After two postponements, the European Commission is set to present an update of its industrial strategy that will focus on the functioning of the internal market, according to a version obtained by EUROPE on Saturday 1 May.
The Communication, entitled ‘Building a stronger single market for Europe’s recovery’, appears to draw lessons from the many weaknesses of the European single market revealed by the pandemic (see EUROPE 12452/14).
In the context of the implementation of “open strategic autonomy”, the internal market should thus be the main thread of this update. This communication could, according to some, be yet another attempt to ‘reconcile’ the proponents of competition and the internal market (the Nordic Member States) with those who are more interventionist and in favour of a more voluntary policy on the industrial front (such as France).
Thus, the document is structured around three main pillars: - one pillar on the 14 ecosystems targeted by the European Commission in the context of the publication of the first Annual Single Market Report, another pillar on strategic dependencies on third countries and a third on the dual digital and green transition.
The Commission intends to map the strengths and weaknesses of the market ecosystem by ecosystem. The Communication should thus be accompanied by annexes of “hundreds and hundreds of pages”. The exercise is not insignificant and is intended to show that the Commission is capable of producing microeconomic analyses as fine as the macroeconomic ones in which it is said to be a master, we are told.
Interestingly, for each ecosystem, the Communication proposes the development of a ‘transition pathway’ to achieve climate and digital neutrality. Here, the institution speaks of “co-creation”, suggesting that economic operators will be directly involved in the process. This is a long-term demand from the economic sector in order to be able to establish predictability over several years, enabling them to direct their investments accordingly.
Emergency instrument for the single market
The announcement in February by the President of the European Commission of the creation of a ‘Single Market Emergency Instrument’ (see EUROPE 12664/29) is taking shape: a proposal should be presented in the first quarter of 2022.
The European Commission is disclosing some information about it. The instrument should ensure more information sharing, coordination, and “ solidarity” when Member States adopt crisis-related measures, mitigating “negative effects” (such as export bans on certain products) on the single market, including by ensuring “more effective” governance.
Above all, the Commission intends to create a mechanism to enable Europe to deal with shortages of products deemed “critical” by speeding up their availability - for example by establishing a rapid conformity assessment - and by strengthening cooperation on public procurement. In this respect, the institution recalls the important role of the ‘Single Market Enforcement Task Force’, launched in the framework of the industrial strategy in March 2020 (see EUROPE 12443/7).
Still in line with this desire to strengthen European autonomy, the role of the ‘Important Projects of Common European Interest’ (IPCEI) is reaffirmed. Here, possible initiatives in the field of cloud computing, hydrogen, low-carbon industries, pharmaceuticals, and semiconductors are mentioned in no particular order. According to one source, the idea of launching an IPCEI in the rocket and aerospace sector is under consideration.
Services and posted workers
Still noting the relatively low share of services in the internal market, the strategy mentions the possible consideration by the European Commission of a legislative proposal to regulate the main business services on the basis of harmonised standards.
The social issue also comes into play. Here, the institution wants to reduce red tape regarding the posting of workers and indicates that it wants to work on the design of a common electronic form. This single digital form could be considered on a voluntary basis. The initiative is planned for the last quarter of 2021.
The role of the SMEs underlines the communication (especially in relation to the monitoring of late payments) in relation to the SME strategy. Skills are also briefly mentioned, but no major announcements are made.
To consult the draft version of the paper: https://bit.ly/3eRkTtE (Original version in French by Pascal Hansens)