Select Committee on European Scrutiny Thirty-Fifth Report



14. SINGLE MARKET SCOREBOARD

 

(23507)

9063/02

SEC(02) 569

Commission Staff Working Paper — Single Market Scoreboard No. 10: May 2002.

Legal base:

   

Document originated:

14 May 2002

Deposited in Parliament:

28 May 2002

Department:

Trade and Industry

Basis of consideration:

EM of 19 June 2002

Previous Committee Report:

None

Committee's assessment:

Politically important

Committee's decision:

Cleared

 

 

Background

    1. As part of the Single Market Action Plan agreed in June 1997, the Commission undertook to produce a "Single Market Scoreboard" during each Presidency of the European Union. This is the tenth edition.
    2. The purpose of the Scoreboard is to monitor the functioning of the single market and allow Member States to compare their performance in certain key areas.
    3. The document

    4. This edition is divided into three parts: part one deals with "Implementing the Internal Market's Legal Framework"; part two deals with "Completing the Internal Market" and part three reviews "Technical Barriers and the Functioning of the Internal Market". The main findings of each part are summarised by the Commission as follows.

— Implementing the Internal Market's Legal Framework

"—  Sweden, Denmark, Finland, the UK, the Netherlands, Belgium and Spain currently meet the European Council's 98.5% transposition[36] target. France, Greece, Germany and Ireland are furthest away from the target.

    • The Barcelona European Council set a new 100% transposition target for all directives more than two years overdue. France and Luxemburg will have to work the hardest to meet this ambitious target by spring 2003.

    • The total number of Internal Market infringement proceedings has risen by 2% since the November 2001 Scoreboard and currently exceeds 1500 cases. France and Italy still account for nearly 30% of all infringements.

    • The 2002 Review of the Internal Market Strategy set a new target to reduce the number of infringement proceedings relating to the misapplication of Internal Market legislation by at least 10% by spring 2003. Ireland (100) and Spain (96) have the most outstanding cases."

— Completing the Internal Market

"—  Only about 50% of target actions set out in the Internal Market Strategy have been completed on time. Between now and the end of the year 13 actions will need to be completed. These include public procurement and the Community Patent as well as actions in the fields of financial services, energy, transport and competition policy.

    • Fully integrated financial markets could add 43 billion euro p.a. to the Union's GDP. The Financial Services Action Plan has made good progress: 27 out of 42 actions have now been completed"

— Technical Barriers and the Functioning of the Internal Market

"—  The Barcelona European Council asked the Commission to report on technical barriers to trade in the Scoreboard. As a first response several brief analyses of industry sectors (i.e. telecom terminal equipment, construction products, bicycles and beer) highlight some important remaining bottlenecks as well as progress made.

    • Significant price differences persist across Europe for general grocery and household items. Market fragmentation and the level of competition in the retail sector are key factors in explaining these differences. Consumers in some Member States can pay up to four times more for the same product as consumers in other Member States."

    1. The document also has an annex which describes the general principles on which policy on the free movement of goods within the European Union is based. In sectors where risk to public health, the environment or consumers is assessed as high, for example pharmaceuticals, EU legislation harmonising technical regulations is used. This covers about half of intra-EU trade in goods. For sectors where the risk is assessed as lower (the "non-harmonised" sectors) the mutual recognition principle is applied whether the sector is covered by national technical regulations or not regulated at all.
    2. The UK is noted as one of the three Member States deserving "considerable credit" for steps towards ensuring the original transposition target is met. On the new stricter target the UK will have to implement five directives[37] by March 2003. On infringement proceedings the UK is reported as having the largest increase in open cases and the second lowest rate of early resolution. In the study of beer the UK is listed as having the second highest level of excise and the third highest of VAT. In the more general prices study the UK is one of those Member States with the highest prices for some goods and the lowest on others. But overall, the UK is the fifth most expensive Member State, or second most expensive for VAT-excluded prices.
    3. The Government's view

    4. In her Explanatory Memorandum of 19 June 2002, the Parliamentary Under-Secretary of State for Competition, Consumers and Markets (Miss Melanie Johnson) tells us:
    5. "The primary aim of the Scoreboard is to monitor a range of indicators which reflect the health of the Single Market. It has no direct policy implications, but nonetheless has proved extremely useful both as a means of evaluating developments in the Single Market and as a spur towards greater achievement. For example, the Commission's Internal Market Strategy lists the practical steps which are necessary to make the Conclusions of the Lisbon Summit a reality and the Scoreboard is one way of monitoring how work is progressing and picking up on areas of difficulty. Likewise, the Scoreboard helps to maintain the pressure on Member States to implement European legislation on time and enables both the Commission and Member States to identify problems. This in turn provides a basis for improving the regulatory environment. The Government therefore supports the continued use and development of the Single Market Scoreboard."

    6. On the UK's implementation of the five Directives necessary to meet the stricter target, the Minister tells us that the UK has, or has very nearly, transposed four already. As for open infringement cases the Minister says the Cabinet Office, which monitors infractions, notes that over time the United Kingdom record has been good and believes that the present slippage — a 42% increase in the number of open cases and a decline in the rate of resolution of cases, from 29% to 24% — is a seasonal blip and that future scoreboards will show improvement.
    7. As regards the finding that excise and VAT levels remain an obstacle to the free movement of goods in this sector, the view of Customs and Excise is that the Scoreboard's comment on beer ignores the overall tax position, on which the UK compares well.
    8. Conclusion

    9. The Scoreboard provides a useful source of information on, amongst other things, the relative performance of Member States in transposing Directives. We were pleased to note that the UK is recognised as making good efforts to improve its transposition record. We were disappointed to see the UK's record on infringement cases slipping, but note the Minister's statement that this only a temporary failure. We note also the Minister's view that overall the tax position as it affects beer in the UK compares well with that in other Member States.
    10. When we considered the last Scoreboard,[38] we were concerned that the Minister had not provided any explanation of the adverse comments on the UK record. We were pleased to receive such explanations from the Minister on this occasion. We clear the document.

 


36  "Transposition" is the implementation of directives into national legislation. Back

37  Directive No. 97/78 of 18.12.97 laying down the principles governing the organisation of veterinary checks on products entering the Community from third countries, Directive No. 97/79 of 18.12.97 concerning the organisation of veterinary checks on products entering the Community from third countries, Directive No. 96/61 of 24.9.96 concerning integrated pollution prevention and control of 24.9.96 concerning integrated pollution prevention and control, Directive No. 98/83 of 3.11.98 on the quality of water intended for human consumption, and Directive No. 99/51 of 26.5.99 on restrictions on the marketing and use of certain dangerous substances and preparations (tin, PCP and cadmium). Back

38   (23137) 14885/01; see HC 152 xxvii (2001-02), paragraph 16 (1 May 2002). Back

 
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