Transcript EU- Enlargement

Free Provision of Services
Agenda
 Part I
 Introduction
 Challenges for Turkish companies
 European legal framework
 Part II
 Tackling internal market barriers
 Case studies
Introduction
Gross value added - EU 27
2%
20%
Agriculture, hunting
fishing
Industry
Services, incl. construction
78%
Source:
EUROSTAT, OECD
Gross value added - Turkey
8%
22%
Agriculture, hunting
fishing
Industry
Services, incl. construction
70%
Source:
EUROSTAT, OECD
Employment - EU 27
5%
27%
68%
Source:
EUROSTAT, OECD
Agriculture, hunting
fishing
Industry
Services, incl.
construction
Employment - Turkey
26%
48%
Agriculture, hunting
fishing
Industry
Services
26%
Source:
EUROSTAT, OECD
World Trade
25 Trillion USD
20
15
16
10
16.4
5
0
2
0.4
World
Exports
1980
Source: WTO Trade
Statistics
3.7
World
Exports
2008
2.1
0.4
World
Imports
1980
3.5
World
Imports
2008
Goods
Commercial Services
World Trade
250
Billion USD
200
150
100
202
132
50
2.9
0
0.6
Turkey
Exports
1980
Source: WTO Trade
Statistics
34.4
Turkey
Exports
2008
7.9
0.5
Turkey
Imports
1980
16.1
Turkey
Imports
2008
Goods
Commercial Services
Challenges for Turkey
State of play
 Accession negotiations started in October 2005
 Screening completed
 Important alignment needs



Introduce freedom to provide services
Right of establishment
Mutual recognition of professional qualifications
 Chapter suspended in December 2006
European Legal Framework
Internal Market
Area without internal borders in which the
free movement of goods, persons, services
and capital is ensured in accordance with EC
Treaty (Art 14 EC Treaty)
Basics
Services can be provided...
 On a temporary basis - Freedom to provide services (Art
49 et seqq ECT)
 Stable continuous manner – Freedom of establishment
(Art 43 et seqq ECT)
 No general time limit
 Case by case decision taking into account duration,
regularity, periodicity and continuity
Basics
 Cross border element needed
 Precedence of Community law
 Direct effect
 Limits for public authorities and to some extend
(collective) private action
 State liability
Freedom to provide services
 Restrictions on freedom to provide services within the
Community are prohibited (Art 49 EC Treaty)
 Beneficiary



Service provider - EU-national established in Community
Service recipient – EU-national OR EU-resident
Service itself
Service within the meaning of the EC Treaty
 Cross border activity not covered by other freedom

Posting of workers is covered by provision of services
 Provided for remuneration (recipient/third party)
 Temporary basis/absence of a stable and continuous
participation in the host MS
V
 VV
Freedom to provide services
 Foreigners to be treated as nationals - no discrimination

e.g. nationality, residence, language requirements
 Abolition of any national restriction


National measure liable to prohibit, impede or render less
advantageous the provision of a service (delays, additional
costs)
Even if no discrimination between nationals and foreigners
Prohibited restrictions
Bans (e.g. gambling)
Obligation to have permanent establishment/residence
Requirement to obtain authorisation/registration
Ban on setting up infrastructure (office, chamber)
Minimum number of employees
Compulsory registration/membership with professional
body
 More advantageous terms/prices for residents






Freedom of establishment
 Restrictions on freedom of establishment are prohibited (Art
43 EC Treaty)
 Carry on an economic activity in a stable and continuous
manner in other MS

Right to open agencies, branches or subsidiaries

Right to set up and manage undertakings

Right to take up and pursue self-employed activities
Freedom of establishment
 Beneficiary
 EU nationals
 Companies/firms formed in accordance with law of a
MS and having registered office/central
administration/principal place of business within
Community
Freedom of establishment
 Foreigners to be treated as nationals - no discrimination

e.g. nationality, residence, language requirements,
economic need tests
 Abolition of any national restriction


National measure liable to prohibit, impede or render less
advantageous the provision of a service (delays, additional
costs)
Even if no discrimination between nationals and foreigners
Prohibited restrictions
 Prohibition to have an establishment in more than one MS
 Restrictions to choose between principal/secondary
establishment
 Involvement of competitors in authorisation decisions
 Insurance from national company
 Quanatitative restrictions
 Specific legal form
 One office rule
 Minimum number of employees
Grounds for justification I
 Activities directly/specifically connected with the
exercise of official authority (Art 45 ECT)
 Grounds of public policy, public security or public health
(Art 46 ECT)
 May justify (non) discriminatory restrictions
Grounds for justification II
 Imperative requirements in the general interest (ECJ)




e.g. consumer protection, protection of workers, road
safety, environmental protection, financial balance of of
health system
No harmonisation
Suitable for securing overriding requirements relating to
public interest
Not go beyond what is necessary (provision of services vs.
establishment)
 May justify only non-discriminatory restrictions
Recognition of Professional
Qualifications
Recognition of Professional Qualifications
 MS free to require qualifications
 Qualifications acquired in other MS have to be
recognised
 Directive 2005/36/EC
 Different requirements for


Service provision (temporary and occasional)
Establishment (permanent business)
Recognition of Professional Qualifications
 Service Provision:
 profession regulated in home MS: immediate service
provision
 profession not regulated in home MS: 2 years
experience during precedent 10 years needed
 public health and safety implications: additional
checks/requirements possible
Recognition of Professional Qualifications
Service Provision
 Written declaration in advance may be required
 Documents needed:


Proof of nationality and legal establishment in MS to legally
pursue activity
Evidence of professional qualification/2 years experience
 No registration with or membership of professional
organisation, excepted pro forma membership
 No registration with public social security body
Recognition of Professional Qualifications
 Establishment:
 General system: mutual recognition of diplomas,
certificates, attestations; aptitude tests and
adaptation periods possible
 Recognition of experience: most crafts and trade
professions covered; proof of experience and training
leads to recognition
 Specific automatic recognition: medical professions
Everything is perfect?
 Many problems/obstacles remain
 Internal Market in services is key for Lisbon Agenda
 Only 20% of trade in the Internal Market
Services Directive
Objectives
 Establish a genuine Internal Market in Services
 Legal Security
 Economic Growth and Job Creation
 No liberalisation of SGEI, no privatisation of public
entities
Scope I

“All” services covered

Directive does not cover:
Non-economic services of general interest, financial services,
electronic communications services, transport services, temporary
work agencies, healthcare services, audiovisual services, gambling,
official authority, social services, private security services, notaries,
taxation
Scope II

Private International Law unchanged

Labour Law (Posting of Workers Directive) unchanged



Compliance with core conditions of work of the host MS
Prior notification of posting may be required
Recognition of professional qualifications unchanged
Administrative Simplification
 Simplification of procedures
 Points of single contact


Right to information
Complete all procedures /formalities needed
 Procedures by electronic means
Freedom of establishment


Permanent change to other MS
Authorisation may be required, if:




Prohibited requirements


Non discriminatory, necessary, proportionate
Transparent and predictable criteria and procedures
No duplication of requirements
e.g. Nationality, residence, economic need test
Requirements to be evaluated

e.g. Quantitative/territorial restrictions, minimum number of
employees, fixed minimum and/or maximum tariffs
Free movement of services
 Temporary and occasional work in other MS
 Country of origin principle changed into „principle of non
obstruction“
 Requirements only if




Non-discrimination
Necessity (public policy/security/health, environment)
Proportionality
Safeguard clause
 Black list (e.g. establishment, authorisation, ban on
infrastructure, equipment)
 Screening
Limited Harmonisation
 Information obligations on providers (name, contact
details, authorisation, after-sales guarantee,
price/main features of the service,…)
 Professional liability insurance and guarantees
 Measures to promote service quality (certification,
quality charter, standards, settlement of disputes)
Administrative cooperation
 Obligation to cooperate
 Information exchange and mutual assistance
 Supervision by MS best placed
 Internal Market Information System
The Directive is …
 No revolution
 Social, labour, environmental standards
maintained and quality secured
 Value Added – less bureaucracy, less barriers, more
legal security
 Unsolved
 Enforcement of administrative decisions
 Control measures for posted workers
Tackling internal market
barriers
Content
1. Introduction
2. Tools to fight internal market problems
3. Conclusions
Introduction
 99,6% of WKÖ members are SMEs
 89,8% of WKÖ members are micro enterprises
 59% Export Quota
 EU market is essential for Austria and its
SMEs
Introduction
 Well functioning of Internal Market priority for WKÖ

Lobbying (Services Directive, Mutual Regonition,...)

Support services for Members
 Enterprise Europe Network within EU-Department

Provides information, analysis and support

about 290 requests/year related to Internal Market

some 50 Internal Market Problems
 SMEs need fast, cheap and reliable solutions
Tools
Preventing Obstacles - Notification
Procedure
 Directive 98/34/EC
 MS have to notify draft technical regulations relating to
products and information society services before
adoption
 Technical regulation not notified cannot be applied
 Commission and MS can examine draft during standstill
periods
 Business organisations can raise objections via EC/MS
 Deatailed opinion extends of standstill period
 Solutions for 95% of cases
Foreign Trade Commissions – Bilateral
Interventions
Austrian Trade Commissions
1. Abu Dhabi
2. Algiers
3. Amman
4. Ankara
5. Athens
6. Bagdad
7. Bangkok
8. Barcelona
9. Belgrade
10. Berlin
11. Brussels
12. Budapest
13. Buenos
Aires
14. Bucharest
15. Caracas
16.
17.
18.
19.
20.
21.
22.
23.
24.
25.
26.
27.
28.
29.
30.
Casablanca
Chicago
Damascus
Den Haag
Dublin
Frankfurt
Helsinki
Hong Kong
Istanbul
Jakarta
Jeddah
Johannesburg
Cairo
Kiev
Copenhagen
31.
32.
33.
34.
35.
36.
37.
38.
39.
40.
41.
42.
43.
44.
45.
Kuala Lumpur
Lagos
Ljubljana
Lisbon
London
Los Angeles
Madrid
Milan
Manila
Mexico
Montreal
Moscow
Munich
New Delhi
New York
46.
47.
48.
49.
50.
51.
52.
53.
54.
55.
56.
Oslo
Padua
Paris
Peking
Prague
Bratislava
Santiago
Sao Paulo
Sarajevo
Seoul
Shanghai
57.
58.
59.
60.
61.
62.
63.
64.
65.
66.
67.
68.
69.
70.
Singapore
Sofia
Stockholm
Strasbourg
Sydney
Taipei
Teheran
Tel Aviv
Tokyo
Toronto
Tripoli
Warsaw
Zagreb
Zürich
SOLVIT
 Incorrect application of EU rules by MS
administration causing roblems for EU citizens with
cross border element
 Network of 30 SOLVIT centres (EEA)
 Informal and pragmatic approach – no legal
obligation to find solution
 Free of charge
 10 weeks deadline
SOLVIT
How does it work?
Country A
Country
B
Home
SOLVIT
centre
Define problem
and discuss the
solution
Citizen or company
Co-operate
to find the
solution
Lead
SOLVIT
centre
Negotiate
possible
solutions
National authority
SOLVIT

Tackle Internal Market Barriers

Trade Commissions

SOLVIT

Infringement Procedures

Interactive Policy Making (SME Panels, SME feedback)
Parliamentary Questions
 To increase pressure
 Written questions may be put by any Member to
the Council or Commission
 Answered within six weeks non-priority)/ three
weeks (priority)
Infringement Procedure
 Lodge complaint with EC if MS violates EC-law
 EC may open infringement procedure and bring case
before ECJ
 MS obliged to comply with ECJ ruling
 Procedure may take several years
Conclusions
 SME stronger affected by internal market
barriers
 Business Organisation‘s support helpful and
needed
 Existing tools are valuable but not perfect
Thank you!
Markus Stock
Austrian Federal Economic Chamber
[email protected]