Rapporteur : Lorenzo GALLIGANI (IT/ECR), Councillor of Pistoia Reference document : Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions – The Single Market: our European home market in an uncertain world: A Strategy for making the Single Market simple, seamless and strong COM(2025) 500

POLICY RECOMMENDATIONS

THE EUROPEAN COMMITTEE OF THE REGIONS (CoR)

A single market crucial for Europe’s regions and cities

1.

points out that the single market is one of the greatest achievements of the European Union, a cornerstone of integration and prosperity, and a decisive driver of Europe’s competitiveness and resilience; that since its creation over thirty years ago, it has become the largest integrated marketplace in the world with almost 450 million consumers and accounts for a quarter of the EU’s GDP, sustains 56 million jobs and represents nearly a sixth of global trade in goods; therefore calls on the Commission and Member States to safeguard and deepen the single market so that its benefits are fully realised in all regions;

2.

underlines the benefits of the single market for consumer trust, notably by enhancing competition that helps to keep consumer prices fair and affordable, by widening the range of products and services available across borders, and by ensuring high levels of quality, safety and environmental protection through EU-wide standardisation; highlights that the single market’s significance extends beyond the economy, fostering citizens’ well-being, mobility and opportunities, and demonstrating the practical benefits of the EU in everyday life;

3.

welcomes the Communication The Single Market: our European home market in an uncertain world – A Strategy for making the Single Market simple, seamless and strong (the ‘Single Market Strategy’), which sets out the Commission’s aim to strengthen the single market by seeking to remove the most harmful single market barriers, modernise and open up EU cross-border markets, support businesses, simplify and digitalise rules and procedures and strengthen overall single market governance and enforcement;

4.

regrets that the strategy does not fully reflect the boldness of the Draghi and Letta reports regarding the single market, and that it fails to propose adequate legal instruments in several key areas; sees it as a step in the right direction but calls for a more long-term approach, combined with resolute short-term measures, to strengthening the single market, guided by pertinent key performance indicators and concrete milestones and targets to measure whether objectives are being achieved;

5.

regrets that more than a year on, despite efforts by the Commission, too few of the Draghi and Letta reports’ recommendations for the single market and competitiveness have been translated into concrete changes on the ground for citizens and businesses, most notably regarding the need for investment, simplification and cutting red tape;

The unfulfilled potential of the single market

6.

while recognising that the single market has already reached a high level of economic integration and has been a central factor in creating prosperity for Europeans, regrets that persistent barriers continue to hold back its potential; points out that according to estimates, a 10 % reduction in the remaining barriers could lead to gains of up to 7 % of GDP;

7.

welcomes the increased efforts within the European Commission on enforcement and barrier removal, which indicate a stronger commitment to tackling fragmentation and gold-plating; reiterates its demand for the Commission (1) to dedicate more of its resources to the systematic removal of single market barriers and enforcement of single market rules;

8.

warns, however, that instruments such as SOLVIT and the Single Market Enforcement Task Force (SMET) rely too much on voluntary cooperation from Member States, which limits their capacity to address inexplicit but persistent protectionism; calls, furthermore, for the involvement of local and regional authorities in these single market barrier removal instruments, as only regions and cities can bring the necessary expertise and technical data from their territories, each with very specific challenges, to make these instruments truly efficient on the ground;

9.

highlights that the huge volume of unsafe, non-compliant and counterfeit goods entering the EU market, especially via e-commerce and from non-EU countries, has been increasing exponentially in recent years, thus negatively impacting EU business operators, in particular SMEs, and consumer safety; calls therefore for a reinforced, modern market surveillance framework to ensure that only compliant products are made available on the EU market, thereby protecting European businesses from unfair competition, maintaining EU added value and preserving economic sovereignty;

10.

calls on the Member States to increase the capacities of market surveillance and customs authorities to ensure that they can effectively enforce single market rules, also using new legal instruments and technologies;

11.

warns that the strategy focuses very much on specifically targeted barriers (the ‘terrible ten’) while many other obstacles, equally detrimental to seamless cross-border activities, remain unaddressed, and further regrets that local and regional authorities were insufficiently involved in establishing this list, thereby missing the opportunity to ground priorities in the practical experience of those closest to businesses; calls for a pragmatic approach in barrier removal that leads to visible benefits, for instance for the facilitation of cross border delivery of key services for the manufacturing sector, such as engineering services, announced in the strategy;

12.

regrets that businesses continue to face significant obstacles to cross-border service provision; stresses that these barriers take various forms, from local administrative requirements to national technical regulations that act as de facto market entry barriers; calls for urgent steps to better facilitate cross-border service provision in the EU;

13.

notes the possible upcoming proposal for a Single Market Barriers Prevention Act; underlines that current tools have not sufficiently prevented barriers from arising, and therefore urges the Commission to start assessing the need for and practical functioning of such a potential Act as soon as possible, in cooperation with local and regional authorities, with a view to eventual publication;

14.

calls for the establishment of a non-regression principle for single market integration to prevent backsliding; notes with concern that intra-EU trade in goods has regressed and calls for tackling legislation that forms an obstacle to free movement of goods to reverse this worrying trend;

A robust and more resilient single market

15.

stresses that recent economic and geopolitical crises have reminded us of the importance of the single market for everyday life, but also revealed its weaknesses, as well as the frailty of globalisation itself, stressing the need for strategic autonomy in critical sectors; recent global trade tensions and volatility have further exposed vulnerabilities, with a direct impact on Europe’s regions and cities, which depend on a well-functioning single market to generate investment, employment and innovation; a stronger single market is needed to better withstand global crises together;

16.

underlines that the Safer Together report by special advisor and former Finnish President Sauli Niinistö on resilience and preparedness puts forward the single market as a critical backbone of EU resilience; points out that this was also one of the main messages of its 2024 opinion on Shock-proofing European regions: Strengthening local and regional economic resilience in the strategic evolution of the Single Market (CDR-1340-2024);

17.

notes in that context that a robust and crisis-proof single market will enable the free movement of critical goods and services as well as workers, even when disruptive events occur; therefore reiterates its call for increased attention to the concept of comprehensive security and security of supply, and supports EU-wide measures that coordinate crisis responses and harness and strengthen supply chains, in particular during and with a view to upcoming crises and disruptions;

18.

underlines that investments in the infrastructure, accessibility and fast and reliable digital connectivity of regions are critical, especially in rural, mountain and island areas, to better connect them to the single market and strengthen its resilience;

19.

calls in particular for cross-border rail passenger and freight transport to be harmonised for obstacles to it to be systematically removed and for swift implementation of major rail construction projects, in order to boost the single market and trade between regions; stresses that a functioning European railway area is crucial for ensuring a resilient transport system and for shifting the flow of goods towards energy-efficient and environmentally friendly modes of transport;

20.

emphasises the crucial role of SMEs in diversifying regional economies and supply chains, and thereby strengthening the single market and economic resilience, as the dependence of regions on a limited number of big employers increases their susceptibility to economic shocks in cases of divestment; notes at the same time that crises often hit SMEs the hardest;

21.

calls for swift and efficient implementation of legal instruments such as the Internal Market Emergency and Resilience Act (IMERA) to maintain the functioning of the single market even when it is hit by severe shocks;

A simpler and more digitalised single market

22.

regrets the negative effects of the growing number of EU legislation on European businesses and competitiveness; recalls that simplification is one of the most pressing demands of businesses, particularly SMEs and microenterprises; commends the Commission’s target to cut the costs of all administrative burdens by 25 % for all companies and 35 % for SMEs, and agrees with the Competitiveness Compass that restoring Europe’s competitiveness requires going much further than before in cutting red tape, while upholding economic, social, health and environmental standards; therefore welcomes the Commission’s omnibus package proposals and calls on the co-legislators to ensure their swift adoption;

23.

reiterates the call by the Draghi report that the Commission should conduct a systematic assessment and stress-testing of all existing EU laws and regulations at the start of each mandate; this should be followed by the codification and consolidation of EU legislation by policy area, including simplifying and removing overlap and inconsistencies across the whole legislative chain; calls, furthermore, for the Commission to ensure high-quality impact assessments of all new legislative proposals, including delegated and implementing acts, and insists that all impact assessments include a competitiveness check, specifically assessing the impact on SMEs and start-ups; stresses that these assessments should also systematically examine cumulative regulatory burdens, administrative costs and compliance complexity, and should be made publicly available in a clear and comparable format, in order to increase transparency, improve the quality of law-making and strengthen trust among businesses and citizens;

24.

supports the Commission’s efforts to simplify complex and time-consuming rules and procedures that stand in the way of frictionless intra-EU trade and underlines that simplification and digitalisation must be designed to genuinely reduce regulatory burdens for businesses of all sizes, while ensuring technological neutrality, and that digital solutions must be fully accessible and provide connectivity for regions with permanent geographical disadvantages; stresses, however, that digitalisation must not become a substitute for simplification and resolute simplification is needed in the first place;

25.

highlights that much can also be done through user-friendly implementation of the single market rules. Public interoperable platforms, standards and digital tools are key, and they must be designed to be both effective for public authorities and proportionate to the different economic operators; calls for strengthening platforms like the single digital gateway and the Once-Only Technical System to facilitate easier business registrations;

26.

urges the Commission to harmonise labelling and packaging rules and ensure simplification alongside digitalisation through the digital product passport; believes that rules on labelling must balance the need to be clearly understood by consumers with the need to reduce market barriers, avoiding duplication of certifications and reporting obligations which are burdens for European businesses;

27.

urges the Commission to harmonise sustainability standards, which are highly fragmented at European level and create barriers within the single market, especially for SMEs;

28.

urges the European Commission to simplify and harmonise tax systems, aligning VAT rules and implementing a single digital platform for cross-border tax compliance, including a simplified system for intra-EU VAT contributions, thereby reducing administrative burdens on SMEs;

29.

highlights that SMEs and micro-enterprises form the backbone of the European economy and are vital for rural development and the freedom to stay in less developed or peripheral territories; also underlines that SMEs, due to their very nature, often have fewer opportunities to equip themselves with the necessary tools in terms of skills and investments to make the most of the opportunities of the single market; stresses that in regions with permanent geographical disadvantages, SMEs and micro enterprises form a particularly fragile economic fabric that is heavily reliant on seasonal sectors and is confronted with high logistical costs; support measures therefore need to be adopted as part of the Single Market Strategy;

30.

welcomes that the Commission dedicates an entire chapter of its strategy to SMEs, thus underlining its ambition to help them navigate the single market; regrets, however, that the strategy does not mention any targeted measures in favour of microenterprises, for whom the single market represents a very specific set of challenges, and calls for the Commission to take this into account when implementing the strategy;

31.

calls on the Commission to ensure that new frameworks such as the 28th regime remain flexible, proportionate and accessible to all relevant types of businesses, and not subject to overly restrictive conditions; the 28th regime should simplify in particular the setting up of a business in another Member State and ensure the application of the ‘once only’ principle through all the administrative procedures, without undermining workers’ protection and fair working conditions;

32.

calls for proportionate and efficient facilitating measures in areas such as recognition of professional qualifications, diplomas and titles in general, posting of workers and working time rules, including with the use of digital tools, to cut delays and avoid discouraging cross-border activity, especially for SMEs and micro-enterprises, which ultimately also affects their workers; believes that more should be done to improve information sharing between competent authorities across Member States;

33.

also calls for mutual recognition frameworks for product certifications to be fully enforced, as required by Regulation (EU) 2019/515 (2) on the mutual recognition of goods, ensuring that SMEs can operate without barriers across the single market;

A single market with a stronger territorial dimension

34.

stresses that the obstacles that remain in the single market for circulation of goods and services and for labour mobility are at the heart of the uneven distribution of its benefits across EU territories;

35.

notes that while intra-EU trade in goods helps foster economic and social convergence of European territories, intra-EU trade in services tends to benefit larger cities and wealthier regions, leaving more peripheral (such as island regions) and rural regions behind; underlines that these regions face specific challenges related to brain drain and demographic changes and permanent structural disadvantages that cannot be seen independently from the single market;

36.

recalls that cohesion policy and the single market are ‘two sides of the same coin’ and insists that further deepening of single market integration must go hand in hand with territorial cohesion and rural development; supports the freedom to stay concept, which aims to make the single market work for everyone in every region and highlights the single market’s territorial dimension, requiring better territorial impact assessments;

37.

therefore, calls on the co-legislators to ensure that further integration is accompanied by adequate cohesion funding, particularly in the context of the upcoming multiannual financial framework, which must confirm and strengthen the role of local and regional authorities in the implementation of EU funded policies as a safeguard against a lack of focus for territorial challenges to avoid negative impacts on the single market;

38.

warns that financing sectoral programmes should not be to the detriment of cohesion funding to avoid deepening regional disparities, and calls on the co-legislators to preserve strong funding for the proposed National and Regional Partnership Plans as part of the next multiannual financial framework;

39.

underlines that a stronger territorial perspective, especially for cross-border, peripheral, rural and mountain and island regions is needed; points out that more concrete mechanisms for coordination between local and regional authorities and cross-border impact assessment could ensure more effective implementation of single market rules in all territories; suggests reinforcing cross-border cooperation programmes that enable SMEs to participate in EU projects and foster cooperation between border regions; in this sense, calls for quick and full implementation of the Cross-Border Facilitation Tool Regulation to contribute to more competitive border regions;

40.

calls for the 2011 report on ‘Europe's outermost regions and the single market: the EU’s influence in the world’ – dealing with integrating the outermost regions into the single market and their influence in the world – to be updated to take into account the economic, technological and geopolitical changes of the last decade and the need to fully implement Article 349 TFEU, as integrating the outermost regions into the single market is an objective that still has yet to be fully achieved;

Regional and local authorities make the single market work

41.

emphasises that regions and cities do not only benefit from the single market, but that they are also indispensable partners for its functioning, as they are the first point of contact for many SMEs and micro-enterprises seeking to expand across borders and support workers and service providers in exercising their mobility rights; stresses, in this regard, the importance of ensuring that local and regional initiatives contribute to the green and digital transitions and foster socially inclusive growth;

42.

points out that local and regional authorities play a decisive role in the enforcement of rules; without their active involvement, implementation and enforcement of single market rules will remain weak; therefore reiterates its call for appropriate involvement of regions and cities in the design and roll-out of single market rules and policies, including those announced in the Single Market Strategy and in existing ones such as market surveillance tools;

43.

calls for the systematic use of territorial impact assessments to identify and prevent future implementation difficulties and to ensure that the specific needs and vulnerabilities of regions and cities are taken into account during the legislative process of single market proposals; insists that such assessments should systematically include competitiveness and SME checks, as well as environmental, climate and social impact dimensions;

44.

underlines that the effective implementation of the single market depends on the systematic involvement of local and regional authorities and calls on the Commission and the Member States to provide local and regional authorities with the necessary means to strengthen their administrative capacities, so that they can properly assist businesses, in particular small-size operators, in navigating procedures and help ensure the consistent enforcement of rules;

45.

welcomes the proposal to nominate a high-level single market sherpa for each Member State and calls for regional and local representatives to be included in its work, with a yearly compulsory dialogue, to strengthen multilevel governance and political ownership at all levels; proposes that a balance between regions be struck when nominating single market sherpas, with cross border, peripheral, rural, mountain and island regions represented, so that their specific features can be systematically factored into the governance of the single market;

46.

calls on the Commission to consider establishing an informal network of single market sherpas at regional and cross-border level, which may be coordinated through EGTCs or other cross-border entities, with annual roadmaps and public reporting;

A call for urgent action

47.

calls for more ambition and urgency in the implementation of the strategy, with the objective of removing the ‘terrible ten’ barriers by the end of 2027, and establishing key performance indicators and concrete mid- to long-term targets for single market integration, as this will be key for future competitiveness, and underlines that failure to act will further weaken Europe’s economy and strategic autonomy;

48.

takes note of the EU leaders’ informal meeting at Alden Biesen to discuss how to deepen the single market, reduce economic dependencies and boost competitiveness, and looks forward to the announced ‘One Europe, One Market’ Roadmap and Action Plan; stresses, at the same time, that now is no longer the time for compasses, strategies and roadmaps to be published, but for actions and real measures to be implemented to deliver tangible progress towards a prosperous, resilient and seamless European economy and single market; underlines that implementation must be timely, coordinated across all levels of governance and properly funded, and that unnecessary administrative burdens should be avoided so that SMEs, microenterprises and local and regional authorities can effectively contribute to and benefit from the transition.

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(1)  CDR-2106-2024.

(2)  Regulation (EU) 2019/515 of the European Parliament and of the Council of 19 March 2019 on the mutual recognition of goods lawfully marketed in another Member State and repealing Regulation (EC) No 764/2008 (OJ L 91, 29.3.2019, p. 1).