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Does this mean the Statute is one step closer to becoming

reality and we should get ready to uncork our champagne

bottles? Perhaps, but for the time being, its probably better

to keep our heads clear and stick to sparkling mineral water. In

any case, the legislative process star ting from the conclusion

of the study and presentation of recommendations, then

moving on to a Commission decision to go ahead with the

Statute, and further to the drafting of a text for review by the

Council and Parliament could take at least one to two years.

Manuel Medina, a Spanish member of the European

Parliament since 1986 with a longstanding interest in this

issue, believes a Statute is a necessary step, given the various

difficulties facing foundations in their European activities.

However, he cautions that a feasibility study could engender

a false sense of progress being made on the Statute. The

Commission has too many feasibility studies, he notes.

According to Medina, a European Foundation Statute is

needed because we have to develop European [structures],

and one way of developing European [structures] is throughfoundations, which are useful instruments. A European

Statute would provide a special status for foundations whose

activities have a European scope, and this in turn should

pave the way for creating a more favourable tax environment

for such foundations and their donors. Medina feels that

taxation can be a particularly problematic area for European

foundations operating across borders in the EU.

Administrative and fiscal barriers to foundations and funders

cross-border work are also a prime concern for Wolf Schmidt,

a member of the Executive Board of the Krber-Stiftung,

an EFC member foundation. The foundation launched the

international EUSTORY network, which aims to promote

dialogue on the different histories in Europe and to ensure

that history is used to foster mutual understanding. The

Krber-Stiftung is now in the process of establishing the

International EUSTORY Foundation (IEF) in order to have a

pan-European structure. When politicians say that a national

framework is enough for public benefit activities in Europe,

they are completely wrong, says Schmidt.

He would like to see the IEF set up as a European foundation

under a European Foundation Statute, as well as a non-

discriminatory tax regime in the EU whereby donations to

foundations throughout the Union are treated the same

way as donations to national foundations. In this regard,

the Commissions infringement procedures against various

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Whats next for the European Foundation Statute?

Work on a feasibility study on the European Foundation Statute was set to begin this summer, following the

European Commissions call for tender in April 2007. With a June 8th deadline for tenders, the bids are now

in and the winner will have 11 months to complete the study. This is the latest step in a process that has been

unfolding for the past few years, with consultations, action plans, briefings, and high-level expressions of

both support and doubt.

Manuel Medina, Spanish member of t he European Parliament

We have to develop European [structures],and one way of developing European[structures] is through foundations..."

-Manuel Medina, Spanish member of the European Parliament

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national governments are a welcome step. Schmidt believes

that a European Foundation Statutewould be important

as a political symbol for an issue like promoting dialogue on

European history which requires Europe-wide activities, [and]Europe-wide fundraising and funding.

As a European Foundation Statute is not yet a reality, the

IEF will be registered as a Dutch entity, with an additional

national-level affiliate in Germany for tax reasons. The primary

mechanism to enable favourable tax conditions for donors to

the IEF will be the Transnational Giving Europe (TGE) network.

Schmidt stresses that we need not only the feasibility study,

we need the Foundation Statute. We need it urgently and

at the same time we cannot wait until we get the Statute.

We have to act now in Europe, that means we have to look

for solutions in the time between. Using TGE is just such an

interim solution.

There is no guarantee

that the feasibility study,

soon to be undertaken,

will result in the necessary

political momentum for

a European Statute. For

Manuel Medina, the best

way to create a political

opening for the Statute

is to tie it into the EUs

current emphasis on

research and technology.

He points out that theEU is seeking to increase

foundations involvement

in research and

development at a European level. It is even trying to develop

a European Institute for Technology which would seek

cooperation with the private sector. So, the EU has an interest

in having those foundations recognised, says Medina. The

counterpart of the European Institute for Technology should

be a European Statute on Foundations so that foundations

can operate across frontiers.

Medina advises the foundation sector not to be discouraged

by negative responses by the Commission. The Commissionsometimes says no and then a few months later changes its

opinion. Soyou have to keep putting the foot in the door.

This is perhaps a good moment You need a political push

andfor that you have to have a good reason to [lobby for] a

Statute on European FoundationsYou have to focus on what

the Union is doing now, and research is one of the goals of the

Union at this stage.

With regard to the European Forum on Philanthropy and

Research Funding, which has been set up by the EFC with the

support of the European Commission, Medina believes it is a

good way to highlight and strengthen the role of foundations

in research: Its a useful thing. Its a way of creating the

appropriate environment.

But still, the feasibility study remains an important process.

The EFC will monitor the process and will seek to be closely

involved with it. The purpose of the study is to provide

an overview of the main regulatory differences affecting

foundations in EU Member States and an inventory of the

main internal market barriers, as well as an estimate of the

costs created by these obstacles. The study will analyse

how these obstacles can be efficiently overcome, including

whether the adoption of a European Foundation Statute

would be an effective solution. Also, the study will assess the

potential impact of a Statute on the foundation and corporate

sectors, and the European economy at large.

Today there are foundations that have a European mission

but cannot fully carry out this mission because of a lack of a

European legal form for foundations. EFC members report

various barriers in their European-level activities. But it is

not only a question of legal and fiscal barriers. A European

Foundation Statute would send a positive signal and mobilisenew funders to bring their resources to bear on addressing

important European issues. The Commissions feasibility study

is a welcome step, but the European foundation sector should

be realistic and make use of various avenues to advance its

goals.

Nyegosh Dube, EFC

For more information on the European Foundation

Statute, go to: www.efc.be/european_statute

When politicians say that a nationalIUDPHZRUNLVHQRXJKIRUSXEOLFEHQHWactivities in Europe, they are completelywrong.-Wolf Schmidt, Krber-Stiftung

THE LEGAL AND FISCAL SCENE

Wolf Schmidt, member of the

Executive Board of the Krber-

Stiftung