Why a Single Market Act?
2012 will mark the 20th anniversary of the Single Market. Launched in 1992 under the leadership of Jacques Delors, the Single Market was intended to strengthen the ties that bind the citizens and Member States of the EU. Its benefits are clear in some areas, e.g. where businesses and consumers have seen mobile phone prices come down by 70% and the cost of airline tickets drop by 40%.
But times have changed. The globalization of trade, technological progress and the emergence of new global players have altered the rules of the game. The financial and economic crisis has had a severe impact on workers and businesses. This new reality demands a fresh response that is ambitious, seeks to re-launch market integration and works towards realizing Europe’s growth potential. The EU is working to put citizens back at the heart of the single market and gain their trust.
A strong and successful Single Market should create jobs and address issues of social protection and environmental sustainability. To meet these challenges a pan-European commitment is needed that involves stakeholders from all corners of Europe, including those at national and regional levels, those in the public and private sector and those in the economic and social spheres.
This is the essence of the Single Market Act: actions the Commission wants to debate and implement as a matter of urgency before the end of 2012. The Commission has identified the problems that prevent the Single Market from reaching its full potential. Many options for growth exist, though these can only be exploited when citizens and businesses are fully convinced of the benefits generated by the Single Market. Actions fall into three categories:
How to re-launch strong, sustainable and equitable growth
How to put citizens at the heart of the single market.
How to foster better governance and dialogue in the Single Market.
The European Commission has identified a set of 50 actions, set out in a booklet, to allow all Europeans to get more out of participating in the Single Market. The proposals will be debated in all Member States.
I will not attempt to summarise the entire booklet or all of its proposed actions. Rather, I have identified some of the key areas that impact on the architectural profession, below.
Efficient rules for common product standards
Common standards means companies no longer have to comply with different standards for different markets. They reduce cost, give better access to global markets and lead to more trade and growth. New products that comply with international quality standards deliver a message of trust and professionalism. Common standards for products across the EU have also been essential to ensuring EU consumers have access to safe, quality goods, regardless of a product’s origin. The economic benefit of standardisation is c. 1% of GDP. But there is room for improvement and it is proposed that standards be agreed more quickly to keep pace with new technologies, so that companies are not deprived of export opportunities.
Promoting a more sustainable economy; increasing the Single Market for services
Services are an essential part of Europe’s economy and represent more than 70% of all jobs. But although progress has been made, the Single Market for services still does not work as well as it could. Cross-border services only represent 5% of GDP, which is very low compared to goods traded in the Single Market (17% of GDP). Citizens and businesses, especially SMEs, will all gain from a better-functioning Single Market for Services. Gains are estimated at annual profits of €60 - €140 billion - a growth of GDP of between 0.6 – 1.5%. The Commission will propose measures to improve the Single Market in services in 2011.
Greener, more innovative and more efficient public procurement
Public procurement for the supply of goods or services has generated more competition for government contracts. On average, five bidders compete for every publicly tendered con-tract. Notwithstanding our concerns about the nature and effect of these procedures, the Commission claims that contracting authorities believe they have delivered average savings of 5 - 8% on expected costs. Goods/services bought after public procurement procedures constitute 17% of EU GDP. EU rules on public procurement are said to have contributed to greater transparency in the awarding of public contracts. Over 150,000 contracts were advertised EU-wide in 2009. However, there is room for improvement. By 2012, the Commission will have put forward proposals for making public procurement greener and more innovative. Options to make economies of scale by testing trans-national public tendering with more than one Member State involved will be studied. The Commission will also look at ways to improve access to public procurement contracts for SMEs.
The external dimension of the single market
The EU is the largest exporter of goods and services in the world and one of the largest recipients of foreign direct investment. The Single Market should function as a solid base
for European businesses, supporting their trade worldwide. It is important that trade partner-ships at international level are based on mutual interests and benefits. The EU must continue to be vigilant in its defence of European interests and jobs, and use all appropriate means to combat unfair trading practices. The Commission believes that the adoption of more inter-national rules would benefit both EU enterprises and global economic growth. The EU will also continue to push for more regulatory convergence with its trading partners at the G20 and in bi-lateral negotiations. In international public procurement the EU will seek to obtain a level playing field for EU- and non-EU companies when competing for public contracts.
Reform of the Professional Qualifications Directive
To work and pursue an occupation in another Member State is a fundamental right under the Lisbon Treaty and should be encouraged to enhance the efficiency of the EU labour market and allow people to take more advantage of job vacancies in other countries. However, too often professionals are subject to lengthy procedures for recognition of their qualifications. It is felt that the opportunities offered by the Professional Qualifications Directive are not fully realized and new legislation is needed. The EU is evaluating current practice in order to consider (for example) the possibility of introducing professional cards for some professions. Possible changes to the Directive must keep pace with new developments in national education systems including back-to-work courses facilitating people’s access to jobs.
Using new technology to make the single market work
Electronic developments are improving coordination between the Commission and Member States. The ‘Internal Market Information System’ (IMI) is an electronic exchange system that helps competent authorities (like ARB) to understand and interpret legislation in other Member States when screening professionals and service providers wanting to work in their countries. Because of its success, the Commission is developing a strategy to expand IMI and its online tools to other sectors so that it becomes a real “face-to-face” network.
A partnership between the Commission and Member States can improve the transposition of Single Market laws into national legislation, but enforcement needs to be improved. Beyond infringements, the Commission will look at other options for conflict solving e.g. through citizens’ services like SOLVIT. Another successful working method that could be duplicated elsewhere is the ‘mutual evaluation’ system used by Member States and the Commission, for the implementation of the Services Directive. Through a mutual evaluation exercise, Member States share, compare and assess each other’s reports on changes to their national legislation to comply with the Services Directive.
The Single Market Act is a proposal for an ambitious political programme. It is a commit-ment by the Commission to work in partnership with the European Parliament, the Member States, national parliaments and all other stakeholders including businesses, trade unions, consumers and NGOs, to generate more opportunities in the Single Market. Every
year, the European Commission together with the European Parliament will host a Single Market Forum for all partners to evaluate this work in progress.
Individuals and organisations are invited to comment (go to http://ec.europa.eu/internal_market/smact/ for full contents of proposals and to participate in debates on key questions concerning the Single Market Act; or write to Commissioner Michel Barnier at firstname.lastname@example.org.
Ian Prichard, Director Policy & International Relations
Evaluation of Directive 2005/36/EC (on the recognition of professional qualifications)
This Directive implements part of the Treaty establishing the European Community, in particular article 3.1(c) creating 'an internal market characterised by the abolition, as between Member States, of obstacles to the free movement of goods, persons, services and capital', though with caveats of article 39 on the Free Movement of Workers i.e. 'subject to limitations justified on grounds of public policy, public security or public health'.
It combines the provisions of the earlier 'sectoral' directives (including the 1985 Architects’ Directive) – affording automatic recognition of qualifications, with the provisions of the General Directive on the Mutual Recognition of Higher Education Diplomas (the so-called General System) – affording recognition, on a case by case basis, subject to compensatory mechanisms (aptitude tests or adaption periods). There is also provision for recognition by experience for those whose work is contingent upon possession of general, commercial or professional knowledge and aptitudes listed in Annex IV.
The Directive provides for two types of cross-border activity
establishment in another member state
provision of 'temporary or occasional' services (not formally defined, determined on a case-by-case basis – and not requiring establishment).
Time-line for review
Though not expecting to produce any legislative proposal until 2012, this is a mid-term activity focused on Single Market benefit for Europe, and in particular, aiming to address the perception that there is not enough cross-border provision of services to achieve the aims of the Lisbon Strategy ('to create the most competitive and dynamic knowledge-based economy in the world [by 2010]').
An administrative exercise is already underway gathering information and scoping the problem. The Commission has already consulted the Competent Authorities, collecting experience reports, and the Professional Associations. A major study on the impact of recent educational reforms is also expected to be initiated before the end of the year, to be finalised by next summer.
A public consultation is expected to be launched in the Spring of 2011, and a Green Paper is to be published in the autumn. Finally, a legislative proposal will be published in 2012 leading to a new Directive in 2013 (to be implemented by 2015).
Position of the Architects Council of Europe (ACE)
The Commission appears to be seeking the approval of the Member States for an agenda to modernise the Directive in the name of growth and jobs.
While, the ACE has long advocated that the provisions of the Directive relating to the architectural profession require to be up-dated, it is concerned that the initiative could fail by misunderstanding both the dynamics of architects mobility and the true needs for labour market flexibility.
The profession has argued that the 1970s description of the key characteristics of architectural training at article 46 needs up-dating to reflect current realities. They are sometimes out of date in terms of scientific knowledge, professional aspiration and pedagogic approach, omitting certain competences now considered as essential.
Also, the Advisory Committee for the old Architects’ Directive produced a recommendation many years ago advocating that the minimum duration of architectural training in the EU should be five years (in line with the prevailing international standard) supplemented by two years practical experience. ACE is now campaigning to try to secure this “5 + 2” objective.
ACE's Position (PDF) regarding the evaluation of the Qualifications Directive.
Position of the RIBA
The RIBA, with SCHOSA and others, is developing a more nuanced position. On the one hand, it considers the old input-based measures, expressed in terms of years of training, to be rather out of date, and advocates the use of outcomes-based measures of competence. It is also seeking to reflect the current economic climate in which graduates from schools of architecture face mountains of debt. To this end, we are seeking to ensure sufficient flexibility in the Directive which could allow for remunerated periods in practice which count towards the final qualification. We also continue to seek to safeguard part-time routes to qualification, which are already recognised as viable alternatives in article 46 of the Directive.
To this end, we are working with CLG (for the architects’ element of the Qualifications Directive) and BIS (which has overall responsibility for all of the professions) to develop inputs from the profession, and will be coordinating with ARB, SCHOSA, ACA and representatives of the profession in the devolved administrations – RIAI, RSAW, RSUA.
For further information contact: Ian Pritchard, Director, Policy & International Relations