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26th Jan 2021

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2006: Bolkestein Directive - a 'Frankenstein' Europe needed?

  • EU internal market commissioner Frits Bolkestein called for a sweeping opening-up of the services across Europe (Photo: European Commission)

When he introduced the proposal in 2004, the Dutch commissioner for the internal market, Frits Bolkestein called the move "potentially the biggest boost to the internal market since it was launched in 1993".

It made sense economically, as services accounted for more than two-thirds of economic activity and jobs in the EU, with 450 million consumers.

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  • French president Jacques Chirac called the services act 'unacceptable' (Photo: European Community, 2006)

But the "Services in the Internal Market Directive", later dubbed the 'Bolkestein Directive', also foreshadowed future tensions over migrant workers, and highlighted social anxieties that after the economic crisis became much more dominant.

It had contributed to France and the Netherlands both voting against the draft Constitutional Treaty in 2005, and it even had repercussions in the Brexit referendum a decade later.

"There are two kind of politicians in Europe: the bridge-builders and the wall-makers," MEP Dacian Ciolos told EUobserver. Ciolos is the leader of the liberal Renew Europe group in the European Parliament, and at the time served in Romania as adviser to Romania's agriculture minister.

"Back in 2006, the latter tried to exploit an unfounded fear in order to threaten the enlargement of the EU. It was very easy for nationalists and populists to convince people at that time but history has proven them very wrong," Ciolos added.

One of the most controversial-ever pieces of EU legislation, it was soon dubbed the 'Frankenstein Directive', and sparked mass protests across Europe.

The legislation's aim was to integrate the market for services - not only for goods - in the EU, which would allow workers to move freely between countries.

Western European workers' fear was that introducing the so-called 'country of origin' principle - meaning that a cross-border service provider would mainly be subject to the laws of their home country - would lead to lowering labour standards and social dumping.

The directive met opposition in Germany, but it was mainly led by France, which was facing a referendum on the EU constitution.

The menace of the infamous 'Polish Plumber' appeared across western Europe (a term first coined by the French satirical paper Charlie Hebdo), symbolising concerns over cheap central European workers threatening hard-fought labour rights and jobs.

A Polish tourism board later tried to turn the stereotype around with a poster in 2015, inviting the French to visit Poland with model Piotr Adamski posing as a seductive plumber.

"Enlargement has brought great benefits to Europeans from East to West, from North to South. Western Europe not only benefited from great plumbers, but great doctors, nurses, engineers and teachers too," Ciolos, who later served as EU commissioner, and prime minister of Romania, added.

"Following the enlargement, western European investors benefitted from a healthy return on their investments in eastern Europe, and eastern European workers got new opportunities.

"Our divisions are seized as a golden opportunity for our enemies to use as propaganda for their nationalist agendas and to propagate irrational fear. We cannot pin all our failings on the Bolkestein directive. Europe was not built simply as an economic project. Our future prosperity depends on our shared values too," he said.

As the controversial initiative made its way through the EU legislative process, trade unions sounded the alarm all over Europe.

Originally, the directive would have covered all services, but after massive protests across the EU, labour law was ultimately exempted from the directive.

This meant rules on working time, minimum wages, holidays and the right-to-strike are those in force in the country where the service is provided.

Some public services, postal services, audio-visual services, temporary employment agencies, social services, public transport and healthcare were also exempted.

The phrase "freedom to provide services" was coined to replace the country of origin principle, which became the core of the compromise as the legislation passed through the European Parliament.

"Eastern Europe needs to continue to transform and progress but it is too simple to judge and criticise and it is an easy narrative for nationalists," Ciolos said.

"Reforming and transforming administrations, improving services, building an inclusive society is not an easy task and it takes time. But the benefits of having cross-border and seasonal workers is a tangible benefit that most of our citizens understand."

While now a Czech baker is free to set up shop in Germany without restrictions or limitations (except in cases of national security, public health and environmental protection), social tensions have only increased in the almost two decades since Bolkestein's name became a byword for the threat to the European social model.

"We have seen that our enlarged union is much stronger and better equipped today, not just to face a multitude of global challenges but to speak on an equal footing with China, the US or Russia.

"It is a very different union than of 2006. We have seen that the benefits of the freedom of movement of services has far outweighed the damage some led us to fear and the contribution it brings to our economies is very much needed - now more than ever," Ciolos concluded.

This article first appeared in EUobserver's latest magazine, 20 years of European journalism & history, which you can now read in full online.
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