Policies

Committee on Internal Market and Consumer Protection

Successes and failures 2004-2009

Background

The EPP-ED Group has long advocated a Single Market that delivers enhanced economic growth and more consumer choice, while encouraging innovation and enterprise.
Led by the coordinator Malcolm Harbour and Vice-Coordinator Andreas Schwab, EPP-ED Members succeed in ensuring the rapporteurship of key legislative dossiers and in promoting our political priorities. Since 2004 the Group has held two of the Vice-Chairmanships of the Internal Market and Consumer Protection (Zsuzsana Roithova and Alexander Stubb, replaced in 2008 by Eija Riitta Korhola).

Services Directive

The Services Directive is still the crucial piece of legislation after the enlargement and the negative outcome of the referenda on the Constitution. The Parliament has agreed a sensitive package and acted as a responsible co-legislator thus taking the political lead at .a difficult point in time for the European unification process.

The primary objective of the Services Directive is to establish a general legal framework for the Internal Market in services by offering both, freedom of establishment and the free provision of cross-border services. Contrary to public fears that the directive would lead to social dumping by opening up Member States services markets, it mainly implements the legal situation taht exists since 1958 and enables citizens and business to be active in the internal market without being hampered by administrative obstacles.

The EPP-ED Members still follow the implementation (process, du to be completed end of 2009 to ensure that citizens and business will fully benefit from the directive. Reducing administrative burden by introducing the Single Points of Contact was one of the key achievements of our MEPs.

The Parliament, lead by the EPP-ED, substantially modified the controversial Commission proposal with regard to scope and legal technique (Country of origin principle).Thanks to the reached compromise to replace the "Country-of-Origin principle" by the "Freedom to provide services", the directive has been adopted with a broad majority.

The EPP-ED restructured the system for administrative cooperation by establishing an efficient, computer-based system for the quick exchange of information between member states authorities for having an efficient control of false self-employment and black labour.

Market surveillance and marketing of manufactured products

The EPP-ED Group’s main tribute to “the Goods Package" has been the reduction of red tape for SMEs and reinforcement of the legal protection of CE marking, by informing consumers about it and penalising its improper use.

The package introduces better rules on market surveillance to protect both consumers and professionals from unsafe products, including those from third countries. Our Group is confident that by clear common rules for the marketing of the products produced in the EU or imported, this legislation will make manufacturers, importers, distributors and economic operators more responsible for consumers’ protection and the better functioning of the market.

EPP-ED MEPs highlighted that the differences between the rules in many Member States discouraged companies, in particular small and medium enterprises, from venturing outside domestic markets. To eliminate technical obstacles MEPs agreed to shift the burden of proof from the economic operator to the Member State.

Another breakthrough was the establishment of Product Contact Points in all Member States, which provide information on national technical rules, so that enterprises, in particular SMEs, can obtain precise information about the law in force in the Member States where they intend to sell their products.

Universal Service package (telecoms reform package)

The telecoms reform package, which updates the 2002 telecommunications legislations, covers all forms of electronic communications including telephone, both fixed line and mobile, fax, internet, cable and satellite. The package promotes competition, less regulation, a better functioning internal market and increased consumer protection measures.

The EPP-ED significantly enhanced the initial proposal from the Commission by including several key consumer friendly measures in the Universal Services and Users´ Rights report.
These include enabling consumers to transfer their phone networks within one day – in some cases this previously took up to one month – protection against being switched against their will to other network providers, and clearer information about price plans when taking out a phone contract. There are also several measures to improve network security and fight spam.
In addition, the report includes provisions to boost services for disabled users so that they benefit from equivalent telecommunications services.

The new rules included in the report protect consumers from blindly entering into long contracts whilst ensuring they are given all the information they need to make fully-informed decisions.

Previously, consumers would not have been told if they would be required to pay significant sums for their handset if they broke a contract early or if services such as Skype were blocked on their handsets. This will change following the adoption of the report in April 2009.

The package will empower consumers to shop around as providers are encouraged to offer better deals. Ultimately this will improve the service they receive on the internet and on their telephones.

More choice and better consumer protection in consumer credits
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The revision of the Consumer Credit Directive was a cumbersome and lenghty process, as Member States were not inclined do agree on EU wide standards for consumer protection in the area of consumer credits. Finally an agreement could be reached on standard information for advertising and pre-contractual information to allow the best informed choice for consumers. Futhermore contractual information to be included in credit agreements; the right of withdrawal and the rules for early repayment of the credit and the creditor's right to compensation as well as the calculation of the annual percentage rate of charge (APR) were included in the new text to allow consumers to have comparable contractual arrangements regardless where in the EU an credit is taken.

Boost for tourism and better protection for consumers

Thе new Timeshare directive responds to the needs of consumers and businesses in today's Single Market by replacing a directive from 1994. It represents a major opportunity for both EU tourism as well as the fast-growing timeshare industry. It will have a larger impact since it will regulate also timeshare and long-term holiday products (including products such as discount holiday clubs) contracts related to movable property, e.g. contracts for accommodation in canal boats, caravans or cruise ships.

Consumers will be better informed before committing to contracts and thus less exposed to rogue operators when buying timeshare or timeshare-related products given their cross-border nature. EPP-ED members ensured that consumers' rights have been further reinforced through the extension of the right of withdrawal to 14 days free of charge.

Control of the acquisition and possession of weapons

Owing to the relentless efforts of the Group, counteracting the radically ideological Green rapporteur, a compromise has been established allong the following lines:
classification of weapons into four categories (A-D) is retained, with a special light registration regime for category D (deliberately vague expression of being 'permitted to possess them in accordance with national law' in order to include Member States providing for holders of e.g. hunting or sport-shooting licences) to be phased-in until the end of 2014 - Member States however remain entitled to retain the number of categories they perceive as appropriate; definitions in line with the appropriate UN Protocol; explicit obligation of marking and traceability of firearms; the Comite Internationale Permanente (CIP) system as a model; computerised data filing system of registration to be phased-in in a form allowing for its both centralised and decentralised construction; European Firearms Pass formally introduced as a principal document required in order to travel in Europe with weapons although, in accordance with the subsidiarity principle, further documents may still be requested; measures for deactivation of weapons, including convertible

The legislative proposal focused specifically on simplifying and harmonising licensing conditions and procedures for transfer of defence-related products. It remains however in the Member States exclusive authority to decide on export policies. Member States shall grant various types of licences (general, global and individual) for intra-EU transfers, with prior authorisation of transfers established as a rule as well as other specific requirements being laid down in the directive. Member States will also be required to certify those companies, that wish to receive products according to general licences issued in other Member States. EP succeeded in introducing the sanctions for breach of the provisions implementing the directive.

Public procurement: Better public services and more opportunities for innovative SMEs

Eu public procurement rules are aiming at two major goals: Efficient use of public money and avoiding discriminatory practices and bribery. Public procurement accounts for 16 percent of the EU's GDP, thus it opens large opportunities for enterprises. The EPP-ED Group is very much attached to continue the improvement of the European regulatory framework in this area.
Firstly, the new Remedies Directive, mainly pushed by our Members, managed to improve the effectiveness of review procedures concerning the award of public contracts. Existing procedures have varying time limits and lead to different sanctions in the Member states. EPP-ED Members advocated the introduction of strict sanctions and clear enforcement rules that will oblige public authorities to comply with the rules for the award of public contracts.
Secondly, the EPP-ED contributed to the adoption of the Directive on Public Procurement in the Defence Sector. For the first time Member States accepted to open up their defence markts to EU wide competition. This will help to get more value for public money, to avoid corruption and to make employment in this sectore more competitive and thus safer.

Finally, the EPP-ED initiated a report on pre-commercial procurement to demonstrate how the EU, Member States and regional and local authorities can use procurement rules to help improve public services whilst giving innovative small businesses new opportunities. The EPP-ED Group is in favour of efficient and transparent procedures that will facilitate SMEs to accessing public contracts.

Safer toys in the EU

The Toys safety directive aims at improving toys safety by modernizing and simplifying current legislation for both economic operators and market surveillance authorities.
The major success of our Members has been the introduction of specific rules on CMR (carcinogenic, mutagenic, or toxic for reproduction) and allergenic fragrances in toys. For the first time requirements have been set related to toys in food. Market surveillance obligations have been given new powers: access to the premises of economic operators, to request information or give instruction to Notified bodies; the right to obtain mutual assistance from other Member States.
Our Group, after long consideration and impact analysis, did not pursue the idea of making third party certification mandatory for all toys as this would drive out of the market the remaining few EU SME producers, whereas Chinese producers are already subject to third party certification. This clearly shows that third party certification alone does not lead to safer toys. EPP-ED Members advocate stronger market surveillance and border controls for the next term of the EP as well as voluntary certification schemes which would create more transparency for consumers..

Harmonisation of consumer legislation for a better performing Single Market

The last legislative proposal of the 2004 - 2009 term will not be finalized before the European elections: The Commission proposal on Consumer Contract Rights. adopted in December 2008, envisages a courageous merger of existing consumer protection directives in a single legal instrument.

The EPP-ED repeatedly called for the creation of a true single market for consumers and enterprises There is still a need for a coherent strategy for targeted harmonisation of consumer legislation combined with an internal market clause that would enhance consumer confidence in the functioning of the internal market.

Half of all Europeans are worried of making cross-border purchases than domestic purchases, and over two-thirds think it harder to resolve certain problems such as complaints, returns, price reductions and guarantees when shopping cross-border.
Taking into account different traditions of consumer law in all Member States, the EPP-ED Group is in favour of a comparable level of consumer protection. In other words full harmonisation of all elements of consumer legislation will be difficult to implement within the existing framework of Member States´ contract law.Secondly leaving Member States full discretion to add on to EU consumer legislation will lead to a segmentation of the internal market as it will make cross border purchases even more complicated.

Convincing Member States to follow the best approach towards a functioning internal market while preserving and extending consumer protection provisions will be on of the major goals for the second half of 2009.

Safe Machinery on the EU market

Despite its technical character the Machinery Directive is one of the major improvements of internal market legislations between 2004 - 2009. It sets the framework for machinery produced within or placed on the EU market. It includes provisions on prohibiting potentially dangerous machinery, the procedures for disputing harmonized standards and safeguard clauses, CE -marking and a reform of the market surveillance system. Thus this Directive is an important piece of legislation for an industrial sector in which the EU is the World´s first producer and major exporter. Modern rules in this area serve as model worldwide and help to secure competitiveness and employment.

Single Market Strategy:

The Single Market Strategy focussed on the full implementation of the four freedoms - the free movement of goods and capital, the free provision of services and the free movement of persons, which are the basis of the economic success story of the EU. But, despite fifty years of existence, it is far from being completed, and the number of obstacles that business and consumers face is still much too high.

The EPP-ED Group identified the need to:evaluate the current strengths and the weaknesses of the Single Market, to address those weaknesses by actively implementing existing tools and by fighting protectionist attitudes and to strengthen the trust of consumers and companies, and promoting the Single Market as the essential instrument for making Europe the most competitive continent.

To create a more supportive environment for the Single Market, citizens and enterprises have to be more involved. The EU should mainstream the Internal Market and complete Internal Market legislation, e.g. in the area of the protection of intellectual property, completing the liberalisation of the energy market, specific measures to encourage SME growth and development, completion of public procurement rules, ensuring the free movement of goods by mutual recognition of standards. Other possible proposals, for instance the revision of the consumer acquis, appraisal of consumer redress and the codification of international private law, should balance the specific interests and lead the completion of the Single Market, not to a fragmentation. In this context, we must encourage sector-based quality standards in services and expansion of mutual recognition of qualifications.

Key priorities for action, as identified by the EPP-ED are removing barriers, accepting the global dimension of the Internal Market and defining the role of consumers in the Single Market. Thus more prosperity, higher employment and social welfare for all can be created.

Recognition of professional qualifications

The EPP-ED Rapporteur, Stefano Zappala, managed to strike a balance between the free movement of skilled professionals and consumer protection in the directive on professional qualifications.

This Directive establishes rules whereby a "host" MS must recognise the qualifications of a regulated profession from another MS, otherwise referred to as the "home" MS. It applies to all nationals wishing to pursue a regulated profession across the EU and also includes those in the liberal professions.

The provision of services is ruled by the principle of mutual recognition with the host country control. The Directive states that the recognition of professional qualifications by the host MS will allow the beneficiary to gain access to the same profession to which he/she is qualified and to pursue their profession under the same conditions as those offered to nationals, on either a self-employed or an employed basis. In special cases like doctors and dentists, the principle of automatic recognition of medical or dental specialities common to two or more MS applies.