Commission calls on 18 Member States to strengthen the EU Single Market for regulated professions
Today, the Commission takes legal action against 18 Member States for failing to ensure proper implementation of the EU rules for assessing the proportionality of new regulation of professions.
The 2018 Directive on a proportionality test before adoption of new regulation of professions requires Member States to make sure that any requirements for professions they introduce are necessary and balanced. The Directive provides a set of criteria to prevent unnecessarily burdensome national rules, which can make it difficult for qualified candidates to access or exercise a wide range of professions. The lack of proper implementation of the EU rules on proportionality tests could ultimately disadvantage consumers in the form of excessive prices, undermine the development of innovative services or even lead to insufficient access to important services. The Directive is a powerful tool for facilitating access to and exercise of regulated activities by professionals across the EU. The action taken today to ensure its proper implementation will help to prevent or dismantle disproportionate barriers in the Single Market, in line with the objectives of the EU Single Market Enforcement Action Plan.
The issue affects many Europeans: around 50 million people, 22% of the European labour force, work in professions to which access is restricted to those holding specific qualifications or for which the use of a specific title is protected, e.g. lawyers or pharmacists. Often there will also be specific requirements on how the profession can be exercised, such as limitations on who can hold the shares of those companies or how these services can be advertised. Ensuring that such rules are justified and proportionate creates concrete benefits for European citizens, both for professionals as well as for consumers.
Infringement procedures
Having thoroughly assessed national transposition measures, the Commission found that various requirements had not been properly implemented by some Member States and that there was a risk that the Directive would not be effective in practice. It has therefore decided to open infringement proceedings against Austria, Bulgaria, Croatia, the Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Lithuania, the Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia and Sweden.
The most significant problems identified by the Commission are the following:
- failure to sufficiently capture all types of regulations such as those adopted by professional associations.
- failure to accurately transpose the criteria of the proportionality test, such as the need to ensure necessity of the new regulation in view of other rules already in place.
- failure to ensure the necessary procedural guarantees, such as objectivity of assessments, effective ex-post monitoring mechanisms, and effective information and involvement of stakeholders.
All Member States concerned have two months to respond to the arguments raised by the Commission. Otherwise, the Commission may decide to send them a reasoned opinion.
Working together to simplify the regulatory framework for professional business services
While legal action is sometimes warranted, the Commission also works hand in hand with the Member States to ensure that professional regulation is ‘fit for purpose’.
In July 2021, the Commission adopted updated reform recommendations on the regulation of seven professional business services: architects, engineers, lawyers, accountants, patent agents, real estate agents and tourist guides. These recommendations help identify opportunities for reform of the national regulation currently in place.
Although the Commission concluded that progress had been very limited since the adoption of the first set of recommendations in 2017, some Member States did introduce useful reforms:
- Poland abolished the minimum tariffs that Polish patent agents were obliged to charge to consumers.
- Belgium reformed the accounting profession, opening up shareholding to investors from outside the profession, accounting firms will now be able to more easily attract finance.
- Croatia abandoned its plans to impose on accountants the obligation to obtain a license based on a pre-defined set of qualifications.
The Commission and the Member States also work together in the context of the Single Market Enforcement Task Force (SMET) to address single market barriers, including, among others, prior checks of qualifications for temporary service provision and excessive requirements for documents that have to be supplied for the recognition of professional qualifications.
In September 2021, SMET published its first report, showing tangible results: after only a few months of operating of the Task Force, requirements for prior checks of qualifications had been abolished for over 210 professions. Member States are also screening their rules and practices in place to identify those that can be abolished.
Individual assistance to citizens and businesses
EU citizens or businesses facing obstacles in another Member State can get concrete help via the SOLVIT network. This network of centresin national administrations solves problems related to incorrect application of EU rules by national authorities. In the area of recognition of professional qualifications, SOLVIT has helped more than 260 professionals in 2019-2020 with problems related to the recognition of their professional qualifications and obtained satisfactory solutions in 80% of the cases.
As a concrete recent example, SOLVIT helped a qualified food technologist in Estonia with several years of professional experience in this field. He was seeking recognition of his professional qualifications in Cyprus, but Cypriot authorities required an academic recognition of his diploma. SOLVIT stressed that this was not in line with EU rules aiming to facilitate access to the labour market in another country. The Cypriot authorities recognised this, accepted the Estonian qualifications and proceeded with the professional recognition procedure. Thanks to SOLVIT, the qualifications were recognised and the applicant could start working in his line of work in Cyprus.
Background
The Directive on a proportionality test was adopted on 28 June 2018 as one of the four initiatives of the 2017 Services Package. The deadline for Member States to implement the new rules was 30 July 2020.
The Directive aims to prevent unnecessary barriers for access to and exercise of regulated activities by professionals, by requiring Member States to assess the proportionality of any new regulation of professions on the basis of a common set of criteria, before the adoption of that regulation. In addition, the Directive contributes to the transparency of the rule-making process by requiring these assessments to be made publicly available via the database of regulated professions. It asks Member States to appropriately inform and involve all relevant stakeholders during the proportionality assessment. Furthermore, Member States need to continue monitoring the proportionality of their rules after adoption and take into account any relevant developments such as technological innovation.
