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ORIGINAL FRENCH ARTICLE: Ce que contient vraiment le compromis annoncé

by Rosa Moussaoui

Bolkestein Directive: What’s Really in the Compromise that was Announced?

Translated Wednesday 15 February 2006, by Henry Crapo

The amendments negotiated by the conservative (PPE) and the socialist (PSE) groups in the European Parliament do not upset the global equilibrium of the services directive, which accelerates the competition between groups of workers.

(Analysis of the agreement reached by the conservative and socialist groups in the European Parliament, concerning the Commission’s directive on service in the internal market of the European Union)

Has the principle of "country of origin" been definitely buried?

The compromise proposition deletes the clause placing a company providing services under the control of legislation in its country of origin and making it the responsibility of that country to carry out the control. But the reference to the country of origin is not, however, replaced by a clause explicitly placing the provider of services under the control of legislation in the country of "destination", where the services are provided. "There is no more country of origin, no more country of destination" explained the representative Evelyne Gebhardt, when she presented, 8 February last, the compromise proposition of the PPE-PSE. Already in October 2005, she had proposed replacing the principle of country of origin by "the principle of mutual recognition", by virtue of which "an economic entity that offers a service in a member state, in conformity with the legislation of that state, can without hindrance furnish the same service in another member state." It is in fact this principle that is retained in the compromise proposition, which proposes the following rewrite of the first paragraph of article 16:
"1. The member states should respect the rights of service providers to furnish a service in a member state other than that in which it is based.
2. The member state in which the service is provided should assure free access and free exercise to a service activity within its territory."
Problem: this revision remains ambiguous concerning the body of law applicable to the service provider. It is thus up to the Court of Justice of the European Community to decide, which leads us to fear, given present jurisprudence, decisions tending to favor the rule of country of origin.

Will the respect for national legislation concerning labor practices and social law be guaranteed?

Just as in the original project, the compromise proposition refuses to let the states oblige service providers (these are viewed as obstructions to the free circulation of services) to make a declaration, obtain an authorization. to be registered, to maintain a representative in the territory, to conserve personnel documents. All these are rulings that would make virtually impossible, in practice, the controls and the defense of workers, whose rights would be simply ignored. Which brings us back to permitting all the so widely used management loopholes.

The compromise proposition clearly states that these rules should not prevent the states from applying, "in conformity with European Community law" "their regulations concerning working conditions" and labor union collective agreements. But in setting forth in advance limitations on the sphere of intervention, this denies the state the means necessary to apply those laws. And, here again, the legality of any given requirement imposed on a service provider will be subject to arbitration before the Court of Justice.

Will the public services be protected from liberalization?

Over and above the exclusion from the field of application of the directive, already effective in the Commission’s project via "derogations", of those services involved in the exercise of public authority, the compromise proposition establishes a list of services to which the directive will not apply. What are involved are those services "pursuing objectives of social protection", social housing, pharmacies, child-care services, "education and cultural services pursuing social objectives", interim employment, health, audiovisual, and notarial. The directive also excludes from its domain of application services covered by special sector directives, that is, services already liberalized or about to be so. But there is a complete lack of precision concerning what one calls, in European institutions, the services of "general economic interest" (SIEG), that is, services having as their object an economic component involving the user: water, energy, sewage treatment, etc.

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