Brussels, 28 May 2001
Internal Market: Scoreboard reveals mixed performance by Member States
The latest issue of the Internal Market Scoreboard, published by the European Commission today, reveals that the EU's average implementation deficit for Internal Market Directives has shrunk to 2.5% - down from 3% only six months ago. However, only three Member States (Sweden, Denmark and Finland) meet the European Council's 98.5% implementation target set at Stockholm. Since the last Scoreboard in November 2000, Portugal and Luxembourg have made great strides, both moving up four places in the overall rankings. Sweden ranks first and has been able to cut its already low deficit in half, to 0.5%. The worrying news is that Austria and the UK, whose deficits were already among the highest, are backsliding. The Scoreboard also reviews environmental Directives, where the average deficit is an alarmingly high 7.1%. The number of alleged infringements of Internal Market rules keeps growing and is now at nearly 1,800, up by 7% since last November. The Scoreboard also contains the results of a survey of prices for consumer electronics and fresh foods, which show that large price differences continue to exist across Member States.
Internal Market Commissioner, Frits Bolkestein, welcomed the positive trend for implementation: "This shows that our 'name and shame' approach is bearing fruit. I particularly wish to congratulate Sweden, Portugal and Luxembourg who have outperformed everybody else over the last six months. However, it is not all good news: momentum seems to have been lost in some Member States, such as the UK and Austria, who are actually sliding backwards. Unless they make significant additional efforts, Greece, France, Ireland, the UK, Austria and Germany risk missing the European Council's implementation target of 98.5% for the Barcelona European Council in March 2002."
The Internal Market plays a key role in achieving the EU's objective of becoming the most dynamic economy in the world by 2010. It gives EU citizens a wider choice of quality goods and services, greater freedom to travel, work, study and live in other EU countries. It offers greater trading opportunities to our companies. But the Internal Market can only achieve its full potential if agreed Directives are effectively implemented by Member States. The Internal Market Scoreboard keeps pressure on Member States by showing their relative performance in implementing this legislation. This approach has worked well: the EU average deficit has steadily fallen from 6.3% in 1997 to 2.5%.
Member States' implementation of Internal Market Directives
Most Member States have made good progress over the last six months. Sweden, Portugal and Luxembourg in particular have all greatly reduced their deficits since the last Scoreboard in November 2000. Greece and France have also made some good progress, cutting their deficits by about a quarter, although both remain at the bottom of the league. Regrettably, some Member States' records have actually deteriorated. This is particularly worrying in the case of the UK and Austria, who are slipping further away from the 1.5% deficit target. The fact that Germany and Ireland made only modest progress is also disappointing.
On the basis of their current performance, Greece, France, Ireland, the UK, Austria and Germany will not meet the European Council's Spring 2002 deadline for a maximum deficit of 1.5%. It would take France until 2003, Germany until 2004, and Ireland until 2006 to reach the finishing line. Even this is an optimistic scenario, as it presupposes that these Member States will implement all forthcoming Directives on time.
The implementation process is continuous and a large number of new Directives, or amendments to existing Directives, will have to be implemented by the Spring of 2002 the European Council's deadline. Greece, for example, would have to implement a total of 114 Directives to be in full conformity with EU law by that date, and France 92. The table below shows the number of Internal Market Directives each Member State would have to implement by Spring 2002 to achieve a zero and 1.5% deficit within that deadline.
The Internal Market remains seriously fragmented in the sense that more than 11% of legislation has not yet been implemented in all of the Member States. This seriously undermines the Internal Market's potential to create growth and jobs. This percentage has not moved much since 1999. In transport and public procurement, over 30% of legislation has yet to be implemented in all Member States.
Implementation of environmental Directives related to the Internal Market leaves much to be desired. Here the deficit (7.1%) is almost three times higher than that for Internal Market legislation as a whole (2.5%). Germany, Belgium and Spain have deficits in double figures. This is not a good record, particularly as the Gothenburg European Council is about to define a European Strategy on Sustainable Development.
At present, the Commission is dealing with about 1,800 infringement cases for alleged breaches of Internal Market law. This figure is up by 7% compared to November 2000. France, Italy and Spain account for most of the infringement action. The Scoreboard also shows that for cases that go to the Court of Justice, it takes many years before they are settled. In about 80% of cases, the Court does not hand down its judgement until at least three years after the case is opened. Clearly, Member States should avoid infringements altogether, but if they do occur they should be settled early. Some Member States are better than others at resolving cases early. Finland and Denmark resolve more than half of their cases early, while Greece, Italy, Belgium, Germany, Luxembourg and the Netherlands do this in less than one third of cases.
Commissioner Bolkestein said: "I am not happy that the number of Internal Market infringement cases keeps rising. For businesses or citizens to have to wait several years before a case is resolved does nothing to enhance the credibility of the Internal Market or indeed the EU itself. A company may be out of business by the time the case is resolved. A citizen may have given up on his or her wish to work, for example, as an engineer or architect in another Member State. I urge Member States to settle cases early and avoid protracted Court proceedings. Not just for the benefit of good administration, which is important, but for our small businesses and citizens."
Many product Directives can only work well with harmonised standards. While European Standardisation bodies have made some useful progress over the years, the situation in a number of key industrial sectors remains unsatisfactory. In the construction products sector, for example, less than 10% of the standards that are needed to make the Internal Market work have been adopted. In the area of machinery, less than half of the required standards have been agreed.
The Commission has received about 12,000 queries via its Business Feedback Mechanism over the last twelve months; one third of those are about problems with technical harmonisation.
Price comparisons are good indicators of economic integration and market performance. The Commission's price surveys for electronic goods and fresh foods shows that large price differences continue to exist. The price for a TV set or DVD player can sometimes be up to 40% higher in one Member State than another. Food prices differ even more. They can be up to three times as high. No country is consistently the cheapest or the most expensive. Furthermore, prices are not necessarily higher in Member States with higher income levels. Nor are VAT differences the cause of price dispersion. There would be considerable savings if further competition and market integration could drive prices down to as close as possible to the lowest price found within the EU for each product. On average, EU consumers could save around 12% on consumer electronics. For further details of the price surveys, see MEMO/01/196.
Commissioner Bolkestein commented: "We need to pin down the causes of these significant price variations, whether they are bottlenecks in competition or obstacles in distribution and marketing, and tackle them urgently. European citizens have a right to expect the benefits of competitive prices from the Internal Market."
The text of the latest Scoreboard is available from the Europa Website: