Services Directive approved by European Parliament

MEPs approved the text of a new Directive yesterday which aims to reduce obstacles to providing services across national borders in the EU. The Services Directive is expected to be passed before the end of the year.

The Directive is intended to make it much easier for service providers to set up shop and conduct business in another EU member state. Discriminatory bureaucratic restrictions will also be banned and it will also be simpler than in the past to provide services temporarily in another EU country. Consumers should have more choice when they choose a service provider and costs are also expected to fall.

In February, when MEPs gave the text a first reading, a compromise was forged between the largest political groups in the Parliament. This meant a controversial “country of origin” principle was replaced and several areas such as healthcare and audiovisual services were removed.

The "country of origin" principle would have allowed workers from one country to work in another, but they would have been subject to the employment law in their country of origin. This would have had an impact on wages, working hours and conditions.

The EU Council of Ministers has already indicated its support for the Parliament's position and European Commissioner Charlie McCreevy welcomed yesterday's vote by MEPs as "a milestone in the history of the European Parliament".

A Commission spokesman told OUT-LAW today that formal approval of the Directive is expected by the Council before the end of the year. The 25 members of the EU will then have three years to implement its provisions into their national laws.