EU enterprise ministers agreed a landmark political deal to open the services market to further competition last night after several hours of tough negotiations, writes Jamie Smyth in Brussels
Deep divisions emerged between enterprise ministers over a draft services directive, which should remove legal barriers preventing firms operating across EU borders. A stand-off between states favouring a more liberal directive and those favouring a lower level of competition threatened to derail the negotiations until late last night.
The stand-off prompted internal market commissioner Charlie McCreevy to intervene and plead with ministers to stop arguing over the details. "We have to look at the big picture, not every comma," he said.
A final compromise text, which a majority of states voted in favour of, was presented by the Austrian presidency.
The services directive should prove a major boost to Irish companies seeking to expand their operations into other EU states. Currently, legal and regulatory barriers prevent firms from offering services across EU borders. The services directive will remove some of these barriers.
It has been promoted by states with large service industries such as the Republic. However, states with high wages and strong labour laws such as France fear it could undermine local industries.
EU ministers meeting in Brussels yesterday debated proposed amendments to a compromise text agreed recently by the European Parliament. The amendments included extending the final date of implementation of the directive to three years, introducing mechanisms to ensure states could not unfairly block service providers from entering their market, and deciding which sectors will be exempt.
A group of 10 states favoured a liberal directive that would open the market as wide as possible to competition. Most of the new member states from central Europe were in this group, as well as the Netherlands. However, a group led by France and Germany favoured the compromise text agreed by the parliament.
One of the main sticking points was a proposal to make all EU states screen national legislation to see how it could affect service providers operating in their markets. Some states were concerned this could enable the European Commission to use this information to force member states to justify rules that could hinder services provided by a company from another member state.
Earlier at the meeting, ministers moved closer to agreeing to implement a proposed directive on consumer credit that should make it easier for consumers to shop around the EU for a personal loan. The proposed legislation would give consumers more choice when they need a loan by encouraging more competition among European lenders.
Current EU president Austria said a majority of member states favoured full harmonisation in this area and said a working group would be set up to take the legislation forward. The rules would lay down how the annual interest rate on a loan should be calculated and presented, and how much lenders should be compensated for early repayments.
Germany and the UK had opposed the move, arguing that their national rules offered better protection.
