Services in EU single market strategy

In the blog entry Evidence-based European market reforms?, we saw that the condensed single market communication could be used in parallel with the staff working document underpinning the reforms:

Upgrading the Single Market: more opportunities for people and business; Brussels, 28.10.2015 COM(2015) 550 final (22 pages)

A Single Market Strategy for Europe - Analysis and Evidence; Brussels, 28.10.2015 SWD(2015) 202 final (108 pages)

(We found that cross-border VAT offered crushing prima facie evidence of failure from the viewpoint of a single market for SMEs, but we left a detailed discussion until later.)

Domestic keys

The many facets of overdeveloped obstacles for (domestic and) cross-border services and the underdeveloped EU-wide markets were discussed in section 2.3, in the strategy COM(2015) 550 on pages 7-10, but in much greater detail in the analysis paper SWD(2015) 202, on pages 13-39.

Restrictions in the retail sector (section 2.4), page 10 in the communication and pages 39-50 in the supporting working paper, raise similar thoughts:   

EU “red tape” is not the only villain. In many cases the improvement of markets for services - to the benefit of consumers and businesses - requires reforms primarily in the EU member states.

The most concrete Commission proposal was a legislative act to create a services passport to demonstrate professional qualifications. Despite enforcement powers regarding clear breaches, increasingly the Commission seems to assume the role of a guiding mentor and motivational coach, hoping to sway local, regional or state authorities.

Discrimination

The discussion about discrimination (section 2.5), pages 10-12 of the communication and pages 51-54 of the evidence paper, turns to annoying geo-blocking and lame excuses, but with burdensome and fragmented VAT and copyright, how much single market can we realistically expect from SMEs (or anyone under contractual freedom)?

Since the Commission refers to Article 20(2) of the Services Directive 2006/123, let us at least take a look at the excuses provided by the non-discrimination provision:

Article 20

Non-discrimination

1. Member States shall ensure that the recipient is not made subject to discriminatory requirements based on his nationality or place of residence.

2. Member States shall ensure that the general conditions of access to a service, which are made available to the public at large by the provider, do not contain discriminatory provisions relating to the nationality or place of residence of the recipient, but without precluding the possibility of providing for differences in the conditions of access where those differences are directly justified by objective criteria.

“Directly justified by objective criteria” is one more question to remember, when we deal with the concrete actions and proposals of the Commission, based on the 2015 strategy for the single market.

Ralf Grahn