Plan to bring offenders to heel

Date: 01/05/1997

By Chris Johnstone

ITALY is sounding out its partners on ideas which would give the European Commission new treaty powers to deal with countries which fail to implement single market rules.

Plans to bolster the Commission's ability to take immediate decisions condemning countries which break the rules are being canvassed in Europe's capitals.

Rome wants to see whether its ideas are likely to win support from other member states before deciding whether to table a formal proposal at the Intergovernmental Conference.

The broad idea is for the Commission to have the same disciplinary powers when policing the single market as it has now in dealing with cases of unfair competition and state subsidies.

A Commission decision is the final word, bar a court appeal, in competition cases. But when it comes to infringements, a Commission decision is just the start of a multi-staged procedure which can take years, with the European Court of Justice alone allowed to condemn countries and impose fines.

The changes being considered would answer the dreams of Internal Market Commissioner Mario Monti, who can now only look with envy at the powers of his competition counterpart Karel van Miert to bring errant companies and governments to heel.

Italian officials say there is broad support for reform of the single market rules, but admit that some countries might be lukewarm about giving the Commission extra powers.

The infringement procedures are, however, widely recognised as a weak link in the institution's workload. It can take months for initial warnings to be sent to governments and politically sensitive cases are sometimes 'lost' or sidelined as they go through the tortuous procedural stages.

Changes to the Commission's internal rules for dealing with infringements were agreed last July in an attempt to cut a huge backlog of cases, but have had little effect.

As well as cracking down on infringements, the Commission has set itself the goal of completing the EU's internal market in time for the single currency in 1999.

Its draft plan for achieving this, which was due to be adopted by the full Commission today (30 April), outlines four main areas for action: making single market rules more effective, dealing with market distortions, tackling sectoral obstacles and giving citizens a better deal.

The regular publication of a single market scoreboard, showing to what extent individual countries are living up to their commitments, is intended to shame governments into delivering on their promises.

The shake-up also includes deadlines for resolving problems raised by the Commission and governments; increased checks to ensure common rules for the acceptance of industrial and consumer products are being respected; simplified single market legislation; and improved regulations on public procurement, mutual recognition, European standards, construction products, transit rules, and the links between the single market and environment.

Tackling taxation distortions, creating a new value added tax system and restructuring levies on fuels - accompanied by streamlined competition and subsidy rules - are also targeted as crucial areas for action.

In addition, the plan emphasises the need to remove barriers in key service markets such as telecoms, energy, pension and investment funds, and make restructuring easier through a European Company Statute.

Measures needed to make the single market a reality for ordinary EU citizens include eliminating all border checks within the Union; improving the rights of those living in a member state other than their own; boosting labour mobility through a proposed directive on supplementary pensions; and providing better guarantees for consumers.

The Commission this week revealed that it launched 30&percent; more infringement procedures for abuses of single market rules last year than in 1995. About one third of the procedures were provoked by slow implementation of legislation, a third by complaints and the remainder were initiated by the Commission itself. Cross-border trade in cars, especially those for personal use, foodstuffs and chemicals were the areas most frequently marred by import barriers.