- Barriers and fragmentation hinder economic growth
- EU rules on services must be followed by all member states
- Borders between member states must remain open
Parliament insists that all member states respect EU rules on the free movement of services. MEPs say fragmentation obstructs the single market and recovery from the pandemic.
The resolution on the free movement of services was adopted with 462 votes in favour (120 against, 108 abstentions).
MEPs call on the Commission to ensure enforcement and compliance with the Services Directive in member states in order to reduce existing barriers and allow cross-border services. They assert that fragmentation and issues with implementation cost the EU around 297 billion EUR, which corresponds to 2% of EU GDP.
The resolution also emphasises that free, fair and safe movement of services and people, consumer protection, and the strict enforcement of EU law is vital for tackling the economic crisis caused by the COVID-19 pandemic. MEPs therefore urge member states to ease unjustified and disproportionate barriers and not use COVID-19 as justification for limiting the free movement of services.
"We are facing a terrible economic crisis in Europe. There is an urgent need to boost the European economy, and this report presents a solution: to complete the single market for services. The potential is enormous. It could lead to the creation of thousands of jobs and generate billions in revenue across member states. We have reached a strong and broad compromise in Parliament and it is now essential to complete the single market in order to counter the economic crisis. It is now up to the Commission and the member states to act," said Rapporteur Morten Løkkegaard (Renew, DK).
Unjustified restrictions and an administrative burden
The resolution points out that cross-border provision of services is often hampered by various obstacles, including the lack of user-friendly information, failure to mutually recognise or compare professional qualifications, limited access to regulated professions, unfounded territorial restrictions, language requirements and administrative barriers for public procurement. MEPs stress that the special status of services of general interest remains fully recognised; however, the rules should not be misused by member states that sometimes unjustifiably hinder access to certain sectors.
MEPs want to see the single digital gateway become more citizen- and SME-friendly and the points of single contact developed into fully functioning portals that provide all the necessary information on business-related requirements which a company must comply with in the relevant member state (e.g. professional qualifications, VAT rules, registration requirements, reporting obligations).
At the same time, MEPs emphasise the need to balance economic freedoms, social rights and the protection of consumers, workers, and business interests. The development of the single market should also further improve consumer and workers’ rights.
Services account for 73% of the EU GDP and contribute to 74% of employment. As many as 9 out of 10 new jobs in the European Union are created in the services sector. At the same time, the share of services in intra-EU trade is only around 20%, generating just 6.5% of EU GDP.