Orgalime Annual Report 2011-12

SPEAKING FOREUROPEAN ENGINEERING

ANNUAL REPORT 2011 / 2012

MECHANICAL METALWORKING ELECTRICAL & ELECTRONICS

President’s Message 01

Director General’s Message 04

Board and Policy Committees 07

The Business Situation in 2011 09

Issues 13

Communications 30

Orgalime Publications 32

Orgalime Partnership 35

Members 37

CONTENTS PAGE

PRESIDENT’S MESSAGE PAGE 1

When I spoke about the situation of ourindustry last year in our annual report,I felt that the outlook was not onlybrighter on the economic side, but alsothat with the EU2020 agenda, industrywas back in fashion in Brussels.

This was very important because wecould see quite clearly that we hadreached the situation in Europe wherecompanies were treading a ne lineas they asked themselves that veryquestion.

Where are we today after a year ofgreat uncertainty with the euro and anumber of European countries comingunder attack in the nancial markets?In recent months Europe�s focus hasbeen on re-establishing budgetaryorthodoxy, essentially through theintroduction of austerity measures.Such an approach, while necessary,is to my mind only part of the solution:for austerity to be acceptable tocitizens, it needs to be accompaniedby hopes of better times ahead, whichonly economic growth can provide.And for the time being this growthmust inevitably come from the private

sector. It is therefore time that bothnational governments and the EUinstitutions focus once again on wealthcreation, not only paying lip service tothe concept, with politicians trumpetingabout growth in the media, but takingeffective measures which will achievethis aim.

First and foremost this requires thatwe who work in the private sector,who have the choice as to wherewe site our productive investments,should nd it attractive to invest inthe EU. Europe depends on theinnovative power of its industries bothlarge and small to compete globally,to secure jobs and growth, to meetambitious environmental objectives,and to ensure a healthy economicenvironment for its citizens. Ourindustry, as a key pillar of the economy,has all the assets to help deliver onthese goals.

We therefore nd it very frustratingto see how rarely the word �industry�is mentioned by our political leaders:it was mentioned only once inPresident�s Barroso�s State of the

Union 2011 address and not even asingle time in the statement of themembers of the European Council�Towards growth-friendly consolidationand job friendly growth� in January2012. Industry is not a dirty word! Isit possible that the vision of Europe�sleaders today is of a Europeaneconomy and recovery withoutmanufacturing?

I am not alone in my concerns: just afew days ago a major manufacturerfrom one of our client industriespublished a full page advertisementin a Brussels newspaper with thetitle �Who dares invest in Europe?�where the core comment was thatEurope was not getting the balanceright in terms of setting a realistic anddependable framework for investment.

I would like to stress that we havemany strong points of attraction forinvestors here in Europe: a largeand wealthy market of some 500million consumers, a still extensiveindustrial supply chain, a populationwhich is in general well educated,even if we complain of lack of skilled

Now that demand is picking up again, should we be investing in the EU or outside?

PRESIDENT’S MESSAGE

PRESIDENT’S MESSAGE

personnel, good communication andtelecommunication infrastructures andlast, but not least, excellent researchfacilities and researchers.

What is going wrong then? If much oftoday�s investment is concentrated infast growing markets, as is logical, thisdoes not explain why companies arenow investing more and more outsideEurope to supply their nal productsinto our markets. The answer is quitesimple: the balance is no longer right.It is not so much a question of cost; itis increasingly that companies are nolonger willing to put up with Europegoing on in a �business as usual mode�,with constant chopping and changingof policy and of the regulatoryenvironment. This engenders legaluncertainty and unpredictability whichmanufacturing investors who arelooking at a ten year horizon or evenfurther are not prepared to risk. InEurope, hardly has legislation beenenacted that there is a review andpractically inevitably more legislation,more changes, more administrationand more costs. What policymakersmust realise is that in Europe if we areto get out of the vicious maelstrom ofnancial crisis followed by austerity andyet more austerity, we must once againlearn to woo manufacturing investorsas our competitors in the fast emergingcountries are doing so successfully.

So in the last months of myPresidency of Orgalime, - I amin my third and nal year as yourPresident - I will be concentrating onengaging the institutions to stress

why manufacturing DOES matter toeveryone and why Europe needs to bean attractive part of the globe in whichto invest.

Industry today is not smoke stacksand pollution and we who runcompanies know how substantial theinvestments we have made are toensure that we continuously improvethe environmental impact of ourproducts and our production facilities.And we must never forget that ourindustry alone provides some 10million direct jobs and the employeesof manufacturing companies form thebackbone of the European economy,including also, of the service economy.

Now a nal word on this: some mightwonder if my views are not taintedby the economic outlook or becauseour industry is not doing well. On thecontrary, if for 2012 the outlook ismixed, 2011 was a good year for ourindustry as a whole, with an estimatedrise in output of 7.8% to reach amassive output �1,666 billion. Anexcellent year, where our exports alsogrew by some 12.5% and employmentby nearly 2%. So we can be andare successful as manufacturers inEurope. We are competing with ourinnovative products worldwide. But wealso need a healthy home base closeto our clients so we can develop newand innovative products near them.As the major part of our productionis in the area of capital goods; thismeans that our clients in all othermanufacturing sectors must go oninvesting in Europe. And it is here that

we are disappointed with the growthprospects.

There is of course more to our activitiesthan industrial policy and I hope that inreading this annual report, you will seehow active Orgalime is for its memberson an ever wider range of issues. Forthis I must say a big �thank you� to allour staff here in Brussels and to ourmembers who contribute to makingOrgalime what we are � the primevoice of Europe�s engineering industryas a whole.

It has been a privilege to serve as yourPresident. I wish Orgalime continuedsuccess in the coming years.

RICHARD DICK

WE WHO WORK IN THE PRIVATE SECTOR,WHO HAVE THE CHOICE AS TO WHEREWE SITE OUR PRODUCTIVE INVESTMENTS,SHOULD FIND IT ATTRACTIVE TO INVESTIN THE EU.

DIRECTOR GENERAL’S MESSAGE

DIRECTOR GENERAL’S MESSAGE

This recent change to the statuteshas allowed Orgalime, for the firsttime, to open up its membership baseto the multitude of European SectorAssociations that are active in Brusselsand which are interested in both workingtogether on common issues, but alsosometimes find themselves lacking thepolitical weight that a larger umbrellaassociation such as ours, with strongroots both in Brussels and the capitalsof Europe, can wield. Our aim is to beever more inclusive in our work andthereby to consolidate, wheneverpossible on the many issues that we arefollowing, a common message from ourindustry. Why? Simply to better fulfil ourcore mission: to be the prime voice ofEurope’s engineering industry on corehorizontal issues, affecting a wide rangeof sectors in our industry.

Soon after changing our statutesOrgalime succeeded in attracting twonew members from European sectorassociations in our industry and thenumber is set to grow in the coming year.

In addition, we also continue, besidesour work on issues selected by ourmembers, to service 19 Europeansector associations through the recentlyrenamed Orgalime Partnership (ex-Bridgehead). This also underlines ourlong term commitment to activelypromote, both at a horizontal level,but also by product specific area,the development of the frameworkconditions under which companies canflourish, grow and provide employmentboth today and in the long term asmanufacturers in the EU, and to ensurethat the trading conditions they face arefair, both here and on export markets.

FORTHRIGHT ENGAGEMENT

Over the past 12 months, our Presidentand I have found it more and morenecessary to engage the institutionsin an increasingly direct manner, asboth officials and politicians keep ontalking in abstract terms about growth,without mentioning the words industryor manufacturing. Such an approach

is, in my view completely wrong, asmanufacturing and the jobs we provideshould matter to everyone, and evenmore so today. Europe needs to be anattractive part of the globe in which toinvest. And Industry is not a dirty word!We provide real jobs. It is therefore timethat politicians really made efforts tomake industry feel welcome, not leastby expressing support for the benefitsmanufacturing generates through itsactivity in Europe!

An interesting article in the Economist(March 2012)1 referred to ‘small is notbeautiful’! The article went on to saythat “…Rather than focusing on size,policymakers should look at growth. Oneof the reasons why everyone loves smallfirms is that they create more jobs thanbig ones. But many small businessesstay small indefinitely…Rather thanspooning out subsidies and regulatoryfavours to small firms, governmentsshould concentrate on removing barriersto expansion. In parts of Europe, forexample, small firms are exempted from

Orgalime’s statutes have recently been revised to read as follows: “Orgalime is an association consistingof national associations and European sector associations in the mechanical, electrical, electronic andmetalworking sectors (nongovernmental trade associations) of European countries, which are legal entitiesconstituted in accordance with the law of their country of origin and which are regarded as representative in oneor more of the fields of activity ….. of this industry”.

1. http://www.economist.com/node/21548945?fsrc=scn/tw/te/ar/smallisnotbeautiful

DIRECTOR GENERAL’S MESSAGE PAGE 5

the most burdensome social regulations.This gives them an incentive to staysmall. Far better to repeal burdensomerules for all firms…” And this is reallywhere – on these burdensomeregulations affecting our companies –that day by day the core of our work lies.

And I hope to be reinforcing our work inthis area, since in January 2012, I alsoassumed the chairmanship of the Alliancefor a Competitive European Industry(ACEI) for the next two years. The Alliancerepresents the interests of 11 majorbranch associations and BusinessEuropefor their common messages, essentiallyin the area of industrial and energy policyand better regulation.

ISSUES

Industrial policy remains at the forefrontof Orgalime’s work at the sectoral leveltoo: this year has been the turn of theelectrical and electronics industry withour follow-up to the Electra report,‘The Smart World’ (launched in April2012) and of mechanical engineeringwhere we have been working with theEuropean Commission to complete areview of the industry which examinesin some depth how the economic crisishas impacted business, how the worldmarkets are shaping before drawingsome conclusions. We will be followingup on both of these over the coming yearas we seek to shape the industrial policyagenda in the EU.

2011 has also been a year for workingon several of the EU’s long termprogrammes since the European

Commission published its proposal forHorizon 2020, the new R&D frameworkprogramme that will succeed FrameworkProgramme 7 and merge otherexisting initiatives into one integratedresearch development and innovationprogramme for the period from 2014 to2020. As might be expected, Orgalimehas been pushing for more focus onthe two programme areas which aremost relevant to the competitivenessof our industry – ‘Creating industrialleadership and competitive frameworks’and ‘Tackling societal challenges’; it isour industry which will provide many ofthe solutions through the technologies,equipment and systems that ourcompanies offer. Given our interest inthese issues, Orgalime has becomemore involved in our industry’s researchassociation EFFRA, where we havenow taken over the management of theassociation. EFFRA at present poolsthe expertise of members to provideprogramming input for the allocation ofsome €600 million of public money forindustry-relevant projects in the area ofproduction technologies.

On the internal market policy andlegislation front, this last year has beena very active one as the Commissionlaunched its proposal to revise thelegislative framework governingstandardisation activities in support ofregulation and the so-called “alignmentpackage” which aims to bring 9directives into line with the recentlyadopted New Legislative Framework.We have also worked on trying toensure that legislation is better appliedin the EU: it is already difficult enough

for manufacturers to apply the massof European regulation affecting theirproducts and processes without havingto deal with non-compliant competitorson their home markets, that not onlycompete unfairly here but also, becauseof the risks which often arise from suchproducts, inevitably tempt regulators toadd yet more layers of regulation, ratherthan reinforcing market surveillance.

This is an issue on which we havebeen working for a number of yearsand which now is clearly rising on thepolitical agenda following our requestto Commission Vice President Tajanito become more active in this area forwhich we organised a joint workshopduring the year.

Our environment team too have beenbusy, concluding work on the recastsof WEEE and RoHS Directives, as wellas engaging the hot issue of the EnergyEfficiency Directive where, I was happyto see, a number of our positions havebeen taken up in the Commission’sproposal. We are however seeing astrong resistance by many nationalgovernments to proposals which seekto speed up the uptake of energyefficiency measures and technologies;once again it seems that governments,while they are happy to impose burdenson our manufacturers through enactingEco design regulation, are unwilling tofacilitate the introduction of the newtechnologies so developed by openingup markets for them in Europe… Now,in addition, in yet another change offocus, resource efficiency has emergedas a priority issue. After discussingthe issue with Commissioner for the

Environment Janez Potocnik at ourPresidents’ Board in September, wepursued our discussions in Octoberin the European Parliament in theEuropean Forum for Manufacturing’sroundtable on ‘Resource & EnergyEfficiency in Manufacturing’. The eventwhich was co-hosted by Paul RübigMEP and Maria Da Graça CarvalhoMEP, both on the Industry, Researchand Energy Committee was alsoattended by Karl Falkenberg, DirectorGeneral DG Environment, who made akeynote speech on the Commission’s inthis area. A number of MEPs also madecontributions on a range of subjects.

On the energy side, besides ourongoing policy work, we continue to beactive in the Commission’s smart gridstask force, as well as on the issue ofe-mobility, for which we organised anevent at which Heinz Zourek, DirectorGeneral of DG Enterprise and Industry,was the keynote speaker and duringwhich we sought to highlight the centralrole that electrical infrastructures(integrated into the smart grid) will playto develop the market for e-mobility inthe EU.

Trade issues, as usual were on ouragenda, with our focus essentially beingon the ongoing negotiations on differentbilateral free trade agreements. Thisyear, moreover, we also looked furtherafield, delving into the area of productcertification in the US where ourmembership has for a long time beencomplaining about the non-competitivecharacter of the US certification market,which is dominated by a single certifier

for a range of products made by ourindustry.

To conclude then, Orgalime’s work isboth diverse in its nature, but at thesame time focused on the core issueswhich affect our companies. As such,we are more than ever a key playerin Brussels, working closely with theEuropean institutions and other partnersto promote a future for our industrieshere in the EU while seeking also throughour approach in the policy area to try tofoster the conditions which will allow ourindustry to maintain its world leadershipin so many areas of technology. Our aimis simple: to ensure that the voice of theEU’s engineering industry, the largestmanufacturing sector in Europe, is clearlyheard in Brussels and the Europeancapitals alike.

ADRIAN HARRIS

INGE DEWIT VANHAELEN JO DECALUWE

PAGE 6 DIRECTOR GENERAL’S MESSAGE

In 2011 (In 2010)

Output €1,666 billion (€1,545 billion)

Employment 10.2 million (9.7 million)

Exports €519 billion (€462 billion)

FixedInvestment

€52 billion (€46.5 billion)

EUROPEAN ENGINEERING SNAPSHOT

BOARD AND POLICY COMMITTEES PAGE 7

MR. KLAUS MITTELBACH (ZVEI – GERMANY) – CHAIRMAN

MR. GUIDO BIESSEN (FME/CWM – NL) – VICE CHAIRMAN

MR. BERNDT-THOMAS KRAFFT (FMMI – AUSTRIA)PAST CHAIRMAN

MR. PAUL SOETE (AGORIA – BELGIUM)

MR. JOÃO REIS (ANEMM – PORTUGAL)

MR. ANDREA ORLANDO (ANIMA – ITALY)

MR. HOWARD PORTER (BEAMA – UK)

MR. THOMAS BUSTRUP (DI – DENMARK)

MR. ERIC JOURDE (FIEEC – FRANCE)

MR. JANEZ RENKO (GZS MPIA – SLOVENIA)

MRS. MARIA SANDQVIST (TEKNIKFÖRETAGEN – SWEDEN)

MR. HANNES HESSE (VDMA – GERMANY)

“The past 12 months has seen, not surprisingly, Europe’s focus on re-establishing some stability in the euro area.Our industry has on the whole done well in the past year, far outperforming most other industrial sectors as ourexport markets grew. It is now time, however, to focus on providing the conditions for growth here in the EU.”

Klaus MITTELBACH, Chairman of Orgalime

BOARD AND POLICY COMMITTEES

BOARD OF DIRECTORS

MALC

“MALC activities continued to be focused on disseminating thestudy on the metal articles and metalworking, monitoring thesteel market, participating in conferences on subcontractingindustries both at national and European level”.

Maria SANDQVIST, Teknikföretagen, Chairman of MALC

Most of the MALC activities related to specific directiveswere dealt with in the various dedicated task forces.

BOARD AND POLICY COMMITTEES

CEEI

MELC

“The Electrical & Electronics industries throughout Europe can becollectively proud as the Electra ‘follow-up’ report, “The SmartWorld – Making Europe smarter and more competitive; Solutionsproposed by Europe’s electrical engineering industries”, hitsthe streets in April 2012. Policymakers and industry need tocontinue working closely during the forthcoming years in orderto ‘smarten’ Europe’s approach. It seems unrealistic to be ‘lost’with all the ‘roadmaps’ now published”.

Eric JOURDE, FIEEC, Chairman of CEEI

The European electro-technical and electronics industry isa key partner to the European Union for achieving its goalsbecause it is this industry that produces the technologiesneeded to make Europe ‘smarter’.

“Orgalime are delighted that the Study on the Competitivenessof the EU Mechanical Engineering Industry which was issuedin December recognises the dynamism of the industry whichhas maintained its share of global markets in the face of everstronger international competition, in particular from China.Europe still leads in the area of technology and performance inmechanical engineering and we appreciate the growing and evermore practical support of the EU institutions in the area of R&D.”

Andrea ORLANDO, ANIMA, Chairman of MELC

The mechanical engineering industry is an enabling industryof outstanding importance for the manufacturing processand all other industry sectors in Europe. It is highly innovativeand its R&D intensity is often underestimated. Furthermore,mechanical engineering industries are crucial for climatechange policies.

THE BUSINESS SITUATION IN 2011 PAGE 9

INTRODUCTION

Orgalime’s economists compile andanalyse their latest data and forecastsfor the engineering industry twicea year. Economic trends for metalproducts, mechanical engineering,electrical engineering, electronics andICT and instruments which are mainlyin chapters 25 to 28 of the NACE rev.2 nomenclature are analysed andcommented upon. Figures for repairand installation services (Chapter 33)which are also provided by the industryare included in the totals.

Based on official data available up tothe end of March 2012 we estimatethe engineering industry’s value ofproduction in EU27 to have reachedsome €1,545 billion in 2010. Thenumber employed stood at about 10.2million people, of which some 1.2 millionwere in repair and installation services.

The engineering industry, whichOrgalime represents as a whole at thelevel of the EU, counts for some 28%of the output and a third of the exportsof the EU manufacturing industries.Total trade (intra + extra trade) of theOrgalime industry increased from €981billion in 2009 to €1,150 billion in 2010.

2011: A GRADUAL DECELERATIONTHROUGHOUT THE YEAR AS ACONSEQUENCE OF EMU FINANCIAL WOES

As the industry entered 2011, it wasagainst the background of a strongrecovery during 2010 that followed thesevere recession of 2009. Confidenceindicators in the investment goodsindustry showed a high level ofconfidence in the EU. Order stockswere generally assessed as slightlyabove normal and production expandedat a double digit rate in some sub-sectors.

UNTIL MID-2011: AS STRONG GROWTHRATES AS IN 2010

The first half year showed that the rate ofexpansion was particularly strong and atabout the same high rate as in 2010, thatis some 10.4%.

However, by mid-2011 economicturbulence started to shape economicactivity: in some countries within thecurrency union the economy contracted,whereas in other countries the economyexpanded way below potential. Thereforethe level of production in the industrygrew only modestly or even fell in somesectors and countries during the secondhalf of 2011. Production in Orgalimeindustries decelerated to 5.3% in thesecond half of 2011 resulting in an overallaverage growth rate of 7.8% in 2011.

DRIVEN BY EXPORTS

Growth in worldwide GDP and industrialproduction was relatively strong during2011. According to the IMF, world GDPexpanded by a healthy 3.8% in 2011.Whereas growth economies, suchas some countries in Asia and LatinAmerica, showed a rapid expansion oftheir economies, growth in the EU wasrelatively weak, with an estimated 1.6%increase of output. As in previous yearsthe expansion of Orgalime industries’exports was mainly driven by sales to thegrowth economies in 2011.

THE BUSINESS SITUATION IN 2011

ORGALIME Sectors 2011 Percentage changein volume of production

Metal Products +6.9

Mechanical Engineering +11.7

Electrical/ Electronics, Instruments, ICT and installation* +5.5

Total Orgalime industries +7.8

AN OVERVIEW OF SECTOR PERFORMANCE IN 2011

THE BUSINESS SITUATION IN 2011

Overall intra EU trade grew by a modest5.1%, whereas extra EU exportsincreased by an impressive 12.5%.

ELECTRICAL, ELECTRONICS ANDINSTRUMENT INDUSTRIES

The electrical, electronics, ICT andinstrument industry is amongst thelargest industrial sectors in Europe. Thevalue of production in 2010 is estimatedto have reached €500 billion and thesector employed an estimated 2.6million people.

SITUATION IN ELECTRICAL ENGINEERINGSUBSECTORSIf this branch of the industry grew byan estimated 5.5% in 2011, there weresignificant variations between differentsubsectors.

The volume of production of electricalengineering equipment increased by4.6% in 2011. This was a decelerationafter the strong expansion of 11.4%in the year 2010. The sub sector of

motors, generators and transformersperformed well, but at a considerablylower rate of expansion than in2010. Growth rates fell in all othersub-sectors with the rate of growthturning negative in manufacturingof domestic appliances. This was aresult of low consumer confidence,rising unemployment and housingexpenditure at a very low level.

ICT ALSO SHOWED RECOVERYBusiness activity overall alsodecelerated in the ICT industry.But the business situation varied fromone sector to the other. Productionincreased at a historically high rateof 20% in volume for electroniccomponents. Production of computerhardware grew at a higher ratecompared to 2010, whereas consumerelectronics failed to grow and showedan unchanged production level.

Production in instrument engineeringfor testing and measuring, which ishighly dependent on overall global

manufacturing activity increased atabout the same rate as in 2010, that isby some 7.5%.

MECHANICAL ENGINEERING INDUSTRY

The European mechanical engineeringindustry’s value of production isestimated to have reached €500 billionin 2010. Employment in the sector isestimated at 2.8 million employees.

SECOND YEAR OF DOUBLE DIGITGROWTH DESPITE A GRADUALSLOWDOWN IN EU GROWTHThe international recovery continuedduring 2011, with world GDP and worldgross fixed investment both growingat a healthy rate. There was however atendency for a slowdown in the secondhalf of 2011.

Growth of fixed investment in the EUpeaked already in the second quarter of2011 and fell slightly thereafter. Due tosharp differences in demand betweenEuropean countries, fixed investment in theEU grew only by a modest 3.2% in 2011.

Demand developed better on othermarkets, in particular emerging markets,the US and Japan, where the “technicalrecovery” after the natural disaster in thefirst half of the year created demand.

Although growth in overall fixedinvestment was only modest, demandfor industrial machinery grew at a higherrate both in Europe and in the rest ofthe world. This is due to the fact thatmachinery and equipment industriesproduce, to a large extent, products forother manufacturing industries.

As a consequence, production inEurope’s machinery and equipmentindustry grew by an impressive 11.7% involume during 2011, a growth rate whichtopped the rise of 10.2% in 2010.

ACCELERATION IN ALL MAJORSUB- SUBSECTORSAll sub-sectors in mechanicalengineering saw their business expandin 2011. Double digit growth rates wereachieved in all major sectors apart from“other general purpose machinery”.Business for machine-tools also pickedup sharply, with production increasing byover 20%, which is a result of the severeslump in 2009 and the moderate pick upin 2010.

INDUSTRY OF FABRICATED METALPRODUCTS

The industry covers a wide range of finalproducts including tools and finishedmetal goods (accounting for some40% of production), castings, forgings,boilers and metal containers, as well assecondary transformation on contractbasis, such as treatment and coating ofmetals. The value of production for thesector in the year 2010 is estimated at€420 billion. The number of employees isestimated at some 3.6 million.

The industry produces, to a large extent,inputs or products used in other sectorsin engineering, such as machineryand the automotive industry. As statedabove, demand from the machineryand the European automotive industrieswas strong in 2011. As a result, outputfor metal goods is estimated to have

increased by 6.9% overall during 2011 atthe same rate as the year before.Heavy structural metal products grewmodestly after two earlier years ofcontraction. The other major metalproduct sectors namely “forging,pressing, stamping” and “treatment& coating” grew by 14% and 7.5%respectively.

INVESTMENT AND EMPLOYMENT PICKEDUP IN ORGALIME INDUSTRIES

With higher utilisation of capacity,improved profits and solid growth ofproduction, investment started to growmore substantially in 2011 compared tothe modest expansion of 2.5% in volumein 2010. Overall fixed investment in theindustry grew by 12% in volume in 2011.

After a decrease in 2010,notwithstanding substantial gains inproductivity, employment started togrow again in 2011. It is estimated thatemployment increased overall by 1.8%in 2011, with variations between thedifferent branches of the industry. .Companies in some countries started toreport once again that finding sufficientskilled staff was once again proving to bea challenge.

THE GENERAL OUTLOOK FOR 2012

A sharp deceleration of growth, butan improvement is expected in thesecond half of 2012

Business activity in Orgalime’s industryhas gradually slowed in the last sixmonths and the level of production has

stabilised since August 2011: indicationsare that this is due both to a slowdown ininvestment in some growth economieson which the industry depends heavily,as well as to rather limited investment bythe industry’s clients in Europe, both atthe level of capital goods and consumergoods: it is becoming increasingly clearthat the EU’s “growth strategy” is nothaving the desired impact on industrialinvestment, with many companiesworried that the investment climate inEurope is not supportive of industrialinvestment because of increasinglyunstable and unpredictable frameworkconditions.

Based on official data and businesscycle indicators for Orgalime’s industryin early 2012, we expect that animprovement will take place during thesecond half of the year.

Short term indicators, such as thepurchasing managers index orforward looking surveys such as IFOexpectations and global leading indicatorshow a slightly stronger outcome thanlate last year. However, the heavilycyclical machinery industry will enter theordinary period of slow expansion aftertwo successful years.

Orgalime economists expect anincrease in volume of production in 2012by about 1.3%, a rate which almostachieves the long-term average growthin Orgalime industries. In order to keepup with international productivity growth,employment in the industry is forecast toremain unchanged.

THE BUSINESS SITUATION IN 2011 PAGE 11

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ISSUES PAGE 13

ELECTRICAL ENGINEERING ANDELECTRONICS: ELECTRA

In June 2008 the Electra report waslaunched. Its aim was to determine whatconditions needed to be met to ensurethat the EU’s electrical engineering andelectronics industry, one of Europe’sleading manufacturing and exportsectors, with an output in 2006 of some€320 billion and employing some 2.8million people, should continue to grow,and at an even higher rate. Written bya team of experts from the electrical

and electronics industry, CENELEC,the European Commission and theEuropean Metalworkers’ Federationunder the joint chairmanship of Mr.Günter Verheugen, Vice-President of theEuropean Commission and Pr. EdwardG. Krubasik, former President ofOrgalime, the Electra report was cited inthe conclusions of the CompetitivenessCouncil of May 2009 and, at the end ofOctober in the same year, the EuropeanCommission issued a Communication‘Electra’ (COM(2009)594 final).

Now, with a follow-up Electra report‘The Smart World’, launched inHannover this year, the electricalengineering and electronics industryrepresented through Electra aims to:— Briefly analyse the results of the first

Electra report, looking at those areaswhere progress has been achievedand at those where more needs tobe done.

— Outline the changes that have arisenfollowing the 2008-2009 economiccrash, as well as the impact of this

INDUSTRIAL POLICY

In 2011/12 Orgalime published a total of 32 position papers complemented by a large number of letters andworking papers covering a broad range of topics ranging from industrial policy, to sustainable consumption& production, from resource efficiency to trade issues, from technical issues to horizontal regulatory andinstitutional issues. As usual, our positions were circulated to the widest audience possible including theEU institutions, national authorities (via our members’ network) and European-wide media. All these canof course be retrieved from the Orgalime website at www.orgalime.org

PIERRE LUCASADRIAN HARRIS

ISSUES

AGNES POTOCNIK ELEONORA PICCINNI

ISSUES

on Europe’s electrical and electronicsindustry.

— Re-examine the challenges atsocietal level that Europe facestoday and present proposals whichare both supportive of Europeanpolicies and ensure that the industrycontinues to grow and invest inEurope, in short making Europesmarter and more competitive.

MECHANICAL ENGINEERING – STUDYREPORT PUBLISHED

In February 2012, the final report of astudy commissioned by the EuropeanCommission on the Competitivenessof the EU Mechanical EngineeringIndustry was published. The terms ofreference called for the study to assesschanges in the competitiveness of theindustry over recent years following theeconomic crash. The study investigatedthe strengths and weaknesses of theindustry, as well as looking at frameworkconditions in the EU to identifyopportunities and threats, thereby tyinginto the Commission’s industrial policyagenda outlined for the years to 2020.

Orgalime and its mechanical engineeringmembers and European SectorAssociation partners worked hard tocontribute to the study and to raisethe profile of this successful sector ofour industry. This was highlighted byEuropean Commission Vice PresidentAntonio Tajani, responsible for Industryand Entrepreneurship, who said: “Thestrong international performance of theEU mechanical engineering industryhas turned out to be an asset for the

EU in the era of globalisation. It isthe proof that successful industrialproduction in Europe is possible. Ifinnovation, productivity, export andcustomer orientation, creativity andentrepreneurship come together witha well-functioning internal market,industrial production has a brightfuture in Europe. Considering Europe’sstrengths, we can bring Europe back ona sustainable growth path. This is notwishful thinking, it can be done.”

Orgalime (along with the 10 EuropeanSector Associations involved) are nowworking on the follow-up to the report soas to push for the implementation of theindustry’s recommendations. Amongthose already taken while the reportwas drafted was a workshop on marketsurveillance, one of the most pressingissues the engineering industry wantsto act upon. Work on the follow up willtherefore continue throughout 2012.

E-VEHICLE INFRASTRUCTURE – NOT JUSTABOUT THE VEHICLE

Out of the first Electra report and theCommission’s follow up Communicationcame a focus on e-mobility. Orgalimehas therefore worked on this throughoutthe year, issuing a position paper onthe issue of “integrating e-vehicles intomodern infrastructures”.

This position was launched at an eventhosted by Orgalime in November 2011which was attended by some 150participants. Orgalime’s aim was tohighlight to regulators that the Europeanengineering industries represented by

Orgalime, are the only industrial sectorpossessing system level expertise inall parts of the system chain – frompower generation and the transportand distribution of electric power, tothe control and drive elements fitted tovehicles. Orgalime in its position paperstressed that the electric vehicle is partof the new world of energy and thatthe associated charging and supportinfrastructure are an integral part of thiswhole system. It is in this area that newdevelopments and opportunities existfor modern European infrastructuresand service markets.

A further area of focus was to highlightthat if, at present, EU regulation forelectrical installations in buildings havebrought electric safety to a very highlevel, this must not be undermined bythe introduction of e-vehicles. Managedcharging processes (smart charging)are a must – charging an electricalvehicle is like any other electrical load onthe grids, but given its impact will needto be managed, including to favourcharging when “greenest” and cheapestelectricity is available.

During the year, Orgalime alsoprovided input on these issues in theCARS21 high level group set up by theCommission with the automotive sectorand will therefore no doubt continue in2012 to work on this issue as part of ouroverall work on energy infrastructures:indeed, Orgalime has also continuedits work on smart grids where we areactive in the Commission’s Smart GridsTask Force, with a view to promotingthe development of Europe’s smartgrids infrastructure.

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STANDARDISATION PACKAGE

There has been much activity in the areaof standardisation during the period ofthis annual report. And indeed, Orgalimehas a good deal to be happy about.Lara Comi MEP produced a report onthe Commission Proposal of a draftRegulation on European standardisation(01/06/2011) which was approved inMarch 2012 by the European Parliament’sInternal Market Committee (IMCO).Overall, Orgalime welcomed the reportwhich echoed many of the concernsexpressed in the Orgalime positionspublished in 2011 & 2012. Essentially,the outcome of the vote was positive forOrgalime, whose efforts are now focusingon the European Council to retain thesepositive changes to the Commissionproposal including in particular:— The acknowledgement of

standardisation as voluntary andmarket driven.

— The invitation to national standardsorganisations to encourage SMEparticipation at national level.

— The call to member states to involvetheir authorities in standardisation work.

— The rejection of voting or veto rights

which were called for by somesocietal stakeholders.

— The introduction of an obligation forthe Commission to notify Europeanbusiness federations and ‘all relevantstakeholders’ to ensure the marketrelevance of draft EC standardisationmandates.

— The request to member states toprovide a detailed justification andevidence if they challenge an adoptedharmonised standard.

The European Parliament is now in formalnegotiations with the Council, which isexpected to reach a political agreementby the end of May. If all the 3 institutionsmanage to come to an agreementbefore the summer break, theRegulation on European standardisationcould be formally adopted by mid-Julyand we will therefore be following up onimplementation in the coming months.

NEW LEGISLATIVE FRAMEWORK –EUROPEAN PARLIAMENT PROGRESSESCAREFULLY WITH ALIGNMENT PACKAGE

Work is progressing on theCommission’s 1400 page proposal

to align 9 directives with the NewLegislative Framework. It is foreseenthat the report will be discussed in Julyin the European Parliament and, if thepackage, which is designed to be apure alignment to the New LegislativeFramework, is followed, we can expectan adoption in first reading before theend of 2012 by both the Parliamentand the Council. Meanwhile Orgalimetechnical groups and task forcesscrutinised the directives of relevance toour industry and detected 2 horizontalissues, which would need furtherclarification:— There are worries about the proposed

formulation of the distributors’obligation of due diligence, whichshould refer in all the 9 Directives to therequirements applicable at the time ofthe first making available (= placing onthe market) of their products in stock.

— Industry is also concerned by therequirement of drafting a singledeclaration of conformity for alllegislation that applies to the verysame product whilst at the same timekeeping it up to date.

INTERNAL MARKET AND STANDARDISATION

DELPHINE ENGLEBERTPHILIPPE PORTALIER ELEONORA PICCINNI EFTHYMIA NTIVI

ISSUES

Therefore, Orgalime is urging theCommission for a prompt revision of theguidance document on New Approachtype legislation, known as the “BlueGuide”, which could prevent divergentinterpretations of the obligations of variouseconomic operators under the 9 recastdirectives and others to come.

Furthermore, Orgalime proposed somechanges that are specific to some of theDirectives, where the alignment is goingbeyond the requirements suggestedin the model (Decision 768/2008/EC).In some other cases, the alignmentinduces a change to the scope or to theconformity assessment procedures ofone or the other Directives, whereas this issimply not the purpose of the alignment.Whether on European standardisationpolicy or on the Alignment Package,Orgalime has co-ordinated its viewswith BusinessEurope, Eurocommerce,and different European SectorAssociations of our industry to ensure thebroadest consistency of industry interests.We will continue following this closelyin the coming months.

A SINGLE MARKET SURVEILLANCE SYSTEMFOR ALL PRODUCTS?

Building on the own initiative report ofthe European Parliament (02/2011) onmarket surveillance and the revision ofthe General Product Safety Directive(GPSD), the European Commissionenvisages setting up a single legislativeinstrument for the market surveillanceof all products. The GPSD would berevised accordingly to align with theNew Legislative Framework.

RAPEX and other tools for the marketsurveillance of consumer products wouldbe incorporated into a separate legaltext, probably an EU Regulation, whichwould cover all (non-food) productsmade available on the internal market,regardless of whether they are intendedor likely to be used by consumers or not.In addition, the Commission is preparinga multi-annual plan which would co-ordinate at EU level, national marketsurveillance activities with the supportof a market surveillance coordinationbody. Aligning penalties across the EUin case of non-compliance is also underdiscussion. If the Commission managesto draft a concrete proposal alongthese lines, it will come close to the jointOrgalime-ANEC request (joint positionissued April 2009) for a “co-ordinatedapproach to market surveillance, basedon available harmonised Europeanstandards (EN), for evaluating the risksto the safety of consumers and otherusers, to the environment or to anothercore community interest specified inEuropean legislation”.

While this envisaged “Safety and marketsurveillance package” entails severalpositive aspects, it also raises someconcerns. For example, the announcedalignment of the GPSD provisions withthe New Legislative Framework, forexample on the traceability of marketoperators, would lead to obligationsthat may not be commensurate withthe intended use of the product undernormal conditions and the residualrisk that is attached to it. Orgalimeis wary about a growingly complexlegislative framework, which is leadingto rocketing compliance costs for lawful

manufacturers, while member statesdo not give any signs, especially in thecontext of a sluggish economic recovery,that they will step up their enforcementduties and means. ThereforeOrgalime is scrutinising the EuropeanCommission plans and is calling morethan ever for simplifying the legislativeframework conditions, so as to simplifycompliance procedures and facilitatetheir application, thereby reducing theabsurd competitive advantage that theauthorities’ inertia is de facto grantingto non-compliant operators over thoserespecting European legislation.

Although there is no clear timeline set,Orgalime is preparing input for the impactassessment and the drafting of theCommission proposal, which is expectedat the end of 2012 at the earliest.

MECHANICAL ENGINEERING –CONFERENCE ON MARKET SURVEILLANCEAND MACHINERY

In November 2011, the Enterprise andIndustry Directorate General of EuropeanCommission organised a conferenceon ‘Market Surveillance and Machinery’which focused on market surveillance inthe machinery sector. The conferenceattracted over 200 participants fromindustry, the European Institutions,member state market surveillance andcustoms authorities and others.

European machinery manufacturersexplained how market surveillanceimpacts on key aspects of their business(competitiveness, safety, innovation,employment, etc.); deficiencies andpossible solutions were discussed.

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Following interventions from the EuropeanCommission and European Parliament,the conference also saw the official launchof the Market Surveillance Industry’sSupport Platform2, a joint initiative of 7trade associations from the machineryindustry, including Orgalime. The platformwill provide technical assistance forcompliance assessment through a singlepoint of access for market surveillanceauthorities and market operators(importers, distributors, purchasers). Thelaunch was preceded with the signatureof a manifesto3 on 10 key actions foreffective market surveillance. The successof the event clearly demonstrated theimportance that manufacturers attach tothis issue. Orgalime is now working withindustry sectors and the institutions toensure an effective follow up.

EUROPEAN COMMISSION PROPOSAL ONTHE PRESSURE EQUIPMENT DIRECTIVE(PED) RECAST DELAYED

The long awaited alignment of the then10 Directives with the New LegislativeFramework arrived in November 2011bearing a small surprise: the proposalsfor the alignment and recast of theDirectives were only 9, as no proposalhas been submitted for the PressureEquipment Directive (97/23/EC). TheEuropean Commission indeed putforward the fact that Article 9 of theDirective had first to be aligned withthe CLP (Classification, Labelling andPackaging) Regulation 1272/2088which in turn will replace legislation ondangerous substances and mixtures.Therefore, the alignment with the NewLegislative Framework could only take

place when an impact assessmentwill be carried out on the alignmentof the PED with the CLP Regulation.Orgalime reacted to this nonalignmentby writing a letter to the Commissionraising its concerns on this situation.In the meantime, the Commissionhas appointed a consultant to carryout a study on the evaluation of PEDto which Orgalime members willcontribute. The focus of the study ison trying to understand the pressureequipment market in Europe and identifythe main trends in the internationaltrade, to outline the difficulties inimplementing the directives, to providerecommendations to improve theeffectiveness of the directive, etc.This issue will continue to be on ouragenda for the coming year.

GAS APPLIANCES DIRECTIVE (GAD) – SLOWPROGRESS WITH THE EC PROPOSAL

After more than two years working ina Commission ad hoc group (in whichOrgalime has a seat) on the new termsof a revision for the Gas AppliancesDirective (GAD), the EuropeanCommission finally launched a publicconsultation on the revision at the endof 2011. Before this, Orgalime hadcontributed a position paper in June2011. The main issues of the publicconsultation to which stakeholders couldcontribute focused on the following:— Alignment of the GAD with the New

Legislative Framework.— Clarification of the current provisions

of the GAD.— Modification of the scope of the GAD

and of the essential requirements.

Orgalime finalised its contribution to theon-line consultation in March 2012.In parallel, the European Commissionhas also appointed a consultant to carryout an impact assessment study on therevision of the directive and Orgalimeis answering a questionnaire draftedby the consultant. The Commissionproposal for a revision of the GasAppliances Directive should be ready inthe first quarter of 2013. Orgalime willfollow the draft proposal through thedifferent legislative phases.

ORGALIME ISSUE A POSITIONCONCERNING THE MARINE EQUIPMENTDIRECTIVE (MED)

Orgalime has been active for anumber of years in the follow up of theimplementation of the ATEX (ExplosiveAtmosphere) Directive 94/9/EC and feltcompelled to comment on the issue ofoverlap between the Marine EquipmentDirective which defines the requirementsfor equipment to be used on board ofa vessel registered within the EuropeanCommunity.

The constructional requirements forexplosion protected equipment at seaare generally the same as onshore.This is illustrated by reference tothe same or very similar standardsharmonised under the ATEX Directive.Many products are used offshore andonshore, thus requiring certificationunder the ATEX and MED Directives,which leads to excessive complications,as it is incomprehensible andeconomically unviable to apply differentstandards for equipment with the samesafety objective.

2. http://machinery-surveillance.eu/3. http://machinery-surveillance.eu/page/manifesto

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TRADE

ŽELJKO PAZIN

FREE TRADE AGREEMENT – FIRSTAGREEMENT IN FORCE, MANY TO FOLLOW

On 1 July 2011 the EU – South KoreaFree Trade Agreement entered intoforce. The agreement was the resultof 8 rounds of negotiations and aimsto liberalise the trade of goods andservices as well as improve investmentconditions. After the first three monthsfollowing its entry into force, theCommission and industry examinedthe first estimates and benefitsbrought by the Agreement. EU TradeCommissioner De Gucht presented thefirst results at the EU-Korea Octobertrade committee held in Seoul. Thesefigures showed an increase in bilateraltrade and, for the first time in the last10 years, the European Union posteda trade surplus with Korea. However,such statistics need to be furtheranalysed before conclusions on tradewithin the engineering sector can bedrawn.

The Commission is currently negotiatingfurther bilateral and multilateralagreements with trading partners that

include Canada, India, Singapore, aswell as Mercosur countries. Moreover,in December 2011, the EU ForeignAffairs Council authorised the openingof trade negotiations with Egypt,Jordan, Morocco and Tunisia, all ofwhich are WTO members, and togetherconstitute a market of more than 120million people with a combined grossdomestic product of nearly €200billion. Following this decision, theCommission could start negotiationsto establish Deep and ComprehensiveFree Trade Areas (DCFTAs) that willcover all regulatory issues relevant totrade, such as investment protectionand public procurement. The aim of theCommission is to offer Egypt, Jordan,Morocco and Tunisia progressiveeconomic integration into the EU singlemarket and to improve the conditionsfor market access to the EU and to theinvestment climate.

As Europe’s leading export industry,we will be following progress on theseagreements closely.

RECAST OF THE MODERNISED CUSTOMSCODE (MCC) TAKES INDUSTRY BYSURPRISE

In February 2012, somewhat to thesurprise of industry experts, theCommission issued a proposal for aRegulation of the European Parliamentand of the Council laying down theUnion Customs Code (UCC). The aim ofthe proposal is to amend the Regulation(EC) 450/2008 (Modernised CustomsCode (MCC)) before it becomesapplicable, and to adjust someprovisions of the MCC which are nolonger in line with changes introducedsince 2008. One of the major changesin the recast is the introduction ofdelegated and implementing acts,following the Lisbon Treaty. Theproposal is now under scrutiny ofthe European Parliament and theCouncil, and Orgalime, which has beencollecting feedback and commentsfrom members on the 250 page longrecast document, will follow progress ofthis proposal in the regulatory process.

JACKIE ANDRÉPAULINA MARCICKIEWICZ

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NON-PREFERENTIAL RULES OF ORIGIN –NO REASON FOR CHANGE

The ongoing work on implementingprovisions for the Modernised CustomsCode (MCC) triggered a discussion onnon-preferential rules of origin, whoselegal character might be changedin the process of drafting the MCCimplementing rules. The modernisedcode sets a 5-year time frame forapplication, and the implementing rulesmust enter into force by June 2014 atthe latest.

For some time now, industry has beenreceiving warning signals from nationaldelegation members of the EU CustomsCommittee on the so called ‘list rules’that could change the existing methodof determining origin and the principleof the “last substantial transformation”,which would be introduced through theimplementing rules. The Commission,however, has never issued any concreteCommunication on the subject, andDG Taxation and Customs Union(Taxud) officials assure that no definitivedecisions have been taken at thisstage, given the massive opposition ofstakeholders.

For European engineering, a stableenvironment in customs legislation andcustoms procedures is of the utmostimportance, which is why Orgalimeis closely following this issue: foryears, Orgalime has been arguing thatsimplified customs procedures andlower costs to business would visiblybenefit the industry, which we believeshould be the legislator’s aim.

MARKING OF ORIGIN (“MADE IN”)

This issue continued to simmer during2011 and therefore Orgalime issued aposition commenting on the fact thatnew legislation on obligatory markingof origin (“made in”) of imports wouldnot have any positive effects on thecompetitiveness of the Europeanengineering industries.

Indeed, Orgalime believes thatmaintaining a competitive and strongindustrial base in Europe requires otheressential elements, such as favourableframework conditions, open markets, afocus on innovation and the respect ofIPR. Orgalime also believes that the EUhas enough legislation which obliges allmarket operators, including importers, torespect technical, environmental, socialand safety legislation. We however feelthat the enforcement of this legislationand efficient market surveillance need tobe further improved

Orgalime will continue to monitor thisissue which now seems be on hold dueto the position of a number of memberstates.

ARGENTINA MARKET ACCESS – NEWIMPORT RESTRICTIONS

In January 2012, Argentina’s taxationand customs authority (AFIP) issueda resolution that requires importers tosubmit a sworn declaration through theirwebsite prior to placing a purchasingorder for all imports to Argentina. Thepolitical goal is to motivate foreigncompanies to manufacture their goods

in Argentina, instead of importing them.Orgalime has suggested that companiesthat are directly affected by the measurein question should communicate totheir national ministries any difficultiesthey experience with import licensing,sworn declarations for import sent tothe taxation and customs authorities,and import/export deals, while providingOrgalime with feedback so that we cancontinue to act in Brussels.

REVIEW OF TRADE DEFENCEINSTRUMENTS (TDI)

In March 2012 the EuropeanCommission published the results of anevaluation of the EU’s Trade DefenceInstruments (TDI). The study examinedthe efficiency and effectiveness oftrade defence mechanisms and in itsresults will be used for the planned TDIreform that is to be launched by theend of 2012. The evaluation coveredthe description of current practice in thefield of TDI, an economic analysis of thearguments for TDI and their applicationin the international legal and economiccontext. It also focused on the reviewof the relevant regulations in the light ofadministrative practice, the judgmentsof the Court of Justice and therecommendations of the WTO’s DisputeSettlement Body, and it assessedthe EU policy and practice comparedto certain EU trading partners. Theprevious revision of anti-dumping andanti-subsidy measures took place in1995 and the main goal of the upcomingreform is to adapt the measures to thechallenges of an increasingly globalisedeconomic environment. As a next step

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following the release of the evaluationthe Commission will launch a publicconsultation on the modernisation ofthe EU’s TDI which Orgalime will befollowing.

DUAL USE ITEMS – UPDATED LIST

In 2011 the European Commissioninitiated a discussion regarding possiblereforms to the Regulation of dualuse items. The dual-use goods andtechnologies can be used for both

civilian and military purposes, which isthe reason why their exports and transitare subject to strict control. The lists ofdual-use goods and technologies arebeing updated regularly to limit the riskof sensitive items being used for militarypurposes.

In February 2012, the EU Counciladopted its position on a draftRegulation updating the EU’s list ofdual-use goods and technologies,with the aim of aligning the lists to

international rules. More specifically,the new Regulation would aim to bringRegulation 428/2009/EC which governsexport, transfers, brokering and transitof dual use items into line with latestdevelopments of international regimesrelevant to the control of exports of dualuse goods and technologies.

In order for our industry to gain a betterunderstanding of this issue, Orgalimeorganised a meeting and exchange ofviews with Commission officials.

EUROPE COMES CLOSER TO A ‘UNIFIEDPATENT’

After years of pushing by industryand little progress in the institutions, apolitical compromise was reached by25 member states on the introductionof an enhanced cooperation procedurefor the creation of a unitary patent title;despite the best intentions of the PolishPresidency to reach a compromiseamong the member states by theend of 2011, the negotiations becamegridlocked since the CompetitivenessCouncil in December 2011 did not reacha conclusion over the location of theseat of the Unified Patent Court, withLondon, Munich and Paris as candidatecities.

For Orgalime’s constituency, this dossierremains one of the most importantissues in the area of Intellectual

Property Rights (IPR). The latestproposals provide for the unitary patentto be introduced as an internationalagreement, implemented in everymember state separately. This topictriggered a debate on the financing ofthe court, the composition of panels,the jurisdiction, as well as the creation ofcourt divisions in member states. Whilethe general feeling is that work on thedossier has accelerated, experts haveurged legislators not to miss out onimportant provisions and consultationswith stakeholders. With the Commissionas well as Members of the EuropeanParliament calling on France, Germanyand UK to take responsibility and reacha compromise on the headquartersdispute, observers are worried that acompromise could even involve thecentral court spending different partsof the year in different countries, whichwould be the worst and most expensive

solution for those most interested inthe unified patent system – the privatestakeholders. Orgalime will continue tomonitor progress on this over the nextyear.

ACTA’S DILEMMA: HOW TO PROTECT IPRWHILE SAFEGUARDING CITIZENS’ RIGHTS

Another issue which Orgalime hasbeen monitoring closely is the Anti-Counterfeiting Trade Agreement (ACTA).Initiated at the end of 2007 by the EU,the US, Switzerland and Japan, ACTAis an international agreement aiming toestablish common principles to fightpirated copyright-protected worksand, to a lesser degree, counterfeitgoods. Even though the agreementhas been under negotiation for the last5 years, it has recently become thesubject of lively discussion in Europe.For its supporters, ACTA strengthens

LEGAL

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RESEARCH & DEVELOPMENT AND INNOVATION (R&D&I)

international cooperation in the fightagainst counterfeiting and piracy intraditional trade and internet commerce.To its opponents, ACTA adversely affectsfundamental rights such as freedom ofexpression and privacy, and is the resultof a clear lack of transparency duringthe ACTA-negotiations. Legal expertscomment that the agreement will notchange anything to national legislationor to the acquis of the EU. As it standstoday ACTA would probably most benefitthe audio-visual and software industries.For manufacturing industries thatproduce tangible goods, an internationalagreement could have a positive impactif countries like China, India or Brazilwere to co-sign and obligate themselvesto improve IPR enforcement, thoughthis is perhaps unlikely to happen in theforeseeable future.

At the end of February 2012, afterseveral EU member states decided tohalt their ratification process, EU TradeCommissioner De Gucht announcedthat the agreement would be referredto the European Court of Justice.The Court will assess whether ACTAis compatible with EU fundamental

rights, such as freedom of expression,information or data protection, and theright to property in case of intellectualproperty. Orgalime will continue tomonitor progress on this issue over thecoming months.

ORGALIME RAISES CONCERNS ONPOTENTIAL DISTORTION IN THE USCERTIFICATION MARKET

In the USA, there is a legal obligationfor third party product certificationfor many finished products ready forend use, if they are to be used in aworking environment. Producers ofsafety components such as controldevices, circuit boards, cables, electricalconnectors, switching devices, etc.,are subject to this certification and aresuffering from the non-competitivecharacter of the US certificationmarket, which allows the market leaderUnderwriters Laboratories (UL), to exploitits position and to further reinforce it.

The specific problem lies in UL’s policygenerally requiring customers applyingfor certification of a complete productto have their components also tested

by Underwriters Laboratories (UL), orelse certification by another NationallyRecognised Test Laboratories (NRTL)checked at significant cost, thuseffectively limiting the freedom ofcomponent manufacturers to chooseanother NRTL for certification of theircomponents. Besides UnderwritersLaboratories, there are many otherNationally Recognised Test Laboratoriesin the USA; however, due to historicalreasons Underwriters Laboratoriesenjoys a particularly strong positioningin the certification market of completeproducts and components.

Orgalime compiled a position paperbased on information received byaggrieved companies and sent it tothe European Commission in October2011. The paper requested that theCommission discuss this problem withthe US administration at the level ofthe Transatlantic Economic Council. InOrgalime’s view, the situation could beimproved if the American OccupationalSafety and Health Administration(OSHA) would decide on an obligatoryrecognition of test certificates betweenaccredited laboratories.

HORIZON 2020 DEBATE: THE DILEMMAOF ALLOCATING €87 BILLION

Following the publication of theHorizon 2020 proposal, the EuropeanParliament is currently scrutinising

the dossier. Orgalime had alreadyexplained in its May 2011 positionpaper why any reform process ofEU R&D&I funding should aim athigh industrial relevance and strongindustrial participation.

As Horizon 2020 aims to be the first oneto support the whole cycle of innovation,from basic research to market uptake, itposes new and demanding questions tostakeholders and policymakers. Horizon2020 will be organised in three different

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pillars, namely ‘Societal Challenges’(42% of total funding), ‘Pure Science’(33% of total funding) and ‘IndustrialLeadership and Competitiveness’ (24%of total funding). The Commission’sproposal was received positively byOrgalime concerning:— The Increase of the budget for

Research and Innovation by 46%,from roughly €50 to €87 billion.

— The integration of several differentprogrammes into one singleprogramme, making EU R&D&Ifunding less complex.

— The higher attention given to industrialneeds by introducing a new specificpillar for ‘Industrial and EnablingTechnologies’ and by allowing PublicPrivate Partnerships to determine thetopics that deserve EU funding.

— Further stimulus to innovation andcommercialisation of research results.

On the negative side, most Orgalimemembers are disappointed by theproposed allocation of funding betweenthe three pillars, with the “Industrial”pillar being the smallest. Also withinthe “Industrial” pillar there is only alimited increase in funding for industry-relevant topics. While the overallbudget increase is 46%, budget linesof interest to the engineering industries,mainly NMP (NMP – nanosciences,nanotechnologies, materials and newproduction technologies) received amuch smaller increase and in the endwill represent only some 4% of thetotal Horizon 2020 budget. This meansa relative decrease compared to thecurrent Framework Programme, wherethe share of NMP is around 6%.

We will continue following work onthis proposal closely in 2012 as itis discussed in both the EuropeanParliament and Council during the year.

ORGALIME’S INDUSTRY LEADS INDEVELOPING THE “PPP MODEL” WHICHWE SEE AS THE WAY FORWARD FOR“BRIDGING THE VALLEY OF DEATH”

The Public Private Partnership (PPP)model, which was established by theEuropean Recovery Plan in 2008, isto be further developed at EU level inthe coming years. The overwhelmingsuccess of the Factories of the Futureand other PPPs has been recognised bypolicymakers as the right implementationtool for bringing research results closer tothe market and thus helping companies,notably SMEs, to bridge the so-called“Valley of Death”. PPPs representa paradigm shift in the form of thepragmatic move to encourage interactionbetween companies, researchorganisations and public authoritiesfor jointly developing a roadmap withresearch topics.

The establishment of the Factories ofthe Future PPP has led to re-engagingthe engineering industry and notably itsSMEs into European funded projects.Now, demonstration activities are playinga prominent role in the ‘Factories ofthe Future’ (FoF) PPP, so that industrialviability, clear economic potentialand/or societal advantages of newtechnologies are proven. Such activitieshelp to guarantee further applicationand market uptake. For the FoF PPPa dedicated not-for-profit association

– EFFRA – was created by Orgalime,a number of its members, companiesand research organisations which poolsthe expertise of participants to provideprogramming input for the allocation ofsome €600 million of public money forindustry-relevant projects in the area ofproduction technologies.

In Horizon 2020 the FoF PPP is set tocontinue, hopefully with an increasedbudget. Moreover further PPPs will belaunched, including possibly in the areaof the SET-Plan (energy technologies),which could deal with issues centralto our industry, such as smart cities,electricity grids, wind, photovoltaic andconcentrated solar power and carboncapture and storage.

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ENVIRONMENT, ENERGY & CLIMATE CHANGE POLICY

SIGRID LINHER ANNE-CLAIRE RASSELET

If the environmental agenda is shiftingmore and more to the “new” areaof resource efficiency the review,usually followed by revision and moreconstraining legislation still remainscentral to Orgalime’s work agenda.

WASTE ELECTRICAL AND ELECTRONICEQUIPMENT (WEEE) DIRECTIVE RECAST

In January 2012, a European Parliamentplenary vote brought to an end an epic3-year parliamentary debate on whatwas initially designed at ‘tweaking’ theoriginal Waste Electrical and ElectronicEquipment (WEEE) Directive. In whatwas meant to be a minor change toimprove the functioning of this Directiveand offering industry more certaintyhas turned into a revision ‘exercise’ withareas such as the scope still as unclearas before, but maintained for 6 years.

Opposed to the recast from the outset,since companies are crying out forregulatory certainty and predictabilityrather than continuous regulatorychange, the WEEE Recast has been atthe forefront of the Orgalime agenda for

the past months. Orgalime was highlyconcerned about the issue of wastecollection. Now it is clear memberstates will remain the addressee of thecollection rate target, strengthenedwith a mandate to involve all actorsin achieving the target. This will beparticularly relevant for the forthcomingtransposition and implementation stagesif the EU wishes to realise its resourceefficiency objectives. Only if all channelsof WEEE are targeted, can the increasedcollection targets and the EU’s resourceefficiency agenda be reached.

In other key areas, the opportunityto make this a more businessfriendly directive has been missed:harmonisation could have been betterhad regulators decided to introducean electronic portal for registration, orindeed made a stronger link betweenproducer definition and registration.On a positive note though, introducinga ‘national authorised representative’which avoids the need of a legal seatof a company in each member state,combined with maintaining a nationalproducer definition, evidently reduces

the administrative burden. The newprovisions on treatment and the rejectionof separate reuse target have alsosimplified matters.

As a next step, Orgalime’s attentionwill concentrate on the upcomingtransposition process of “WEEE 2”and on underpinning the upcomingimplementation work. On thebasis of ongoing discussion onthe implementation of the “RoHS2” Directive, we can expect manycritical discussions to ensure a properimplementation of the Directive,including possible guidelines to beissued by the European Commission.Meanwhile, Orgalime industry willupdate its guidance document on theWEEE Directive as soon as the directiveis published in the Official Journal of theEuropean Union.

RESTRICTION OF HAZARDOUSSUBSTANCES (ROHS) DIRECTIVE RECAST

At the end of May 2011, the EuropeanCouncil rubber-stamped a two and halfyear recast procedure on the revised

ANNE-LOUISE PICARD DEBORAH GIRASA

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RoHS Directive which entered intoforce on 21 July 2011. The legislation,which restricts the use of six hazardoussubstances in electrical and electronicequipment, such as TVs, laptops,washing machines, fridges and lighting-equipment has now been extended toprogressively phase in medical devices,monitoring and control equipmentand other electrical and electronicequipment including cables and spareparts into the scope.

This legislation is critical for ourmanufacturers as it has far reachingimplications: not only do substancerestrictions imply design changeswith the costs that this entails, but itis also a complex task to ensure thatthe necessary changes happen in ourglobal supply chains which often includemany thousands of suppliers. The recastRoHS Directive also ties in with otherenvironmental legislation applying tothe same products, notably the REACHRegulation, the Eco design Directiveand the WEEE Directive, renderingapplication unduly complex.

On the day of the entry into force of theDirective, Orgalime published its guide“A practical Guide to understanding thespecific obligations of Recast RoHSDirective“. The purpose of this guideis to explain the main changes andobligations arising from the recast,and to identify their consequences forOrgalime industries. This guide can bedownloaded from Orgalime’s website.

The impending transposition andimplementation phase will also be

crucial for manufacturers. In particular,producers feel it important that:— Member state’s transpositions respect

the harmonised rules set out by theDirective.

— Coherence with the REACHRegulation is ensured, especiallywhen applying the new RoHSsubstance evaluation methodologybefore reviewing/setting newrestrictions.

— Stakeholders and notably industryexperts are involved in the application,including input to the new comitologyprocess.

— Clarity on the scope is providedwithout delay.

In July 2011, the Commission alsoannounced an update of its RoHS FAQguidance document before the deadlinefor transposition in the member states(2 January 2013). Orgalime is thereforeworking on this, and more specificallyon those interpretation issues notaddressed in its guide of July 2011.

ENERGY ROADMAP 2050

At the end of 2011, the EuropeanCommission adopted theCommunication ‘Energy Roadmap2050’. The EU is committed to reducinggreenhouse gas emissions to 80-95% below 1990 levels by 2050 in thecontext of necessary reductions bydeveloped countries as a group. In theEnergy Roadmap 2050 the Commissionexplores the challenges posed bydelivering the EU’s decarbonisationobjective while at the same timeensuring security of energy supply and

competitiveness. As one of the prioritiesof the Danish Presidency, Councilconclusions on the Roadmap areexpected to be adopted at the EnergyCouncil of June 2012. Orgalime is happyto see that several of its positions havebeen taken into account and will beproviding further input into the process.

ENERGY EFFICIENCY DIRECTIVE

For years the focus on the institutions inthe area of energy efficiency has beenon engineering products themselvesthrough the Eco design Directive andits multiple implementing measures.Now the Commission has switchedits attention to the uptake of theenergy efficient solutions proposed byengineering companies, with the issueof the proposal for an Energy EfficiencyDirective which is a first concrete followup of the Energy Efficiency Plan 2011,In a first position issued at the end of2011, Orgalime largely welcomed theEuropean Commission’s proposal. Aftermuch activity and heated discussionsbetween stakeholders, February 2012saw a key Industry Committee EuropeanParliament vote in which Orgalime couldbe satisfied to see some of our corerequests taken on board:— Energy Efficiency obligation schemes.— Harmonisation of public procurement

criteria for all products, taking intoaccount cost effectiveness based ona whole life cycle analysis.

— Accompanying measures for financialand technical facilities.

— Annual renovation rate of buildingsowned by public bodies and indicativetargets for the reduction of energy

ISSUES

consumption of existing buildings for2020, 2030, 2040.

— Consumer information andempowering/training programme.

With work moving ahead under theDanish Presidency, which intendsto reach a first reading agreementduring the first half of 2012, Orgalimewill continue focusing on this corearea in calling for an harmonisationto the maximum extent possiblecurrent practices and efforts of thedifferent member states, thereby at lastdeveloping concrete measures whichwill help to make the EU 20/20/20agenda a reality.

RESOURCE EFFICIENCY

Following the issue of the EuropeanCommission’s ambitious ‘Roadmap toa Resource efficient Europe’, Orgalimefelt obliged to produce a response inthe form of a position paper ‘Resourceefficiency: An economic necessitywhile remaining a societal challenge’.This Commission policy initiativehas a direct impact with many ofOrgalime`s core policy issues, notably

the Eco design, WEEE and RoHSDirectives, the REACH Regulation andthe Horizon 2020 research agenda.If our industries are committed to thesustainable management of resourcesand of manufacturing processes whileconstantly improving the environmentalperformance of the products that areplaced on the market, it is howeverof increasing concern that the marketopportunities for these technologies willbe outweighed by possible negativeimpacts on our industry´s investmentsmade for the implementation of the Ecodesign and WEEE Directives.

A project at the Commission´s JointResearch Centre (JRC) rings alarmbells as it promotes what is in ourview an unworkable, not to mentionunnecessary, parallel methodologicalapproach for implementing resourceefficiency and waste managementparameters under the Eco designDirective 2009/125/EC (see Orgalime’scomments on the JRC project). Bothpositions have been submitted to theCommission, the European Parliamentand the Danish Presidency.Late in February 2012, the European

Parliament’s lead EnvironmentCommittee issued its draft report onthe Commission´s “Resource EfficiencyRoadmap” presenting the policypriorities and envisaged measures.With full support to the Commission,this draft report calls for an extensionof the Eco design Directive in termsof both, scope (to include non-energyrelated products) and environmentalparameters to be regulated, suggestingrequirements on recoverability, durabilityand recycled content of products. Thiscontradicts Orgalime´s position and inparticular the findings of the currentimplementation activities on energyefficiency. Notwithstanding this ratherdisappointing viewpoint, the draft reportalso brings forward a number of positiveaspects, notably, requesting a fullimplementation of the EU waste acquisand placing the emphasis on research,development and innovation to improveresource efficiency.

So in 2012, Orgalime will continue topromote the views of the industry onwhat we feel are unjustified moves to yetagain revise the Eco design Directive;such a revision, if it goes aheadwill just reinforce the feeling amongmanufacturers that they can hardly relyon regulatory stability and predictabilityfor their operations in the EU.

SUSTAINABLE CONSUMPTION ANDPRODUCTION (SCP)

The preparatory phase of the reviewprocess of the Sustainable Consumptionand Production and SustainableIndustrial Policy (SCP/SIP) Action

ISSUES PAGE 27

Plan has started early 2012 with thelaunch of a stakeholder consultation on‘Delivering more Sustainable Consumption and Production’. To implementthe EU´s resource efficiency andsustainable development agenda, theconsultation called for stakeholders’views on the possible introduction ofmeasures contributing to improve theenvironmental performance of productsand increase the demand for moresustainable goods and productiontechnologies, on SCP/SIP, through forexample, green public procurement,or the introduction of environmentalfootprint of products and organisations.

Orgalime contributed to the consultationthrough a position rather than byanswering the consultation documentwhich we felt was somewhat biased inthe way the questions were posed. Inthis paper we focused more particularlyon the environmental footprint, whichwe felt might well weaken the successfulenergy label and stressed our supportfor the Eco design Directive, whichaddresses all environmental aspectsrelated to Energy related Products.

Orgalime also proposed a numberof alternatives to those cited in theconsultation, placing much more of afocus on the proper implementation ofalready existing legislation rather thanon preparing the way for yet more layersof legislation.

ECO DESIGN DIRECTIVE

The Eco design Directive whichaddresses all environmental aspects

of Energy related Products (ErP)throughout their whole life cycle, fromcradle to grave, which we support iswell into the implementation phase, thisis the holistic approach to eco design forwhich we have long been clamouring.

Orgalime is following the implementationof the Eco design Directive andparticipates, as an observer, to theEco Design Consultation Forum andEco Design Working Group, whichmeets regularly to discuss possibleas well as general implementationissues. While eco design and labellingrequirements have been adopted fortwelve products of our industries, some25 additional measures are under way,for example, for vacuum cleaners,computers, transformers, fans andprofessional refrigeration equipment.

On the basis of a study on the nextworking plan, the Commissionproposes to study 9 further productgroups in the period 2012-2014 underthe Directive. This comes in additionto accomplishing the work on thealready targeted 37 product groups,out of which some 25 measures stillneed to be finalised. For the sameperiod, 4 voluntary agreements areto be recognised and 11 adoptedimplementing measures are already duefor revision! Orgalime re-iterates that weshould “…first finalise implementationon existing lots, then strengthenenforcement and finally considerlaunching new lots”

As with so many other directives,implementation seems to have barely

had the chance to take effect before areview is due. The Eco design Directiveis no exception: the preparatorywork on the review of the frameworkdirective itself is coming to an endas the contracted consultant CSESreleased its draft final report includingrecommendations for a possibleamendment of the Directive. Orgalimeraised its concerns on a series of CSESdraft final study recommendations,including:— Proposals to further extend the scope

of the Directive beyond energy relatedproducts.

— Create national registers forproducers as a claimed means tostrengthen enforcement.

— Change the preparatory processof implementing measures throughinvolvement of a new executiveagency or the JRC.

Currently the European Commissionis reviewing the final CSES report andnow must decide whether or not topropose an amendment to the currentframework Directive. Consideringthat an extension of the scope ofthe Directive beyond Energy relatedProducts is premature, the oppositionto such an extension will remain high onOrgalime’s list of priorities. We believeit is essential to avoid undermining theconsiderable efforts and investmentmade by our industries to improve theenvironmental performance of theirproducts by continuously modifying theregulatory framework and shifting thegoal posts. This can only jeopardise theongoing implementation process.

ISSUES

CHEMICALS POLICY (REACH)

Now well into the implementation phase,Orgalime has been heavily involvedin this process, as the designatedrepresentative of complex articlemanufacturers which includes theengineering, automotive, aerospaceindustries as well as the retail sector,attending meetings of the CARACAL(Competent Authorities for REACH andCLP) as well as the Director’s ContactGroup and monitoring ECHA’s guidancereview. Orgalime particularly followedthe review of ECHA’s ‘Guidance onrequirements for substances in articlesV2 (April 2011). However, the debate nowcontinues with 6 dissenting memberstates (Austria, Belgium, Denmark,France, Germany and Sweden),notwithstanding the legal opinion ofthe Commission, stubbornly reiteratingtheir concerns with respect to the 0.1%threshold that triggers communicationand notification requirements.

In September 2011, Orgalime tookthe opportunity of re-iterating theconcerns of Downstream Users inthe implementation of the REACHRegulation as well as the expectations ofsuppliers and especially, the chemicalsmanufacturers, to an audience of morethan 300 participants at a workshoporganised by the European Commission.

Orgalime is also involved in the 2012review process, which aims at evaluatingthe impact of the REACH Regulation.Orgalime contributed to some of thethematic studies, such as the oneassessing the impact of REACH on the

competitiveness and innovativeness ofEU industry. It is somewhat prematureto come to a conclusive assessment ofthe effectiveness and efficiency of thedifferent REACH procedures, as wellas the overall impact on the industryat this point. We strongly opposere-opening the REACH Regulationthat would jeopardise the efforts andinvestment made by the industry toapply what is no doubt one of the mostcomplex pieces of legislation affectingengineering companies.

However, Orgalime urged theCommission to carefully monitor anyunexpected impact that has alreadybeen perceived, such as undesiredlimitations of the substance portfoliosavailable for Downstream Users toinnovate or legislative overlaps. To ensurethat REACH will achieve its overallobjectives, Orgalime advocates:— The effective application of REACH as

the EU wide framework for chemicalsmanagement, including in the area ofnanomaterials where the EuropeanCommission has managed to clarifythe definition of a nanomaterial.

— The harmonised implementationof REACH requirements in all EUmember states.

— The strengthening of both upstreamand downstream information flows toachieve an effective, fluent and timelyflow of information throughout theentire supply chain.

Orgalime, will of course, continuecarefully screening the applicationof REACH and the review processthroughout 2012.

INDUSTRIAL EMISSIONS DIRECTIVE (IED)

In September 2011, following on fromimplementation under the former ‘IPPCDirective’, Orgalime participated in thefirst stakeholders’ consultation forumunder the new Industrial EmissionsDirective (IED). As a member of theforum, Orgalime has provided itsopinion on the Commission’s guidancedocument for the future drawing upof Best Available Technique (BAT)reference documents (BREFs) whichhas then been adopted through thecomitology procedure (implementingacts) as well as BAT conclusions forglass and BAT conclusions for iron andsteel, the first two revised referencedocuments under the IED.

The Commission reiterated its wishto continue with the exercise toderive BAT conclusions on the basisof existing BREFs. Indeed, shiftingfrom the IPPC framework to the IEDrequires substantial changes and, forthat purpose, the Commission hasenvisaged in its work programme toreview a large number of BREFs, aswell as to launch the drawing up ofnew ones.

Accordingly, the expertise of the SevilleTechnical Working Group will remainessential to identify and ensure fairand appropriate development of BATreference documents. Orgalime willtherefore continue to maintaining anoperational network and coordinationwith and between Seville expertsnominated by and representing theengineering industry.

ROADMAP TO A RESOURCEEFFICIENT EUROPE:KEEP A STABLE ECO DESIGNFRAMEWORK

COMMUNICATIONS

Arguably the key role for corporatecommunicators is organisationalengagement – helping audiences tofind their place on the organisation’sstage. Story-telling can help withthis task.

Since the kaleidoscope has beengiven a good shake and as the medialandscape has adapted to its newsurroundings, we find all the pieces stillin flux. Orgalime has tried to apply ‘newrules’ for the benefit of our audienceand in doing so, giving meaning to whywe do what we do.

A Brussels based writer recentlypublished an article4 from which I takean extract – for it explains our business

of communications quite nicely“…In his book King Arthur’s RoundTable: How Collaborative ConversationsCreate Smart Organisations, DavidPerkins argues that all organisationsare really only about conversations andthat, notwithstanding the particularline of business we are in, effectiveleadership is always about helpingpeople to have better, smarterconversations. And if you talk aboutconversations in one breath, you surelyhave to mention stories in the next.After all, stories are the ‘stuff’ of mostconversations and are unique in theirability to bring meaning, pattern andorder to the otherwise disconnectedfragments of our lives. Not convinced?Well just try and think of any recent,

meaningful conversation, in which youdid not tell a story to illustrate yourpoint, contribute an idea, raise an issueor make a connection with somebody”.

Michael Margolis explains in BelieveMe: Why Your Vision, Brand, andLeadership Need A Bigger Story, forthose of us who communicate on behalfof our companies or organisations, it ishigh time we faced up to the fact that“people don’t really buy your product,solution, or idea, they buy the storiesthat are attached to it.”

The way the story is told still dependsthough, on who your audienceis. Tailoring is still required and isnecessary for not only the type of

It’s all about the story! And we in the engineering industry have a story to tell…

MARK REDGROVE

COMMUNICATIONS

MAGDALENA WAWRZONKOWSKA

4. David Willows – Director, External Relations, International School of Brussels – This is my story, tell me yours

COMMUNICATIONS PAGE 31

audience, but also the channel thestory will be told on. Communicationsis the art of telling stories about anorganisation and helping people to findtheir place in that story, stories shouldbe coherent at every stage, storiesshould relate to the audience andcommunicators have to be playful – byavoiding predictability, stories take on alife of their own, evolving over time.

Whilst the story of Europeanengineering hasn’t gone viral – yet, the

statistics again support the conceptof giving people the information theywant, in the right format, at the righttime and on the channel they prefer.Orgalime specialises in what we doand we have a loyal band of followers– now, we should aspire to pushingthe boundaries further, throughour storytelling, and convince ourreaders that industry has dispelledthe rumours of being ‘bad’ and thatwithout a strong European engineeringand manufacturing base, Europe’s

backbone and Europe’s recoveryare seriously weakened. This isour challenge, first with our directaudience – the politicians and officialsin Brussels and throughout Europe,but also in the longer term to the widerpublic since our industry is attractive,does provide a job and a future to itsemployees – and needs the skills ofthese employees to flourish in Europe.

PUBLICATIONS

UPDATE OF MODEL CONTRACTS –DISTRIBUTORS ABROAD AND AGENTSABROAD MODEL CONTRACTS – MAYAND JUNE 2011

Following new rules in EU competitionlaw issued in 2010 by the EuropeanCommission, Orgalime updated 2 verypopular Orgalime model contracts, the“Exclusive Agreement with DistributorsAbroad” and the “Exclusive Agreementwith Agents Abroad” in May and June2011 respectively.

Model Forms are a type of publicationthat consistently remain high indemand as they provide help whendrawing up contracts that cannot bestandardised to the same extent asGeneral Conditions.

MODEL FOR A CODE OF CONDUCT FORASSOCIATIONS

The Code of Conduct, a modelOrgalime originally produced in2010, has now been translated intoGerman and Spanish. This publicationhas the double purpose to serveas Orgalime’s Code of Conductthat binds all members and otherparticipants working on an Orgalimeplatform and to be made available toNational Associations/European SectorAssociations within the engineeringindustries that so far haven’t developedtheir own code of conduct. Thestandardised text provides clearrules for the activities of associationsand offers guidance to limit the riskof receiving fines from competitionauthorities.

RELEASE OF ORGALIME S 2012GENERAL CONDITIONS

In March 2012, Orgalime releasedthe S 2012 General Conditions,“General conditions for the supply ofmechanical, electrical and electronicproducts”, a revision of the S 2000General Conditions, August 2000, thathas proven to be Orgalime’s best-selling publication. Well over 1 millionhard copies of the S 2000 generalconditions have been sold since theirpublication and they are the biggestpull to our licensing website, wherewe provide a licence for the use of ourconditions in electronic format.

Orgalime General Conditions arestandard contracts prepared byOrgalime’s Legal Affairs workinggroup, which includes legal expertsfrom Orgalime’s member associations.The aim of these publications is toprovide simple and balanced GeneralConditions of contract for use betweenbusinesses. There are, to date, 9 setsof Orgalime General Conditions.

PUBLICATIONS

In 2011-2012, Orgalime maintained the tradition of producing relevant legal publications for the industriesit represents by updating and revising previously released works and adding new language versions.

PUBLICATIONS PAGE 33

To keep up with the increasingpopularity and acceptance of ourGeneral Conditions by companiesthroughout Europe, and in order toassist companies from our industrieswilling to expand their horizons,Orgalime has broadened the scopeof available versions of its new S 2012publication to include Danish, Slovak,Czech, Japanese, Turkish and Arabiclanguage versions. The previouslyother available versions (German,French, Spanish, Italian, Portuguese,Dutch, Swedish, Hungarian, Polish,Russian and Chinese (Mandarin)) haveall been updated as well.

CONTINUED SUCCESS OF ORGALIME’SLICENSING WEBSITE

Orgalime’s licensing website continuesto prove an increasingly popular toolfor companies wishing to use ourstandardised General Conditions inan electronic format. Over the lastten years, over 2300 companieshave registered on the website, with638 companies located worldwidepurchasing a licence. The interestcompanies have shown in this servicehas more than doubled in the last 4years, proving the high esteem andreputation publications issued byOrgalime are held in by the industrieswe represent.

IN 2012

Throughout 2012, Orgalime willcontinue revising other of its legalpublications, such as the S 2000 Guide(revised to offer guidance for the use ofthe S 2012 conditions), the SW 01 andSE 01 General Conditions.

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ORGALIME PARTNERSHIP PAGE 35

And this network as well as our frequentcollaboration on common issues hasgrown steadily and surely, and, with it,the influence of our industry where itcounts – here in Brussels – where policyand regulation affecting our companiesare born.

Previously known under the brand‘Bridgehead’, it was renamed in early2012 to underline the value Orgalimeput in the associations it services. TheOrgalime Partnership is the departmentof Orgalime that services individualassociations in promoting theirpositions, advocacy and managementactivities. It offers a wide range ofservices to associations active in theelectrical, mechanical and metal articlesindustries, designed with a long-termcooperation in mind.

With a mix of excellence and deeplyrooted networking in Brussels withoutstanding knowledge of the en-gineering industries, there is a constantcross pollination between Orgalimeissue managers dealing with horizontalissues and Orgalime Partnership

experts. The Orgalime Partnership hasdeveloped different types of serviceswith its partners:— Targeted bulletin.— Active monitoring service.— Advocacy, communication & public

relations.— Institutional contact services.— Association management services.— Project services.— Business intelligence services.

The Orgalime Partnership has achievedmany value added actions andstrategies during the past 12 months:a non-exhaustive list is given hereafter.The activities range from increasing thepolitical footprint, to implementation,communication and management of theassociations.

POLITICAL ACHIEVEMENTS

The Orgalime Partnership supportsits customers by being part of thediscussions to promote political positionsat the right place at the right time.Orgalime Partnership experts attendmany stakeholder meetings across the

regulatory spectrum and support theirpartners by developing political positionsfor them, for example for:— Materials handling issues in the

Commission’s guidelines on theMachinery Directive.

— Proposals for amendments andvoting recommendations on metering& billing provisions in the draft EnergyEfficiency Directive.

— The work that led to the decisionof the European Commission onthe qualification of brush-cutterattachments as interchangeableequipment.

The Orgalime Partnership also uses itsexpertise in voluntary initiatives to thebenefit of its customers. For example,we coordinated a European ‘waterlabel’ for taps and showerheads andmost recently co-funded an industryplatform on market surveillance for themachinery sector.

The Orgalime Partnership currentlyprovides services for the followingcommittees/associations:

Why the Orgalime Partnership? Very simply because it makes sense for Orgalime to put at the service of ourwider industry network, the experience and the contacts that we have gained in over 50 years of workingin Brussels. It is now some 15 years since Orgalime’s members, at that time national associations only,representing the interests of the largest industrial sector in Europe, launched this partnership with differentEuropean Sector Associations.

ORGALIME PARTNERSHIP

ORGALIME PARTNERSHIP

AREA – AIR CONDITIONING ANDREFRIGERATION CONTRACTORS

ESMIG – SMART METERING

CECAPI – LOW VOLTAGE EQUIPMENT

ESTAL – SURFACE TREATMENT ON ALUMINIUM

CEIR – VALVES

EUMABOIS – WOOD WORKING MACHINERY

CEO – HAND TOOLS AND ANCHOR FIXINGS

EURALARM – FIRE & SECURITY SYSTEMS

ECCS – CONSTRUCTIONAL STEELWORK

EUROPERF – PERFORATORS

EFCEM – CATERING EQUIPMENT

EUROPUMP – PUMPS

EFSAC – SAFETY & SECURITY EQUIPMENT

FEM – MATERIAL HANDLING & STORAGE

EGMF – GARDEN EQUIPMENT

PNEUROP – COMPRESSORS

EIFI – FASTENERS

T&D EUROPE – ELECTRICITY TRANSMISSIONAND DISTRIBUTION

EPTA – POWER TOOLS

VISIBILITY ACHIEVEMENTS

In terms of visibility, the OrgalimePartnership has been activelyorganising tailored events that increasedthe footprint of its clients:— EGMF – conference and training on

how to deal with unfair competitioncreated by non-compliant products

— ESMIG – recognised as an officialpartner of the European CommissionSustainable Energy EuropeCampaign through its project ‘ESMIGGuidelines for Smart Metering’

— ESMIG – European Parliamentworking breakfast

— ESMIG – Presence at Metering,Billing/CRM Europe 2011 the majortrade show of the industry

— EUROPUMP – A promotionalconference for the EuropeanCommission, national ministries anduniversities on eco-design

— EUROPUMP – kick off meeting for4 lots of the Eco design Directive

— FEM – Market surveillance conferenceattended by over 200 delegates

— FEM – Communication campaign onmarket surveillance & machinery inthe Brussels print media

— New website + Google analytics forEUROPUMP and CEIR

— Blog for EUROPUMP— Page creation and input to Wikipedia,

Facebook, Twitter and LinkedIn

JANET ALMOND

STÉPHANIE UNY

ZOI MYLONA

ROZENN MARÉCHAL

JÉRALDINE RABYNICOLLE RAVEN

GUY VAN DOORSLAER OLIVIER JANINPIERRE LUCAS

MEMBERS

VDMA WSM ZVEI

GERMANY

IEEF

IRELAND

MASOC

LATVIA

LINPRA

LITHUANIA

AUSTRIA

FEEI FMMI AGORIA EGMF EUROPUMP

BELGIUM

BASSEL

BULGARIA

DI

DENMARKTHE FEDERATION OF FINNISHTECHNOLOGY INDUSTRIES

FINLAND

HUP

CROATIA

SWISSMEM

SWITZERLAND

TEKNIKFÖRETAGEN

SWEDEN

CONFEMETAL SERCOBE

SPAIN

GZS-MPIA

SLOVENIA

AIMMAP ANEMM

PORTUGAL

NORSK INDUSTRI

NORWAY

PIGE

POLAND

ANIE ANIMA

ITALY

ILTM

LUXEMBOURG

FME-CWM METAALUNIE

THE NETHERLANDS

34 MEMBER ASSOCIATIONS – 32 COUNTRIES130,000 companies – €1,666 billion of annual output – 10.2 million people employed

FIEEC FIM

FRANCE

BEAMA EAMA GAMBICA

GREAT BRITAIN

“DIAMANT BUILDING”, BOULEVARD A. REYERS 80, B-1030 BRUSSELSTEL: (+32) 2 706 82 35, FAX: (+32) 2 706 82 50, [email protected]

THE EUROPEAN ENGINEERING INDUSTRIES ASSOCIATION

Orgalime Annual Report 2011-12

Documents

Transcript of Orgalime Annual Report 2011-12