Towards revision. The major debate underway on the liberalisation of services within the single market, the so-called Bolkestein directive, has three possible outcomes:
a) the draft by the former European Commissioner for the Internal Market is accepted. There is no support for this premise and Mr Bolkestein no longer has any institutional role to play that would allow him to defend it;
b) the Commission is prevailed upon to withdraw the draft. The Commission has no intentions of doing so because the liberalisation of services is one of the four “freedoms of movement” which form the basis of the single market and the EU cannot give up on achieving this. The new Commissioner for the Internal Market, Charlie McCreevy, has gone on record as saying that the “status quo is not an option”;
c) changes are made to the draft. This is the favoured option of work underway in the European Parliament and the Council. The Commission takes a full part in this work and has not opposed the idea of making changes. It is true that there is no consensus on what will become of the directive, differences of opinion subsist and will continue to do so, so much so that the European Parliament is to take position by a majority vote. But talks have already allowed the stakes and the significance of the draft to be clarified; the debate on this is a good example of European democracy in action (see this column of 12 February).
For twenty years or more… If I go on about this dossier a lot, it's not because everyone's talking about it, but because I have long been convinced that it is one of the pillars of the European model of society. Long-standing readers of this column may remember that I first took position on this some twenty years ago, when Jacques Delors and Karel Van Miert were trying to get the concept of “public services” out of the shadows, where they seemed to reside in some of the Member States, and replace them with the concept of “services of general interest”, which allowed the reflection on them to get started. Today's debate is an additional step towards understanding this crucial aspect of our conception of society. I don't intend to sum up all the work that's going on and all the guidelines being mapped out; our bulletin takes regular stock of them and I did so (provisionally) in this column on 14 December last year. Those who have a copy of the working document of Evelyne Gebhardt, rapporteur for the European Parliament, or who receive the comments of “Confrontations Europe”, can skip the rest. For the others, I would like to make a few observations on the starting point of the whole draft: the principle of the country of origin.
This principle implies that those who provide a service in another Member State are subject solely to the rules and regulations of their Member State of origin. I believe that Ms Gebhardt's document, which I referred to above, has virtually taken this apart, not just from the point of view of social balance and protection of SGIs and SGEIs, but also legally. Those who were expecting a document which goes for the jugular will be disappointed; nothing attacking other stances, no criticism, not even a sentence to that effect, but a neutral and objective analysis, taking as its basis unreserved support for the completion of the single market. Ms Gebhardt is well aware of the duties of a rapporteur.
Mr Bolkestein's reasons. First of all, let me remind you of how and why Frits Bolkestein chose the path of this particular principle. As the man in charge of the completion and functioning of the single market, he was disgruntled, not to say scandalised, by the misgivings and vacillations of the Member States. The treaties are unequivocal, they provide for “free movement” for goods, persons, capital and services. The last of these was not, however, progressing as planned. Something had to be done. He opted for the path followed by one of his forerunners from 25 years ago, Etienne Davignon, at the time of the “Single Act”, to complete and simplify the free movement of goods. Mr Davignon gave up on his quest for the interminable harmonisation of national standards to be applied to various products, based on the Court of Justice's “Cassis de Dijon” ruling. What did this ruling say? That a product admitted for free movement in one Member State must be admitted to them all. Goodbye to the objective apparently favoured by certain officials of defining a “European model” of bread, or shoes, or bicycles; the EEC needed a few general rules (on safety, hygiene, environmental protection, etc) and then the legislation which applies is that of the country in which the good is produced; if general European standards are observed, then free movement is inescapable. At the time, Mr Bolkestein, mutatis mutandis, transferred this principle to the services sector; it is the rules of the country of origin which apply and it is the country of origin which makes sure that they are being followed.
No proclamations or trumpets. This is the construction that Ms Gebhardt basically tore down, but without proclamations or trumpets. Goods are things, while services are men and women at work. She points out that the Court of Justice- having brought in the principle of country of origin for goods (the “Cassis de Dijon” ruling dates back to 1978)- then extended it to certain services in the rulings of 1991 and 1998, but in quite a different way: the Court said only that if a check on the service provider has been carried out in the country of origin, it is not necessary to repeat the same check in the country where the service is provided. This, clearly, presupposes that the same standards need to be checked. But what if this is not the case? What if a job or profession is subject to strict rules in one Member State and none at all in another? Such cases exist, the rapporteur giving the example of the profession of stone-masonry, which is strictly regulated in Germany but not at all in the UK. By applying the rule of country of origin, the result could be discrimination against nationals, who cannot do certain jobs without specific training and some kind of formal qualification, whilst the nationals of another Member State can, in that very country.
Another problem is that other texts or community drafts, such as the proposal on the recognition of vocational qualifications, or the directive on unfair trade practices, provide for the country to carry out the checks on the service offered. This is just one example of the contradictions (already stressed by those taking part in a hearing held by the EP on 11 November last year) between the Bolkestein draft and other Community texts in force, such as the Convention of Rome, the directive on public contracts and most of all, the directive on seconded workers. The various pieces of legislation could come into conflict and Ms Gebhardt takes the view that it is “incongruous for the directive on services to set prescriptions which are diametrically opposed to European legislation already in place or being drawn up”.
We could, then, ask whether the principle of country of origin has not been condemned, by the European Parliament at least (which is co-legislator on this). It is true that there are also proponents of the principle. As well as Charlie McCreevy, Frits Bolkestein's successor to the post of European Commissioner for the Internal Market (see our bulletin of 24 December, p.8), Alexander Stubb (EPP, Finland) has taken up the case for the defence (see our bulletin of 9 February, p.17). However, a vast majority has rejected it as a general rule, sometimes explicitly, occasionally even spectacularly. According to the Socialist Gilles Savary, it is “lowest common denominator policy”, because those with the lowest levels will win out, forcing the others to come into line in order not to be excluded.
Attempt at a compromise. The European Economic and Social Committee (EESC), faithful to its job of defining the positions of civil society as a whole; tried to define a compromise: harmonisation of national legislation first of all, application of the “principle of country of origin” when this harmonisation has reached levels which would make this possible without distortion. Furthermore, services of general economic interest (SGEI) would then be subject to a specific cross-cutting directive. This is clear and courageous, but much of the employers' group voted against (see page 14 of this bulletin).
Reservations going beyond political divisions. Generally, the hostility of the Socialists to the principle of country of origin is confirmed by the fact that among the hypotheses to be discussed at the conference the Socialist Group of the EP is holding on Tuesday and Wednesday, one is worded “the principle of the country of origin, a threat to the European social model”. Several reservations are shared by other political groups and especially the EPP-ED group, as evidenced by the vast range of proposals, some contradictory, put before the hearing held by the group last December (see our bulletin of 15 December, p.16). The MEP responsible for this sector, Malcolm Harbour, welcomed the objective of the directive but recognised “the need for changes and clarification”. The fact that the objectives and reservations go beyond the usual divisions along political lines and some of them are shared by right and left is also demonstrated by the attitude of the bodies representing local and regional authorities, such as AER (Assembly of European Regions), which vigorously defends the prerogatives of the regions and communes in the management of the SGEIs, all political tendencies together.
What's more, the sheer number of sectors calling to be excluded from the Bolkestein directive is impressive. The total exclusion of the SGEIs is called for not only by various political forces, but also by the committee on employment and social affairs of the EP (see our bulletin of 29 January, p.15), but several other sectors feel that they should be entitled to specific provisions due to their specific natures: television and cinema, gaming and lotteries, social housing, etc.
All of this holds the promise of more discussions to come and not a little conflict. But the stakes are so high that it's well worth it. (F.R.)