The European Commission yesterday intensified its efforts to realise a single market across the European Union with a proposal which would outlaw barriers to providing services across national boundaries.
The draft EU law has been keenly awaited by the Irish Government which wants to advance the legislation as much as possible during its tenure of the EU Presidency.
"This is one of the most significant proposals to come out of the Commission during our Presidency," a Government official said.
The proposal might be less enthusiastically embraced by some professional and trade groups, including lawyers, architects and pharmacists, since it aims to strip away what the commission describes as "archaic" protections.
Mr Frits Bolkestein, the European Commissioner for the single market, described his proposal as "potentially the biggest boost to the internal market since its launch in 1993".
His officials argue that, while the EU has made substantial progress in creating a single market in goods, service businesses are still faced with formidable obstacles to cross-border trade.
They argue that dismantling national barriers sector by sector is impractical and that taking infringements to the European Court of Justice on a case-by-case basis is slow and ineffective.
Mr Bolkestein judges that the time is right for a more sweeping approach. His proposal, which would have to be put into national law in each state, would impose on national governments an obligation to abolish administrative requirements that are a barrier to cross-border provision of services.
It will apply to all services, except the areas of financial services, telecoms and transport where there is already sector-specific EU legislation. Retailers, hoteliers and restaurant-owners, consultants, architects, craftsmen, employment agencies, advertising agencies, lawyers and pharmacists would all come under the remit of the law.
The proposal would outlaw discrimination, however disguised, on grounds of nationality. National authorities would no longer be allowed to require someone providing a service from outside the country to demonstrate that there was "economic need" for their services.
Nor would it be possible to set quotas per head of population, as is the case for pharmacists in Belgium, for example. It would be illegal to require that directors or staff of companies be of specific nationalities or that companies be established in the state where the service is provided.
Similarly discrimination against consumers would be outlawed. It would be illegal for a car-hire company to charge different prices depending on the nationality of the consumer.
Where any such requirements remain, they will have to be justified by the government concerned, subject to review and challenge by other governments and the Commission.
The directive aims to do away with arcane demands for documents, whose equivalent may not exist in other member-states, thereby effectively securing the domestic market for domestic providers.
The proposal encourages the exchange of information between national supervising authorities so as to increase mutual confidence that service-providers from elsewhere are adequately supervised in their home country.
The Commission wants the self-regulated professions, such as lawyers and architects, to establish European codes of conduct on professional ethics, so that self-regulation cannot be used as a barrier to cross-border competition.
In this field, Ireland has yet to comply with various EU laws already passed, including the law on professional qualifications and the lawyers' directive which allows a barrister qualified in one country to practise in another.
The Commission proposes doing away with the ban on advertising from these groups, which applies in some countries. The draft contains specific provisions on requirements for professional insurance and on multidisciplinary activities, for example, partnerships or co-operation between lawyers and tax advisers. It would allow governments to maintain restrictions on such multidisciplinary partnerships where they are necessary to ensure compliance with professional ethics.
The law will contain specific clauses on the provision of health services across national boundaries, codifying recent case-law. It stipulates that for non-hospital-based services, patients must be reimbursed by their home country for care received elsewhere in the EU, to the extent that the treatment would normally be reimbursed if provided in the home country.
For hospital care in another EU country, prior authorisation may be required but cannot be refused if the treatment would be reimbursable in the patient's home country and cannot be obtained there without undue delay.
Mr Bolkestein wants to see the law take effect in 2007, but the proposal requires the assent of both the Council of Ministers and the European Parliament, and such is the scope of the legislation that a fierce lobbying battle can be expected.
The Taoiseach has already made clear the importance of the proposal to the Irish Presidency's aim of improving Europe's economic competitiveness. In a letter to his fellow heads of government he wrote: "The services sector, where progress is lagging, requires particular attention, and we intend to significantly advance the proposal for a directive on services."
A spokeswoman for the Government said the Presidency had scheduled the proposal for discussion at a meeting of the competitiveness council on March 11th, to be chaired by the Tánaiste, Ms Harney. Before that it would be considered by working groups of officials.
"It is something we want to push," the spokeswoman said, while cautioning that the proposal was "very long and very ambitious". Progress would depend on the reaction from other governments, she said.