HOTREC & ITIC

HOTREC

John Power

HOTREC is the Confederation of the National Associations of Hotels, Restaurants, Cafes and similar establishments in the European Union and in the European Economic Area. Based in Brussels, it serves as a focal point for the transmission of the industry's views to the EU. It also monitors European developments and keeps the member organisations informed. Two General Assemblies of HOTREC are held annually and in the year under review, General Assemblies was held in Vienna and Cologne. These locations coincide with the taking up of the Presidency of the EU by Austria and Germany. Reporting to the General Assembly are Working Groups, which concentrate in the relevant areas of activity, concerning our businesses.

HOTREC participates under the Chairmanship of DGV of the European Commission in Sectoral and Social Dialogue with ECF-IUF, which represents the interests of the employees in the hotel and restaurant industry in Europe.

In September HOTREC officially launched its publication "150 European Union measures affecting Hotels, Restaurants and Cafes". This publication analysis in detail the over 150 legislative measures proposed or already enacted by the European Union which currently affect the daily activities of every hotel, restaurant, and cafe in Europe. The reception to launch the publication had a very high turn out of important personalities of the European Union with representatives of the European Parliament and Commission. It provided the then President of HOTREC, Alain Phillipe Feutre the appropriate platform to make a plea in favour of less regulation.

In the context of the introduction of a definitive VAT system, DG XX1 of the European Commission is working on a draft proposal concerning VAT rates. The present indications are that the Commission's draft proposal would provide for three rates, a standard rate of approximately 17%, a social rate around 4% or 5% applicable to socially essential services and basic products and an intermediate rate of 12% which would apply to services with a high labour factor. This draft is still likely to be significantly amended on the way to being adopted. There is also a suggestion that the Commission would prefer a prolongation of the current transitional system.

In June 1998 the Commission presented a proposal for a directive on the right to deduct VAT. This proposal enumerated a number of cases where deductibility would only be partial, with hotel and restaurant services it suggested being deductible at the rate of 50%. However, the European Parliament recently adopted an amendment to the effect of which would be that hotel and restaurant services would be fully deductible for VAT registered clients. While this is a step in the right direction, the Commissioner, Mr Monti stated that he could not accept any of the amendments of the European Parliament so the lobbying will continue at European level and at National level to force the Commissioner to change his view.

The European inter-professional social partners UNICE (Union of the Industrial and Employers Confederations in Europe), CEEP (European Centre for Public Enterprises) and their employee counterpart ETUC (European Trade Union Confederation) have reached an agreement subject to being ratified by the individual bodies setting minimum requirements to be applied in each member state on the question of fixed terms of contracts. HOTREC was an observed at these discussions. If ratified and confirmed into Irish law the principle effects of the agreement would be that fixed term workers shall not be treated less favourably with regard to conditions of employment in relation to comparable permanent workers, solely because they have a fixed term contract, unless this treatment is justified on objective grounds.

HOTREC and ECF-IUF signed an agreement on the framework of their social dialogue at European level. This agreement clearly identifies the objectives of the social dialogue, the obligations of each part and the structures for the co-operation of both parties under the social protocol.

The Supreme Court in Austria ruled that TVs in hotel bedrooms in were not subject to the payment of copyright fees and the Court of First Instance of Oviedo (North of Spain) has presented a request for a preliminary ruling to the European Court of Justice on whether reception by hotels of satellite or terrestrial television signals and a re-transmission by cable to the various rooms is an actual transmission to the public. All Associations within HOTREC submitted the experience in their own countries as support for the Spanish case. A close watch is being kept on the development of the proposed Directive on Copyright in the Information Society.

HOTREC expressed a view to the European Commission that the harmonisation of the blood alcohol level allowance for driving should not take place as there are different circumstances in different countries on the effect of alcohol and driving. Last year Denmark; Germany and Austria decided to move from 0.8 to 0.5 milligrams per millilitre of blood. Spain is considering the move, there is a debate ongoing in Britain and Ireland, Italy and Luxembourg still have limits in excess of 0.5 mg/ml. The General Agreement on Trade in Services (GATS) was signed in 1994 and a new round of negotiations is due to start no later than December 1999. The GATS cover trade and investment in the field of services, the aim is to liberalise access to trade to foreign providers of services in signatory countries. The rules will also cover tourism services and may help the worldwide development of the sector. HOTREC has been invited by Commissioner Brittan to attend the first conference on preparing for the new round of negotiators (GATS 2000).

In September 1998 the DG XXIII officially invited NET - an umbrella organisation which includes HOTREC, European Travel Agents Association, European Tour Operators Association and the European Campsite Association to participate in consultative meetings with European small and medium enterprise business organisations to discuss issues which are likely to impact on small and medium size enterprises.

On environmental issues a proposal is currently before the European Council allowing for the voluntary participation by organisations in a community document (EMAS). If adopted, this regulation would extend to the service sector the voluntary management scheme which presently is in existence for the industrial sector. Many national associations in HOTREC have already developed environmental policies for their sectors and these are available to other associations to help them in their own developments. CEN, which is the European committee for standardisation, has completed work in standardising much of the tourist accommodation terminology and these will be published early in 1999. I participated in the HOTREC working group which made a submission to the CEN and I am satisfied that its implication for hotels will be minimal.

HOTREC continues to work on the drafting of a model contract which will be submitted to ECTA and which is based on the existing code of practice between HOTREC and ECTAA. The purpose of this model contact would be to help hotels and travel agents that do not have existing contracts to formulate contracts in dealings with one another.

ITIC

William Power

The Federation continues to play a major role in the activity of the Irish Tourism Industry Confederation, the umbrella body which represents the united views of the 22 major industry sectors in negotiating with the Government, the EU and Bord Failte. Throughout the year, ITIC participated in the various discussions and negotiations under the auspices of Partnership 2000. These included attendance at the preliminary meetings of Partnership 2000 and contributions to Government policy through inputs to the various sub-committees.

During 1998, ITIC commissioned an independent study entitled "Strategy for Growth beyond 2000". This study envisaged a scenario in which under favourable conditions tourism can be increased and from an influx in 1997 of 5m. overseas visitors, with revenue of £1.8bn. to a potential high of 7.8m with a revenue of almost £2.5bn. by the year 2002. This would require an average annual growth rate of 9% in numbers and 9.5% in revenue over that period, figures which are substantially ahead of international forecasts. A lower level growth scenario outlined in the study envisaged total tourism numbers of 7.15m. visitors at £2.22bn. in revenue. The study calculated the level of investments (from all sources) required over the next 6 years to achieve business potential identified by the study of a total of £753m. allocated under a number of key headings, destination marketing (£20m. per year) £120m.; product development £219m.; quality improvement £300m.; human resources £102m.and additional costs £12m.

ITIC acted as the umbrella organisation representing the tourist interests in seeking a commitment from Government to adequately fund an increased destination marketing programme for 1999 and the years beyond. This called for an annual spend of £20m. per annum over the next 6 years in above the line of destination marketing activities. Industry's spend on international marketing is estimated in 1998 to have been £44.7m. In fact the private industry sector contribution provided two-thirds of the total amount spent on marketing Ireland overseas. ITIC on behalf of the industry, was in constant discussion with the Minister for Tourism, Sport & Recreation and its officials in making arrangements for and setting up a tourism-marketing fund. It emphasised the absolute need to have such a fund ring-fenced for destination marketing activities and be under the joint control of industry and the state. ITIC in conjunction with the Overseas Tourism Marketing Initiative will implement a tourism awareness programme which is aimed at increasing awareness among the tourist industry practitioners about the core values of Irish tourism and importance of protecting and enhancing these values both within their own businesses and their communities. The programme is receiving a financial grant aid from the EU under the Operational Programme for Tourism 1994-1999.
In addition to the foregoing, ITIC have identified a number of policy issues which need to be addressed. These include: -
- Increasing pressure to secure better regional spread of business, need to being identified in earlier research commissioned by ITIC;
- Developing an improved system in the measuring of tourism performance on the ground;
- Seeking initiatives to address the employment and training challenges facing the industry;
- Continuing to press industry interests with the Social Partners-
- Continue to press for the development of a new Operational Programme for Tourism post 1999;
- supporting demands for the retention of duty free sales for intra-European travellers.

ITIC is fulfilling the need for a strong cohesive, voice of the tourist industry at a particularly crucial time. ITIC continues to seek the active support of its members in achieving its aims. I believe the best way forward is through a cohesive national plan in which the roles of, responsibilities including the funding responsibilities of Government, EU and the industry itself are clearly identified and committed to.