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The complexity of the Services Directive - flagship of liberalisation efforts in Europe - is one of the reasons why the implementation process of this crucial EU legislation will take years and the services sector is not fully acting as EU’s growth engine. A new study published today by New Direction – The Foundation for European Reform and the Belgian think tank LIBERA! recommends a new simplified testing method if national regulations abide by the rules of the Directive and are necessary, suitable and proportionate.
Brussels, 20 June 2012 – Despite accounting for more than 45% of EU GDP, the services sector has been largely neglected: two and half years after the deadline for implementing the Services Directive, most European businesses still face legal uncertainty and trade barriers when offering their services in other EU countries. National governments often hide behind complex and unclear or non-exiting guidelines on how to screen national regulations, failing to remove costly regulatory obstacles.
The ‘Serving Europe – Making the Services Directive work” study, published today, recommends the ‘Services Impact Test’ (SIT) as an advisable practice for EU member states. The SIT is a screening system with 3 to 4 different filters that can be used to eliminate elements of national legislation incompatible with the Services Directive.
The author of the Manuel Dierickx Visschers, a policy analyst at the Flemish Parliament and vice-president of the Flemish think tank LIBERA!, has analysed various screening systems and according to his research SIT has proved to be the most effective.
The Belgian “IKEA-regulation” case study highlights the danger of keeping in place distorting regulations due to EU member states’ protectionist policies, unless a judicial review and enforcement mechanism is pursued Due to insufficient screening, the unnecessary and disproportionate IKEA-regulation is still in place and continuously prevents large retail centres from conducting their business on a proper basis.
“Instead of bringing clarity and certainty to businesses, the Services Directive is a complicated matter that will take years to implement. Unclear and complex conditions can lead to confusion and misinterpretation and bring unnecessary and disproportionate costs. If Europe wants to have visible growth and innovations in services, it needs to liberalise its market in a transparent and simple way,” said the Director of New Direction Shane Frith.
A well-functioning and fully integrated Single Market for services is urgently needed in the light of the current economic crisis, concludes the study and continues: “Today, it appears that the European Commission does not know how to deal with the insufficient screening of legislation by EU Member States. A re-examination in the screening process is necessary but the main issue now is which precise questions to ask the Member States. The Services Impact test may provide the solution for this issue,” adds Dierickx Visschers.
“More uniformity, transparency and legal certainty of the screening process are needed. Based on our analyses Services Impact Test would be advisable and probably necessary from a legal perspective in order to meet the screening and reporting obligations,” says Dierickx Visschers.
Note to Editors
New Direction - The Foundation for European Reform is a free market think-tank established in Brussels in 2010 to add innovative ideas and encourage reform efforts in Europe. Together with a strong network of partner think tanks around Europe, New Direction produces original and relevant research papers focusing on the most pressing issues in the area of economic growth, competition, financial regulation, energy security, taxation, agricultural policy, bureaucracy and EU institutional affairs.
Libera! is an independent non-partisan think tank in the Flemish region of Belgium fostering the values of a free society in general and the protection of private property rights in particular. The scope of its research and activism is not limited to the regional or national arena but also extends to the European and international level. Libera! publishes academic studies, policy papers and articles on a regular basis. Furthermore, monthly events and activities are also organised, ranging from public debates and evening discussions, through formal banquets and international conferences, to private dinners and working luncheons with policymakers. A Flemish think tank with an international focus, Libera! is a proud member of New Direction: Foundation for European Reform, the Stockholm Network, the Atlas Network and the European Coalition for Economic Growth.
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