The draft Directive on Services in the Internal Market,
originally put forward by the Commission in January 2004, is
designed to cut the red tape that currently prevents businesses
from offering their services across borders, or from opening
premises in other Member States.
But plans to cover the majority of all services provided to
consumers and businesses were dashed in January after MEPs
drastically watered down the text of the proposals. The European
Parliament also removed the controversial “country of origin”
principle from the draft. This would have entitled European traders
to work in any of the 25 Member States while complying only with
the relevant laws of their home state.
The European Commission has now published an amended draft that
takes these amendments into account. According to reports, the
Commission took the view that it was better to have a watered down
Directive than none at all.
Accordingly, the amended proposal does not affect labour law or
deal with the posting of workers. It also excludes the following
from the scope of the Directive: financial services,
telecommunications, transport services, port services, healthcare,
social services relating to social housing, childcare and support
of families and persons in need, activities connected with the
exercise of official authority, temporary work agencies, private
security services, gambling and audiovisual services.
The country of origin principle has also been deleted from the
text.
The main features of the draft include:
- Establishing a business anywhere in the EU: businesses will be
able to complete all formalities online and through a single point
of contact. Authorisation schemes will be clearer and more
transparent, while "economic needs" tests (expensive procedures
requiring businesses to prove to the authorities that they will not
"destabilise" local competition) will no longer be allowed. This
will speed up authorisation and reduce costs for businesses.
- Providing services across borders: the freedom to provide
services anywhere in the EU will be underpinned. Member States must
respect service providers' rights to provide a service in a Member
State other than that in which they are established. They must
receive free access to and enjoy free exercise of a service
activity in any territory. However, Member States will be able to
apply measures that are non-discriminatory, proportionate and
necessary for reasons if these are necessary to protect public
policy, public security, public health and the protection of the
environment.
- Better consumer protection: businesses will be under an
obligation to make key information available to consumers and will
not be allowed to discriminate against a consumer on grounds of
residence or nationality.
- Better supervision of businesses: Member States will have to
step up administrative cooperation between them to ensure improved
and effective supervision of businesses. This will be backed up at
a practical level by an electronic information system enabling
authorities to exchange information directly and efficiently.
Separately, the Commission is also publishing guidance to Member
States on the operation of the Directive covering the posting of
workers from one Member State to another. It will also come forward
with a separate initiative in the area of health, covering issues
such as patient mobility, and will publish Communications on social
services and on services of general interest.
"This is a realistic, practical and workable solution. It has
the potential to make a real economic difference at a critical time
for Europe,” said Internal Market and Services Commissioner Charlie
McCreevy.
The draft Directive now goes forward for consideration by the
Council of Ministers. MEPs will also have a chance to vote on the
amended proposals.
