Ivor Richard, employment commissioner of the European Community, bluntly notified American business executives yesterday that controversial restrictions on the operations of multinational corporations in Europe will be implemented.
The regulations would require multinational corporations with more than 1,000 employes to consolidate the financial reports of all their operations in Common Market countries, disclose extensive data on plans and strategies and consult with workers' representatives in advance on such major decisions as plant closings.
The U.S. executives object to the regulations as potentially dangerous to trade secrets and as a disincentive to U.S. investment in Europe.
"I don't expect a vote of enthusiasm," Richard told corporate lawyers and business lobbyists in a speech at the International Club. "I don't expect to win your assent. My objective is to produce a directive not that you will like but that you can reasonably be expected to work with."
The European Parliament in December approved the so-called Vredeling proposal and other regulations after years of negotiation, debate and lobbying. Several amendments aimed at making the package more palatable to corporations have been proposed in Parliament, but Richard said the Common Market commission, which is aiming to produce a final version by late spring, will not accept all of them.
He said he "shared the concern of business" to change the original draft to protect "business secrets and other confidential information." Amendments proposed by the Parliament, he said, would have allowed management to withhold virtually any piece of information a company declared secret, and that could not be permitted.
Instead, Richard said, he will revise the rules again to "allow managements to omit any information whose disclosure would substantially harm the company's prospects or substantially damage its interests."
Disputes over what sort of information falls into this category would be settled by a tribunal, he said. Lawyers for U.S. corporations argue that this plan would only ensure endless rounds of expensive litigation.
Richard said American companies must understand that there was unanimous sentiment in the European Parliament, "from the extreme right to the extreme left," in favor of legally binding regulations to correct "the failure of some multinational companies, among them some very prominent ones, to provide information to their work force on decisions of vital interest to the workers."
He said the Vredeling program, named for a former commissioner, was a "modest proposal" that would leave management decisions in the hands of managers while giving workers advance information about matters important to them, such as corporate reorganizations or plant closings.
Stephen Cooney, international trade officer of the National Association of Manufacturers, said American corporations "are seriously concerned about European unemployment," but said "no one" would benefit from the mandatory consultations.
Cooney said the proposed rules would be counterproductive for Europe because they would discourage American capital investment in Common Market nations. Richard brushed aside the disincentive argument, saying "American companies invest where they can make a profit, and if you can show me how this will reduce profits, I am prepared to listen."