Commission action plan for the Single Market

The Commission Communication on the "Impact and effectiveness of the Single Market", adopted on 30 October 1996, presents the results of an exhaustive survey conducted over the past two years. This review reveals that, although the essential legal framework for a Single Market...

The Commission Communication on the "Impact and effectiveness of the Single Market", adopted on 30 October 1996, presents the results of an exhaustive survey conducted over the past two years. This review reveals that, although the essential legal framework for a Single Market is now in place, delays in adopting and applying important parts of the Single Market legislation are compromising its effectiveness.

The Commission Communication puts forward the main priorities for action in this area and calls for a new commitment to the Single Market, not only at the highest political level - the European Council in Dublin - but also from all those who must contribute to making the Single Market a success (national authorities, the European Institutions and the economic operators themselves).

The issue of effective application and enforcement of Community law is widely perceived as a problem by businesses and individuals, who suffer from delays in implementation of the law in some Member States and variations in its interpretation and enforcement from one Member State to another.

On the basis of the review exercise, the Commission has outlined a series of clear policy recommendations for action, at national and Community levels, so that the Single Market's full potential can be achieved. The Communication suggests an innovative approach, building on a number of recent initiatives, including:

- Specific initiatives to strengthen Community rules;
- Creating a framework for enforcement policy;
- Audits of national enforcement measures;
- Mobilizing scientific and technical expertise;
- Speeding up Commission infringement procedures;
- Better enforcement instruments for the Single Market;
- Monitoring the operation of the Single Market.

The Commission's review, nevertheless, highlights the positive effects of the Single Market on the European economy. There are clear signs of significant change in the European economy even if it is still too early for many Single Market measures to have taken full effect. The Commission's analysis shows the following positive, albeit preliminary effects:

- Up to 900,000 more jobs than would have existed in the absence of the Single Market;
- In 1994, Community income is estimated to have been 1.1% to 1.5% higher due to the Single Market: an increase of ECU 60-80 billion;
- Inflation rates seem to be 1.0% to 1.5% lower than they would have been in the absence of the Single Market;
- Intra-EU manufacturing trade was boosted by 20-30%.

Furthermore, there is now evidence of:

- Growing competition between companies in both manufacturing and services;
- An accelerated pace of industrial restructuring, with the resultant benefits in terms of greater competitiveness;
- A wider range of products and services are available to retail, public sector and industrial consumers at lower prices, particularly in newly liberalized service sectors such as transport, financial services, telecommunications and broadcasting;
- Faster and cheaper cross-frontier deliveries resulting from the absence of border controls on goods, which in turn allow a wider choice of suppliers;
- Greater mobility between Member States for both workers and those not economically active (including students and retired people);
- Confirmation of economic convergence and cohesion between different EU regions;
- Greater attractiveness for investment: the EU absorbed 44% of global foreign investment flows in early 1990s, compared to 28% in the middle of the 1980s;
- Sectoral specialization by Member States has decreased leading to greater convergence of production structures.

These benefits have been gained without any reduction in safety standards for consumers or workers. In many areas standards of protection for the citizen have in fact increased. Citizens of the Union also enjoy more personal freedom and have more choice than ever before. The Commission's survey confirms that Community legislation in the Single Market area has, taken as a whole, created the basic conditions for free movement and economic efficiency.