in a wider domain, and this is very important also for security. Thank you.
Matthias Pechke
And then just if I may. So very just very briefly, two points which I've forgotten to mention. With the future customs agency, we will have a central entity in the future, which will be able also to organize centralized procurement procedures. Until now, we had procurement procedures at the level of individual member states. If we can bundle this, if we can organize it differently in the future, obviously, it is going to make a difference in many ways, you know, simplifying the procedure.
But I think you this is self explanatory. The second point I just wanted to mention, this risk assessment allows us to identify high risk suppliers, has identified the key risks and the medication measures which we can put in place. This is all very useful, but it's important to understand that with regard to the objectives and the countries, the countries of origin, let's say, of it is totally agnostic, which means that our assessment is going to be extremely objective. We are going to proceed in a way which is very objective, which is related to these criteria which are now established. And we cannot be under attack for taking a one-sided approach if we follow this list of criteria and this policy.
I think this is reassuring, in an environment of many interdependencies. This should protect us also against legal claims and legal procedures. So it is, I think, an important element to be on the line. Thank you, chair.
Anna Cavazzini
Thank you so much. So we have 10 before Commissioner Shevkovich is coming. So we have a short second round, and I saw already Dirk Hötting. Now I pronounce it correctly. Correct?
We had to go to China together. Now I can pronounce your name. Okay. And then we have Pablo.
Dirk Gotink
Thank you, chair. And apologies that I was late, because I believe this is I was very happy with this report because it fits into what mister Pesco also mentioned as sort of an increasing consciousness of security concerns when it comes to our border for goods and what kind of instruments and machines we put there to help us scan the stuff that comes into the market. And this is getting more and more urgent because actually considering the trade deficits that we're running, more is coming in and less is going out. That is basically the bottom line. Now I have a there are many concerns.
One is about the market for it because I've talked to several European businesses that could make this or are making this, but they point at some very systemic differences between, for example, access to data to train software and to actually recognize sort of in the scanning in yours to develop the product. And there's a huge competitive disadvantage there. Secondly, can the commission also look at the differences between whether these machines were connected to main servers or not? Because I know that in some countries, they're not, and in some countries, they are. And then does this create a situation, for example, with the future data hub?
We need to sort of arbitrate between which machines can be connected to the system and which won't. Please bear in mind that in to at least, yes, you might be agnostic to where things come from, but when it's about Nooctech, I think we should be very careful and we should not connect those machines directly into the data hub. I would like the commission to be very strict on that. And then thirdly, when it comes to sharing information, are there also sort of industry standards that you could promote in terms of standardization that also foreign suppliers, also maybe not from China, could adhere to when it comes to your sort of minimum standards on product development for these kind of container and goods scanners? Thank you.
Thank you. Pablo.
Pablo Arias Echeverría
Thank you, chair. I'm going to speak again in Spanish. Well,
I'm very grateful for that reply. But when you say that they're constantly attacking us, it's true. We're constantly under threat. Yes. It's a reality.
There's good cooperation between member states and them. That's good. Very positive. But it may be a reality. It's gonna be a little bit more difficult to change it, but I'm a bit more concerned about the European response for the medium- and long-term.
That's not a doubt. It's a fear that I have. But you're also saying that it's true there are alternatives. There are suppliers who are a risk, but there was nothing said about public private cooperation. So I think that is a crucial issue.
And so that's basically the question I would ask about encouraging the European industry. And for that, I think it's crucial to have that public-private cooperation. I think it would be very useful if you could give us some input on that. I know there are some great reports. Congratulations on that once again.
But I think not only would I like, but I think it's essential to have this in order to rule out certain doubts. If you could provide us with input, it would be very useful. Thank you.
Anna Cavazzini
Now I'll give the floor back to the commission a second time. I don't know which of you wants to start.
Matthias Pechke
Mister Hoting is absolutely right. Access to data to train software is key. So that's going to be an important challenge. AI will play an important role in the domain. You're right that, in some member states, there is a connection to the central service.
In some member states, it is not. Sometimes this is already the consequence of a fear that there would be security issues. You have a concrete request concerning the promotion of the standards. We are getting prepared for this. We already have a technical working group in place, which is working on the preparation of the relevant standards.
So this is a work in progress. Public private, I thought that I had at least tried to reply to this. Yes. We do not exclude this. We will look at future programs.
I've mentioned the CCI. We will, obviously, also under the new MFF have funding possibilities and programs. There's the European Competitiveness Fund, which is, from our perspective, a possible tool for the development of a policy in the relevant market. So I just give you this as one element, but we are not, in any way close to further ideas on what we could put in place, to be even more proactive. Thank you.
Anna Cavazzini
Perfect. So, this concludes agenda item 13. And, again, thanks for the commission for being here and answering all of.
Anna Cavazzini
Questions. And we now come to the exchange of views, with Mahosh Sheftewitsch, commissioner for trade and economic security for the structured dialogue, and I think he's on his way. We are, like, five minutes early, so I suggest we do a tiny little break and then restart when he's coming. So don't probably leave the room because I have the feeling he's very close, but, of course, you can get up and do whatever you want. So welcome back to our afternoon session.
And of course, welcome to Commissioner Sefcevich, Commissioner for Trade and Economic Security for our yearly, structured dialogue. We are very happy that despite all the different crises you have to tackle every day, you come to our committee, because, of course, we have a lot of topics to discuss, not only the very successful customs reform we just finished, but, of course, also other aspects of economic security. We are also, I think, very interested in you going to the US because, as you know, the MCOA is responsible for our digital legislation, and there were some worrisome news. But, of course, the members can talk about it in a second. I give you the floor for some introductory remarks, and then we have the rounds of coordinators and members to ask questions and have you for your answer.
And you have to run and catch a plane, so we try to be a little bit shorter today. So.
Maroš Šefčovič
Thank you. Thank you very much, dear chair, dear Anna. Honolulu, Merz. Indeed pleasure, to be here with you and to discuss number of issues. I'm glad that we do not have to solve any crisis with your committee.
So, I mean, your committee is working well. And, of course, it's a huge help, and I very much appreciate the good atmosphere and excellent working relations. First, as you suggested, madam chair, reform, I think this, you described it very well, indeed marks the historic step forward for our customs union. And, we and the commission very much welcome the agreement, which was reached by the college legislators on the twenty-sixth of March. And, I very much appreciate the commitment demonstrated to reach the conclusion in a timely manner.
We know how, you know, many topics linked to the customs reform are urgent, and therefore, I think the fact that we managed to do it in such a constructive and telemetry is, I think, a very important signal. You've been working on this reform in great detail, so I do not have to underline the fact that this is the most ambitious overhaul of the EU customs rule since 1968. We all agreed from the outset that it was of the critical importance. And I think the geopolitical and geoeconomic context, which we are living in right now, and this fast changing landscape of international trade just underline the point how important it was and how important it was that we did it, in such an expedient manner. I believe that, thanks to our great cooperation and this reform, we will strengthen our new economic security.
We will have at our disposal modern data-driven customs architecture. We will have simplified custom processes, and I believe that this would enhance the efficiency of both businesses and administration. I'm also very pleased that this contractive spirit was found in what is sometimes extremely difficult discussions around the selection of the location for the future customs authority, because this was also done in an exemplary, fast way. And, we are very happy that the Lille was selected from the number of excellent bids. As you know, the commission has already started to work on the authority in the terms of governance, staffing, and headquarters, but I also have to make one caveat to underscore that we can only proceed with, I would say, real work.
You know, I'm talking about staffing, contracts, and I would say the work of, I would say, this legal nature once the text is published in the official journal. And we are, of course, working with the council to make sure that this is also done in an expedient manner. So we hope that this would happen by the end of September. We will have text in official journal, and all these steps before that will be well prepared, so we can then proceed with executing them once we have the clear legal basis and everything is published in official journals. We are also making this good progress because we got the strong support from the members of this committee, and madam chair, dear Anna, missus Cavazzini, and mister Gottinghoseraportelli, would like to thank you for the creativity, for being always available, for strong and cooperative approach.
You have shown through this much-needed reform, and I have to say that it was very obvious from the beginning. And, therefore, I think we could have concluded in such a swift manner. Now, of course, we would be continuing to rely upon you to move to the conclusion of all the last types steps linked with the swift adoption of these legislative proposals to make sure that traders, national customs authorities would have sufficient time to adapt to the new rules. If you allow me to turn to the ecommerce, which is also an extremely important topic these days, I know that some of you were in China recently to exchange with Chinese authorities and businesses also on this topic. Thank you very much for the feedback and also for making very clear what are the European worries, positions, and also suggestions.
And here, again, we knew how crucial this would be also already few years ago, and therefore, already in our communication from February 2025, we underscored the fact that customs reform can act as a key enabler to level playing field when it comes to ecommerce, and this would strengthen our customs and market surveillance capacities. And, therefore, I'm glad that we are now moving into that direction because I heard it also from the honorable members of this committee and from many members of this parliament how important it is to ensure that only safe products that comply with our rules should enter the EU market. As you know, starting this year, the commission is preparing to implement specific ecommerce measures, including two financial measures imposed on business to customers, b to c shipments, a €3 customs duty as of first July 2026, and the EU handling fee to be put in place as soon as possible after the publication of the new union customs code and no later than November 2026. So here again, it very much depends when the whole text will be published in official journals. I would just remind all of us that last year, we have seen astonishing 5,800,000,000 low value ecommerce parcels arriving in the EU, which from the perspective on a year to year increase represents again staggering 26%.
In this context, I would like to highlight the importance of the priority control areas we announced last year where the member states, customs, and market surveillance authorities can coordinate their controls on the ecommerce parcels. These actions have shown the high level of noncompliance, I'm sorry to say, of products sold online by specific marketplaces directly to EU consumers, with the rate of formal noncompliance sometimes stopping at 50%. These findings are shared with the digital authorities as well, and they confirm the need for enforcement authorities to closely coordinate their action and learn from experience both in terms of methods and cooperation. We have seen, once again, how critical it is for our customs, community, for all our customs officials to act as one and to avoid giving loopholes to noncompliant traders. Looking ahead, with work on the customs union gathering pace, there are a number of other files which will very soon require your attention.
And let me therefore, madam Chert, quickly run you through the most important one. First, rules of origin. Nonpreferential rules of origin have a traditional role in trade defense and sanctions, but they have also become central for implementation of the new EU policies. I'm talking about CBOM. I'm talking about the net zero industry act, and I'm, of course, talking about the industrial accelerator act.
I shared an implementation dialogue with businesses in July last year, with several avenues for the reflections identified, notably related to simplification, commercial secrecy, and supply chains. In the evolving trade economic and political landscape, rules of origin have to be examined to ensure they still fit the EU policies. Therefore, the commission will also review the other aspects of our trade and economic security policies. Now I'm referring to the autonomous suspensions and quota schemes that would allow for targeted tariff reductions for specific products insufficiently available in the EU, to ensure they are anchored in today's reality and serve the interest of the EU's economic security and competitiveness. Second very important topic, which I would like to bring to your attention, is fight against illicit drug precursors, where the commission has presented the revision of existing legislation to both internal and external trade to boost our security and contribute to our simplification drive.
And the last point I would like to highlight is a customs equipment, which we discussed right before this exchange. And here, as a guardian of the external border of our single market, customs authorities retain a great deal of critical and sensitive data. I therefore attach great importance to the risk assessment being carried out by the DG Tax Suite to identify and mitigate risk associated with detection equipment at EU borders. Honor members, I know that we are pressed by the time, so I will stop here, and I very much look forward to our discussion. Thank you very much, madam chair.
Anna Cavazzini
Thank you very much for this short and concise introduction. And now we have the coordinators. And because we are a little bit short of time, I would take two together. Normally, we have a ping pong, which is very nice, but I think we will not manage today. But first, let me welcome, actually, we have a group of visitors here also in the Imco Committee.
I welcome the Global Ecolabelling Network Board in our committee meeting, and I hope you find our session interesting, and thanks for your work. So now we start with the EVP with Pablo Arias Echeveria. So one and a half minutes maximum, probably shorter.
Pablo Arias Echeverría
I will try to do my best. Thank you, chair. I'm going to speak in Spanish, if you don't mind.
Well, as you said, commissioner, just a few days ago, this group went on a visit to China, which was very productive, I think. And we were talking about, well, small countries coming through their electronic platforms. About 95% of those low-value packages come into Europe from those Asian countries. So there is clearly a deliberate attempt by Chinese companies to bring their excess produce onto the European markets, with effects on competition and also for our consumers as well. So it seems that some European leaders now are forcing us to do something about it.
But one year ago, you came before this commission again, and we would just we've seen a massive increase in electronic e-commerce since then. But we've got some good news. We've heard about the €3 amount to be paid on the small packages from this summer, which is good as well, and the reform. Now obviously, we think that the new temporary measures will be coming into force in July. And do you think there'll be enough then to balance out the mass imports of these small packages through the e-platforms?
And then also the strategic debate between discussions between the EU and China has come down a little bit, but some members are actually talking individually now with Asian countries. Do you think that it's more advantageous to talk with China as a united block or through doing it individually? Thank you.
Who is connected online?
Laura Ballarín Cereza
Thank you very much. And I have three questions now. First and foremost, on the reform package, the commission informed us that there was €2 for packages below €50 in value. How can we ensure that is not going to apply paid by consumers, but it will be borne by suppliers? And secondly, the tax should go to member states to strengthen the customs authorities, who are the ones responsible for ensuring that standard quality standards are met.
How can we ensure that those funds go in actual fact to the member states customs authorities? And thirdly, we aim to protect consumers here, but also local trade. I come from Barcelona, which won the European capital for trade, but we're being called on by traders to take further steps. The commission is doing this through the reform. But do you think there are other laws that should support, for example, digital services, which could help face up to this unfair competition?
Thank you.
Maroš Šefčovič
Thank you very much to mister Chelyab, but also to madam Laura Ballaran for both questions. Indeed, as very often we described what was happening in the field of small parcels, I think it's best described as a real tsunami. I mean, we had more than 1,000,000,000 parcels of increase every year since, I think, 2020. So, clearly, that was kind of the niche market, which became the real problem from the perspective of product safety, but also it now represents a serious issue for our retail stores, and for the European traders and producers. Therefore, I think it was excellent that the parliament delegations were in China and that the Chinese representatives with whom I'm interacting here directly from you, directly elected representatives of European people, that this is really very much your concern as well.
What we are doing here, I think that the only response which would bring us a real success is a systemic approach. Exactly what I think we are doing together. So we will have now, as we discussed, the most in-depth customs reform where we would go digital, where we would have much better overview of what is happening. We will be closing the loopholes, and we'll be forcing this approach to act as one. So there will be not some kind of soft penetration points in different parts of the European external border for the traders.
Second thing, we are introducing this customs duty. And as you know, we're currently working on establishing the proper level of the handling fee, which will come in in autumn, of this year. So there are already, I would say, financial elements in it. And, what, madam Ballaratne was asking, we, of course, want to make sure that also market surveillance authorities and customs officials are better equipped, that they get stronger financial support. And they will be also equipped once our data hub is up and running for much better analytical information.
So we will have, I would say, the systemic approach, I believe, more financial support for the services and better analytics, which would underpin, I believe, higher quality approach to the risk based checks. I think that this reform also supports what I am pitching always to my colleagues, ministries who are responsible for customs and market survey and authorities, that they have to work much more in sync because we want that not only the custom side would be controlled, but also quality, what is in these parcels. And I think that with this reform, we can definitely achieve that. Last point on China. This is, of course, a big topic.
I mean, last year, you know, we recorded a very high deficit. I don't think it's probably the second is the highest to talk the numbers. Every single day, we have 1,000,000,000 euros deficit to China, €360,000,000,000. So this is clearly not sustainable. That was the message I passed to my Chinese counterpart.
We agreed that we need a systemic approach to this as well. We will have, I invited him, for the visit to Brussels where we are structuring how we are going to discuss all these things, and we will be engaging our Chinese partners on all of these issues. Thank you.
Anna Cavazzini
Yeah. That was also one of the messages we passed to our interlocutors when we were in China. So now we have the second pair of coordinators, Virginia Girond for the PFE.
Thank.
Virginie Joron
you. Thank you, mister, for coming along today. You said earlier that the origin rules is something we can come back to because earlier on we had made in Europe, and that's a very important subject. You may be reopening the dossier on the origin. I think this is very important to limiting market access.
I'd like to get to the very trucks of the matter, and that's the budget. We all need money to pay for all this equipment. We had an excellent exchange of views on the report, which showed the difficulties that we're having at the moment to deal with the specifications, to live up to the specifications, and the difficulties that the customers will have in the future. In your text, which is very clear, you talk, you say that the management cost should lead, should cover the costs of checking that the goods are in compliance. We said 5,800,000 small packages in 2025.
We're now talking about 2,000,000 € 60,000,000 a few years, and you're saying €2,700,000 for the customs program. So there's a shortfall there. We saw this earlier. There's a real problem with the equipment. There's a real problem with having the proper means.
So why so little money? We have the keys to come up with an efficient system. So why are we not giving sufficient funding? Pipera.
Gheorghe Piperea
Thank you, chair. If you allow me, I'm gonna speak Romanian for better understanding. Romania is.
One of the countries that is deeply hit by inflation. We have one of the highest inflation rates in the EU. In the last three months, consumption in Romania has gone down by 25%. On the one hand, this means that prices are going up. On the other hand, it costs have become prohibitive for citizens.
From this point of view, it is extremely important for us to establish the root causes of the prices going up. In the past days, the commission has issued a very interesting regulation project. It is interesting in the light of the style the commission has had so far. Some of the important imported products will see CBEM regulations suspended for them. Obviously, this is interesting because this will lead to a certain reduction in the prices of these imported products.
Two days ago, an ENV report suggested that this program proposed by the commission be reduced, but it also proposed to extend it to encompass more products. I would like to know what is the position of the commission from this point of view, because this is a support that Romanians would definitely find helpful and important.
The commissioner.
Microphone, please.
Maroš Šefčovič
I'm sorry, madam. I was just referring to you and thanking for the question as well as I did to mister Pipira. And I was just agreeing with you that the work on the rule of rules of origin is very important and very complex, very complex indeed. And, therefore, we are in the middle of this process to make sure that we would be as precise as possible because for different products, it might mean, I would say, different composition. So I'm sure that we'll have to come back once we have a more comprehensive view of how to approach this issue because, as you know, we've been going through what I would describe as hyperglobalization over the last 15 years.
Now we see that we are going through a certain process of regionalization, and we see some protectionist tendencies from different economies. So also the supply chains and the disruption very often kind of impacts the whole perception how the how the how the trading partner has been formed and evolved over the last ten, fifteen years. So, therefore, we are taking all this into account, and we will come back to you with a very comprehensive view how the rules of origin should be adjusted to the current work so we would really distinguish what is indeed made in Europe, what would qualify to be seen as a true European product. If it comes to the equipment and the savings, when we've been proposing the customs reform to you, we've been underscoring the fact that currently 86,000 customs officials across Europe are using 111 different softwares, which are very expensive. You have to buy them.
You have to maintain them. You have to upgrade them. And, of course, what is even more problematic, very often, they're not compatible. So they don't talk to each other. So we have a lot of loss of data.
We are not as efficient in executing the functions of the customs across Europe. And, therefore, we are paying a lot of attention and working closely with our member states to go for one software, which would really work for everyone. And this measure should bring more than €1,000,000,000 of savings per year, which I hope will be then, of course, reused and reinvested in increasing the equipment, quality and training and proper support for the customs officials. Of course, you will also be debating, for the next two years in different committees, in different variations, the budget for the next seven years, multi-annual financial perspective, where also, this is one of the issues which, I think, should be covered. I know that my colleague, Commissioner Sen Seraphin, has a lot of clients with a lot of requests.
And overall, they would need the compromise, but this is one of the areas which also I see as a key element if you want to guarantee the proper economic security for the European Union. To mister p Peterrea, of course, we can discuss multiple factors, which unfortunately have the negative impact, which results in the prices increase across Europe. Clearly, what we see over the last couple of days, the situation in the Strait Of Hormuz, the dramatic increase of the energies and the fossil fuels are clearly impacting every single product because every product has to be transported somewhere. So I know that we are looking for all the possibilities to reduce the prices. We are talking to member states about energy taxation, about excise duties, about other elements, and we are looking at all the opportunities how to do that because we hear our farmers, and we know that in particular, they're very worried about the increase of price for fertilizers and what kind of impact it would have already for the next crops for the next season.
And we are looking at every aspect, including the C1 from the perspective, what needs to be done so we have more flexibility and more options available. Thank you.
Sandro Gozi
Thank you, chair, and thank you, the commissioner at the Amaros. I got three questions. One on the council reform, one on cooperation with the national authority, and the last one on UK. The first referred to the introduction of the new legal concept of deemed importer for distant sales in the customer union reform, which I think is a very good thing. But do you think that this is enough to make our product more safe and in terms of responsibility of the online marketplace?
Or should be or something more should be done to ensure a full and satisfactory liability responsibility for online marketplaces for the safety of the product they offer? The second point is cooperation with the national customer authorities. Which room do you see for the commission to coordinate and to ensure a stronger cooperation among national authorities in the relation with third country authorities? I mean, you what do I mean? I mean, trying to have a more coordinated approach as Europeans.
And the last one on the UK. Is there any progress on digital trade regulation and mutual recognition of conforming assessment between us and UK? And do you think that the opening of KeyStarm to a dynamic alignment will be enough to avoid, in the future, potential regulatory divergences in the key sectors? Thank you very much.
Kim Van Sparrentak
Thank you very much. Dear commissioner, we were wondering if you could give us some more details about the EU-US tech dialogue that was announced two weeks ago. Handelsblatt reported it would be a joint committee regarding the implementation of EU digital rules and in antitrust proceedings against US tech companies. The commission spokesperson, however, said it will be a dialogue, and the aim is to reinforce our cooperation on digital technologies and markets, and to clarify misunderstandings. But to me, it sounds like we are further opening the door to regular foreign pressure on the enforcement of our digital rule book.
And let me be clear, only Europe should decide on our own tech rules, how they are implemented, and how and when they are enforced. And the announcement of this so-called tech dialogue coincided with both a visit from US state secretary Helberg to Brussels, where he demanded that the EU cooperates with the US with regards to tech regulation and with the lowering of tariffs on steel, aluminum and copper derivatives, which were hitting German and Italian industry the hardest. So could you first please explain to us how this EU. S. Tech dialogue has been part of the EU-US trade negotiations so far, especially since Commission President von der Leyen and Vice President Verkun have promised multiple times that European digital rules are not up for negotiation.
Because I would think that if it's only to clarify, it should be called a Q and A. Right? Another dialogue. Thank you.
Anna Cavazzini
Thank you so much. The floor is back to you, and we still have 6 MEPs. You have to tell me when to leave. Right?
Maroš Šefčovič
Yeah. You're very kind, madam chair. I got the hint. I should be short in my answers. Thank you for that.
No. I'll do that. I really appreciate it. So I'll start with Sandro, and I know that he has in-depth expertise on UK files. So I will start with his last question.
I think, indeed, the dynamic alignment would be of enormous help, and we very much appreciate that UK government is looking at this possibility favorably because, as you know, we are currently in a full preparation of what I hope will be another successful summit with the UK. We are talking about the SPS agreement. We are talking about an electricity trading agreement. We would like to link up our ETS schemes. And there, of course, the dynamic alignment principle makes the negotiation going swift, and it gives much more a stronger predictability for the business operators from both sides, and it make it much, much simpler.
So that's the approach which we strongly advocate. I'm very happy to say that we are working very intensely with The UK. I hope we would have a good results. And I think if you look at the geopolitical, geoeconomic situation, it's very clear that the strong partnership between India and the UK is something that the world needs. I believe it's something what both of us needs, and I believe what our leaders want us to deliver upon, and we will be working in that direction.
Your second question was about the national customs authorities. So what would be the best focal points or how to work with them more closely? I think and thank you very much for clearly highlighting this to me when I was getting this very important responsibility in this mandate, that what needs to be made very clear is that this has to be a political priority not only for the European Commission, not only for the European Parliament, but also for the national authorities. And you cannot imagine how much time we spent with the ministers who are directly responsible for customs authorities. And in every country, it's a little bit different.
Sometimes these are ministries of finance. Sometimes it's a specific ministry. Sometimes it's somebody else. But we found the people who were direct responsibility for the customs authorities. And I think that makes huge, huge difference because they also have to respond to their citizens what to do with the parcel, how to guarantee the quality of the products which go through the borders, and that makes huge change that they wanted to do this transformation and reform with us.
Therefore, we, I believe, have a very swift process if I compare other trial logs and other processes in the council. The fact that the seat was selected so quickly, and I was part of that very constructive atmosphere working between the co legislator, and I think that was thanks to that political outage, which we would maintain and keep and make sure that all this is properly implemented. If it comes to the deem important, I think this was also one of the ideas which came from the European parliament, and it's very clear that we would clearly proceed with infringement if necessary penalties if there will be systemic failures coming from the deemed importer. And I believe that this is, I would say, a very important step. Let's see, you know, how it would be implemented in practice, but we believe that at this stage, this is, I would say, the best possible step for the future.
To, madam, Kim Transparent. Transparentag, I just would like to reassure you that, what we've been talking about with our American partners, it's indeed digital dialogue. I can only reconfirm for the president of the commission and for my colleague, executive vice president Henna Virkunen, highlighted that our digital laws are not up for negotiation. It's very clear. That was my position throughout the whole process when we have been discussing this with our American counterparts.
But at the same time, I also have to say that what we need sometimes is really to listen to each other because I can tell you that sometimes I was myself surprised what kind of prejudice, misconceptions, and misunderstanding there was on the US side what our digital laws actually do. And in many aspects, like tackling the illegal content, tackling the, let's say, terrorism content, all kinds of nefarious pictures which are appearing on the screens of our children. This is not acceptable for us, and it's not acceptable for them. So we many of these aspects, have the same goals. And, therefore, I think if our experts, because this is what they are talking about, would talk to each other, clarify these things.
I would say that they will realize, in many aspects, have very similar approaches. But we will take our own decision. It's our laws. We have a legislative initiative. You have a legislative power, and this is what will be respected in the US.
You would recall that we had, under the previous administration, trade and technological council. There've been mixed opinion about how efficient this was. So maybe that was one of the ideas which is floating around. But what we are talking about, if I am referring to the digital sector, we are talking about digital dialogue.
Thank you.
Leila Chaibi
Thank you, commissioner. I welcome the inter-institutional results on outcomes on customs reform. But, thank you for what you said about what my colleague, Kim Manzparantak, said. But I wanted details. The press told us that you were traveling to the US in April, so tomorrow.
So this is the only opportunity for us to ask you questions about this trip, and I'm taking the opportunity. The objective of your travel is to put in place the Conservation Council between the EU and the U. S. To negotiate, and you've given us some elements. You said you will not be negotiating our digital legislation with Washington, but every day, Donald Trump is threatening Europe, even threatening the Pope.
So with no mandate from the member states and not wondering about what the EU members of parliament think, you need to understand that we are surprised that you, mister commissioner, have chosen to travel, and this might we might consider this an unacceptable. Now on what legal basis? Are you the commissioner? Or why are you creating this council? And how can we put, give account to us of discussions you will have at this Consolidation Council?
Thank you.
Thank.
Arno Bausemer
thank you very much. I'd like to ask a couple of practical questions. I welcome the fact that we're reacting to the plethora of small packages from China. I'd be interested if we could have different categories and say €3 for each. Now how can we check this?
I mean, whether you can see whether a package contains a cotton T-shirt or a silk jacket or a toy, whatever. Are we actually going to go through every single package? Are we going to rely on the label? Or how are we going to do this? Wouldn't it be easier to do this per package, rather than distinguishing per product group?
And the second question, if this is for two years until July 2028, have we decided what we're going to do after that? If we have a drop in the number of packages, will we then go back to the old rule? Or what is the plan for post 2028?
Maroš Šefčovič
Thank you very much. Madam, just would like to reassure you once again, if it comes to the digital sector, we've just been discussing it with my colleagues, executive vice president Virkonen and River, actually, this Monday. And I fully acknowledge, recognize, and support their portfolio commissioners, for these topics, and we discussed all the details with them. So I'm not going to create any counsel in this regard. We discussed what could be the modalities of the digital dialogues, and these will be the two ladies, my colleagues, commissioners, who would be in charge of managing the digital dialogue with the American counterparts.
Where is the trade dimension coming in? Because as it is right now, the main counterpart for all these questions on the US side is USTR, US trade representative office. But I know that also madam Rivera had very good discussions with the Department of Justice if it comes to the questions of the mergers and acquisitions. And we see it, as I said, as a digital dialogue. So I hope that this would reassure you, and I can tell you that two of my colleagues, executive vice president, myself, we are very vigilant on all these matters?
To mister Bausenet concerning the €33 approach, I think that we have decided for this approach because, to be honest, we had to start somewhere. And this would be an absolutely new situation for our customs authorities, and we need something which would be executable, implementable at this stage. And, therefore, we went for this €3 flat rate per hour time. At the same time, I'm sure that you are well informed that this is a temporary situation for the period 2026 and 2028. And then we hope that by then, our systems would be well prepared for charging normal duty.
So this is kind of start up transition measure, which would allow us to act already in this time until the complete customs code and all the reform which we discussed, would be implemented to the extent that we could go to this normal duty collection for which, of course, we need also the digital platform to be ready to implement also this second phase of customs collection. Thank you.
Anna Cavazzini
Thank you so much, Maroj. Now, yeah, we learned that you have to run. I hope that next time we can have much more of your time, because you see we have a very active committee with a lot of members. To the members for the second round, we just say goodbye to the commissioner, and then, luckily, the director-general stays here. So we have the opportunity to also ask him the specific questions.
But, first technical break, I say goodbye, and then we continue.
Maroš Šefčovič
And you can compare the answers if you are aligned. You know? Thank you so much. Thank you. Thanks.
Have a.
Good time.
Sorry. I mean, I
Anna Cavazzini
Okay. So without further ado, let's continue with the second round of members. We start with Dirk Hoting for the EPP.
Dirk Gotink
Well, thank you, Maroj. Sorry. Yeah. Well, I you can skip me then. No.
It's okay. I didn't, I mean, Jerashimo is like, mean, yeah. Exactly. I mean, I think we'll still have the opportunity to thank everyone involved in the file because there were many, and there were huge amounts of I mean, for me, it was relatively easy. For the people in the technical meeting rooms, it was relatively difficult because it's such a huge file.
So thanks to all the advisers, of course, the EPP, Guerra, but all the others as well. The shadows, of course, you are, you are, we are actually quite united. It's unbelievable. We'll have to see tomorrow, because we vote on it tomorrow. But let's see if we really get the majority from you, Laila, all the way over to here, to Virginie.
And then we show that actually the internal market is a uniting factor in this parliament, which is not always the case in this building. I mentioned, of course, the advisers, but, of course, Elena, Marco, and Juan, you were great. A lot of good work. But, you'll hear this several times still before we get this voted in, July. Yeah.
One thing, Jerasmos, on the money, we intentionally made the scope very large so that you can put a lot of costs in the calculation of what is the handling part of the fee. So that, it gives you a lot of leeway to actually look at what is the real cost because that's a big, big misunderstanding of these low value parcels. They're not low value. They're high cost, and they cost our public authorities a huge amount of money, and we're all paying that in taxes. So, we will be on the money, and we'll be looking also for the next budget.
And I just wanna thank you also for your great help in the whole process.
Anna Cavazzini
Thank you so much. We take one more colleague, Maria Klabini, for s and d.
Well,
Maria Grapini
I have a lot of things to tell the commissioner, but I trust that his colleague will convey the message. And I would like to thank the director for the support offered during the dialogue. I had a meeting today with the European Forum of the Industries, and they raised several issues, including how the customs code will be implemented. I think we have a balanced form of the new regulation, but the problem for me is related to the enforcement. The commissioner was talking about equipment.
We have more than 200 customs points. If we have customs points that are not provided with equipment, then uncontrolled goods will enter the internal market, and it will be a disaster. So we've worked a lot on this regulation, and we should have thought about how we can equip these customs points so that the member states do their job in controlling the goods. On the other hand, when we speak about the package, we're not only talking about the customs code as the magic wand, and I'm sorry that the commissioner is not here with us anymore. The representatives of the industry were referring to key legislative acts such as the regulation on market surveillance, the new legislative package, and also the MFF that should include the right budgets.
Thank you very much.
Thank you.
Anna Cavazzini
So much. Probably, you can have now one round of answers, and then we have another round of MEPs.
Gerassimos Thomas
Thank you very much. And, I want also to thank the staff, my staff that are also sitting over there, but also the cooperation with the parliament staff. And, I think it has been a true good spirit of finding solutions, and moving forward with this important file. I think implementation is key. I think the first part of implementation comes in making sure that this regulation is published as soon as possible.
It is not published now. It will take at least three or four months for a revision of juris linguist. So we need to make sure US parliament and council that they make the necessary, let's say, formal steps so that it is approved, because otherwise, if it's not published, it doesn't apply. The second issue is there is a number of important implementing acts and delegated acts that they have to take place before it is actually enforced. And we plan to work on this very quickly and implementing acts and delegated acts to make sure that the provisions are actually, you know, applied.
I would say that, in the meantime, the current UCC is very vigorously applied. So it's not that we are waiting for the new UCC to come in. It is under the current UCC that we made the priority control area controls on ecommerce, that you have all the results. It is under the current UCC that we made numerous infringements for the first time over the last 3 years. We have not done infringements for the last 50 years, and we made a lot of infringements with member states to make sure that they apply things.
And it is under this commission that we already procured, let's say, a large number, two calls on customs equipment close to 500,000,000 in two calls that we provided customs equipment to member states. Under this UCC and this budget, we will also now launch, later this year, a customs equipment tender. We still have 340,000,000 or so available to proceed with customs equipment now, before the agency is set up and then procures new equipment. So I think it is important that we have not created something that we leave a space. We keep enforcing very rigorously what we have, including spending well the money that we have, including infringements and implementation, so that we make sure at the same time that the regulation and the new agency and data hub take over.
Mhmm.
Dimitris Tsiodras
Yes. Thank you. I'd like to say that the customs union reform is an important step to address the challenges facing the European customers and the businesses. But we need to remember that while some of these e-commerce platforms did not exist a few years ago, they have reached an unprecedented scale. I very much regret the fact that we are not as agile as they are or as we should be.
So I'd like to ask, how can we practically increase the uptake of artificial intelligence to improve national authorities' inspection capabilities, including the scanning and analysis of product listings on ecommerce platforms? And the second question is how does this agreement enable us to effectively tackle the misuse of geographical indications and ensure a level playing field for European producers? Thank you.
Cynthia Ní Mhurchú
Thank you very much, chair, and thank you very much, DG, and taking over for commissioner Sekovich. No, no mean task, but I'm sure you'll be up to the challenge. I just want to in the context of the customs reforms, which are very welcome and obviously going to lead to a stronger internal market, I just want to focus in on the payments method and the fact that the digital euro is coming on stream, and it's going to offer a welcome choice to consumers and indeed, more so businesses, in the European Union. And it'll sit alongside Visa, Mastercard, PayPal, all the existing payment systems. But the question that I had, for the commissioner, no doubt you'll adeptly and ably answer it, is what steps can the commissioner and his department, what steps are you taking to ensure that SMEs, a lot of whom I represent in Ireland South, but I'm talking about European SMEs as well, what steps are you taking to ensure that they are not disproportionately affected with the regulatory requirements associated with the introduction of the digital euro?
And also with regards to consumers, then, my second and final question is for consumers who would like the option of using cash alongside the digital euro or may prefer to continue using cash. Can you provide comfort to them that the digital euro would be complementary to cash, but it won't in any way replace cash payments? Thank you very much.
Anna Cavazzini
Thank you so much. And last but not least, Andreas Schwab for the EPP.
Thank.
Andreas Schwab
Thank you so much, chairman. Generosimos, I do remember that when you came in the last term here to ask us to find a very good team for this proposal to be worked out, we delivered. But I do also remember, chairwoman, that when there were hearings for the new commission, customs didn't play a role. There was no hearing on customs, because the commissioner was brought into other committees, but not to us. So customs, unfortunately, is not as popular in the European politics as today, most people will have the impression here.
And, therefore, I wanted to ask you, paying all the respect to my colleagues that did an amazing job, including the chairwoman, what is the real time frame? Because you were saying now that we are working on it. We are but member states have taken so much time to come to that point that I cannot hide from you that I'm doubtful about this being implemented in the next two years. So can you outline a bit why you are so convinced that it will be implemented with the member states so quickly? Thank you very much.
Gerassimos Thomas
Thank you very much. I will concentrate mainly on the customs issues. I think on the use of on mister Chiodras, I think the whole concept of having a single EU data hub, which will be established by the European customs authority, is precisely to have all the data of what enters the European Union in one place. This data hub will be built with a new concept of a data system, not simple collecting of the national IT systems. And therefore, it will allow and it will be included in the tender for the data hub that it will be published in the next two months.
You know that, we will have the possibility to make the best use of AI in order to do the EU risk analysis. The customs authority will do the data hub, and on the basis of this data, it will do the EU risk analysis. And this will benefit from uptake of artificial intelligence, and I think that is very important not only for, you know, geographical indications and others, but for any kind of compliance, that it is subject to single market authority control. The customs reform, apart from saving money and making from the national authorities, making sure that everybody pays the right tariffs. It is going to facilitate in a key way what is happening with compliance with single market authority tasks.
I remind you that up to fifteen years ago, in the EU, we had only 20 pieces of legislation to control at the border, and now we have 372. So there are all these additional things that they have to control at the border, and it's only feasible if we have a common view of the border. We don't have the national authorities, customs will ensure their enforcement, but at least they have a common view. I think, coming also to Mister Schwab's observation. I mean, the council and the parliament, first of all, in my personal assessment is that it didn't take too long for such a reform.
I think both institutions worked. I would have liked to do everything in one year, but, you know, it was very fast and very efficient. And I think the council and the parliament brought forward the dates of the commission. So we had proposed to 2038 and 2034, and everything was brought forward, including the starting time. We will have a data hub functioning already in 2027.
The member states are working on this. They're enthusiastic about this. I think it is the most important thing not to get into this mentality. The member states co-own somehow this date this European customs authority. They are enthusiastic in doing this, and therefore, it will be done.
Technically, to do one system is possible. We are advancing on this, and therefore, all the legislation we have calculated, we have an action plan on how to do it. It is possible. I think we need to pay emphasis on talking to the clients rather than to the member states, the stakeholders, the customs authorities. We have an important program of engaging more with the public, with the private, importers, and customs agents.
We have done this over the last three years, but now the rules are clear. We can engage with them and say, this will happen. This will not happen. We have planned this together with the member states, and in the parliament it has been taking into account this change management need for the institutions like the customs authorities for the interacting, you know, private sector companies and for all the stakeholders. I think the money as commission, as you put forward the implementation of the customs authority and the data hub two years earlier, we made redeployment and we find the money in this new MFF that's addressing also the comment about the money.
We thought it was very important, so we redeployed internally in the commission the money to start the data hub that it would be built by the commission, and then will be given to the agency. So we don't expect the agency to first set up, and then do the data hub. The data hub will start being built now by the commission, as it is in the regulation, and will be given to the European customs authority. So we have secured the financial resources for this. And in the next MFF, subject to the, let's say, agreement of the budgetary authorities, we have proposed to have a sufficiently large, single market and customs program budget by which we will cover for the next MFF, we will cover the needs of the new European customs authority plus the needs of running the existing systems for another years until they are phased out.
So I think we have in our proposal, we have made a careful assessment. We had to modify a bit the financial requirements to take into account your request to add some more tasks and front-load some of the tasks. We have done it. Luckily, both the parliament and the council have agreed to that, so we have to make sure that we have a final agreement on this. I'm sorry.
On the digital euro that you mentioned, it is a matter, let's say, not directly linked to the customs. Of course, the customs, the importers use any kind of, let's say, payments that are authorized and available, including digital payments from all over the world. It is the nature of customs to make use of all the payments means available. Not necessarily cash when you cash out the customs fees, but, of course, in the other areas, it is fine. Thank you.
Anna Cavazzini
Thank you so much for jumping in and, of course, bringing, like, the bridge from today to tomorrow. Tomorrow, the first item on our agenda is actually the vote on the customs reform. So then we will talk about it again. But, of course, thank you so much for staying here with us, for answering our questions. This concludes the agenda item structure dialogue and also our meeting for today. And see you tomorrow at ten for the vote on the customs reform, and have a very good evening.
Speaker 57
Me too. I wake up also very early somehow, but then a lot of small things. Right? So many small things. I mean, too many.
But he has to do for all the points or only for.
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