20th Jan 2022

Brussels seeks to charm citizens in EU market vision

It is time that ordinary citizens, and not just big business, feel the direct benefits of the EU's single market, the European Commission said on Tuesday confirming its subtle shift away from ever-more EU market legislation towards empowering consumers.

"The single market is not only for big business, it is for consumers and small business as well", commission president Jose Manuel Barroso said presenting Brussels' vision for a "single market for the 21st century Europe."

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The commission identified 23 "important sectors" of the EU economy - accounting for 46.5 percent of EU employment - where there are signs of the market not functioning well. These sectors include distribution activities, financial services, post, telecom and professional services.

But notably, the EU executive did not use these findings to come up with a raft of new directives and infringement procedures against member states - as it has often done in the past when presenting market shortcomings.

"Legislation is not the answer, the toolbox we need now is much more complex," said Mr Barroso, with single market commissioner Charlie McCreevy admitting that "there is not a long list of legislative measures in the package."

The commission will instead focus on a series of citizen-friendly initiatives – continuing its "citizens agenda" which Brussels strategically adopted after French and Dutch voters rejected the EU constitution in 2005.

After telecoms commissioner Viviane Reding vowed last week to make it easier for consumers to switch mobile operators, single market chief McCreevy announced Tuesday that it should also be easier to "change your account from one bank to another."

Consumers should be able "shop around for the best deal in financial services," he said, not ruling out fresh regulation in the banking sector if voluntary commitments do not work.

Brussels will also propose cross-border EU rules next year to allow consumers collective redress - a group of people from across the bloc would get the right to file the same complaint about a company and to pursue it.

Mr Barroso was quick to add that this would not mean copying the system of US-style class action lawsuits – seen as primarily benefiting law firms, who pocket enormous sums of money. "We have different tradditions of litigation in the EU and the US," he said.

Other items on Brussels' pro-consumers agenda include an overhaul of consumer law, improving contractual rights for counsumers, and a Consumer Scoreboard designed to name and shame member states' achievements in the area.

Ann Mettler, executive director of the Brussels-based Lisbon Council think-tank, said the commission package represents a "very thoughtful contribution" to the debate on the future of the single market.

"The single market is often associated with new legislative initiatives, but now we are at a stage where we have to reflect a little bit and link the single market project much more closely to consumer interests," she said.

Socialists angry

The commission's single market vision however drew sharp criticism from the socialist group in the European Parliament - primarily because Brussels did not propose new legislation to exempt public services from the EU market.

In a paper on so-called "services of general interest", forming part of the single market package, the commission makes clear it will not propose new legislation making sure that public services - such as health, social housing and education - will be explicitly safeguarded from EU competition and state aid rules.

Mr Barroso said new legislation is not "useful" since a new public services protocol - included in the EU's new Lisbon Treaty - already clarifies that Brussels will not interfere in how member states organise their public services.

Socialist group chief Martin Schulz said "the statements of President Barroso today are a provocation...Legal uncertainties about our public services need to be cleared up."

The commission's line is more to the taste of the parliament's centre-right EPP group, with UK conservative member Malcolm Harbour declaring "we wholeheartedly support the commission's contention that there is no need for a framework directive on services of general interest."

EU single market norms worldwide

Meanwhile, the commission also announced it will push EU single market norms on the world stage, hoping that the EU will evolve into a trend-setter when it comes to market regulation.

"The [European] GSM standard is now used by almost two and a half billion mobile phone users worldwide. In CO2 emissions trading, aviation safety or chemicals, the EU has established new rules, which are gradually being adopted across the world," says the single market paper .

The EU should now become even more active in international bodies such as the World Trade Organisation in ensuring that "European norms are a reference for global standards," the commission said.

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