Newsletter from Europe Issue 6/2003
Bashir Khanbhai MEP
(Norfolk and Suffolk)





The quality of gold, silver and platinum in jewellery shops across the region could be under threat if the latest proposed EU Directive to harmonise the hallmarking of precious metals across Europe is introduced.


Pure gold and silver are soft metals which wear away and lose their shape if made into jewellery without additives. Therefore, manufacturers of jewellery alloy gold and silver with copper or other cheaper metals in order to harden them. This necessary adulteration of precious metals with cheaper ones provides the dishonest with an opportunity for easy fraud. Because of these wide possibilities for deception, the need for standards for precious metals, reinforced by a system of compulsory hallmarking, has long since been recognised.


The British hallmarking system has proved to be of great value in guaranteeing quality of precious metals, offering a control standard for the manufacturer and consumer and a reference pricing guide for the retailer.


The UK has been a signatory to the International Convention on Hallmarking since 1972, allowing the UK Assay Offices to strike the Convention Hallmark recognised by some countries e.g. Austria, Denmark, Finland, Ireland, Netherlands, Portugal, Sweden and Switzerland.


Sadly, other countries such as Italy, France, and Germany, do not have an independently verifiable system of hallmarking that allows their manufacturers to offer similar guarantees to their jewellery retailers and buyers. Italy is Europe's largest jewellery manufacturing nation and its lack of compulsory requirement for hallmarking


has contributed to an EU-wide problem of under-carating and fraudulent products.


Despite this, the Italians, who currently hold the EU presidency, are insisting that the EU scraps independent assay and hallmarking on the grounds that a non-harmonised system in Europe distorts the market. This would introduce an inferior system of hallmarking, thereby forcing the UK to relax and even abandon its own system.


The Italian-driven EU Directive on Precious Metals, is a dangerous threat to consumers and the whole industry. It will allow manufacturers and importers in Europe to self-certify their jewellery and put it on the market anywhere in Europe, including the UK, without going through an independent third-party Assay Office. It will end the UK's Compulsory Independent Hallmarking. It would be impossible to trace the origin and reliability of any set of marks and would deprive the buyer of any independent guarantee of quality and so diminish his or her confidence in the value of all jewellery! 




The unelected and unaccountable bureaucrats in the EU Commission have been busy inventing their very own 'weapon of mass destruction' for British agriculture, particularly sheep farmers. In order to control and manage future outbreaks of animal diseases such as BSE and Foot and Mouth, Commissioner Byrne (Environment & Public Health) wishes to ensure the "traceability" of all EU sheep.


Britain has 37 million of the 100 million sheep in the EU and it is the largest "sheep" country in Europe with both a domestic and export market for its lamb. Like millions of Brits, I look forward to a Sunday lunch of roast British lamb with mint sauce, but for how much longer will we be able to enjoy such a meal?


The new EU Directive will require every one of our 37 million sheep to have two plastic ear tags carrying an individual 14-digit number, pinned on the sheep's ear. Every time any sheep is moved, its individual number will have to be checked and recorded. If the tag is lost for any one sheep, the farmer must identify and check the missing number and apply for a replacement plastic tag.



It is estimated that about 15 per cent of the sheep will lose their tags. Therefore, for 600 sheep scattered over miles of moorland, a hill farmer would have to round up his entire flock to determine which sheep have lost their tags and then record all the 14-digit numbers on the sheep that still have their tags. He will then know which of the 14-digit numbers are missing by referring to his master list. Having established this, he would have to apply for the missing numbers and pin the right tag on the right sheep as before!


Allowing three minutes for each tagging or checking of a number and with labour costs at around £12 an hour, the expense of this scheme to an average sheep farmer in the UK will be £13,00 to £16,000 a year! There are about 67 million sheep movements a year, therefore, writing down all these 14-digit numbers will take 3.35 million hours, costing around £40m! The cost of replacing tags is estimated at £14m and the on-farm cost of record-keeping is estimated to be at £8m. Considering that an average UK sheep farmer earns around £12,000, how can such a scheme be implemented and how can it be afforded by farmers who are already suffering from substantial loss of income from the recent loss of farm animals?


Do EU Commission bureaucrats ever consult farmers directly, visit farms and markets before sub-contracting consultants to draft such ridiculous and unenforceable proposals?


EU legislation, which impacts on all of us, should be in the hands of elected Members of the European Parliament. The EU Member States must strip the EU Commission of its power to initiate legislation by restricting its function to that of a civil service. I am urging the Inter Governmental Conference (IGC) that will decide on the new treaty for the EU in October, to incorporate such a change.




The European Parliament made crucial amendments to ensure that the cost of buying and selling shares does not increase. The Economic and Monetary Affairs Committee voted on the Investment Services Directive (ISD) which threatened the survival of low-cost, 'execution-only' share dealing.


The Conservatives tabled amendments to the ISD to lift the threat to execution-only business and confine suitability tests to advice services.  Different political groups and nationalities supported the amendments, which have been extensively lobbied for by UK shareholders.


The European Commission's proposals for new red tape on execution-only services could have been a fatal blow to these low margin, 'no frills' services.


Investors would have been forced to buy advice they neither needed nor wanted, costing them as much as 20 times the price of an execution-only sale.


This unnecessary red tape has been rejected by MEPs in committee. We now have to ensure that the full plenary session of parliament supports the removal of a red tape threat to execution-only services and preserves investor choice.




Conservative MEPs have been vigilant in monitoring the expenditure of structural funds in the EU. Our efforts to minimise fraud and misuse are often undermined by Labour MEPs, who even vote against their own government. This month, they blocked a move to repatriate EU regional and cohesion policy, a measure supported by the Conservatives.


The European Commission and Member States have failed to ensure that our money has been properly spent. There are still billions of unspent Euros sitting in the Commission's coffers. The system is in desperate need of a complete overhaul and must give member states control of the funds. I will continue to fight this fraud and mismanagement in the EU at all levels.


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 Promoted & Printed by Conservative MEPs in the EPP-ED Group in the European Parliament, Brussels: Khanbhai, Sturdy, Beazley & Van Orden