Action plan for the single market (1997)

1) OBJECTIVE

To enable the single market to function fully and effectively by setting out in detail the priority measures to be taken to improve the functioning of the single market by 1 January 1999.

2) ACT

Commission Communication of 4 June 1997 to the European Council - Action plan for the single market [Commission communication to the European Council CSE (97)1 final - Not published in the Official Journal].

3) SUMMARY

The aim of the Commission's action plan for the single market, which was presented on 4 June 1997, is to improve the functioning of the single market by 1 January 1999. This action plan was announced in the conclusions of the Dublin European Council and follows on from the Commission's report on the impact and effectiveness of the single market.

The action plan sets four strategic objectives which are of equal importance and must be pursued in parallel:

• making the rules of the single market more effective (proper enforcement and simplification of rules at Community and national levels);
• dealing with key market distortions (tax barriers and anti-competitive behaviour);
• removing sectoral obstacles to market integration (new legislative measures and changing national administrations' attitudes);
• delivering a single market for the benefit of all citizens (the social dimension of the single market).

Within each of these strategic targets, the Commission has identified a number of specific actions to be carried out by 1 January 1999. All of these are crucial to allow the single market to function fully and effectively and to boost employment and growth. However, the Commission believes these actions should be differentiated in terms of the level of advancement they can reasonably achieve by 1 January 1999.

The Commission has therefore drawn up a three-phase timetable with adoption in the very short term of urgent measures, speedy adoption of a number of existing proposals and as broad an agreement as possible by 1 January on the remaining measures.

PHASED TIMETABLE FOR IMPLEMENTATION OF THE ACTION PLAN FOR THE SINGLE MARKET (ANNEX 1 TO THE ACTION PLAN)

Phase 1:

Phase 2:

Phase 3:

Annex 2 to the action plan lists the four strategic objectives and identifies a number of important specific actions to improve the full and effective functioning of the single market. A selective approach is taken which does not preclude measures in other areas to complete the single market.

The action plan refers in particular to measures in the sectors below.

In the field of taxation, the action plan proposes submitting to the Member States a series of measures to:

• eliminate tax-related distortions by:- reducing the effects of tax competition, especially in the area of corporate taxation;- eliminating disparities in the taxation of capital income and indirect taxation;- abolishing withholding taxes on interest and royalty payments between companies;
• speed up the establishment of an origin-based common VAT system which is simpler and applied in a more uniform manner;
• restructure the Community framework for the taxation of energy products by widening the Community minimum rate system, currently applied only to mineral oils, to include all energy products;
• reduce those types of state aid which cause the greatest distortion of competition, such as certain regional aid measures and rescue and restructuring aid.

With regard to consumers, the action plan proposes submitting to the Member States a series of measures to:

• guarantee the general safety of products by:- strengthening the common rules on market surveillance, for example by establishing joint inspection schemes or more detailed inspection procedures for industrial products and consumer goods, foodstuffs, pharmaceutical products and medical devices;
• regulate the distance selling of financial services with a view to removing obstacles to the cross-border provision of services, while at the same time strengthening protection for consumers;
• approximate national laws on the sale of consumer goods and associated guarantees, so that consumers who have purchased a defective product enjoy basic rights throughout the European Union;
• ensure that consumer health is taken into account in the framing of new legislation.

As far as the free movement of goods is concerned, priority will be given to implementation of the Customs 2000 programme and reform of the transit system. The measures to be proposed will focus on:

• management and supervision of transit operations;
• computerisation of procedures;
• introduction of a single transit system for Europe;
• coordination of fraud prevention and law enforcement.

The increased importance of new technology brings several challenges. In view of this, the action plan proposes submitting to the Member States a series of measures to:

• introduce a transparency mechanism for information society services;
• harmonise certain rules of copyright and related rights in order to guarantee uniform protection in the new technological environment.
• regulate the distance selling of financial services;
• ensure the legal recognition of digital signatures in the single market and set minimum criteria for certification authorities;
• protect conditional-access services across the single market.

The action plan also stresses the importance of meeting the deadline of 1 January 1998 for the liberalisation of telecommunications. To that end, the Commission will keep up its efforts to ensure full implementation of the regulatory package by means of a twin-track strategy of bilateral contacts with national regulatory authorities and formal infringement proceedings in the event of non-compliance. This will involve:

• ensuring timely and effective application of Community rules;
• enhancing transparency;
• assessing national licensing schemes;
• contacts within established technical forums (ONP, ACTE, newly created Licensing Committee).

In the field of intellectual property, the action plan proposes submitting to the Member States a series of measures to:

• modernise the European patent system and make it more user-friendly with a view to promoting innovation in Europe;
• harmonise certain rules of copyright and related rights to ensure uniform protection in the new technological environment; initiatives will focus on online communications and the reproduction and distribution of protected material;
• protect providers of conditional-access services against the pirating of their services by illicit decoders, smart cards or other devices;
• afford full and adequate protection for biotechnology inventions while creating the legal certainty which both producers and the public require;
• combat counterfeiting.

In the transport sector, the action plan proposes submitting to the Member States a series of measures to enable the air transport market to become properly integrated. These are:

• new rules on airport charges which will ensure transparency and allow some flexibility in applying the principles of cost-related pricing, in order to achieve the highest possible capacity utilisation rates (for example, through peak-hour pricing and noise-related charges);
• rules on slot allocation at Community airports aimed at ensuring that existing airport capacity is used as efficiently as possible while respecting certain environmental constraints, ensuring mobility in the market and giving preference to possibilities for increasing competition;
• creation of a European Air Safety Agency whose objective will be to enable European airspace to be used more efficiently and to enhance safety levels by drawing up common rules for the design, manufacture, maintenance and operation of aircraft and for the staff and organisations involved in these tasks;
• strengthening the regulatory powers of Eurocontrol with regard to the provision of air traffic control services, in order to improve the quality of service and make common standards more consistent;
• Community membership of Eurocontrol in order to achieve convergence between action taken within that organisation and policies pursued in areas of Community responsibility.

Finally, with regard to the objective of creating a single market for the benefit of all citizens, the action plan provides for various measures such as:

• eliminating border controls by adopting accompanying measures and three proposals for Directives;
• protecting social rights by consulting the social partners on the information and consultation of workers at national level and by adopting a White Paper on the organisation of working time, in particular in transport services;
• promoting labour mobility in the EU by adopting a Directive on supplementary pensions and improving and extending the use of the EURES employment database;
• protecting consumer rights, health and the environment by adopting the Directive on the sale of consumer goods and the communication on the single market and the environment;
• setting up machinery for dialogue with citizens which informs them of the rights and opportunities offered by the single market and allows them to report the difficulties they experience in exercising their rights.

Last updated: 05.09.2003