No suprises in new EU services text

The European commission has presented a revised version of the much-criticised services directive that broadly follows last February’s compromise by MEPs.

Some MEPs, in particular on the centre-left, had been concerned that internal market commissioner Charlie McCreevy would not honour his pledge to include amendments that had been backed by a large majority during parliament’s vote.

In particular, the commission was rumoured to be backtracking on amendments concerning interaction with existing labour laws and on consumer protection.

But McCreevy underlined that the commission had “honoured its commitment” to follow parliament’s lead, with just a few exceptions.

“This new proposal has real teeth, and member states will have to remove all unjustified obstacles to the freedom to provide services.”

“It will now be easier for businesses to establish in another member state, with one-stop shops for all the necessary requirements and the ability to fulfil the procedures online,” the commissioner said.
 
Country of origin removed

Key amendments on which country’s laws should apply to cross border service providers – without reference to the much-maligned country of origin principle - have been retained in the commission document.

Taxation, security services, temporary employment agencies and the audiovisual sector will all be excluded, in line with parliament’s text, as will health services.

But separate legislation will be drawn up soon by health commissioner Markos Kyprianou to regulate the mobility of patients and reimbursement of health costs. 

Public services provided by the state are excluded from the scope, but those carried out on behalf of the state by private companies remain within the directive.

Social services relating to housing, children, persons in need and family support will also be excluded but McCreevy warned that it was important to clearly define which social services should be covered.

“The commission will issue a communication on social services of general interest in the next few weeks,” he said.

No conflict with labour law

McCreevy highlighted one of the major areas of consensus between parliament and commission – interaction with existing legislation.

“Removing references to the directive’s interaction with labour law was an important element for creating a positive atmosphere around the compromise text,” McCreevy said.

“The feeling that the original text would have led to a lowering of standards – no matter how incorrect – poisoned much of the debate.”

“It is now clear that all existing labour regulations will take priority over the services text.”

Consumer protection ensured

Concerns voiced by some MEPs – notably parliament’s rapporteur on the services dossier, Evelyne Gebhardt – that the commission’s text would remove consumer protection also proved unfounded.

“We have clarified that private international laws will take priority over the services directive, which means that consumers can rest assured that the consumer protection rules in their own member state will continue to apply to cross-border services,” the commissioner said.

The new commission text differs from parliament’s compromise agreement in just a handful of areas, notably on legal services.

MEPs had voted to exclude the legal profession from the scope of the directive on the grounds that it could lead to confusion with existing legislation.

But McCreevy stressed that it was quite clear that in cases of confusion, the sectoral legislation – and not the service rules – would apply.

Posting of workers clarification

McCreevy was joined in the hemicycle by employment commissioner Vladimir Spidla, who briefed MEPs about new guidelines on the implementation of the rules on the posting of workers.

The varying interpretations of the 1996 legislation has allowed many member states to impose unjustifiable barriers to companies from other countries.

Centre-right MEPs, led by shadow rapporteur Malcolm Harbour, had pinpointed the abuse of the rules on the posting of workers as one of the key barriers to cross-border service providers.

The commission’s guidelines provide information on a number of key areas. For example, host countries cannot oblige service providers to have a permanent representative in their country, or require prior authorisation before workers can be posted.

It also underlines that host countries can require service providers to declare their intention to post workers, as this facilitates controls.

Service providers will also have to provide “social documentation” such as timesheets or papers concerning health and safety to ensure that local rules are being complied with.

“Businesses have the right to post workers under the service directive,” Spidla explained. “But we need to explain what controls member states can justifiably use to stop social dumping and the abuse of local legislation.”

• Previous article
• Next article