COMMISSION OF THE EUROPEAN COMMUNITIES 
C0M(93) 632 final 
Brussels, 22 December 1993 
%M COMMUNICATION FROM THE COMMISSION TO THE COUNCIL 
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fc-Ife^ "MAKING THE MOST OF THE INTERNAL MARKET": 
STRATEGIC PROGRAMME 
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COMMISSION COMMUNICATION TO THE COUNCIL 
"MAKING THE MOST OF THE INTERNAL MARKET": 
STRATEGIC PROGRAMME 
The Internal Market is not yesterday's issue. A single open market provides the 
essential basis for economic recovery and future economic growth in the Community. 
Its completion and its efficient operation remain a priority. 
The Commission has therefore decided that it is necessary to prepare a Strategic 
Programme for the completion, the management and the future development of the 
Internal market which can serve as a guide to the main priorities of the Community in 
this area and as a means of measuring the progress of the Community towards its 
objectives. The Strategic Programme is attached to this Communication. 
The content of this programme has been the subject of considerable debate both 
within and outside the Commission for some months, following the issuing of the 
Commission Communication "Reinforcing the effectiveness of the Internal Market" on 
2 June 1993, which was accompanied by a 55-page Working Document entitled 
Towards a Strategic Programme for the Internal Market". These documents were 
discussed by the European Parliament, the Economic and Social Committee and the 
Council of Ministers between June and September. In addition, a large number of 
organisations representing industrial and economic interests responded to the 
Commission's invitation to send in comments on the Working Document. All of these 
reactions have been considered in the preparation of the definitive Strategic 
Programme. 
The consultation process has confirmed the Commission's view that an overall plan 
for the implementation and development of the Internal Market is desirable. The 
overwheming majority of comments supported the initiative although there was some 
divergence of view as to priorities. The Commission considers that the final version of 
the Strategic Programme represents a reasonable and balanced set of new objectives 
for the Community, which puts considerable weight on management issues but which 
also contains proposals for the further development of Community legislation in some 
areas where that is deemed to be necessary for full exploitation of the Internal Market. 
The Commission has also put more emphasis on the contribution of other policies, 
such as competition or environmental policy, to the successful operation of the 
Internal Market. 
The Commission now presents the Strategic Programme to the Council and 
Parliament as a guide for future policy both at Community and national level. In its 
conclusions the Commission proposes that the Strategic Programme be launched on 
the following basis: 
• an endorsement by the Council of the general orientation provided in the Strategic 
Programme; 
• a firm undertaking by the Council to accelerate discussion on the seventeen 
legislative proposals from the 1985 White Paper that are still before it, with a view 
to their final adoption before the end of 1994. 
Progress in respect of the implementation of the Strategic Programme will be regularly 
reviewed in the Commission's Annual Report on the Internal Market. 
European Commission 
MAKING THE MOST 
OF THE INTERNAL MARKET 
STRATEGIC PROGRAMME 
Contents 
EXECUTIVE SUMMARY i 
INTRODUCTION 1 
SECTION A - COMPLETION OF THE BASIC LEGAL FRAMEWORK 5 
I. Outstanding White Paper measures 5 
II. Free movement of persons 6 
III. Other measures before the Council 6 
IV. Introducing competition into regulated sectors 8 
V. Measures to be withdrawn 9 
SECTION B - MANAGING THE SINGLE MARKET 10 
I. Ensuring conformity and transparency in the transposition of 10 
Community directives into national law 
II. Ensuring quality in enforcement 12 
1. Administrative cooperation 12 
2. Preventing the emergence of new barriers 15 
3. Sanctioning against infringements by Member States 16 
III. Redress: Access to justice and judicial cooperation 16 
IV. Evaluating Community rules 18 
1. Evaluating the practical performance of Internal Market legislation 18 
2. Evaluating the broader business and economic impact 19 
3. Strengthening the INTRASTAT statistics collection system 20 
V. Resources 22 
SECTION C - DEVELOPING THE SINGLE MARKET 23 
I. Transparency and proportionality of new Community measures; 24 
transparency of procedures; communication and information 
1. Transparency and proportionality in preparing new Community 25 
legislation 
2. Communication and information measures 26 
II. Further improving the environment for business 28 
1. Competition policy 30 
2. Improving cross-border payments 30 
3. Transport 31 
4. Intellectual and industrial property 32 
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5. Company law 33 
6. The creation of a favourable tax regime for businesses 34 
a) Indirect taxation 34 
b) Direct taxation 35 
7. Upgrading European standardization, conformity assessment and 36 
quality 
a) European standardization 36 
b) Conformity assessment and quality 37 
8. Catering for SMEs 38 
9. Commercial communication and media 39 
10. Commerce and distribution 40 
11. Energy 41 
III. Further improving the environment for the consumer 41 
IV.The relationship between sustainable development and the 42 
Internal Market 
V. Establishing trans-European networks 43 
1. Promotion of a convergence of interests and coordination 44 
2. Stimulating private investment 45 
3. Ensuring technical interoperability 46 
4. Early development of telematic networks between administrations 47 
SECTION D - A DYNAMIC AND OPEN EXTERNAL POLICY 49 
I. Management of the Union's external frontier 49 
II. Completion of the common commercial policy in the context of 50 
the Internal Market 
SECTION E - REVIEWING AND ADAPTING THE STRATEGIC PROGRAMME 52 
CONCLUSIONS 53 
ANNEXES 54 
Executive summary 
Section A - Completion of the basic legal framework 
Section A of the programme calls for the adoption of the legislative proposals that 
still have to be agreed in order to establish the basic legal framework for the single 
market and identifies steps to be taken to introduce competition into regulated 
sectors. 
More specifically these measures include: 
• adoption of the outstanding measures from the 1985 White Paper, mainly in the 
areas of company law, taxation, and intellectual and industrial property; 
• action to ensure the free movement of persons, including the adoption of 
proposals put forward by the Commission on the basis of its new right of initiative 
under the Treaty on European Union; 
• other measures before the Council, including a number of measures arising 
from the removal of frontier controls; proposals on the export of dual-use 
goods; the harmonization of technical rules and the strengthening of the 
notification procedure for new rules at national level (Directive 83/189/EEC); further 
proposals regarding intellectual and industrial property; a draft framework 
directive for the protection of personal data; and proposals in the area of 
financial services; 
• measures to introduce competition into the regulated sectors of energy, 
telecommunications and postal services. 
This section also draws attention to the Commissions recent decision on the 
measures to be withdrawn following discussion at the European Councils of Lisbon, 
Birmingham and Edinburgh. 
Section B - Managing the Single Market 
Section B of the programme addresses the task of managing the Single Market. 
The actions included cover the following areas: 
• The need to ensure conformity and transparency in the transposition of 
Community directives into national law - A communication will be presented on the 
means of resolving problems in this area and a series of measures will be 
undertaken to make national measures transposing Internal Market law more 
readily accessible. 
• The need to ensure quality in enforcement, principally through developing closer 
administrative cooperation between Member State administrations and between 
them and the Commission - Two communications are being presented at the end 
of 1993, one on a general framework for administrative cooperation and another 
on urgency procedures. The first of these will contain proposals on guiding 
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principles for administative cooperation, and both will form the basis for a further 
work programme. A series of measures will be introduced to support 
administrative cooperation, including proposals on the development of a 
communication and data exchange network for Union administration. The 
existing channels for dialogue with the Member States on problems which are the 
subject of litigation initiated by the Commission will be reinforced. Instruments to 
prevent the emergence of new barriers will include the extension of the coverage 
of the notification procedure on national legislation which could affect the free 
movement of goods (see Section A) and consideration of the need for similar 
procedures with regard to some services. The Commission will also clarify the way 
in which it will make use of the power to propose sanctions to the Court under 
Article 171 of the Treaty. 
Redress: Access to justice and judicial cooperation - Actions will be developed, 
in partnership with the Member States, to improve access to Community 
legislation, to facilitate recourse to the national courts, to reinforce the free 
movement of judgements and to examine the approach to the conflict of laws in 
the context of the Single Market. 
The importance of evaluating Community rules is emphasised. This will be 
approached from the point of view of the practical performance of the legislation 
as well as that of the broader business and economic impact. The Economic 
and Social Committee has an important role to play here. Use will also be made of 
various existing networks, while a major study on the economic effects of the 
Internal Market will be launched in 1994 with a view to publication in 1996. To 
improve the statistical information which will contribute to evaluation, improvements 
to the INTRASTAT system are envisaged. 
Attention is drawn to the need for adequate resources for the management of the 
Internal Market 
Section C - Developing the Single Market 
Section C of the programme is concemed with developing the single market, that is, 
defining a more dynamic view of market regulation and identifying means by which the 
Community can make available to those who are active in the single market the full 
use of its potential. 
It spells out action to be taken in the following areas: 
• Ensuring transparency and applying the principle of proportionality in 
preparing new Community legislation - Although only a limited number of new 
legislative initiatives are envisaged, the Commission proposes to develop 
guidelines for the evaluation of the need for such initiatives in the Internal Market 
area, to improve internal coordination in the Commission and to establish new 
procedures for the publication of legislative intentions in relation to the Internal 
Market at an early stage in the preparation process. 
• Communication and information measures are essential if individuals and firms 
are to benefit fully from the Internal Market. The Commission will develop a 
coherent strategy involving Community institutions, national administrations and 
non-governmental organizations in a systematic and coordinated way. 
• Further improving the environment for business - Action is needed in a number 
of key areas in order to make further improvements in the environment within which 
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business operates. These include the application of competition policy .tackling 
the problem of improving cross border payments, further proposals on 
transport, action to promote Union-wide protection of intellectual and industrial 
property, improvements in the area of company law, the creation of a favourable 
tax regime for business, covering action on both direct and indirect taxation, the 
upgrading of European standardization, conformity assessment and quality 
systems, consultation and evaluation of the need for action in the areas of 
commercial communication (advertising, sponsorship, direct marketing, 
promotions etc.) and the media, actions to promote efficient and competitive 
systems in the area of commerce and distribution, and measures to increase 
competition and business opportunities in the energy sector. 
Further improving the environment for the consumer - Action to promote 
consumer participation in the Intemal Market is essential to its functioning. 
Particular priority will be given to the areas of legal and commercial guarantees 
and financial services, as well as to information for consumers. 
The relationship between sustainable development and the Intemal Market -
The Treaty objectives of the Intemal Market and of sustainable and non-inflationary 
growth respecting the environment should be mutually supportive. Action is 
envisaged to help ensure that this is the case and that potential conflicts are 
avoided or resolved on the basis of a coherent approach. 
Establishing trans-European networks is a key to the better functioning of the 
Intemal Market as well as to growth and cohesion. The Strategic Programme, as a 
complement to the White Paper on growth, competitiveness, and employment, 
outlines measures to promote the convergence of interests and coordination, 
action designed to stimulate private investment and to ensure technical 
interoperability, and, finally, proposals on the early development of telematic 
networks between administrations. 
Section P - A dynamic and open external policy 
Section D of the programme deals with external implications of the Intemal Market. 
• Management of the Union's external frontier requires action to ensure that 
national customs services are equipped to deal with the important role that they 
play on behalf of the Union as a whole. This is the aim of the Customs 2000 
initiative which is now being finalised. In this context also, action will be taken to 
combat customs and tax fraud as well as trade in illegal drugs. 
• Completion of the common commercial policy in the context of the Intemal 
Market - The finalization of a common import and export regime for goods and 
services vis-a-vis the rest of the world is a precondition for an equivalent level of 
competition within the Internal Market. Several issues of relevance in this regard 
will be addressed by the Commission in the coming years. 
IV 
Section E - Reviewing and adapting the Strategic Programme 
Section E highlights the need to maintain an ongoing process of evaluation of the 
Strategic Programme leading to its adaptation in the light of developments. The 
Annual Report on the operation of the Intemal Market will provide an appropriate 
occasion for such regular evaluation. 
Conclusions 
In its conclusions the Commission proposes that the Strategic Programme be 
launched on the following basis: 
• an endorsement by the Council of the general orientation provided in the Strategic 
Programme; 
• a firm undertaking by the Council to accelerate discussion on the seventeen 
legislative proposals from the 1985 White Paper that are still before it, with a view 
to their final adoption before the end of 1994. 
Introduction 
1. The Intemal Market is working - but it can and must be improved in order to fulfill 
its promise. The immediate task of the Union is to ensure that a properly-functioning 
single market contributes to economic growth, industrial competitiveness and higher 
employment. This Strategic Programme provides a complete view of the priority 
actions which the Union must pursue to this end. 
2. The content of the Strategic Programme has been the subject of wide-ranging 
debate over the past six months, following the issue in June of the Commission 
Communication "Reinforcing the Effectiveness of the Intemal Marker, accompanied 
by a Working document "Towards a Strategic Programme for the Intemal Market*. All 
the Community institutions responded to the invitation to examine and comment on 
the working document, as well as individual Member States and a significant number 
of industrial and other economic interests. There is consensus on the need for an 
overall sense of direction in the management of the Internal Market. 
3. The Union can be proud of the success of its Single Market Legislative 
Programme, most of which is now in place. The evidence available to the Commission 
suggests that goods, services and capital are moving freely within the Union, and that 
any problems are exceptional and temporary. The one outstanding problem, the free 
movement of people, is now the subject of new initiatives in the context of the 
provisions of the Union Treaty. 
4. But the establishment of a genuine single market is not just a matter of adopting 
Community-level legislation within a deadline. It is a continual process of ensuring that 
this common legal framework is applied, widely-understood, enforced and, where 
necessary, developed in a coherent way to meet new needs. In that sense, the Union 
is at the beginning, not at the end, of its task. 
5. Ensuring that the Union area without internal frontiers becomes a practical as 
opposed to a legal reality will be a major challenge for the years ahead. It will demand 
further action not only at Union but even more importantly at national level. It will 
involve a variety of policy instruments, in which additional legislation will play only a 
minor part. This process will have to be based on dialogue between public authorities 
and the society they serve and on partnership between the Member States and the 
Commission. Making the most of the opportunities offered by the Intemal Market will 
take some time; the purpose of this Strategic programme is to provide a "road-map" 
which may make the journey clearer and perhaps shorter. 
6. The debate which was launched with the publication of the communication and 
working document in June showed that there is wide support for the global approach 
outlined in the communication and working document of June 1993, and many 
comments favoured a strengthening of the emphasis on the links between the Intemal 
Market and other Union policies. The Strategic Programme therefore emphasises the 
part played in ensuring the effective operation of the Intemal Market by competition 
policy, consumer policy and policy in favour of small and medium-sized enterprises. 
Competition policy must ensure that the freedoms established under the Internal 
Market programme are not eroded by state aids, anti-competitive agreements or 
mergers or the abuse of dominant positions: it also has the potential to contribute to 
COM(93) 256 final of 2.6.93 
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the opening up the Intemal Market in areas which were not covered by the "1992" 
programme. Consumer policy protects the interests of consumers and empowers 
them to make the Single Market work for them, so that they benefit from the 
improvements which flow from Internal Market completion. Policies to stimulate and 
support enterprises, particularly the creation and development of SMEs will also 
enable them to take advantage of the opportunities and to respond to the challenges 
inherent in the Intemal Market. 
The Programme also gives increased emphasis to other policy areas which are 
closely linked with the attainment of Internal Market objectives: 
- the effective management of the Union's external frontiers and progress in 
relation to aspects of commercial policy are essential for individuals and 
firms, both in the Union and in third countries, to reap the full benefits of the 
Intemal Market, while avoiding the risks of illicit or distortive practices; 
- environment policy and Internal Market policy must be integrated so that 
the objectives of sustainable economic development and of guaranteeing the 
"four freedoms" are met and so that potential conflicts are resolved on the 
basis of a coherent approach; 
- the freedoms which embody the principles of the Intemal Market must also be 
exercised within a framework which gives due weight to the requirement for 
economic and social cohesion. 
7. This programme is intended to be a guide to the next steps to be taken in order 
that the Union's ambitions for the Intemal Market are achieved and yield their full 
economic benefits. It is above all an action-oriented document, which concentrates on 
describing the measures that are judged to be necessary for the Internal Market in 
each policy area. The action points are highlighted in the framed areas of the text 
8. The first part of the programme identifies the legislative proposals that still 
have to be agreed in order to establish the basic legal framework for the single 
market. It includes outstanding measures from the original 1985 White Paper, 
additional proposals that have been put to the Council since then, new proposals that 
have just been presented concerning the free movement of people, and measures to 
introduce competition into certain regulated sectors, such as energy, 
telecommunications and postal services. Some proposals which the Commission 
considers no longer essential for the creation of a single market have been withdrawn. 
9. The second part of the programme addresses the new task of managing the 
Union area, that is, making sure that Community legislation is properly and evenly 
enforced and regularly evaluated so that individuals and companies can take 
advantage of the Intemal Market. This is not a bureaucratic exercise - it is a necessary 
condition for fair competition, for avoiding unnecessary costs resulting from inefficient 
administration for business and the consumer, and for developing the confidence that 
must accompany sustained economic recovery. It will require a sustained effort, at the 
national as well as Union level, to make those concemed familiar with Community 
rules and fully-equipped to apply them. It will also be necessary to avoid that national 
regulations create new barriers to the operation of the single market just as the old 
ones have been removed. Assistance must also be given to citizens or companies 
that wish to avail themselves of their rights under the law. This part of the programme 
addresses itself more to the Member States than to the Community institutions, since 
this task will require the development of awareness of the reality of the Single Market 
within all branches of national administrations and within society as a whole. 
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10. The Commission draws particular attention under this heading to the need for 
the provision of adequate resources both at Union and national level if the Union is to 
be able to fulfil expectations concerning effective management of the Single Market. 
The current resources of the Commission are a serious constraint, and its proposals 
for the 1995 budget will be developed to take account of this. 
11. In line with the results of the consultation procedure on the Commission's 
working document, the guiding principles for the development of the single market 
must be a commitment to competition, the need to take account of the broadening of 
the Union's policy objectives under the Treaty on European Union and exploitation of 
the full economic benefit of the single market. 
The third part of the programme is concemed with developing the single market, 
that is, defining a more dynamic view of market regulation and identifying means by 
which the Union can encourage those who are active in the Single Market to make full 
use of its potential. Apart from a limited number of new legislative initiatives aimed at 
completing the basic framework of Community rules for the Intemal Market, other 
policy instruments will be used to promote the coordinated development of trans-
European networks, the stimulation of European standards and quality policy and 
compatibility between sustainable development and the objectives of the Intemal 
Market Particular measures will also be taken, in line with the multiannual programme 
for SMEs for the years 1993-96 which was recently adopted by the Council, to assist 
smaller enterprises to adjust to a more competitive environment. 
12. Taken together, this package of measures represents a "second phase" in the 
development of the Single Market, in which most of the basic rules are already in 
place but where additional action is still needed to give value-added to what exists. 
The Commission wishes to underline that any further initiatives in this area will be 
based, like the Strategic Programme itself, on the widest possible consultation of 
interested parties and will take into account the principle of proportionality. The fact 
that the principle of subsidiarity has been enshrined in the Treaty on European Union 
is intended to see to it that decisions are taken as close as possible to the citizen, a 
constant watch being kept to ensure that action taken at Community level is justified in 
the light of the means available to national, regional or local authorities. The practical 
effect of the Maastricht Treaty is to require the Community to demonstrate that there 
is a legitimate need for each new initiative. Nevertheless, this principle cannot be a 
pretext for putting into question actions for which the Commission has received a 
precise and indisputable obligation to act in certain areas such as the Internal market. 
The single market belongs to the citizens and enterprises of the Union and they must 
have a say in its further development. The role of the Union is to limit its intervention 
to what is necessary in order to allow those in the market to operate within it 
effectively on a continental scale. 
13. The fourth part of the programme outlines the objectives of the Union's 
external policy in terms of management of the external frontier and completion of the 
common commercial policy. The fifth part recalls that the Strategic Programme must 
itself be dynamic and capable of adjusting to change. What follows represents the 
Commission's view today of what has to be done to make the most of the Intemal 
Market, but this programme will have to be renewed and adapted periodically to take 
account of new developments and needs. In its future Annual Reports on the Intemal 
Market, the first of which will appear shortly, the Commission intends to review 
progress towards the objectives set out in this programme and will make changes to 
the programme when necessary. The Strategic Programme will therefore become a 
permanent means of indicating the priorities for Union action in this area. 
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14. In its conclusions the Commission proposes that the Strategic Programme be 
launched on the following basis: 
- an endorsement by the Council of the general orientation provided in the 
Strategic Programme; 
- a firm undertaking by the Council to accelerate discussion on the seventeen 
legislative proposals from the 1985 White Paper that are still before it, with a 
view to their final adoption before the end of 1994. 
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Section A - Completion of the basic legal framework 
The date of 1 January 1993 marked the start of the Single Market. The objective set 
out in Article 7 A of the Treaty has largely been achieved, except for the removal of 
identity controls on persons at the internal borders. Ninety-five per cent of the basic 
legislative programme foreseen in the Commission's 1985 White Paper Programme 
has been adopted by the Council. Furthermore, the Council has adopted a wide range 
of additional measures to complement the original 1985 Programme and others are 
under discussion. 
I. Outstanding White Paper Measures 
The White Paper requested decisions in all areas of economic activity. The basic 
legislation has been adopted concerning in particular the removal of veterinary and 
phytosanitary controls, public procurement, excise duties, removal of technical 
barriers, freedom of movement of capital, financial and other services and direct and 
indirect taxation. The recent adoption of the proposal on the liberalization of cabotage 
for the road transport of goods as from 1 July 1998 was a significant break through for 
the free provision of services. 
One of the justifications of the Intemal Market is to enable enterprises to allocate 
resources more efficiently. Increased competition in a larger market will lead to 
corporate restructuring and the restructuring of business strategies. Consequently, the 
proposals on company law, company taxation and intellectual and industrial property 
formed an integral part of the Programme. Therefore, the priority is now for the 
Council to adopt the remaining seventeen White Paper proposals. 
• The incomplete coordination of national company taw bat so far been an obstacle for the mobility of 
companies 'within the internal Market* 
• important decisions on the structure of publie tfmtted companies and the crossborder merger of such 
companies nave been blocked pending the outcome of the discussion on the European Company 
statute. 
» Also stifi before the Council are two proposals to eliminate trouble taxation» The first proposal aims at 
the abolition of wtthotding taxes on interest and royalty payments.made between subsidiaries and 
parent companies of different Member States. The second deats with the possibility for enterprises to 
take into account losses Incurred by their permanent establishments and subslojarîes in other Member 
States. Apart from these proposals the Arbitration Convention* on the establishment of an 
arbitration procedure tor Intra Union transfer pricing cases» Is awaiting ratification by four Member 
States* 
* In the field of Intellectual and Industrial property, decisions are outstanding concerning the legal 
protection of biotechnlcai Inventions and plant breeders lights. With regard to the Regulation on the 
Community trade mark, on 28 October 1993 the European Council paved the way for a solution with 
its decision to establish the Community Trade Mark Office In Spain. 
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II. Free movement of persons 
The delays in the adoption of the few outstanding White Paper measures have not 
affected the achievement of the objective of the abolition of intemal border controls on 
goods, services and capital. These controls, including customs controls on persons 
disappeared on 1 January 1993. But the continuation of identity controls on persons 
has raised broad criticism from the public and the European Parliament. 
Having noted that the objective of the free movement of people had not been fully 
achieved by the date of 1 January 1993, the Commission redoubled its efforts in order 
to achieve this objective, without further delay, which constitutes an essential element 
of the building of Europe. 
In order to achieve this objective, it approved for 1993 a phased approach: 
• in a first phase, the Commission would continue to take political initiatives and 
exercise constant pressure so that the progress announced by the Member States 
for 1993 should effectively be realised; 
• in a second phase, the Commission would take stock of the initiatives undertaken 
and decide, without relaxing its political pressure, on possible further measures to 
take, particularly of a legislative nature. 
Two recent developments can facilitate the action which the Commission intends to 
take in the second phase of its strategy: 
• the entry into force of the Treaty on European Union offers new possibilities to the 
Commission in the context of Title VI of this Treaty in areas until now covered 
simply by inter-governmental cooperation; 
• the countries of the Schengen Group have reaffirmed their commitment to 
achieving between them the free movement of persons by 1 February 1994; 
although this result once achieved, will not be sufficient to result in the free 
movement of persons over the whole of the Union territory, it will constitute a 
considerable step forward. 
Taken together these two developments will provide a springboard from which the 
Commission will be able to increase the pressure through a combination of initiatives, 
both in the Community domain and in in the context of the Third Pillar of the Treaty on 
European Union. 
The Commission has adopted a proposal for a Council Decision establishing the Convention regarding 
the control of persons on crossing the externat frontière of l^e Union, together with a proposal for a 
Regulation based on Article 100 C determining the countries whose, nationals must carry # via * on 
crossing the external frontiers of the Member States, These proposals will be very soon followed by » 
proposal on the basis of Article 100 C {3} aimed at establishing a uniform model of «Isa. 
These measures, Identified as essential from the point of view of the abotftion of border controls, should 
be se$ft as part of a general and coherent approach to the Implementation of Articte 7A whJoh* to order to 
be pursued» calls for the presentation at the appropriate moment of other proposals. 
I. Other measures before the Council 
Although the legislative activities of the Community will substantially decrease after 
the completion of the White Paper programme, the dynamic process of establishing 
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the Internal Market still requires a certain amount of legislative measures to cover 
present developments. 
In the field of Indirect taxation, measures need to be taken relating to VAT harmonization provisions 
on second-hand goods, works of art, antiques and collectors items, gold transactions and transport of 
passengers; 
The Community has presented proposals on prohibiting the release for free circulation, export or 
transit of counterfeit and pirated goods and measures combating fraud In the area of commercial 
and agricultural trade to avoid the removal of frontier checks resulting in fraud or in difficulties for 
consumers. 
The objective of the proposal for a Council Regulation on the export of certain duaJ-use goods is to 
create the conditions under which intrs-Unlon controls could be eliminated, by ensuring that all 
Member States apply effective export controls, based on common standards. Discussions on this 
proposal are being pursued m the Council. 
Although the harmonization of technical rules, foreseen In the White P*p«r, has been completed, 
covering entire sectors such as agricultural and fbotf products, pbarmeceuticel products and 
passenger cars, in this field there Is a certain tendency to create new barriers to trade In the form of 
new national measures, A common position has been reached on a proposal fo extend the scope of 
the notification procedure for new technical Regulations (Directive 83/189/EEC) to facilitate the 
monitoring of developments at national level. Other proposals concern the outstanding technical 
harmonization of lifts, pleasure boats, pressure equipment, motor vehicles other than passenger cars, 
precious metals and food law, 
The approximation of Intellectual and industrial property provisions Is an important contribubon for 
the effective functioning of the Single Market For Instance, the Directive on the term of copyright 
protection has recently been adopted, Apart from the stUI outstanding ratification of the Agreement 
relating to Community Patents, other Important proposals are currently under discussion» Proposais 
concern the legal protection of data bases or the recently presented proposais on a Regulation on 
legal protection of design and industrial models and a Directive on the approximation of national 
design protection laws which aims at a Internal Market for design products. 
In the area of the protection of personal data, the Commission Is heprçg.for Jhe adoption of a 
common position on the draft framework Dfrecbve In 1094, Tne adoption pf^is Direct*** is a ptforfly, 
In view of the increase In the Hows of personal data ft» the private and jrçjbîic sector», Vfhlch Is • 
consequence of the effective exercise of the freedoms of the internal Market and the abolition of 
Internal borders. 
The opening up of financial markets was one of the most significant achievements of the Single 
Market, With regard to a more effective protection of consumers a proposal amending the ftnandal 
Services Directives, has been made to reinforce the prudential supervision of credit institutions, 
non-life insurance, life insurance and investment firms. The same objective applies to the proposai 
modifying the 1985 Directive on undertakings for collective investments In transferable securities 
(UCÎTS). Funds investing in money market instruments can be included in the scope Of this Directive. 
A common position was recently adopted on a bank deposit guarantee scheme, which Is a parallel 
instrument to the recently presented Investor compensation schemes» designed to underpin the 
European passport approach, Various proposals envisage measures to facilitate financial operations. 
The Directive relating to funds held by institutions for retirement provision alms at ensuring the 
freedom of mangement and investment of pension fund assets. The modification to the Directive on 
listing prospectuses Is designed to enhance the ease with which large companies can be traded on 
several European stock exchanges. 
in the energy sector, just as \n any other sector, companies, products, investments and services V9 
subject to all the Treaty provisions. Nevertheless, given the particular nature of the energy related 
products, the regional and local constraints and the necessity to preserve the missions of public 
service attributed to the relevant utilities, a gradual approach has been followed in order fo introduce 
transparency in the functioning of the market and to proceed towards the adaptation of the functioning 
rules of gas and electricity grids to the Treaty principles and provisions. 
The main elements of transparency have been already introduced with regard to both investments and 
prices. These elements provide ad the operators with an instrument of information and market 
monitoring* 
A draft Directive on granting of hydrocarbon extraction licences Is under discussion within the Council 
and the Parliament. This Directive would represent an additional instrument and supplement the 
existing Directive on public procurement 
-8-
in order to strengthen the compatibility of the gas and electricity secte», as well es to facilitate intra-
Union trade and exchanges taking into account the specificities of these sectors, a first ^Ibap has been 
taken with the two Directives on the transit of electricity and the transit of natural gas. 
The proposals for the next sf epv which aims to introduce, among other things, the concept of third 
party access, are under discussion within the Council and the Parliament 
IV. Introducing competition into regulated sectors 
The Intemal Market is far from being a reality in certain sectors where national 
legislation and the granting of exclusive rights (monopolies) deny access to the 
market and prevent direct competition. The definition of an adequate legal framework 
which takes into account the requirements of public interest and the objective of 
economic and social cohesion is therefore a precondition for the introduction of 
competition into sectors which are of primordial importance for consumers and for the 
competitiveness of European industry. 
In a number of sectors, the Commission and the Member States are considering how 
to achieve the liberalization of certain regulated sectors in ways which promote intra-
Union competition while ensuring that public policy objectives (e.g "universal $60/106") 
are fully realised. Different approaches have been proposed, with varying degrees of 
success in the fields of energy, telecommunications, and postal services. Further 
action is being prepared in the field of air transport. 
In the energy sector, the Commission has proposed two Directives, based on articles $7(2$, 60 and 
100 A. establishing common rules In the gas and electricity sectors*. In the meanbme, lite 
Commission will persevere with article 169 Infringement proceedings «gainst Member States which 
Impose restrictions on the Import and export of gas and electricity. It wll also continue to press for 
harmonization of licensing rules for prospecting* exploration, and extraction of natural gas and oil 
where a common position Is expected fo be adopted by the Council In the near future. 
In telecommunications, the Council has endorsed the Commission's proposal to liberalise 
competition In voice telephony by 1 January 1Ô9Ô* 
In June 1982. the Commission adopted a green paper launching a consultation process on IN 
development of a Single Market in postal «ervlces4. In the Bght of findings from this consultation 
process, thë Commission may envisage a number of options for barrnon^ation and liberalization 
concerning among others express deliveries, mailing of publications, mail advertising and cross-
border maif^ 
In the field of air transport IN Commission is preparing a proposal for the liberalisation of ground 
Nnoling facilities at Union airports. 
It should be stressed that adoption of the legal framework is a necessary, but not a 
sufficient condition for the liberalization of intra-Union trade and competition in these 
sectors. The true functioning of an intemal market requires that these rules be 
stringently upheld in such a way that economic operators have sufficient confidence in 
the legal framework as to take full commercial advantage of it. 
OJC 65 of 14.03.92 
Council Resolution of 22.07.93, OJ C 213 of 06.08.93 
COM (91) 476 final 
-9-
V. Measures to be withdrawn 
Following on the discussion at the European Councils of Lisbon, Birmingham and 
Edinburgh, the Commission has proceeded to examine the entire body of Community 
legislation in order to give greater effect to the principle of subsidiarity. The 
conclusions of this review process have been presented to the European Council held 
at Brussels in December 1993. This review is designed to identify items of Community 
legislation which may be usefully rescinded, overhauled or simplified, either because 
the justification for those measures has been found wanting (necessity), because their 
effectiveness is open to question (criterion of effectiveness), or because the proposed 
measures are excessively restrictive (criterion of proportionality). The Commission has 
now reached conclusions concerning the withdrawal of a number of legislative 
measures, including several relating to the Intemal Market field, as indicated in its 
Report to the European Council on the adaptation of Community legislation to the 
subsidiarity principle (COM (93) 545, 24.11.1993). 
10-
Section B - Managing the Single Market 
The Single Market Programme was designed to put into place a legislative framework 
for a frontier-free Union. This phase of major legislative effort has now ended, and the 
emphasis must now be placed on ensuring that the rules of the Single Market operate 
effectively in practice. This means that the legislation adopted by the Community must 
be correctly transposed into national law, that the rules, once in place, must be strictly 
and evenly enforced, and that there must be effective means of redress for natural 
and legal persons adversely affected by breaches of Intemal Market rules. 
Ensuring effective transposition of Community law is primarily the task of the 
Member States. While about 85% of the necessary measures have been adopted, the 
Member States must speed up the process of completing the process for the 
measures which have entered into force. It is clear that people are looking to the 
Commission to ensure not only that this job is done, but that it is done property. The 
Commission can contribute to a homogeneous interpretation of Community legislation. 
The Commission is also responsible for ensuring that the Member States fulfil their 
obligations with respect to transposition, and for a posteriori verification of the 
conformity of the national legislation, a major task for which the Commission does not 
at present have adequate resources. Where Member States fail in their 
responsibilities to ensure transposition or where transposition is incomplete or 
incorrect, the Commission will not hesitate to take the appropriate action under Article 
169 of the Treaty. This may now include recourse to the provisions of Article 171 of 
the Treaty regarding the imposition of sanctions. 
Enforcement is normally the responsibility of the Member State authorities, the 
Commission being responsible for ensuring that each Member State has provided for 
enforcement and that the system in place is adequate to the task. In a frontier-free 
Union, however, enforcement must be carried out on the basis of close co-operation 
and mutual assistance between the Member State authorities and between them and 
the Commission. A major effort is needed to ensure that this happens across the 
board in all areas of the Intemal Market. 
In a single market, individuals and firms need to know that there are adequate means 
of redress available if they need them. The Commission and the Member States must 
act, within their respective areas of competence, to help ensure that this is the case. 
The provisions in the Treaty on European Union on judicial co-operation provide a 
valuable framework in this regard. 
It is an essential part of managing the Intemal Market to evaluate the functioning of 
the rules, both in terms of practical performance and broader business and economic 
impact. 
I. Ensuring conformity and transparency in the transposition of 
Community Directives into national law 
Community legislation governing the operation of the Internal Market is largely in the 
form of Directives, an instrument which requires each Member State to adapt its 
national legislation by enacting "transposition" measures to give effect to the Directive. 
This has the advantage of allowing a degree of flexibility to Member States as to the 
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form of the legislation, taking account of their different legislative techniques. 
However, it also imposes the need for the Commission to ensure that the 
transposition measures are adopted and that they really correspond to the 
requirements of the Directives. 
This task is a demanding and complex one due to the volume of legislation involved 
(for example, over 300 Directives in the area of agriculture) , the fact that many 
Member States transpose the requirements of a single Directive by adopting several 
pieces of national legislation (sometimes ten or more) and the technical complexity of 
the subject matter in many areas. 
The Commission will continue to use a combination of methods to ensure that 
transposition legislation is complete and in conformity with Community Directives. 
These include: 
• comprehensive monitoring of texts bv Commission staff: this approach is adequate 
only in areas to which a relatively small body of Community legislation applies; in 
other areas, existing resources do not permit the Commission to complete the task 
by using this approach; 
• use of external consultants: to overcome the problem of limited staff resources, the 
Commission has recourse to outside consultants to examine transposition 
legislation in some sectors; experience shows that this approach has limitations; 
• multilateral and bilateral meetings with Member State officials: discussions with 
Member State representatives can assist in the interpretation of Directives and in 
identifying areas of difficulty; regular bilateral meetings are also held for the specific 
purpose of discussing transposition (see below); 
• direct contact with economic operators in the sectors concemed: the various 
networks through which the Commission maintains contact with economic 
operators in the different sectors can be a useful source of information on 
problems with transposition measures; 
• complaints as a means of identifying problem areas: this "passive" approach 
depends on individuals and businesses being aware of their rights under 
Community law and drawing attention to the problems they encounter with the 
legislation of Member States. 
A preliminary review of the methods used and the problems encountered in 
monitoring transposition in a number of areas of Intemal Market legislation is given in 
Annex 1. In many sectors, the resources available are clearly insufficient The scale 
of the problem is such that it merits a more detailed examination in order to identify 
the most efficient approaches to the task, the precise resource requirements, and 
possible ways of reducing the need for transposition measures. 
The Member States have the main responsibility for making their transposition 
measures more widely known; however the Commission can assist in making them 
more visible and actions in this respect are indicated below. 
1. Monitoring the conformity of transposition measures 
The Commission oonslders that it is necessary to examine further the most cost-effective way of 
ensuring the conformity of transposition In view of the resource problems Identified above and in 
Annex 1. enlargement of the Union wîtl Inevitably accentuate the probtemsln this regard both In terms of 
the volume of legislation and the number of languages, The moat effective ways of organizing 
partnership with the Member States with regard to this task should be reviewed* This examination should 
be linked with the examination of an Issue on which there has proved to be a wide diversity of views, 
namely» the possibilities for using regulations rather than Directives In certain circumstances, thereby 
limiting the need for transposition. A communication on these subjects wilt be prepared for September 
1994. 
-12-
ln order both to assist the Commission In Its task of monitoring the quality of transposition and to 
Improve transparency, future Internal Market Directives Will continue to require Member States to refer In 
their transposition legislation to the Community Directives to which they relate, and, In addition, to 
provide transposition table* Showing the correspondence between the Community and national 
measures. This procedure has proved Its value, for example in the financial services sector. Member 
States witt also be encouraged to provide transposition tables for existing legislation. 
In those areas of Internal Market legislation In which the Commission relies heavtty on complaint» ae a 
means of detecting problems, steps villi be taken to make economic operators and the relevant networks 
more aware of the methods for drawing attention to difficulties they may encounter, If necessary by 
means of formal complaints. 
The regular bilateral meetings which are already held with some Member States to discuss 
transposition will be widened to all Member States and emphasis on the conformity of transposition 
measures will be increased. 
2* Proyjdinq access to up^o^afeMftrffî^non, national trar»»P0f^Q^ NWftft 
Firms or their advisers need to know where to look for Information on immunity legislationend national 
transposition measures relevant to tiieif sector. With tfcfs in mind, 
* ail existing sources which give references to these, or where their full text can be found, both within the 
Member States and at Community level, will Delisted; 
• promotion of printed material and databases produced by the Commission and the Office for Official 
Publications which provide refefencet will be stepped tip; 
« « survey will be mede of user requirements in this regard, end, depending on the results of this survey 
the existing INFO $* database (and/or the booklets denVed from it) will be adapted by end 1*84; 
« the CEIHX database, managed by the Office for Official Publication*, will be adapted so that It can be 
searched by a more user-friendly, form-filling technique, and Its coverage of references to national 
transposition measures, including those concerning the Internal Market, wSH be brought up to date 
in 1994; 
* a tendering procedure Is In progress for the creation of an entirety new version of CELEX by the ^nà 
of 1995; 
• the Commission will examine, in conjunction with Member States end with private publishers, cost-
effective ways of making the references or texts of national transposition measures more 
readily available; 
II. Ensuring quality In enforcement 
The main instrument for ensuring the effective and even-handed enforcement of 
Community law throughout the Union must be an adequate and properly functioning 
system of cooperation between the authorities in each Member State responsible for 
enforcement and between them and the Commission. This should result in the ready 
resolution of many problems, but, where the Commission considers that a Member 
State has failed in its responsibilities and takes action against the Member State 
concerned, it is appropriate to maintain a channel for dialogue, so that, even at this 
stage, solutions are reached on the basis of mutual agreement whenever possible. 
Finally, mechanisms are required to ensure that new barriers are not created, for 
example through legislative measures at national level which affect the operation of 
the Intemal Market. 
1. Administrative cooperation 
The removal of barriers between Member States gives rise to a new situation in which 
Community law, and the way in which it is applied in other Member States, takes on 
greater importance for people and business in the Union. They need to feel confident 
that administration of the law is as reliable and effective as it is for their own national 
-13-
Regulations. For public expectations in this regard to be fulfilled, it is essential that the 
authorities responsible for enforcing Internal Market measures maintain a high degree 
of cooperation and that they keep one another informed. This is particularly true 
where potentially serious consumer problems impose an urgent response, but should 
not be limited to cases where consumers' health is at risk. Naturally, enforcement falls 
within the competence of the Member States, and in many cases such cooperation is 
already a matter of course. In some sectors, such as animal and plant health controls, 
customs and taxation, and social security, it is already coordinated to a considerable 
degree at Community level, but in others enforcement is very uneven from one State 
to another. Existing co-operation, such as that which has existed in the field of social 
security since 1959, needs to be supported by specific measures, particularly the 
development of a communication and data-exchange network between 
administrations. 
1. A framework for administrative cooperation 
With this in mind, the Commission Is transmitting a parallel Communication to the Council, for its 
consideration in December 1993, seeking to initiate a work programme to facilitate administrative 
cooperation, based on: 
a) an endorsement by the Council of a number of guiding principles for cooperation, 
b) a commitment by the Commission to carry out a survey of existing cooperation In Internat Market 
sectors» In particular In those areas where Community legislation does not already provide details on 
the enforcement of Its guiding principles, with the aim of setting up or strengthening cooperation where 
necessary; 
c) supportive measures to be provided by the Commission 
in another Communication, to appear by the end of 1983, the Commission examines the rapid response 
systems which have been set up to handle urgent cases arising out of the operation of the Internat 
Market and recommends some measures for tightening up procedures and further coordination., 
The Commission is also preparing a Communication on coopération between the Commission and 
national authorities in charge of the appllcatkm of competition rules. 
In view of the considerable success of package meetings, en Instrument of partnership between the 
Commission and the Member States which Is designed fo arrive at non-contentious solutions to existing 
litigation concerning national compliance with Community law, the Commission will, as appropriate, 
extend them f o all Member States and Increase their frequency 
2. Support for administrative coopération 
The Commission, within the limits of its competence and Its resources* wiH undertake m programme of 
supportive measures, which will depend on the sector concerned, but will Include; 
a) the development of a communication and data exchange network for Union administrations 
The growing need for administrative co-operation requires the establishment of an efficient reliable m<$ 
useMriendly system of communication and data exchange between administrations, In particular 
electronic mail. Electronic mal) on the basis of the X400 series of standards can provide the capabilities 
required for a large number of different types of Information exchange, under the condition diet the 
components of such a network all comply with the same interoperability requirements. Such m electronic 
mail network can only be considered genuinely operational If a sufficient number of systems is connected 
to and interconnected via an operational electronic mafl service ensuring communications with all 
administrations concerned. Administrative co-operation will only benefit ftom this communication facility 
If It is generally available; It must reach a certain critical mass of compatible end-user systems and 
corresponding network facilities. What is called for Is 
- an accelerated and wide-ranging Introduction of an e-mail network (EUROMÀII), 
«* combined with a high degree of co-ordination between the thirteen administrations Involved 
- a series of flanking measures In order to facilitate the operational use and further development of the 
network. 
The Commission proposes that this initiative to be taken by Union public authorities quickly in order to 
achieve with minimum delay a priority objective - the effective management of the intemal Market -while 
at the same time contributing directly to reduced costs for business and the citizen. To this effect, the 
Commission aims for 
(4) 
-14-
- an early decision by the Council, to adopt a single technology (X400) as the basis for electronic mail in 
all administrations concerned with the management of the Single Market and to lay down conditions 
for coordinated implementation and Community financing; 
- the progressive Installation of the necessary systems by the thirteen administrations concerned» le. 
both at Community and national level, In the departments Involved In the management of the internal 
Market and the decision-making process of the Union, on the basis of the commonly agreed 
interoperability requirements» and their interconnection with the purpose of establishing an electronic 
mall service, a process which should be completed by the end of 1996; 
~ the establishment of mechanisms for Community financial support In particular via TNA/IDA, for 
implementation of EUROMAIL on the basis of commonly agreed principles and transparent 
procedures; 
- a series of flanking measures related to the operational use and further development of the 
EUROMAIL network, such as a planning process to provide a comprehensive view of needs, common 
security rules and procedures; harmonised data protection rules: information exchange on 
administrative procedures. 
During the survey on administrative co-operation particular attention will be given io the needs of the 
administrations io exchange information in order to identify additional demand, bottle-necks end missing 
networks, as well as priorities for implementation. The results of the survey w$ be used Within the 
proposed IDA programme (Interchange of Data between Administrations) to support the coordinated 
implementation of projects of common Interest and to ensure Interoperability between networks and 
network components. 
Other measures 
b)the development of interpretative^ guide» to legislation and the pubficaHon of interpretative 
communications by the Commission, to assist with consistent enforcement such as for example; 
• Interpretative guides 
- in the public procurement sector, interpretative guides 1er supplies, works and services (Including 
water, transport, energy and teiecommunications) and a guide, for each Member state, on the national 
rules applicable to public procurement; 
* Interpretative communications 
- revision of interpretative communications on parallel importe of pharmaceutical products and on 
procedures tor the reception and registration of motor vehicles (19S4); 
~ adoption of interpretative communications on sectors where examination of the situation in Member 
States shows the need to ensure the freedom of movement quality labels, faire s/Ht exhibition*, 
personal importations of medicines, distribution of newspapers and magazines, and certain 
forms of sales promotion (1994-95); 
- adoption of an interpretative communication on the application of the principle of mutual 
recognition to trade in Industrial products. 
Such guides and communications wiii of course be of assistance not only to enforcement authorities but 
also to the economic operators concerned. 
c) pursuit of the existing schemes for exchangee of officials between the Member States, such as thé 
KAROLUS programme and the MATTHAEUS programme for customs officials; 
d) the organization of ad hoc meetings» seminars and conferences on enforcement issues; 
e) the collection, translation and circulation of information on National enforcement structures and 
practice: 
f) On the basis of the sectoral review referred to under 1b) above, evaluation of the possible need for 
Community aid to strengthen administrative infrastructures. 
In areas where cooperation based on Community Directives Is Just starting, such as scientific 
cooperation In the area of official control of foodstuffs, adequate means should be provided in order to 
ensure the effectiveness of this cooperation. 
In areas where cooperation Is already strong, It can be expected that existing structures wH( continue as 
before, or be further developed, as In the recent proposal for customs and agriculture5, 
Amended proposal for a Council Regulation (EEC) on mutual assistance between the administrative authorities of the 
Member States and cooperation between the latter and the Commission to ensure the correct application of the law on 
customs or agricultural matters - COM(93) 350 final, 1.9.93 
-15-
2. Preventing the emergence of new barriers 
There would be little point in implementing the Single Market programme to eliminate 
obstacles to free movement if this freedom were allowed to be eroded through 
piecemeal legislative change by Member States. 
The Commission wishes to underline that Member States should examine whether 
intended national legislation may unduly put a risk the free circulation of goods, 
persons, services and capital as provided for under Article 7 A. 
While the Commission intends to have due regard to the principle of proportionality in 
respect of future Community legislation for the operation of the Intemal Market, it is 
also up to the Member States to exercise restraint in the development of national 
legislation, the adverse effects of which on the operation of the single market may be 
disproportionate to the benefits at national level. 
The potential negative impact of national regulatory activities should not be 
underestimated in areas where, in keeping with the principle of subsidiarity, the 
Community intends to develop common actions based on the use of voluntary and 
consensual instruments (standardization, intra-professional agreements etc.). 
A notable example of an instrument which enables the Union to avoid the introduction 
of new barriers by means of a procedure which ensures transparency is Directive 
83/189/EEC which requires the notification of legislation or standards which could 
have implications for the free movement of goods. A proposal to amend the directive 
in order to fill gaps in its coverage has reached a common position in the Council. As 
regards financial services, notification requirements for cases of refusal of mutual 
recognition of credit institutions, insurance undertakings and investment firms, (and 
also for cases where sanctions are applied) are provided for in the relevant 
Directives6. Member States must inform the Commission of the cases in which they 
refuse to allow institutions to set up branch establishments in another Member State, 
and the Commission reports every two years. 
The actions described below are designed to extend such procedures in the interests 
of the proper operation of the Intemal Market. 
1. Mutual information on national rules derogating from the princlpfe of the free movement of 
goods 
Now that we have a single market in which priority is to be given to mutual recognition in cases where 
national rules have not been harmonized, steps must be taken io ensure that where a Member State, tn 
order to satisfy a mandatory requirement or one of the grounds specified in Article 36 of the Treaty* 
makes en exception to the principle of the acceptance of goods coming from other Member States, this Is 
immediately brought to the attention of kthe Commission and the other Member States. 
Only transparency can enable barriers to the free movement of goods to be dealt with swiftly 
- either, and preferably on a voluntary basis between the Member States concemed, 
- or, if necessary* at Community level before such problems produce all their adverse effects on 
businesses* consumers and, more generally, Union citizens. 
Following its communication to the Council and Pariiament on management of the mutual recognition of 
national rules after 1092, the Commission will propose before the mi of 1383 the establishment of a 
Simple procedure for the exchange of information between Member State» and with the 
Commission that will enable the Community to monitor the mutual recognition of national 
provisions Which have not been harmonized at Community level. 
Directive 89/646/EEC, Article 21 directive 92/49/EEC, Article 40; Directive 93/22/EEC, Article 19 
-16-
3. Notification procedures in the field of services 
The Commission is considering whether, in the non-harmonized area, more formal notification 
procedures for new legislation affecting services may be necessary, at least in some sectors. The 
first example will be In the Green Paper which is being prepared on Commercial Communication In the 
internal Market which will envisage the introduction of a system of prior notification of draft national 
législation in this area. 
3. Sanctions against infringements by Member States 
The new Article 171 of the Treaty allows the Commission to bring the case of a 
Member State which has failed to comply with a ruling of the Court of Justice before 
the Court to specify the amount of the lump sum to be paid by the Member State 
concemed. If the Court finds that the Member State has indeed failed to comply with 
its judgement, it may impose a lump sum or penalty payment. 
It is necessary for the Commission to clarify the ways in which it will make use this 
new power, as well as certain existing powers. 
The Commission, in the light of whatever cases arise, win consider what line to take and what criteria 
it intends to apply In the context of Article 171 of the Treaty, 
III. Redress: Access to justice and judicial cooperation 
Management of the Union area implies that national and Community institutions have 
the necessary means, where Community law is violated, to ensure that it is respected: 
this is a fundamental requirement of any legal system. The situation in the Union is a 
unique one, in that the application of Community law depends, by and large, on the 
separate jurisdictions of the Member States. The coming into operation of the Intemal 
Market will inevitably result in an increase in the number of cases in which residents of 
one Member State will need to claim their rights in another conversely, doubts about 
the possibility or the facility of doing so represent a significant obstacle to cross-border 
transactions, and therefore to the proper operation of the Single Market. 
It is not for the Community to seek a harmonization which would eliminate the 
distinctive features of national jurisdictions. However, both Member States and the 
Commission have a duty to take the necessary steps to remove the kind of doubts 
referred to above so that the Single Market is not impeded. At a basic level, this 
means improving knowledge of Community law, so that, without prejudice to the 
jurisdiction of the European Court of Justice under the EC Treaty, the capacity of 
national courts to apply Community law is optimised: this requires action with regard to 
information, including improvements to the transparency of Community legal texts, 
and with regard to training in Community law. Wider issues, such as facilitating 
access to the courts also require consideration. The inter-governmental 
conventions of Brussels and Rome are of particular importance to the Internal 
Market: their ratification by the Member States must be completed, and possible 
improvements must be examined. 
Greater transparency is necessary with regard to the sanctions applicable to breaches 
of Internal Market law. The Member States have recognized, in a declaration annexed 
to the Treaty on European Union, that measures taken by the different Member States 
-17-
should resuit in Community law being applied with the same effectiveness and rigour 
as in the application of national law. 
The coming into operation of the Treaty on European Union, and particularly the "third 
pillar" concerning cooperation in the fields of justice and home affairs, provides a new 
context for advancing in this area. The Commission will strive to promote actions 
designed to encourage coordination and cooperation in the judicial field between 
Member States and the Commission. Specific forms of cooperation may also be 
envisaged with the Court of Justice of the European Communities, particularly in 
promoting wider knowledge of the jurisprudence of the Court. 
The following action programme will be developed over the years 1994-1996. 
1. Improving access to législation 
Adoption by the Council in 1994/95 of a Partnership Plan for Dissemination (PPD) to ensure wider 
dissemination of knowledge of Community law In legal circles. The competent national authorities 
and the professional circles concemed {magistrates, judges, lawyers, legal advisers, solicitors, court 
clerks etc,) will be consulted starting m early 1994, The plan should coven 
» specific actions to improve the presentation, the media, and the effectiveness of the meant of access 
to Community legislation; these actions will build on initiatives already under way: the legislative 
consolidation of internal Market law In accordance with the needs Identified by the Commission; 
provision of informally consolidated texts and improvements to the INPO QZ database end to 
CELEX (see also section on information and communication); 
• adoption of an Interpretative communication on the liability of the State following a violation of 
Community law (Francovitch and Bonifacf ruling) in 1994/95, once the Court has ruled on two 
pending cases in this area ; 
* adoption of an Interpretative communication on the free movement of services, followed by one on 
the right of establishment; more specific sectoral communications Will be prepared as required. 
« improving the transparency of national sanctions by requiring that they be systematically notified 
with transposition measures; appropriate provisions wilt be written into future legislative proposals in 
the Internal Market area and Member States will be asked to communicate information in relation to 
existing legislation. 
2. Encouraging recourse to the national courts 
National courts must be in a position to resolve a larger proportion of cases concerning the conformity of 
rules or behaviour with Community law - the number of which can be expected to Increase *ubstant!a% 
in the context of the Single Market » if the the Commission and the Court of Justice are not to be 
Inundated. Two Initiatives are envisaged In this regard: 
m A Partnership Plan for Training (PPT) aimed at improving the awareness of and training In 
Community law of the legal profession. Simple solutions, avoiding the creation Of unnecessary 
structures, will be favoured, including better exploiting existing possibilities in the framework of fte 
activities of European institutes receiving support from the Community, such as those of Maastricht, 
Trier, Bruges and Florence, and the approaches proposed will take account of the heavy demands on 
the time of magistrates end judges, A Recommendation encouraging Member States to ensure a 
greater emphasis on Community law in the training of young lawyers will be an integral part Of 
the Plan, which should be adopted in 109$, 
« The Commission will publish* In late 1993, a Green Paper on "Access to justice for consumer» 
and the resolution of consumer disputes In the Single Marker*, it examines the national 
procedures, both judicial and extrajudicial, for consumer disputes, and the pilot prefects which the 
Community has financed in this area, and indicates the difficulties in applying them in the case of 
cross-border disputes. The solutions proposed will be the subject of wide consultation. 
3. Reinforcing the mutual recognition; of Judgements 
The Brussels Convention is designed io ensure that a commercial judgement once obtained In a 
Member State, is recognised and enforced \n other Member States with a minimum of formalities. This 
convention is a key element in the framework of the Internal Market 
Ratification of the extension of the Convention to Spain and Portugal should be completed by 
Belgium, Denmark, and Germany. 
-18-
ln the context of Judicial Cooperation, an analysis is under way of the effectiveness of the 
Convention, The Commission witi play its part and take any action that may be required on completion 
of this analysis and will report on progress at the end of 1994. 
4. The Internal Market and conflicts of laws 
Action is required by all Member States except the Netherlands to complete ratification of the extension 
to Spain and Portugal of the Convention of Rome on the law applicable to contractual obligations. 
As the traditional approaches to the conflict of laws In the context of international private taw do not take 
account of the requirements for mtra-Union coopération in a Single Market an analyste will be 
undertaken of the effectiveness of the Convention- This will commence with a survey among 
Member States and interested parties which could form the basis for proposals to improve the appiicetion 
or widen the scope of the Convention, 
IV. Evaluating Community rules 
Systematic evaluation of the effectiveness of Intemal Market legislation and related 
policy actions is indispensable if shortcomings in the new framework are to be swiftly 
rectified, and if the potential economic and social improvements flowing from the 
Programme are to be maximised. Business, consumers, local and national authorities 
and Community institutions have a shared interest in detailed and accurate 
assessment of the impact of the Intemal Market The strategic objective for the 
Commission is to develop a network of contacts which will allow the monitoring 
activities undertaken by the various parties concemed to be harnessed for this 
purpose. By facilitating communication and the exchange of ideas and findings 
between the various parties, such a network could allow the Intemal Market 
framework to be fine-tuned and improved upon. 
1. Evaluating the practical performance of Internal Market legislation 
This process of evaluation should have a two-fold focus. The first involves monitoring 
the performance of Internal Market measures in eliminating the relevant trade barriers 
and highlighting areas where they may have to be further developed in order to 
realise fully their objectives. 
For example, the removal, for over a year, of veterinary and phytosanitary controls at 
the Union's intemal borders makes it necessary to evaluate the European legislation 
adopted in the animal health sector for the implementation of the single market Many 
problems have arisen in the light of this experience. It is therefore appropriate to draw 
conclusions and to take the necessary measures for adaptation. Freedom of 
movement remains the basic objective of the legislation and every measure should be 
limited to scientific and veterinary requirements. To be effective, measures to combat 
diseases should be adapted to the epidemiological situation and the regulatory 
measures should be sufficiently flexible to permit adaptations both as regards the 
veterinary situation and the regions concerned. Mutual confidence must be 
strengthened, the identification of animals traded in the Intemal Market must become 
a reality on the ground. Finally, the agreed control posts at external frontiers must 
strictly respect the norms which have been laid down. 
The Commission will increase its cooperation with the Economic and Social 
Committee in pinpointing areas for further action based on information provided by the 
ESC, including information gathered within the context of ESC hearings to which a 
-19-
number of representative organizations will be invited to present their experiences in 
the operation of Intemal Market legislation. 
It will also develop its use of advisory and monitoring committees in the fields of 
technical legislation for industrial and foodstuffs sectors, transport, environmental 
legislation, financial services, public procurement, customs legislation, and commerce 
and distribution, and will extend this practice to other areas where appropriate. 
The Commission will develop Its contacts with bodies having day-to-day experience in the application of 
Internal Market measures and the operation of mutual recognition regimes, and other organizations with 
specialist knowledge through; 
« A two-way exchange of information with the Commission* network of Euro-Info Centres * The Euro-
Info Centres, and their host structures «re already proving tneir worth as a source of feedback on 
progress in removing trade barriers; The Commission proposes to request Euro-Info Centrée to 
submit regular reporta on the experience of SMÊ'S with respect io «he Impact of Internal 
Market legislation, 
• A series of studies In transfrontier regions to be launched In 1994 • in transfrontier regions, 
companies are confronted on a daily basis with differing administrative and legal regimes and 
practices. These regions could be used as test-cases to establish whether internal Market Initiatives 
have led to Improvements for economic operators, and in identifying further areas for action, 
« Hie organization of sectoral workshops * Should the volume of complaints transmitted to the 
Commission suggest that the application of Internal Market measures In certain sectors is bedevilled 
by problems, sectoral workshops to study these problems WiB be organised by the Commission 
services concerned in collaboration with the relevant professional organirations. 
* The development of sectoral monitoring toots - A prime example of this type of action is the 
setting up, within the public procurement Consultative Committee, of an observatory by the end of 
1$93, in the financial services field* the Commission will present studies on She application: and impact 
of Internal Market legislation to the Council or relevant committees of the financial services eector. For 
example, the Commission Is required to submit a series of 14 reports on specific issues regulated by 
Directives, e.g+ a report on the functioning of the directive relating fo the Type Approval of motor 
vehicles, which is due at the end of 1894, The Commission win also organise special studies on Open 
Network Provision (ON?) and mutual recognition of terminal equipment 
2. Evaluating the broader business and economic impact 
The second focus for evaluation involves the broad assessment of the business and 
economic impact of the Single Market. This will allow Community and national policies 
to be adapted in the light of structural effects generated by Single Market completion. 
For example, feedback on the practical impact of Intemal Market legislation and 
mutual recognition regimes could reveal cases where the removal of physical, legal 
and technical obstacles to intra-Union trade and competition may need to be 
supplemented by application of competition policy safeguards if the pro-competitive 
potential of the Intemal Market is to be realised. Complementary actions, such as in 
the field of training, may be required to help enterprises or workers adjust to new 
economic circumstances. 
The Commission will give greater attention to analysis of the impact of the Internal Market on business 
dynamics end strategies and market structures through; 
• The development of statistical tools for evaluating the effect of the Internal Market Discussion 
between Commission services concerned have begun with a view to collection of data in 1994. 
. Specialised statistical tools In specific Internal Market fields* Statistics forwarded by the Member 
States to the Commission in compliance with Community PiibHc Procurement Ojroctrves wW be 
exploited through the development of an "Executive Information System* This system will deliver 
user-friendly statistical performance indicators and reports Illustrating progress: in the liberalization of 
public procurement Specific information and data gathering networks are being developed in the 
transport field under the aegis of the GURÊT programme 
-20-
Finali2ation of a framework regulation on business statistics, replacing the current annual survey 
on industrial structure and extending the scope Into the services sectors, to Improve availability and 
comparability of high-quality statistical Information needed for the evaluation of economic activity m 
general and the follow-up of the effects of the internal Market in particular, 
Specific coverage of the Impact of Internal Market on individual sectors In future editions of the 
Panorama of EC induatry (1995 edition), and more detailed treatment of Internal Market related 
aspects in future editions of the annual report of the 5ME Observatory. 
Building a network of research centres with a proven background In Internal Market analysis 
(deadline end 94), 
Drawing on the results of studies undertaken by the Member States. 
The launching in 1994 of a wide-ranging study on the business end economic Implications of 
the internal Market -The Commission alms to publish the terms of reference for this study which wiB 
Say down the parameters and get the analysis under way In its Resolution of 7 December 1992 
inviting the Commission io undertake such an analysis* the Council has asked that this study examine 
the impact of the Internai Market on a broad range of factors Including economic and social cohesion, 
and Its contribution to sustainable non-inflationary g/ov^ respecting the environment. 
3. Strengthening the INTRASTAT statistics collection system 
The cessation of customs formalities on 1. January 1993 has led to the setting up of a 
system for the compilation of statistical information on the flow of goods between 
member states, this information being supplied directly by enterprises. (INTRASTAT) 
The changes induced by this new system are of such a magnitude that national 
administrations, who only had a limited amount of time to take them into account, are 
still being confronted by major problems both at the level of compilation and analysis 
of the information. 
The experience gained in this instance and the analysis of the first published results 
invite caution. Nevertheless, the Member States and the Commission have wasted no 
time in either taking or envisaging measures which would improve the system in an 
appreciable and rapid manner. 
The principal difficulties to be overcome are as follows: 
• The level of response from enterprises - It is not easy to gauge this level. There 
exists no past information for enterprises in all the Member States taken together 
and a systematic comparison of the results with those gleaned from a fiscal source 
has not yet been possible. Nevertheless the level of non-response has been 
estimated as between 10 and 25% of the number of operators, according to 
Member State, being 5 to 10% of the total by value. This phenomenon, which 
seems particularly to concern small enterprises, will necessitate a significant 
mobilisation of resources to improve the level of coverage. Following action on 
reminders taken in most Member States, the situation seems to be improving. 
• The delay in the transmission of declarations - Despite the intensive information 
campaign carried out by national administrations with the support of the 
Commission, the late publication of regulations has not always enabled enterprises 
to adapt their administrative organisation in time. There have ensued from this 
important delays in the transmission of declarations, which are being progressively 
reduced. 
• The classification of goods - The level of detail of the combined nomenclature has 
resulted, principally for those SME's without computer systems, in a complexity and 
multiplication of the number of lines to be declared. This last effect has been 
accentuated by the absence of a threshold for each transaction, the thresholds 
21-
being fixed in the new system by enterprises as a function of their importance in 
intra-community trade. The supply of certain information, according to its position in 
the combined nomenclature (notably net mass) has on occasion posed a problem. 
• The link with taxation - This is one of the major characteristics of the INTRASTAT 
system. The constraints which it imposes on the level of the statistical declaration 
to determine the reference period or for the treatment of certain movements of 
goods(contract work for example) complicate to some extent the economic 
significance of the statistics and the comparison of the two sources. 
• The treatment of the information - The lack of time for the adaptation of the 
computer systems of national administrations has had negative repercussions for 
the treatment of information, which has led to delays not only in the pooling of intra 
community information but also on trade with third countries. The statistical 
services have also had to come to terms with the considerable increase in the 
number of line of declaration with which they must deal. The application of 
thresholds has had a certain simplifying effect for the vast majority of enterprises 
but has resulted in a degree of complexity for national administrations in handling 
the data. 
• Computerised and telematic methods - The products developed in the ambit of the 
EDICOM project, whether for alleviating the burden of declaration for Member 
States, or those designed to automate the processing operations of national 
administrations, are now very useful but had a difficult beginning due to their late 
arrival on the market and the time required to set them up 
In the face of these difficulties, national administrations and the Commission have 
wasted no time in reacting and in either making or proposing appropriate 
measures. 
The measures are aimed at curtailing the level of non-fèSponse; information campaigns and campaigns 
to remind enterprises, as to their obligations of declaration have been conducted in the majority of 
Member States in the course of the first semester and are now beginning to bear fruit. 
To complement those measures taken by the Member States (reminders, correcting information. 
enquiries. Improvement of registers..*)* the Commission has proposed « package of actions now In the 
course of being Implemented: 
» setting up of a working group on the definition of methods of adjustment and estimation for data 
collected. 
« proposal for a draft regulation to be proposed by the Commission with a view to simplifying the task of 
those liable to make returns, notably as to the classification of certain types of goods, to the provision 
of net mass for certain products and to the declaration of low value transactions. 
• the development of end adaptation to needs of each Member State of computerised and telematic 
methods. 
« proposal for a draft Commission regulation with a view to obtaining within a reasonable time limit and 
in a regular manner the results from the Member States, 
» installation of a system for the exchange of provisional results, at an aggregate level, to precede the 
provision of more detailed information. 
To conclude, it is advisable to underline first of all that the situation has improved 
considerably in the course of the year, but still varies considerably by Member State. 
The countries who have opted for a single declaration for both statistical and fiscal 
purposes (France, Italy) or for two declarations but made concomitantly (Greece) have 
been able to provide detailed statistics within a satisfactory time limit. 
For the others, the delays observed in the making available of the results are 
decreasing. However, to return to a normal situation will require considerable effort, in 
particular as regards improvement in the quality of the content of the information. 
(5) 
-22-
At this stage the majority of Member States do not consider that there is a need to 
carry out fundamental revisions to the INTRASTAT system, and that it is advisable at 
the outset to assure the effectiveness of the proposed measures for improvement 
V. Resources 
Management of the Intemal Market will involve a fundamental change in the tasks of 
both the Commission, which will have to assume new responsibilities for the 
supervision of the application and enforcement of Community legislation, and the 
Member States, which will have to cooperate more intensively than ever before. 
These changes also have implications for the total level of resources devoted at 
national and Community level to making the Intemal Market work. 
To some extent existing resources may be sufficient provided that they are used in 
new ways. Thus it may be possible for certain Commission departments to devote 
more manpower to checking the quality of national transposition of Community law, to 
handling complaints from the public or to questions of interpretation of existing 
directives, insofar as they are no longer heavily involved in the development and 
negotiation of new Community legislation. There are, however, limits to this approach, 
some of which have already been illustrated in earlier sections of this document the 
volume of national legislation to be examined may be very great, complaints or 
questions of interpretation may be complex, the same department may still be actively 
involved in proposing new legislation including some of the large number of 
implementation measures required under existing legislation. For some tasks it is 
already clear that existing resources cannot be stretched further. 
The Commission believes that the effective management of Community legislation for 
the Intemal Market will be a more resource-intensive task than its preparation. The 
Commission's current resources, expressed in terms of manpower or budgetary 
appropriations, are remarkably modest compared to those of national administrations 
for the same purpose and to general expectations as to the Commission's 
responsibilities. Without more resources in some areas the Commission will not 
properly be able to exercise its responsibilities. 
The Commission will therefore consider in its preparation of proposals for the 1995 
budget to what extent its priorities need to be revised in order to take more account of 
the costs of managing the Internal Market. Some of the actions foreseen in this 
programme, such as the survey of administative cooperation mechanisms will provide 
additional information on which to base additional budgetary requirements. The 
Commission assumes that it can count on the support of the Council and the 
European Parliament in this exercise. 
-23-
Section C - Developing the Single Market 
The completion of the basic legal framework foreseen in the 1985 White Paper and 
action to ensure that Community legislation is effectively and evenly applied, as 
described in the preceding parts of this programme, already represent a significant 
contribution to the proper functioning of the Internal market The freedom of 
movement for goods, services, persons and capital, the original objective of the White 
Paper, will provide the necessary basis for economic recovery and the future 
competitiveness of the Community economy. 
But such a static view of the single market, in which the management of existing 
legislation is judged to be sufficient, will fail to deliver the full economic and practical 
benefits of a single market In its June 1993 working document the Commission 
included a number of additional measures, some but by no means all involving 
legislative initiatives, which were put forward as a means of providing added value to 
the existing Community legislative framework by addressing problems that were not 
necessarily foreseen in the White paper and which reflected the preoccupations and 
priorities of those operating in the market. 
The response from the market was loud and clear. The view that there is still 
unfinished business for the Community in this field was largely supported by the 
reactions to the Commission consultation on the basis of the working paper. 
Organizations representing industry and business interests strongly supported 
continued harmonization of legislation in a limited number of fields, such as direct 
taxation and the protection of intellectual property, and small business pressed for 
additional measures which would help them to participate more in the opportunities 
opened up by the creation of a single market Consumer organizations, while 
welcoming the Commission's commitment to protect the consumer interest, urged a 
far more ambitious approach. A large number of respondents, including the European 
Parliament and some national governments, insisted that more needed to be said 
about the role of competition policy in the operation of the intemal market Others 
raised the issue of ensuring compatibility between the management of the intemal 
market and the Community's commitment to sustainable development and the 
protection of the environment. 
The other Community institutions also supported the inclusion of a dynamic 
component in the Strategic Programme. The European Parliament declared that the 
Community should reject a "wait and see" attitude and should pursue further action in 
the intemal market field with a view to promoting economic growth. The Economic and 
Social Committee expressed broad agreement with the Commission's views 
concerning the development of the internal market, putting emphasis on the need for 
interaction with other Community policies and the need for a more integrated 
approach to trans-European networks. The Presidency conclusions of the Intemal 
Market Council of 27 September support the political appropriateness of a programme 
to include, where and to the extent necessary, the dynamic development of a single 
market at the service of the citizen. 
The Commission is therefore bringing forward a package of measures which 
constitute a "second phase" in the development of the intemal market. These 
measures have been selected on the basis of a number of guiding principles which 
take account of the new circumstances in which the Union now finds itself. 
-24-
• First, there is an overriding need to promote greater competition within the 
single market. The legislative barriers to market entry that have now been 
removed must not be replaced by anti-competitive behaviour by market operators. 
Increased vigilance by public authorities will be necessary to make sure that the 
single market is indeed open to all on equal terms. 
• The development of the intemal market must take account of the broadening of 
the Community's policy objectives under the Treaty on European Union, the 
entry into force of which constitutes a new point of departure for all Union policies. 
The confirmation of the importance of environmental, industrial or consumer 
protection policy, as well as the need for trans-European networks, must lead to a 
re-appraisal of existing policy in the intemal market field. 
• The full economic benefit of the single market must be exploited in order that 
the expected improvement in European competitiveness and economic 
performance can be accelerated. This will require a new flexibility in the choice of 
policy instruments. In some cases it will be necessary to rely on voluntary 
instruments or organizations, assisted and promoted where appropriate by public 
authorities, such as in the standardization and quality field. In others, such as 
company law, taxation or intellectual property protection, for example, it will be 
necessary to provide a more favourable legal environment in order to encourage 
companies to operate on a continental scale. The putting into place of large-scale 
physical infrastructure, in the form of trans-European networks, is also clearly 
aimed at this objective. 
• Finally, the changing political context within the Union requires new working 
methods for the development of intemal market policy. All major Community 
initiatives in this area must be based on transparency and regular assessment of 
the appropriateness of policy. The public is becoming more demanding in terms of 
information; citizens must be kept efficiently and systematically informed about the 
rights and advantages which they obtain from the intemal market 
The following section therefore presents a broad mix of policy instruments, in which 
new legislation plays a relatively small part. A large proportion of this part of the 
programme concerns the promotion or use of a voluntary approach to achieve the 
Community's objectives. Where, however, additional legislation is thought to be 
necessary for the internal market, it will be developed on the basis of proportionality 
.transparency and close consultation, as this Strategic Programme itself has been. 
The Commission intends where appropriate to publish its major legislative intentions 
at an early stage so as to permit interested parties to make their views known as to 
whether legislation is needed and what form it should take. The indication of the areas 
where legislative initiatives may be needed which follows is the first step in the 
process; each proposal will be the subject of further consultation. 
As is indicated in Section E below, this part of the programme will be regularly 
evaluated in the light of the Commission's Annual Report on the operation of the 
Intemal Market. 
I. Transparency and proportionality of new Community measures; 
transparency of procedures; communication and information 
Transparency, as regards the Community legislative process, legislative texts, their 
application and their implications for individuals and firms, is a key to bringing the 
Union closer to its citizens. In order both to appreciate the possibilities offered by the 
-25-
Intemal Market and to be able to make use of those possibilities, people throughout 
the Union need information about the laws that apply to them. They also need the 
assurance that new laws are introduced only where they are needed, that they 
minimise compliance costs, and that they are coherent, both in themselves and vis-a­
vis existing laws. The actions outlined here are designed to contribute to these 
objectives; however, the other Community institutions and the Member States must 
also play their part. 
1. Transparency and proportionality in preparing new Community legislation 
In order to ensure that Community legislation for the Intemal Market is fully coherent 
each new legislative initiative should be evaluated in accordance with an analytical 
framework serving as a guide for the Commission from the earliest stage of 
preparatory work to the adoption of the measure. 
Evaluation of the need for legislation is a task that the Commission cannot undertake 
without consulting those who would be affected by it. A procedure for the publication 
of legislative intentions by the Commission at an early stage in the preparation of 
proposals for Community measures will ensure that interested parties become aware 
of the intention to legislate and will also contribute to the development of legislative 
proposals. 
The principle of proportionality helps to maintain coherence, by ensuring that each 
intervention has a degree of regulatory intensity that is in proportion to the real needs 
and the effectiveness necessary to the attainment of its objectives. 
Transparency. prqportiona,|ityt and oofrerenfie |n legislation 
The Commission will prepare, by mid-1994, on the basis of an initial examination already undertaken in 
the context of the follow-up to the Sutherland Report, systematic guidelines for the evaluation Of the 
need for internal Market legislation, the form It should take and its Internal and external 
coherence. This method will take account of 
- the origin of the demand for Intervention; the identification of the Community objectives concerned; 
- the Identification of an obstacle to free movement justified in terms of Articles 36 or $6 of the 
Treaty or of the jurisprudence of the Court or necessary to legal security or the proper functioning of 
the market where the operation of mutual recognition poses practical problems; 
- the economic Impact of the proposed legislation: advantages for the economy as a whole (rather 
than simply for the sector directly concerned) end additional costs to which it wilt give rise; the 
Commission will examine the methodology which would enable such analysis to be undertaken, in 
conjunction with Its commitment to improve and strengthen the business impact assessment system 
and to consider the use of detailed cost benefit analysis when making proposals for Community 
legislation; 
- the application of the principle of proportionality to determine how harmonization should be 
achieved, in terms of the type of instrument (legal or voluntary) and its content, io ensure that the 
action does not exceed what Is necessary to secure the objectives of the Treaty; techniques of 
harmonization will be considered on a scale ranging from the promotion of voluntary instruments, 
through optional harmonization, and minimum harmonization to full harmonization; 
w coherence will also be ensured by Improving the Commission's internal consultation procedures. 
The Commission approved, on 2 December 1992, a communication entitled 'Gmoter transparency in foe 
work oft fie Commission", m which a procedure is provided for particularly concerning notification. This 
involves publication by the Commission, in certain cases, in the Official Journal (C Series), of a brief 
summary of the initiative envisaged, together with information on the Way to obtain copies Of the 
document. The Commission wilt endeavour to ensure that this method is effectively put into practice. 
-26-
The «se of Oreen Papers, In particular, should be encouraged, In order to promote greater participation 
by the parties concerned, 
2. Communication and information measures 
For people and businesses in the Union to enjoy the advantages of a large, frontier-
free market, they need to be informed on the possibilities it offers and have channels 
open through which to communicate their needs. This need is significant for several 
aspects of Internal Market policy, such as access to justice, administrative 
cooperation, and further aid to business, especially for organizations providing advice 
for small business, and is also referred to in the sections of this Programme which 
deal with these aspects. 
The Commission is developing a communication strategy involving all the Community 
institutions, national administrations and non-governmental organizations, in a 
systematic and coordinated way. In this regard, it adopted, on 30 June 1993 the 
communication "The Information and Communication policy of the Commission - a 
new approach". Furthermore, a first Commission Decision had already been made on 
5 May 1993 outlining the strengthening of information and communication for the 
Single Market. The identification of key audiences has established that the general 
public, youth, the consumer, industry and business, information officials in national 
administrations are priority audiences for 1994. This strengthening will continue by the 
setting of key objectives (starting with those areas where the lack of information is the 
greatest) and organize the resources which are available at Community and national 
level, on the basis of a partnership with the Member States. 
So far as its direct provision of information is concerned, the Commission will 
increasingly have recourse to media specialists to provide, in a more professional and 
targeted way, information on the operation of the Internal Market 
The Member States are well placed to conduct publicity campaigns, due to their 
existing systems, greater resources and knowledge of specific local factors. The 
Commission will strive to coordinate more closely with them, for instance by publishing 
a complete list of national and Community-level information campaigns, and in 
providing them with the necessary publications and access to Community databases. 
Professional and Trade Associations also have a role to play, both on their own 
account and as intermediaries for the Commission (for instance through the EIC and 
the Office network) and by expressing the information needs of their sectors. For 
example, regular meetings with organizations representing SMEs can be developed 
with a view to improving the flow of information to these organizations concerning 
relevant Community activities. 
a) Information provided by the Commission; : 
•" Annual Report on the operation of the infernal Market 
- This will be published at the end of each year in order to improve traraparegey of legislation end Its 
implementation, extending the coverage already provided by various reports7 on the Implementation 
of the 1ÔÔ5 White Paper to the whole operation of the intemal Market 
Communication of 2 December 1992 on the Operation of the Community's Internal Market after 1992 - Follow-up to the 
Sutherland Report (SEC(92)2277 final); Commission Communication of 2 June 1993, on Reinforcing the Effectiveness 
of the Intemal Market and Working Document of the Commission on a Strategic Programme on the Intemal Market 
(COM (93) 256 final). 
-27-
- The annual report will come in two parts. The first part has a political orientation and includes a 
summary of the report and the main points arising in the past year, The second part includes the most 
relevant information on the operation of the internal Market and assesses the measures taken In the 
various sectors. Thus it covers legislation which existed before 198$, the new developments in the 
acquis communautaire and policies which were not in the White Paper proposals. 
* Databases 
- The principal database which provides information on the intemal Market Is WP0 92, which has bem 
progressively incorporating informative ^consolidated versions* of internal Market legislation in all 
nine official Union languages! In addition to its coverage on Community législation and preparatory 
acts and references to naiflorialtra*^ 
and a section on social policy. The consolidated legislation to appear so far covers pharmaceuticals, 
foodstuffs and company law. For the general public, a new section answering key Questions on 
&JROPB WITHOUT FRONTIERS is being established This response to fie needs of the general 
puoBc and its development wilt be pursued vigorously in tôôAThe way in which all this information is 
distributed most evolve to reflect needs pe*t«ld82t and as Indicated above under TrovkBng access to 
up-to-date information on natfonal transposition legislation** a survey wife* be carried out in ttity 19K 
and any changes made will be based on the results of that The obtusion of the INFO 62 database wilt 
be Improved by making it available on the wider public European networks» 
- CEkEJC* now ran by the Office for Officiai ItyWieawons* remains the ohief source of fuSMext data on 
legislation and case Saw, including that concerning the Internal Market TÎ^ComrnJssion w» maintain 
dose liaison with the Office, In order to ensure that the process of medemisetion which te under way 
permits the acceleration of the introduction of texts end thereby increases its efficlency+ 
- TED, the Tenders Electronic Daily database far public procurement contracts, toil! be the subject of 
proposals for it to be made rrrore accessible and user friendly. 
* Printed information 
» A new brochure on the intemal Market m the ^Europe on the move* series wffl be published Ineady 
1994* to be updated later In the year to include this Strategic Programme. 'Most of the contents of 
iNFO 8& «re also available in printed form, and this coverage wilt be extended oaring 1ÔÔ4 to Include 
the EUROPE WITHOUT FRONTIERS questions and answers and consolidated Community 
legislation, in the latter case starting with the pharmaceutical sector* in a compSaSon which includes 
the original and amending texts. 
* The Commission is studying the feasibility of a periodical covering its dbcumeritafion end databases, 
which would also serve as a contact point w^it^naiedmWstrafions\ 
- The Commission wilt enoourage the produ^ 
- A European Ouide for Consumers In the Intemal Market wtë be puofished. The Oukte Is intended to 
give consumers in the Union « simple and practical overview of what Coinmuniry consanwpoNcy has 
provided* 
~ The Commission will improve the quality and distribution of its newsletter on the internat Market, 
which will be published atleast tour times annually from 1994. 
- The existing guides to the different national social security systems for migrant workers will be 
updated, end the possibility of providing information on other supports, e.g. videotapes or telematic 
services, wilt be explored. 
* Faire and exhibitions 
A decision will be taken at the beginning of each year concerning Commission participation in fairs 
and exhibitions which are concerned with the development of the internal Market in the Commission 
participation, not only will a sectoral approach be pursued, but the needs of the general publie will be 
primary objectives. 
b)The neeof intermediaries In information policy 
» The network of EICs, which is covered in the section on further improving the environment for 
business, is a key contact point with smaller businesses, and the Commission will plan training 
sessions on Infernal Market questions. 
4 In addition to these, other intermediaries, close to firms and consumers, will be identified; these could 
include: 
- professional and trade associations; 
- trade unions; 
- chambers of commerce. 
-28-
where these are not already hosts to BCs. 
* Once identified, the intermediaries wlil be asked to set out their information requirements. 
* Efforts will be made for Commission staff, or if necessary external agencies such as Team Europe* Io 
be present at seminars* meetings or workshops with these intermediaries to explain what Is available 
under the Internal Market programme, 
« Commission financial contributions couid be ma<$^ to some intermediaries, 
. The annual selection of "success cases" foundthrou$htheEiCswl8bepubftshed. 
« The Commission supports, on « pilot scheme basis, the ten Transfrontier Consumer information 
Centres, created with the aim of enhancing shopping In another Member State and of helping citizens 
to solve problems they may encounter with transfrontier purchases. 
* The Commission has promoted the setting up of databases In consumer centres In four Member 
States. These databases, which are interconnected, aim to provide consumers with ready access to 
information on the consumer legislation governing transactions in which they are involved. This 
network wilt be extended to aft Member States by the end of 16$4< 
$ f^^Pershrp.wtth^e ^ern.ber^atee 
* The Commission will draft texts on particular themes associated with the internai Market, such as the 
mutual recognition of qualifications, then invite the Member States to provide their own contributions 
reflecting their specific "national" situations, with a view to publishing a différent version in each 
Member State, either: 
- on CD-ROM, or 
- in conventional paper form 
* in response to numerous: texjuests from various organizations in the Member States, the Commission 
win examine the possibilities for the joint production of materials, on, for example, public procurement 
foodstuffs, pharmaceuticals, consolidated legislation or explanatory guides. An invitation Will be 
published in the Officiai Journal for interested parses to submit proposals for publication (on 
conventional or electronic media) or publications already completed, with a view to receiving either 
financial support from the Commission or permission to use tha Community logo, 
* in order to ensure more effective coordination the Commission will compile e list of national and 
Community-ievei information sources on an annual oasis. 
* The European Statistical Office, EUROSTAT, Is considering estabRshlng a network for the 
dissemination of Community statistics in collaboration with the national statistical offices, thus 
effectively linking up EUROSTAT with the statistical departments of the Member States, The aim is to 
provided the end user with the information required to function effectively tn the Internat Market, locally 
and in his own language» 
dl Management of information policy 
While the Commission has a budgetary allocation for Information on the internal Market there are 
limited staff resources* and it wilt be advisable to haverecourse to specialists when appropriate. 
The information actions should pursue four aims' 
- the definition of key messages and themes; 
- partnership with the Member States; 
« providing specialised information; 
- making the best use of existing resources (such as the database INFO 92). 
In information aimed at the general public, specific actions such as the installation of telephone 
answer lines witi be pursued. In the specific approaches, recourse to the Commission's Êurobarometer 
for pre and post-testing win be made. 
II. Further Improving the environment for business 
The Intemal Market programme was originally conceived of as a means of improving 
the framework in which Union business operates. The completion of the intemal 
Market opens the door for individual companies to take advantage of new commercial 
opportunities on partner country markets, and thereby paves the way for a profitable 
expansion of enterprising firms. The White Paper programme of 1985 constituted a 
giant step towards realising this goal. Now that the legislative steeple-chase has been 
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almost completed, attention can be focussed on the complementary actions which will 
help business to exploit the potential of the single market effectively. 
One of the guiding principles of the Strategic Programme is that legislative overload 
should be avoided. There is a danger that binding measures which look wholly 
justified in isolation can, when taken in conjunction with other rules, regulations and 
administrative provisions, create such a cumulative burden on economic operators, 
particularly smaller firms, that they curb activity, enterprise and employment. For the 
most part, the actions which are proposed below aim to complement core Intemal 
Market legislation with optional structures and mechanisms which will help business to 
make the most of the new opportunities. In some cases, however, the Commission 
considers that new legislative action is necessary if the proper functioning of the 
Internal Market is to be guaranteed. Furthermore, it must be recognized that the legal, 
fiscal and technical environment within which Community firms must evolve does not 
sufficiently reflect the dimension and the dynamics of the intemal Market. A reflection 
on this entire framework is urgently required. 
A strategic policy which aims to further improve the business environment comprises 
the following strands: 
• A strong and effective competition policy, to be implemented in conjunction by 
Community and national authorities. Such a policy is an essential adjunct to the 
Internal Market Programme if the anticipated reinvigoration of competition 
engendered is not to be stifled by restrictive agreements or practices, excessive 
concentration of markets, or a proliferation of state aids. In the absence of an 
effective comptetion policy, the Intemal Market will not deliver its full benefits in 
terms of improved capacity of Community business to compete internationally, or 
increased consumer choice and lower prices. 
• Finalising the legislative and administrative framework required to make the 
Internal Market operate more effectively - Without prejudging the results of of the 
overall reflection referred to above, further legislative action is needed in the fields 
of company taxation, protection of intellectual property rights, and cross-border 
payments to iron out remaining obstacles to intra-Union transactions and business. 
A review and simplification of existing and proposed legislation and procedures will 
also serve to eliminate any unnecessary regulatory burden on business. Further 
progress in the key areas of transport and energy are essential if the benefits of 
the Single Market are to be fully realised. Consideration should also be given to the 
legislative (and technical) situation regarding commercial communication in the 
Single Market context. 
• Creating and developing a non-legislative infrastructure which offers ancillary 
support to companies engaging in cross-frontier activities - The Union should 
actively promote the strengthening of the European standardization and conformity 
assessment infrastructure, and encourage the convergence of quality management 
instruments. The Union should also introduce optional legal structures for 
companies established in more than one Member State. Access to distribution 
networks and a competitive commercial sector are also important elements in 
enabling business to participate in the Internal Market. 
• Catering for the needs of SMEs - Action must be taken, in line with the 
Commission's multiannual programme for SMEs for 1993-96, in accordance with 
the resolution of the Council of 11 November to ensure that these companies 
participate fully in the benefits generated by the Internal Market. 
• Developing an industrial policy as a complement to the inherent benefits of the 
Internal Market in terms of competition by focusing on improvements in basic and 
applied research, better links between research and industry and thus an 
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environment favouring the process of commercialisation, an intensified diffusion of 
available knowledge and better education and skills in the work force on all levels, 
and infrastructural investment 
1. Competition policy 
The speedy and uncompromising application of competition safeguards is an 
indispensable complement to efforts to remove legal and administrative obstacles to 
intra-Union trade. Otherwise, anti-competitive practices on the part of companies or 
national authorities may choke off the competitive dynamics which are trie driving 
force for the economic benefits which are expected to flow from the completion of a 
Single Market. A strong competition policy will protect firms which try to capitalize on 
openings generated by the Intemal Market from being undermined by such practices. 
Looking to the future, the Commission intends to develop its rapid-response capability 
which will enable it to react effectively where the functioning of the Intemal Market is 
obstructed by behaviour which is in breach of Union competition rules. To this end 
concerns relating to anticompetitive practices or abuses of dominant positions which 
come to light during monitoring and evaluation of the operation of the Intemal Market 
will be systematically relayed to Commission competition policy services. On the basis 
of such information, the competition policy authorities will make greater use of own-
initiative investigations to establish whether competition rules have been infringed, 
should the problem seem to warrant further attention. 
The following checklist indicates areas which will be resolved by the application of 
competition policy rules over the coming year. 
1. Application of competition safeouards priorities 
The Commission wl» give priority to the following measures; 
• preparing a code of conduct end a block exemption regulation on computerised reservation services 
for air passenger transport; 
« a block exemption regulation for maritime consortia; 
• widening the scope of the existing block exemption regulation for technology transfer. 
2. Simplification and effective application of competition procedures 
The Commission witi continue to streamline and simplify systems and procedures with a view to 
accelerating decisions on the application of Community competition law. In particular, the Commission 
intends to adapt provisions relating to the form, content and other details of applications and notifications 
which are laid down in Regulation (EEC) No 27/62 to render them more user-toendly. 
3. Interpretative communications planned 
« Guidance statements on legal and technical aspects of the merger regulation (e;g;, turnover 
calculation, definition of a concentration) 
• Communication on concentrative and cooperative joint ventures 
• Communication on the assessment of commercial agents contracts with regard to Article 86 of the 
Treaty 
• Revision of the Notice on agreements of minor importance 
2. Improving cross-border payments 
Firms and individual consumers who engage in cross-border payments are penalised 
by the high costs of the systems used to make these transfers, as well as by 
excessive delays for execution and the incidence of double charging. Following the 
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adoption of its working document in March 1992 on problems related to cross-border 
payments8, the Commission commited itself to take appropriate action, including 
legislative action, in the event that financial institutions do not take adequate steps to 
introduce more transparent and more efficient cross-border payments services. In 
response to this pressure, the European Credit Sector Associations elaborated a set 
of Industry Guidelines for Customer Information on Cross-border remote payment 
which were to be implemented by 31 December 92. Nevertheless, a Commission 
study, conducted in early 1993, has found that there has been little practical 
improvement with respect to the level of transparency, cost, time delays, and double 
charging of cross-border payment services. 
The Commission will shortly draw conclusions from this consultation -, Whatever the option chosen, Ow 
possibility of a legislative initiative within a very short time cannot be excluded If the existing 
arrangements in the voluntary framework, which the Commission wilt in any case support, prove 
insufficient to achieve concrete progress with regard to the transparency of information, the prevention of 
double charging and delays in execution. 
3. Transport 
The various modes of transport have a vital role to play in the development of the 
Intemal Market in that they are the channels through which two of the four 
fundamental freedoms - the free movement of persons and of merchandise - are 
exercised. The future strategy for the implementation of the common transport policy 
is laid down in the White Paper of 1992. This document details the measures which 
will be taken to establish a Community framework which guarantees sustainable 
mobility. It is only through the realisation of sustainable mobility that the proper 
functioning of the intemal market can be attained. 
The programme aims, inter alia, "to abolish restrictions to the supply of transport 
services in order that the elimination of administrative, technical, fiscal, customs and 
other barriers can generate its full effect." The principal challenges confronting the 
European transport sector require the adoption of a farreaching and global strategy. 
The apporach which has been elaborated responds to economic and social 
requirements and integrates: 
• an upgrading and a more rational use of infrastructures: 
• increased security for users of these infrasturctures: 
• more equitable working conditions for those employed in the transport sector 
• improved environmental protection: 
• reinforcement of the external dimension of the internal market. 
The future strategy provides for the development of an infrastructure and equipment 
policy to allow, amongst other things, the less favoured peripheral regions of the 
Community to take full advantage of the opportunities which stem from the completion 
of the internal market. 
To ensure the proper functioning of the internal market, it is particularly important to 
apply Community rules on concentrations and dominant positions, and effective 
disciplines on state aids to the transport sector. This need is particularly compelling in 
areas subject to national monoplies (often public) or oligopolies, such as rail and air 
transport, which have traditionally been sheltered from domestic and intra-Community 
SEC (92) 621 final: Easier cross-border payments: breaking down the barriers 
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competition. The dismantling of baniers between markets which have traditionally 
been segmented will pave the way for new cross-border developments. 
Action points: 
» in the field of international rait transport the Commission will formulate the further legislative measures 
which are provided for in Council Directive 91/440. 
» As regards navigation of inland waterways, the Commission will examine the system of tour de role 
(queuing by barges for freight shipments) and its consequences for the organisation of the market 
* Reliable and comparable statistical systems wilt be established for a» transport modes. 
• The Commission is also preparing proposal tor Community action on 
- hire of motor vehicles-early 1ÔÔ4. 
- technical inspections of speed limitera for heavy vehicles, coaches and open-top buses * end of 1994. 
- adaptation of tachographs to take account of technical progress •early 1994 
- harmonisation of national certificates for the piloting of boats for inland navigation - early 1994 
See also the section below on Trans-European Networks. 
4. intellectual and industrial property 
Policy in this domain must evolve constantly to take account of relevant technological 
developments. International aspects of intellectual property protection are 
increasingly the subject of discussion within GATT and within the WIPO. 
Nevertheless, the degree of integration already achieved within the Intemal Market 
requires more structured solutions. The overriding aim of Community action in the field 
of intellectual property is to achieve free circulation of goods which are covered by 
intellectual or industrial property rights. In eliminating obstacles to Union-wide 
protection of intellectual and industrial property and in ensuring a high level of 
protection, Community action can help to promote the competitiveness of business, 
and to stimulate research and innovation within the Union. In the field of intellectual 
and industrial property protection, the Commission will continue its established 
practice of undertaking consultations with interested parties before drawing up 
proposals for Community action. 
Action points 
• To provide a further option for the protection of technical inventions in addition to the existing 
Patent Systems* the Commission will examine the necessity for the harmonization of national systems 
of utMy models. This form of intellectual property protection is well-tailored to enhance innovation 
activities and to meet the intellectual property protection needs of SMEs, The Commission plans to 
publish a Green Paper on UtMy models by September 1994. 
. Following two rounds of consultation on the subject of private copying of Sound and audiovisual 
recordings with interested parties» the first in 1988 and the second to be completed by the end of 
1993, the Commission will consider whether action ts appropriate,. 
• Copyright and neighbouring rights: On the basis of consultations with interested parties in the fields 
of artists* resale rights and reprography, the Commission will consider the usefulness and need for 
harmonising legislation. An examination will also be undertaken of the Intemal Market implications of 
the doctrine of exhaustion of copyright 
. To counter the probiem of erosion of effective patent-life protection for niant protection products, the 
Commission will draw up a proposal for the introduction of a supplementary protection certificate 
for plant protection products. 
. The Commission will proceed to an evaluation of the implications of the recent ruling handed down by 
the Court of Justice on the interpretation of Article 6 of the EC Treaty for Community action in the 
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fieids of intellectual and industrial property9. On the basis of its findings, the Commission will take the 
necessary actions to ensure that the legal principles enunciated by the Court are given full effect 
5. Company law 
Company law represents an area in which insufficient progress has been made at a 
Community level. Nevertheless, more than ever, the objectives pursued by the 
Community through its efforts at harmonization in the area of company law and 
accounting remain valid - these objectives are the mobility of firms in order to allow 
them to benefit from the advantages of a unified market, the equality of the conditions 
of competition between firms established in different Member States, the promotion of 
commercial links between the Member States, the stimulation of cooperation between 
firms across frontiers and the facilitation of cross-border mergers and acquisitions. 
Appropriate Community measures are needed to provide for legal structures which 
facilitate cross-border establishment and investment, and to smooth discrepancies 
between national systems of company law which discourage or penalise these 
activities. Particular attention needs to be paid to improving financial reporting 
requirements within the Union, which could also increase the Union's influence in the 
international accounting harmonization debate. 
The legislative framework in the area of company law has undergone important 
developments during the seventies and eighties. Nevertheless, certain proposals are 
still blocked in the Council, even in the Pariiament (proposals for a 5th Directive, a 
10th Directive, a 13th Directive). Some of these difficulties, particularly linked to the 
transfer of headquarters and mergers between firms, which are decisive for the 
mobility of firms within a unified market, are the subject of the proposal for a European 
company statute. This would be a flexible vehicle at the disposal of firms, which would 
facilitate their mobility. The efforts to have this statute adopted should continue. Also, 
on the basis of the wide consultation to which it is proceeding with the Member States, 
the Commission must consider whether its proposal for a 13th Directive on takeover 
bids corresponds to the needs of businesses and whether takeover bids, as an 
instrument for the redeployment of firms on a single market, should be the subject of 
more or less detailed regulation at Community level. 
Action points 
* Besides pursuing its efforts designed to provide firms with instruments which should facilitate their 
deployment in the internal Market, the Commission intends to initiate a fundamental reflection on the 
iegai framework for firms in a single market, in order to determine the optimum conditions for their 
évolution in this market and the necessary means to be applied to achieve these conditions; this 
reflection will result in the course of 1994 in a communication, possibly accompanied with proposals 
for action, with a view to consultation of the Member States and of interested circles. 
» A number of accounting problems have not yet been dealt with explicitly in the present Accounting 
Directives. Amending those directives in order to provide solutions for these problems and to improve 
the comparability of accounts poses difficulties and is not likely to result in concrete achievements 
within an acceptable time scale, instead the Commission will urgently explore other ways of 
encouraging convergence in cooperation with national accounting standard setting bodies, Member 
States and other interested parties. These discussions will be based upon the principles included in 
the existing Accounting Directives. They will also take account of and seek to influence international 
developments. 
9 Ruling of October 201993: cases C-92/92 AND C-326/92. This ruling has not yet been published 
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• The Commission witi launch a reflection process on possible actions to improve the comparability of 
financial Information published by companies. Such a step could help to facilitate cross-border trade 
and investment, and stimulate the development of a European capital market 
« Efforts will also be made to clarify the rote, position and responsibility of the statutory auditor, 
including a definition of liability towards the company and third parties. This action will serve to 
improve the reliability of published financial information. 
« The Commission will reflect on how the implementation of national law can be organised to take 
account of affiliations between subsidiaries and parent companies established in different 
Member States. The objective of this simplification would be to ensure that appropriate obQgations 
are imposed on parent companies when the activities in question are exercised at this level, and Io 
modify obligations in the tight of group needs (eg. cooperation agreements with certain legal 
guarantees)!. 
6. The creation of a favourable tax regime for business 
a) Indirect taxation 
Apart from the inevitable difficulties involved in the setting up of the new system, 
which have been rapidly overcome, the general regime has functioned well, so 
permitting the free circulation of goods. However, economic operators have confirmed 
certain rigidities in the mechanisms already adopted, notably in the case of VAT, as 
regards taxable transfers, contract work, certain services and work relating to movable 
tangible goods, chain transactions, and triangular operations. 
These difficulties, examined within the scope of the "Comité d'écoute" for enterprises 
have either been found practical solutions in collaboration with national 
administrations, or have been, or soon will be, made the subject of legislative 
initiatives on the part of the Commission. The directive of the 14 December 92 has 
considerably simplified triangular operations. Other measures for simplification will be 
the subject of new proposals by the Commission before the end of February 94 . 
The approximation of rates of VAT (a common minimum rate of 15% for normal rates 
of VAT) and of excise duties in force since 1 January 1993 has ensured the 
realisation of one of the fundamental principles of the single market: the freedom for 
the European consumer to go and purchase whatever he desires, tax paid, in the 
Member State of his choice, whatever his country of residence. 
Particular difficulties have manifested themselves in the operation of the specialised 
regimes for sales of goods to final consumers (mail order and sales of new private 
vehicles), by virtue of the complexity of the mechanisms put in place and of the 
obligations which these impose on the operators. 
The only satisfactory solution to this problem would be the moving over to a definitive 
system characterised by the payment of VAT in the country of origin. 
In any case, the treatment of intra-community exchanges will be reviewed in the light 
of the acquired experience, and with the goal of the approximation of tax rates for 
operations within a member state itself, an issue on which the Commission shall 
propose a directive re a definitive VAT regime before the end of 94. 
Although the functioning of the new general excise regime has posed no major 
difficulties, the Commission will present in 1994 a proposal for a simplifying directive 
to overcome certain problems, both for operators as for national administrations, 
linked to the application of certain particular dispositions such as distance selling. 
Moreover, the Commission will have to reexamine levels of excise tax in the light of 
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the experience acquired and various other policies reccommended by the 
Commission, such as its environmental policy, health policy and energy policy. 
The Commission's actions in the field of indirect taxation will concern, inter alia: 
. following up Its efforts.in the field of VAT as well as excise duties, and in collaboration with the tax 
administrations, by making proposals for a directive in order to facilitate the functioning of the 
regimes. 
• In the matter of administrative cooperation, the ad hoc committees presided over by the Commission 
win continue their coordinating work in $4 and the Commission will present a report on the functioning 
of the VIES system and experience with this system. 
« the report on and the proposal for the passage of a definitive VAT regime, which wiil be presented 
before 31.12,04. 
b) Direct taxation 
The guiding principle of Community policy in the field of direct taxation is to eliminate 
the doubie taxation of cross-border activities whilst ensuring taxation at least once. 
Concrete measures, such as the proposed Directives for interest and royalties, the 
offsetting of losses, and the proposed extension of the parent-subsidiary and merger 
Directive have already been tabled before the Council of Ministers. All of these 
measures enjoy the full support of economic operators and would make a significant 
contribution to improving the tax environment in which cross-border activities are 
planned and executed. 
However, adoption of these measures would only go part of the way towards resolving 
the problem of double taxation. The guidelines laid down in the Commission 
communication to the Council and Parliament in response to the Ruding10 report 
provide a detailed blueprint for further Community action in this field. 
ffmmpmwwfmm 
a) Oou We taxation of enterprises 
# On the basis Of guidelines laid down in response to the Rudtng report, the Commission will come 
forward with proposals for further action to eliminate double taxation. These measures would take the 
form of either a general obligation to abolish aR cross-border doubie taxation or a phased approach 
the priorities for which Would have been Set by mutual agreement with the Member States; 
« increased fiscal competition can influence the allocation of resources in the internal Market Solutions 
can be envisaged to resolve two series of problems: 
~ the first element is represented by the use of fiscal measures to attract very mobile factors such as 
financial services; 
- the second consists in the differences \n the conventions concluded on the subject of double taxation 
between Member States and third countries 
« The Commission wiil press for greater coordination of the approach to double taxation agreements 
between Member States and third countries. Large discrepancies between Member States lead to 
financial distortions as capital flows with the rest of the world are diverted through Member States 
providing the most advantageous tax treatment with the third country concemed, 
» Ongoing discussions, at regular intervals, between the heads of the national direct taxation 
administrations wilt be stepped up with a view to implementation of the policy guidelines defined in 
response to the Ruding Committee report These wilt include increased cooperation in the field of 
mutual assistance» and the development of mutually compatible policies where differing systems 
interact adversely. 
» The Commission win simplify procedures for the application of Community legislation and of bilateral 
taxation agreements which provide for the reduction or elimination of withholding taxes. 
SEC (92) 1118 final: Commission communication to the Council and Pariiament subsequent to the conclusions of the 
Ruding Committee indicating guidelines on company taxation linked to the further development of the Intemal Market. 
June 261992 
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« Action is needed to ensure equal treatment of crossborder investment by financial service providers, 
where the managing funds do not enjoy the same treatment under the different bilateral doubie 
taxation agreements between Member States. 
b) Small and Medium sized entreprises 
* Reinforcing Xhej&etf-ftnancing capacity of non-incorporated enterprises - In most Member States, re­
investment of profits by non-incorporated enterprises is taxed at the marginal rate of income tax, 
which is generaliyjiigher than the rate of corporate tax which is applied to reinvestment of profits by 
incorporated entities. Consequent^ investments made by unincorporated firms through setf-financing 
is penalised. A solution to this problem might be to tax the reinvested profits of non-incorprorated 
enterprises at the rate of corporate tax which is levied on incorporated enterprises. A proposal win be 
made shortly. 
* Transfer of enterprises » In many Member States, the transfer of a non-incorporated enterprise in the 
event of the owners death often results in heavy taxation which may Jeopardise the survival of Hie 
firm, A second problem for firms having assets in several Member States concerns succession duties. 
Of the 66 possible bilateral relations between the Member States, only 12 are covered by conventions 
on the prevention of double taxation In the field of succession duties. There Is therefore a risk of 
doubie taxation In the event of transferor ownership of an enterprise which the Commission intends to 
eliminate. The Commission will submit a proposal for a Recommendation on problem» relating 
to the transfer of entreprises to the Council in the first halt of 1994. 
* Reduction of the administrative constraints on SMEs - SMFs often reject expansion of their activities 
in other Member States by means of permanent establishments, fearing an excess of administratives 
burdens linked to the necessity of conforming to another code of fiscal legislation. The Commission is 
therefore examining the possibility of submitting permanent establishments in other Member States, in 
the start-up phase, to the tax legislation of the Member State where the firm ha^ its headquarters^ 
* Venture capital ~ The Commission will also make proposals to abolish tax obstacles to the use 
of venture Capital by SMEs, Venture capital funds often suffer from doubie taxation of the income 
generated, firstly at the level of the fund and secondly, once income is distributed to the investor. This 
difficulty is magnified if the same fund wishes to invest in more than one Member State. 
c) Taxation of frontier workers 
* The Commission will soon envisage issuing dear guidelines for resolving tax problems affecting Union 
residents working in a Member State other than their State of residence. In particular, these guidelines 
will aim to ensure thai tax relief is granted In a non-discriminatory fashion. 
d) Ufa assurance and pension funds* 
» The different tax treatment of insurance products presents major difficulties for the proper functioning 
of the single market in insurance products, The decision of the Court of Justice in the Bachmaiw case 
is of importance in this respect This ruling acknowledges that, under certain circumstances, Member 
States may be justified in not granting tax relief for life assurance contracts which have been 
concluded with insurance undertakings which are not established in that country as a means of 
safeguarding the coherence of the national tax system. 
7. Upgrading European standardization, conformity assessment and quality 
a) European standardization 
The "new approach to technical harmonization" has brought European standardization 
and conformity assessment to the forefront of the campaign to eliminate technical 
trade barriers to intra-Un ion trade. Barriers stemming from differences between 
national standards and certification requirements persist. The Community, therefore, 
has a strong interest in supporting further development of the European 
standardization, conformity assessment and quality infrastructures in order to ensure 
that the elimination of remaining technical trade barriers proceeds as swiftly and as 
effectively as possible. In addition, European standardization and conformity 
assessment instruments are an invaluable tool in the implementation of other policies 
(e.g. environment, energy, food quality, safety at the workplace, and Trans-European 
Networks). On the basis of in-depth interservice discussions, the Commission will 
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come forward with a report highlighting the potential role of European standards in 
these policy areas by early 1994. 
in order to exploit fully the potential contribution of European Standardization to the effective functioning 
of the internal Market, the Commission proposes the following directions for action' 
» Financing Of European Standardization - in 1934, the Commission Will undertake a review Of the 
way In which European standardization could be financed over the medium term. This review 
will aim to identity ways in which the resources which are invested by Member States, the Community 
and private sector in national and European standardization can be best harnessed for the purposes of 
developing a standardization system which meets the requirements of European Integration, 
* Maximising the benefits from European standardization * It Is essential that the work programmes of 
the European Standards bodies are closely attuned to the needs mû priorities of the single market. 
The commission will see to it that the Community contribution to standardization goes to standards 
projects which generate the greatest value-added in terms of market Integration and realization of 
other Union policies. 
* Increasing transparency - Steps will be taken to improve the visibility of standards, render the process 
and results of European standards-making more accessible and comprehensible fo economic 
operators. The Commission will enter into discussions with European standardization bodies with a 
view to ensuring that a wide ranging public enquiry takes place on the technical merit of proposals for 
European standards. This consultation should specifically focus on the adaptations that switchover to 
the new standard might imply for enterprises, and m particular for SMEs, In addition, the Commission 
wiS compile annual progress reports, monitoring the use of standards In Community policy *.&& 
headway in the writing of European standards which have been mandated by the Commission. 
* Proper coordination of European standardization activities - Coherence between the activities and 
products of the European Standardization bodies must be developed, through measures such es the 
development of mutually agreed work programmes. 
4 Standards and research - The links between standardization »M research wilt be developed through 
the promotion of effective and timely transfer of research results to standardization, and particularly by 
Community support for research which is targeted on providing scientific data which is required for 
Standardization activities. The Commission wiil devote increased attention to capitalising on thé 
results of Community expenditure On R&D linked with standardization, measurement and testing 
undertaken within the context of the Fourth Framework Programme on Research and Development 
(Commission proposed expenditure under this heading amounts to 188-250 mio Ecu), 
« Ensuring the effectiveness of European Telecommunications * European Telecommunications 
Standards <ETS) drafted by ETSl are not quickly transposed or referenced Into the list of national 
standards and remain too often ignored by network operators or telecommunication administrations. 
The Commission wiil propose that an increasing number of ETS be accorded the statue of 
harmonised standards. 
b) Conformity assessment and quality 
The objective of this policy will be to promote the development of a common "quality 
environment" which will allow operators to develop and market products, services, and 
production processes on a Union-wide basis through reference to mutually recognised 
quality benchmarks and concepts. Given that quality is market-driven and that quality 
constitutes an important dimension of company competitiveness, any attempt to 
impose the use of particular quality instruments on the marketplace through regulation 
would be misconceived and have serious potential risks. Instead, the Union wiil aim to 
promote a voluntary shift towards quality tools which ensure that products or services 
delivered in conformity with this framework enjoy Union-wide acceptance with respect 
to both regulatory and market requirements. 
The "new approach to technical harmonization" and the "Global Approach to 
Conformity Assessment" have extended the boundaries of public policy in the field of 
technical specifications beyond the imposition of binding technical regulations. The 
Community and national authorities now realise that standardization, conformity 
assessment and other tools which may be used for the purposes of quality 
management by firms are important features of the business landscape and can 
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contribute to the successful development of Union enterprise. Public authorities have 
a role to play in fostering improved quality through the introduction of appropriate 
incentives and structures, and the incorporation of quality issues when implementing 
other policies. The Commission is beginning work on the formulation of a Union 
quality policy which is due to be finalised by the end of 1994. 
The elements of a quality policy wilt be as Mows: 
4 Supporting the integration of quality considerations and a commitment to excellence on the part Of 
companies at ail stages in the quality chain {design, production, after-sales services etc). 
» Encouraging mutual recognition of results and certificates between conformity assessment bodies and 
quality certification institutes through accreditation to common standards (EN 45000K end 
participation in European networks and infrastructures linked to the European Organization for Testing 
and Certification {ECTC), '&* &>%&** 
« Appropriate European standards and conformity assessment procedures will have an important role to 
play in Community quality policy. For certain products and services, compliance,*d6\ recognised 
standards and certification will represent « means of embodying given quality performance 
characteristics. The greater emphasis on building a coordinated approach Io quality will tort to 
increased market pressure for a closer alignment of quality tools. 
* Ensuring the effective coordination M$d orchestration of national actions in the field of quality policy. 
* integrating quality policy objectives into other Community policies (e.g. regional policy, measure* to 
support SMEs, actions to assist industry restructuring). 
« Establishment of an Observatory on quality, 
* Promotion of the use of appropriate quality techniques In service industries» 
* The development of ait aspects of quality In the agricultural and food sectors» both through 
instruments specific to the different agricultural products and through horizontal measures such as 
those In favour of organic farming and other environmentally friendly techniques. 
8. Catering for SMEs 
SMEs form the bedrock of the Union economy, accounting for 99% of the population 
of Union entreprises and generating 70% of private-sector employment It would 
therefore be misleading to treat SMEs as a homogeneous group, confronted with 
identical challenges and opportunities. The Commission, for its pari will continue to 
ensure that relevant Community policies are tailored to the requirements of small and 
medium-sized enterprises. Through the structural funds, for example, the Community 
contributes substantially to the cofinancing of measures aimed at SME's. In 
recognition of the fact that SMEs have the potential to act as the motor for 
employment and wealth creation in the Union, the Council has approved a 
Commission multiannual programme for 1993-96 which is designed to stimulate the 
development of SMEs. In this context, the Commission has a key role to play in 
improving awareness on the part of SMEs of relevant policy and market 
developments. Existing channels for the provision of information and advice will be 
reinforced and upgraded, and the Commission will pursue an active role in 
disseminating Nbest-practicesH and innovative solutions to problems confronting SMEs. 
In addition, the Commission intends to launch a number of horizontal actions 
designed to tackle constraints which impede SMEs from reaping the full advantages 
of the single market. The following issues will be targeted for action in line with the 
conclusions of the SME Council on 11 November 93. 
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* Financial problème experienced by SMEs » Many SMEs ma undercapitalised and encounter 
difficulties in gaining access to adequate finance because of an inability to provide collateral. There 
must be a rapid follow-up to the measures foreseen by the European Councils of Edinburgh and 
Copenhagen which represent the first response at Community level to these problems. Particular 
attention should be paid to the development of operational mechanisms. The advantages in their 
entirety should be destined for the final beneficiaries, the SME's. Other measures must be found to 
improve the access of SME's to credit and finance. A particular aspect of these problems Is that of 
payment terms - in the wake of the the Commission** working document end the subsequent 
consultation process on the problem of delays relating to commercial transactions, proposals to 
alleviate these problems will be examined in the first naif of 1994, 
. Helping SMEs to adapt to standardization, certification» and quality assurance procedures - Ail 
SMEs should have access to detailed infromation on existing and draft European Standards, and their 
interests should be taken on board in the process of standàfds-wraing. Even those SMEs which do not 
contemplate trading across frontiers may $nd themselves confronted wfth chages in standardfeation 
and conformity assessment arrangements ai a ioc^ level Which are driven by European 
standardization and conformity assessment This wider audience of SMEs must be kept fully informed 
of any new developments of relevance to them, proposals for practical measures to disseminate 
"best-practices" and measures to help SMEs to adapt to changing standardization end 
conformity assessment requirements will be 4r»m up on the basts of a review of current action 
Within the EUROMANAGEMENT programme. 
The Commission will devote attention to ways in Which trade associations representing SMEs can 
be more actively integrated in the processes of European standardization 
* Opening up public procurement 16 SMEs * SMEs find ft difficult to compete effectively for contracts 
because of onerous administrative requirements a.n4 the need tor paifaership with reliable partners in 
the Member State where contracts are being awarded. The Commission will publish a 
comprehensive explanatory guide fo clarify the steps which a company needs to fake before 
submitting a bid for a public procurement contract In another Member State fn the second half 
of 1994. 
The Commission will also table a list of concrete measures to improve access by SMEs to public 
procurement markets in other Member States for consideration by the Council during the first 
half of 1994. Amongst others» these measures win suggest ways In which: -
- the BC-NET and SRE networks can be used to create inter-firm partnerships for the purposes of 
competing directly ores sub-contractors for public procurement bids; 
to adapt training programmes for public procurement markets to the specific needs of SMEs; 
the quality of advice available on public procurement matters from public and private organizations 
can be upgraded, particularly in less-favoured regions; 
information support can be provided to improve access to subcontracting opportunities; 
the Tenders Electronic Daily (TED) information system can be rendered more accessible and user-
friendly; an important pilot project on an information system for public procurement (SIMAP) will be 
launched at the beginning of 1994. 
Administrative simplification «The Commission will continue to develop its Business Impact 
Assessment system which is intended to highlight any administrative difficulties for SMEs in 
complying witi) or benefiting from a proposed Community initiative. The Business Impact Assessment 
will be reinforced by the use of cost-benefit analyses, where feasible and appropriate. 
Transfer of enterprises - The transfer of businesses touches all enterprises but is a particular 
problem for small and family owned businesses, A growing number of businesses are unable to solve 
the problems oi transfer and have to close down. The Commission wifl therefore be issuing a 
Recommendation to the Council covering the problems relating to the transfer of business (see also 
"direct taxation*}* 
9. Commercial communication and media 
The Commission wiil adopt a Green Paper on commercial communication in order to 
ensure the coherence and transparency of Community policy in this field, as well as to 
prevent possible new obstacles to the free drculation of commercial communication 
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services (advertising, sponsorship, direct marketing, promotions etc). The main 
elements of this Green Paper are summarised below. 
1. Green paper on commercial cornrnunicatJoq 
The Commission will publish a Green Paper on commercial communication in mid-1094 which will 
examine the nature and extent of legislative and technology-based obstacles which interfere with ail 
forms of commercial communication including advertising, sponsorship, direct marketing, promotions, 
and packaging. This initiative represents the first comprehensive and thorough attempt on the part of the 
Commission to address these issues. Furthermore, the Green Paper will be based on wide-ranging 
consultation and contacts with all interested parties, including business, communication service 
providers, and consumer associations. The results of this consultation process and the findings of a 
survey of parties involved in Commercial communication will be published in late February 1994. The 
subsequent Green Paper will outline possible role for the Commission in facilitating cross-border 
commercial communication. Three broad areas for Community involvement Witt be envisaged: 
« The Commission can act as a coordinator and contact-point, disseminating information on the 
development of the market and undertaking impact analyses of specific measures 
« The Commission can fulfil a "market monitoring" function and attempt to preempt the emergence of 
new difficulties stemming from insufficient coordination of national legislative measures, and uneven 
implementation of new technologies 
* The Commission can organise a country-by-country review of national systems of legislation 
governing commercial communication. 
2. Media services 
In the field of media services, there are a number of problems which interfere with aie freedom of 
establishment and free circulation of related goods and media services. In response to some of the most 
pressing problems, the Commission will take action on the following two fronts; 
# Evaluate the need for community action on the basis of the Green Paper on "Pturatism and 
concentration in the media in the internat market* In particular, the Commission will take a decision in 
early 1694 on the need for an action on the issue of media ownership. 
» A reflection document will also be drawn up on the question of the protection of coded signals for 
televisual and audio broadcasting. This document will examine the issue of whether new Community 
measures, incorporating recent technological advances, could play a role in removing technical 
barriers to trade in signal decoders. This measure will address the need for effective protection of 
coded signals against illegal pirating. 
10. Commerce and distribution 
Efficient and competitive commerce and distribution systems, which allow products 
manufactured in one Member State to be effectively marketed and distributed in 
another Member State under commercially attractive conditions are required if the 
benefits of the Internal Market are to be maximised. This requires that attention be 
given to improving access to distribution networks and the fostering of links between 
firms in developed and less-developed regions, between large and small firms, and 
between firms in different Member States. To this end the Commission will continue 
close consultation with representatives of the commerce and distribution sectors 
within the forum of the Commerce and Distribution Committee, and with Member 
States through regular meetings with officials, Director-Generals of Commerce, and 
experts. In addition, the Commission will take action along the following lines. 
The setting up, in collaboration with the Member States, of an integrated system for the collection, 
processing and distribution of homogeneous statistics on commerce and distribution at the 
Community level. The gathering of reliable and detailed data is a prerequstte for the formulation of 
further Community policies in this field. 
The second phase of the "COMMERCE 2000" initiative, designed to encourage the integration of new 
technologies for improving internal communications, inventory management, logistics and distribution, 
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is in the pipeline. Greater emphasis shall be given to developing cross-border nature of projects 
supported under this second phase. 
The Commission shall give further support to self regulatory measures, such as voluntary codes of 
conduct in the areas of means of payment, franchise arrangements and mall-order sales, as one 
means of developing market-led solutions to pan-European problems In commerce and distribution. 
Publication of brochures by the end of 1994 explaining Community and national regulations relevant to 
the retail and distribution sector concerning freedom of establishment, competition law, consumer 
protection and urban planning. 
11. Energy 
The achievement of the Internal Market for energy aims to provide consumers with an 
easier access to the different sources of energy, in the framework of a more 
competitive market which will put energy supply on a wider basis and thus improve 
security of supply. 
In order to provide for effectively increased competition and business opportunities in 
the energy sector, a series of measures, initiatives and orientations exist, with regard 
to both the internal and the international dimension. 
1. Memaldimejiiicji 
« Energy policy accompanying measures have a great role fo play. In this context, the Commission 
energy policy aims to reduce disparities within the Union regions as regards access fo energy 
resources, energy dependence, structure and security of supply. Actions are undertaken in the 
framework of the regional and urban energy planning and die structural funds, 
* Development and strengthening of trans-European energy networks are paramount The Commission 
is engaged in the preparation of Community "guidelines". These networks can ensure a diversification 
of energy resources, and consequently increase supply links also with areas outside the Community. 
« A co-ordinated energy policy on reserve stocks and crisis measures rematnes another key issue. 
2. International dimension 
* The Energy Charter wiil provide a legal framework for energy trade, investment and co-operation with 
the former planned economies. That means more opportunities for business, diversification and 
security of supply, 
« Bilateral technical assistance programmes for the Republics of the former Soviet Union and for the 
countries of Eastern and Central Europe, combined with association agreements and other links and 
programmes, although designed to assist economic development and general stability, contribute to 
the long term security of energy supplies. 
* in the same context, the strengthening and deepening of the producer-consumer dialogue, particularly 
with North Africa and the Mediterranean countries, remain essential. 
III. Further improving the environment for the Consumer 
The Intemal Market has not been created for business alone and it will not operate 
properly without strong and effective consumer participation. The citizen as consumer 
is entitled to benefit from greater competition and a greater choice of goods and 
services, while being assured that his safety and other essential interests are 
adequately protected. At the same time well-informed consumers exercising market 
choices can accelerate the positive economic effects of an integrated market. The 
consumer therefore has a critical role to play in forwarding the objectives of the 
Internal Market Programme. 
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Besides the measures mentioned in other parts of this programme which wiil clearly 
be of benefit to consumers, such as greater transparency of Community legislation 
and specific information activity aimed at consumers, the Commission believes that 
other legislative measures may be necessary in order to ensure that the consumer 
can treat the Union as a genuine single market. The priority areas concemed are legal 
and commercial guarantees and financial services. 
The Commission therefore proposes the following actions: 
On the basis of public reactions to its October 1992 Green Book on guarantees and after-sales 
services, to be given by April 1994, the Commission will come forward with appropriate proposals 
during the second half of 1994. 
With respect to financial services, the Commission intends to address the following issues: 
Work will start to examine to what exterrt the rules for transparency for other forms of consumer credit, 
such as those provided for in Directives 87/102/EEC and 90/88/EEC, can be applied to mortgage 
credit A draft proposal wiM be submitted in early 1995. 
The 1988 Recommendation in respect of payment systems, including credit card systems» will be 
reviewed and may be transformed into a binding instrument A decision will be taken by the end of 
1994. 
The action already mentioned above in respect of facilitating transnational payments will also be to the 
benefit of individual consumers. 
The Commission will reflect on the possible form and content jof measures to improve the safety of 
some services which, with the advent of the Single Market, take on a greater cross-border dimension. 
IV. The relationship between sustainable development and the 
Internal Market 
There is no inherent conflict between the completion of the Intemal Market and the 
fight against environmental degradation. They are and should be mutually supportive. 
This special relationship is already recognised in the Single European Act and is 
reinforced by Article 2 of the Treaty where it is clearly indicated that the completion of 
the Intemal Market will be an important means to reach, inter alia, "a sustainable and 
non-inflationary growth respecting the environment". 
Short term economic gains at the expense of economic partners and of the 
environment should be replaced by an attitude which constitutes the basis for greater 
efficiency and competitiveness, both at a Union level and internationally, for a more 
sustainable economic pattern, in the long run. At an international level, the 
Commission will support efforts to develop an international framework to resolve trade 
conflicts arising from application of national or regional measures designed to protect 
the environment. In addition, the Commission will support future efforts to strengthen 
the rules and safeguards contained in the GATT Code on Technical Barriers to Trade 
in order to ensure that environmental Regulations are not abused for the purposes of 
artificially restricting trade. 
Union environment policy is at a very important juncture. Following the UNCED 
agreements, and in accordance with the Treaty on European Union and the Fifth EC 
Environment Action Plan, an integrated approach is being developed in order to 
ensure that the most effective policy is applied to enable a move towards a more 
sustainable path of social and economic development. This is not only vital for the 
environment itself but also for the long-term success of the Intemal Market. Its 
success is dependent on the sustainability of the policies pursued in the fields of 
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industry, energy, transport, agriculture and tourism, which are in turn dependent on 
the capacity of the environment to sustain them. Many environmental issues such as 
climate change, acidification and waste management can only be tackled by an 
interplay between the main economic actors and sectors, not only through the use of 
legislation but also by using an extended and integrated mix of other instruments, 
such as standards and/or certification systems, voluntary schemes or economic 
instruments. This interplay can best be achieved within a Community framework, 
without which there is a risk that actions taken will fail to have their full impact or that 
the integrity of the Intemal Market will be jeopardised. This framework, however, 
should not be designed or felt to be a straitjacket. It should be flexible enough to 
encourage all concemed to accept their responsibilities and to develop and apply an 
optimal mix of instruments tailored to their local and regional circumstances but 
without creating unnecessary and unjustified distortions. 
Although progress has been made since the adoption of the Single European Act, a 
number of issues remain to be resolved if the implementation of the Fifth Action 
Programme and the functioning of the Internal Market are to be fully reconciled. 
During 1994, further reflection will be undertaken concerning the link between the 
Intemal Market and sustainable development. 
Action poynft 
« Environment and competitiveness » In its Communication of 10 *iovember 19921 % the Commission 
stresses the potential benefits of the integration of environmental considerations Wo product and 
service development and production processes in terms of bolstering competitiveness on Union and 
world markets, in particular, effective action on this front could provide Union firms with a first-mover 
advantage on international markets* Community actions such as 6co-labeIling and Eco-euditing, as 
welt as appropriate fiscal incentives* could be used to support die development of these strategies by 
Union firms. 
« Waste » The Commission will elaborate proposals for reconciling the principle of the free circulation of 
products with the special waste regime. 
« Vetting of proposed national environmental measures to ensure their compatibility with the internal 
Market » The current proposal to widen the scope of Directive 83/1S9/EEC to include voluntary 
agreements or economic instruments designed to achieve, inter alia, environmental objectives, will 
provide a means for making progress on this front 
V. Establishing trans-European networks 
The Commission's working document of June 1993 has put the emphasis on the need 
for a coordinated and coherent approach in the development of networks. This 
approach should integrate aspects of interconnection, interoperability and access to 
networks. Indeed the development of networks has to be demand driven and 
submitted to the rules of the market. The White Paper on growth, competitiveness and 
employment emphasised the need to realise projects judged to rank as a priority, 
whilst proposing a strategy to accelerate their implementation. However, in order that 
networks policy may make a contribution to economic growth, which goes beyond the 
projects themselves, there is a need to undertake certain horizontal actions in order to 
facilitate the emergence of trans-European networks. 
1 Communication of the Commission to the Council and to the European Parliament: Industrial Competitiveness and the 
protection of the environment. SEC(92) 1986, November 1992. 
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The proposals made in the Strategic Programme complement the proposals of the 
White paper. Whilst respecting the specific characteristics of each sector, they must 
contribute in a positive manner to the implementation of Title XII of the Treaty on 
European Union and to the creation of confidence, whether of public authorities, 
industrialists, bankers or operators of the networks. These proposals sketch the 
measures necessary to ensure the coordination of networks policy at the Community 
level, stimulate the participation of the private sector in their financing and to ensure 
their interoperability. In addition, it should be recalled that the various Community 
financial instruments contribute to the cofmancing of a significant number of projects 
forming part of the trans-European networks. 
1. Promotion of a convergence of interests and coordination 
The difficulties in establishing priorities and projects of common interest are as well 
known as the reasons for these: divergence of interest and priorities at the national 
level, the absence of a forward looking European vision and a poorly adapted legal 
and administrative framework. In the perspective of an increased integration of 
European infrastructures for transport, telecommunications and energy, it will be 
necessary to reinforce coordination at the Community level, in order to progressively 
integrate the European interest into the national dimension of networks and to 
optimise the use of the available resources while respecting the principle of 
subsidiarity. 
Action points 
* The adoption by the Council of network plans, Identifying possible guidelines lor the development of 
networks in the medium term, constitutes the first step in this sense. These plans are based on e 
dialogue at the European level that it would be advisable to deepen, and play an essential rote tn 
directing some Community Instrumentsjowards those projects which are judged to rank as priorities 
in eligibie Member States and regions. The work undertaken by the Commission has already resulted 
In the adoption by the Council of four masterplans in the field of transport Other network plans are 
still being discussed in the Council and at the Parliament, whilst the Commission intends to present 
new proposals In the immediate future (see table in annex 2). Work is under way to 
- have the plans already proposed adopted by the Council and the Pariiament ; 
- present to Council, the Parliament, the ESC, and the new Committee of the Regions the 
supplementary proposais currently being prepared; 
- promote the integration of networks in space and between different nodes and in particular in the 
transport area where a multimodal plan is being elaborated; 
~ identify the areas which are directly connected to the efficiency of networks Such as the quality of 
service offered and the different conditions necessary to ensure efficiency and to make the appropriate 
proposals. 
« The reinforcement of strategic and operational coherence is the second step. The master plans are 
necessary instruments to implement the TEN policy but without further coordination these could result 
in an assembly of complex and fragmented activities, in maintaining a comprehensive strategy for 
TEN'S, which has proved to be successful in the establishment of the intemal Market itself. It will be 
necessary to co-ordinate the various instruments, assign the required resources between sectors and 
monitor the progress achieved. A decision therefore, is needed on the institution of an appropriate co­
ordination mechanism to reinforce coherence for the implementation of the TEN policy. The 
Commission will make specific proposals shortly. 
• An improvement of statistics is necessary to improve the diagnosis of needs. The lack of comparable 
and reliable statistical information at the Community level In the Held of infrastructures has often been 
raised. This can only be corrected with the active support of the Member States. The Union must 
equip itself with adequate means of observation in terms of methods, standardization and instruments 
of measurement The Community's Statistical Office will be making appropriate proposals in the 
course of the first half of 1904< In the sphere of telecommunications, this will involve providing the 
means of conducting an in-depth analysis of the market for services. 
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An in»depth examination of the pivotal role that European towns «re intended to play In the 
development of energy and transport networks and in parallel to this, of the contribution that trans-
European telecommunication networks can make towards the harmonious development o^t these 
towns. In the definition of a new européen approach to Infrastructures the nodes and arteries of 
communication must be treated simultaneously. The Commission la considering work In order to 
study the Impact of trans-European networks on the development of the urban fabric. With the results 
of these analyses the Commission will be able to make appropriate proposait In 199& 
The development of a prospective vision, the exchange of data and reflections et a Community level 
on the future development of infrastructures must be promoted; The Commission intends to support 
public or private efforts with * view to stimulating Community reflection and dialogue between the 
Interested parties (promoters of projects, operators of networks, industrialists, universities, national 
regional end local authorities). A first private initiative supported by the Commission concerns the 
establishment of a European Centre for the Study of Infrastructures launched by the European Round 
Table, 
2. Stimulating private investment 
Pressure on constrained national budgets and wider competition makes the funding of 
trans-European networks increasingly problematical. More needs to be done to 
stimulate private investment in major infrastructure projects and overcome any 
obstacles that may inhibit it. 
Stimulating the participation of private finance in TEN projects would have a direct 
effect on growth, competitiveness and employment in the Union in the medium term 
by bringing forward infrastructure projects that would not otherwise take place or 
would be considerably delayed. 
Although the financing of specific projects should be decided on a case-by-case basis 
(see specific proposals contained in the White paper), market conditions could be 
generally improved in order to minimise the risks under the control of public 
authorities and to offer an appropriate return for the risks undertaken by the private 
sector. The Community should play a more active role in "unlocking" private 
investment. 
Action points 
a) Putting in place a legal framework that encourages greater private sector Involvement 
While it Is necessary to keep a balance between the profitability of investments and the social rote of 
major infrastructure projects* convergence of conditions for private Investment should be encouraged in 
order to stimulate such Investment in networks throughout the internal market Competition policy has an 
Important roie to play in opening up national markets {see Section AIV above). In many Instances, the 
regulatory environment requires careful adjustments In order to provide « flexible framework for the 
development of transborder network projects. A detailed analysts, is necessary, however, of existing legal 
and regulatory barriers that may impede private seder Involvement In networks: Specific proposals may 
be made once the results of such studies are made available {end of 1ÔÔ4), 
b) improving administrative procedures In order to accelerate the planning of infrastructure 
Investment 
An important element for the development of networks consists in simplifying administrative procedures 
and reducing delays in the planning process. Multiple administrative layers and complex consultation and 
decisionmaking procedures prolong the planning process for infrastructure projects and thereby frustrate 
investors and users while increasing the costs and risks of infrastructure projects. 
» Member States should review their current practice concerning the treatment of planning applications, 
with a view to simplifying procedures and accelerating the planning of infrastructures. The elaboration 
of a handbook of best practice in the Union is being considered by the Commission in order to provide 
a yardstick for public authorities. 
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. As part of the Commission's efforts to enhance the rote of the Declaration of European interest, clear 
guidelines and other advice w» be issued to Interested parties by mkM9ft4 on the policy «specfe In 
which the Commission has un Interest, in particular in the fields of environmental, competition and 
public procurement policy. 
c) Attracting institutional and retail investors in Union financial markets for financing J>rojecte In 
trans-European networks 
Some trans-€uropean network projects are financially viable in the private sector in their own right in 
these cases» the public sector's roie may be restricted to providing an appropriate legislative and 
regulatory framework, tn addition, the Declaration of European Interest could Stimulate the Interest Of»» 
private sector by facilitating the access io Community financial Instruments and accelerating certain 
administrative procedures (see proposals below). 
In the case of projects indispensable lor the functioning of the network but not generating sufficient 
revenue to attract private Investors a public financial contraction should be considered. The usual form 
Is a grant but alternatives exist, such as Interest rate subsidies, tax Incentives or credit guarantees, The 
possibility of developing such instruments at Community level is being studied, In particular with regard 
to attracting Institutional and retail investors. Among the proposals being considered are en innovative 
approach to guarantees and insurance In connection with the EF, provision of interest rate subsidies m 
conjunction with Community or ElB loans, tax incentives to attract long term capital or the provision of 
some equity capital through the EIF for new infrastructure projects, A communication containing detailed 
proposais will be made in the second half of 1894, 
d) The Declaration of European interest to serve a» a catalyst for stimulating Investor Interest lor 
trans-European network projects. 
The principal features of the enhanced DEI could be summarised as follows: 
» The Declaration of European interest could be used as a badge Showing the intention of the 
Community fo address any administrative and legal problems with minimal delay in order to allow the 
project to proceed. 
« Specific follow-up actions in connection with the granting of DEI could be decided in order to help 
mobilise private capital^ such as: 
~ reimbursement for successful DEI projects of costs related io preparatory studies; 
* priority consideration for credit enhancement by the European investment fund, once the EIF is In 
place; 
* active Commission "sponsorship'* of successful projects In Union financial martlets; 
* eligibility for equity participation by the EIF* once EIF rules so allow; 
* tax incentives for bond Issues related to DEI projects. 
3. Ensuring interoperability 
Differing regulatory requirements and technical specifications and the multiplicity and 
diversity of administrative structures and management rules result in absence of 
cross-border interoperability and market fragmentation. With a few exceptions, 
interoperability of trans-European networks has not been addressed in a systematic 
way. Community mandates to the European standardization organizations have 
concentrated on the implementation of Community policies, in particular technical 
legislation, public procurement and the development of information technology and 
telecommunications. 
The Community should adopt an approach which allows for the full participation of the 
parties concerned in the research of networks interoperability. This is an area where 
national public authorities traditionally exercise an important regulatory role and, at 
least in part, interoperability cannot be achieved without recourse to obligatory 
technical specifications. The emphasis however, should be laid on specifications 
agreed by network and market operators themselves. 
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« in a general manner, an Inventory will be drawn up during the course of the first half of 1994 of the 
areas in which actions must be envisaged to improve solutions to the problems of interoperability. 
* For each area the procedures requiring harmonization actions wiil be Identified, whilst making as clear 
a separation as possible between: 
- the regulatory procedures which come under the Member States* administrations because they 
Involve a Collective Interest and are traditionally reserved for public authorities; 
- the regulatory procedures which are generally delegated to the operators of the networks and which in 
the administrative and technical domains represent obstacles to the irtferopenability of systems or 
simply to the flutdrh/of exchange flows; 
- the technical specifications which require the participation of the actors directly associated with the 
establishment of infrastructures or with the provision of equip*rwrt for networks. 
« On the basis of these results the Commission win propose sciions in 1999 to determine the most 
appropriate legal Instruments to resolve the problems of regulation and envisages being able to 
entrust 
~ to competent bodies those tasks which correspond traditionally to the work of a regulatory body In a 
country of the Union; 
«• to. the European standardization bodies those tasks which normally fell within the ambit of 
standardization, having made sure that these bodies are in a position to manage tasks which will be 
appreciably different from those of traditional programmes. 
» A proposal for a directive on the interoperability of high tpeed trains wffi shortly be presented to the 
Council. The proposal would envisage the elaboration of technical specifications of interoperability, the 
respect of which Will be compulsory, and of European standards, for which mandates Win be given to 
CEN/CENELEC/ETSÎ. 
» Action should be taken by the Commission and Member States to promote the r^articipation of network 
operators and Industry in the elaboration and application of European standards both within the Union 
and witi) Its neighbours, 
* Where necessary common technical specifications on essential elements lor interoperability will be 
made obligatory. 
4. Early development of telematic networks between administrations 
Within the scope of the Commission's policy on trans-European networks there have 
been established a certain number of computerised networks for the exchange of 
information between the national administrations of the Member States dealing with 
tax and customs matters on the one part and between the Member States and the 
services of the Commission on the other part The Commission will proceed with a 
feasibility study in the coming months whose goal will be to initiate the creation of a 
truly common network of communication for customs and indirect taxation, which will 
act as a medium for all existing or future applications. 
Concerning applications, the customs systems must be concemed with the 
development of an integrated Community Tariff, which will allow the Commission to 
communicate information relative to customs duties and agricultural levies (TARIC 
system ), to decisions re the classification of goods ("Information on restricting tariffs"), 
and to ceilings and quotas (QUOTA). These systems will contribute to the 
effectiveness of customs administrations, who will be able to make decisions quickly 
on the basis of reliable information updated daily, and therefore represent a 
considerable benefit at the level of the economic operators. 
The fiscal systems concerning the exchange of information relevant to the levying of 
VAT on intra-community flows of goods (VIES system ) and the exchange of 
information relevant to excise duties (being developed). These systems permit 
Member States to develop régimes for indirect taxation in intra-community exchanges 
following the abolition of fiscal barriers. 
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More generally, the establishment and operation of an efficient, reliable and user-
friendly system of communication and data exchange infrastructure between the 
thirteen administrations, as proposed in the earlier section on administrative co­
operation, will provide a motive force for implementation of the priorities and main 
lines of action defined in the proposed guidelines for telematic networks now before 
the Council, particularly for the proposed IDA programme (Interchange of Data 
between Administrations). It has close affinity with the growth initiative in that it incites 
investment decisions, results in a more favourable economic climate through 
improved efficiency, and strengthens industrial structure. 
Quite apart from its relevance to the effectiveness of administrations of the Intemal 
Market, this network will demonstrate a significant industrial policy potential. It could 
contribute to the dynamics of the European industry by providing industry (hardware 
and software suppliers, system integrators, network operators, service providers) in a 
structured and co-ordinated way with indications of where the users in public 
administrations intend to go in the longer term. Its activities will produce a common 
denominator in the e-mail systems and services used by the public administrations, 
which will influence other users as well. Consequently, industry will be faced with an 
increasingly converging set of requirements which enables industry to provide inter 
working solutions for a Europe-wide market without loosing its innovative capabilities 
and its freedom for product differentiation. Wider implementation of e-mail in the 
administrations will provide industry, thanks to the public procurement policy of the 
Community, with an opportunity to sell homogeneous products within a significant 
home market, which in turn should exert a significant pressure for quality improvement 
and bring prices down. 
Although electronic mail will be able to provide satisfactory solutions for many 
information exchanges, there are certainly requirements which can be met more 
adequately by adding either supplementary capabilities or applications using the 
underlying infrastructure (e.g. EDI) or else using completely different technologies. 
The proposed IDA programme, which aims to provide Community support to the 
implemention of the trans-European communication and data-exchange networks, 
aims to be the main instrument in this area, through its ability to support the 
implementation of projects of common interest and its concern for interoperability 
between networks and applications. Action should build on existing networks and take 
into account developments in cooperation between administrations which go beyond 
the Union scale. 
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Section D - A dynamic and open external policy 
The effective management of the Union's external frontiers and a dynamic commercial 
policy are essential if individuals and firms, of both Union and third country origin, are 
to reap the full benefits of the intemal market Actions on both fronts are needed to 
stamp out illicit or distortive practices which could undermine the competitive 
functioning of Union markets. 
I. Management of the Union's external frontier 
The completion of the intemal market, in conjunction with the entry into force of the 
Maastricht Treaty and the imminent enlargement of the Union, have pushed issues 
related to customs administration at the Union's external borders to centre-stage. The 
Member States, in cooperation with the Commission, have been busily reviewing the 
manner in which customs activities are accomplished within the framework of the 
"Customs 2000" initiative. Measures needed to achieve the objectives of the "Customs 
2000" document will be finalised in early 1994. The main elements of this programme 
are indicated below. 
a) Controls at external frontiers: 
» The primary objective is to ensure a high quality of control at the external frontier, which facilitates 
the free flow of traffic white being applied in an effective, efficient and homogeneous manner. 
Equivalent retuK*» both in terms of control and trade facilitation, must be achieved by the customs 
services at the external frontier If confidence is to be maintained (n the operation of the Customs Union 
and the internal market. This will avoid trade deflection and distortion of commercial flows with the 
rest of the world. 
« The national customs services, in cooperation with the Commission, Wiil submit a report in 1994 on 
the question of whether differences between administrative sanctions applied by Member States in 
the event of breaches of customs rules give rise to trade olsjpriions, and on whether there is a need 
for some approximation of penalties. . 'e 
» Close cooperation between national administrations, organised by the Commission, is needed to 
prevent Infringements of customs rules and other conditions for access to the Union market Priority 
areas include fraud prevention, protection of intellectual property rights - particularly trade marks, 
designs and copyright » and measures to combat counterfeiting. 
b) Facilitation and control; 
* A delicate balance needs to be struck by the customs Services between deterring and detecting 
evasion On the one hand, and the need to ensure minimum disruption to legitimate trade and free 
drculation of persons end minimisation of compliance costs on the other. The Union has a role to play 
in disseminating best practices based on new technology» and in extending the Use of simplified 
procedures and risk analysis techniques. 
t\ Resources and efficiency: 
« A planned approach is needed to Identify objectives and allocate resources according to 
priorities. The Commission can act as a mediator in order to ensure that an agreed framework is put 
in place Which takes into account the needs of the Union as a Whole. 
* Customs recruitment and training should be modified to enable customs officials to adapt to more 
flexible working practices and new work techniques (risk analysis, audit-based controls, 
computerisation of routine tasks etc). 
* Computerisation of customs procedures wiil proceed apace to allow computerised clearance of 
goods by traders. Progress on this front will take into account the possibility of using traders' computer 
-50-
systems to meet customs requirements, the need to develop links between national systems, and the 
facilitation of customs operations across Member States, using computer control mechanisms. 
An examination of approaches needed to ensure the adequate provision of resources wiH be 
undertaken In 1994, This review wiil take into account possibilities such as resources available under 
Community funding instruments, sharing or pooling of equipment, Joint operations and similar 
arrangements. 
The completion of the Intemal Market calls for a strengthening of administrative 
cooperation and mutual assistance between Member States, and between the latter 
and the Commission to tackle the problem of customs and tax fraud. Since the 
adoption of Regulation 1468/81, the national and Commission investigation services 
have intensified cooperation and carry out joint investigations in third countries in 
order to ensure the correct application of customs and agricultural legislation. A 
proposal for a modification of this Regulation, which would have the effect of 
significantly improving its operation, has now been presented to the Council. 
The Commission is also, in collaboration with the Member States, examining the 
possibility of upgrading cooperation in combating drugs. Following the adoption of a 
single framework for trade with third countries in drug-precursors12, several sensitive 
third countries have undertaken to control trade in these goods on the basis of a 
regime for reciprocal cooperation. Although Community competencies in the field of 
drugs trafficking are currently in flux, the Member States have pressed for increased 
cooperation at Community level. To this end, a number of mechanisms for 
cooperation have been developed which will henceforth be administered by a customs 
working group which has been set up on the basis of Article K 4 of the Treaty on 
European Union. 
II. Completion of the common commercial policy in the context of 
the internal Market 
Since the Community's inception in 1957, significant progress has been made towards 
the realisation of a common commercial policy for goods and, more recently, services. 
The finalisation of a common import and export regime for goods and services vis-à-
vis the rest of the world is a precondition for an equivalent level of competition on 
Member State markets, and will facilitate the dismantling of customs formalities on the 
shipment of goods between Member States. Although the main elements of a 
common commercial framework are now in place, a number of loopholes remain. 
Apart from the completion of the common commercial policy, there are a number of 
areas in which further progress at a multilateral level can reinforce the benefits which 
flow from the operation of the internal market. The Commission will take steps over 
the coming years to address the points outlined beiow. 
The Community has an array of trade policy instruments (Article 113, anti-dumping, 
countervailing duty regulations and the New Commercial Policy Instrument). The 
Commission has proposed to the Council improvements designed to speed up and 
streamline the procedures for deciding how and when to apply these instruments. It 
has also made it dear to the Council that more resources will be needed to make 
these instruments more efficient and effective. In the process of implementing the 
results of the Uruguay Round it will be important to ensure that the Community means 
remain adequate. 
12 Regulation 3677/92,13.12.90. as modified by regulation 900/92 of 31.03.92. 
-51 
* Action will be taken to ensure that all Member States apply effective export controls, baaed OH 
common standards, for dual-use goods and technologies, 
» The Commission Will undertake action in the field of export credit insurance. 
» The Commission will continue to press for the abolition of most remaining national quotas, or the 
"Communrtisation" of selected quotas on trade with State-trading countries. 
« in the field of the common transport policy, the Commission shall take the necessary steps to 
increase the consistency of national relations with third countries in the field of transport services, This 
work wiH require the progressive transformation of existing bilateral arrangements in the fields of road 
haulage, air transport and maritime transport with appropriate Community agreements end 
procedures, in addition, the Community will step up its participation m international fore relating to 
transport issues. To this end, greater attention should be given to direct participation of the 
Community in these lore. 
4 Financial services - Successful conclusion of the GATS wffl provide greater access for Union 
intermediaries to third country markets, given that the Union is already open to competition on this 
sector. The Union wilt work for further liberalisation of these sectors at a bilateral and multilateral level. 
* Compétition policy - The Commission will promote respect for the principle of "positive comity" of 
competition policy at an international level, by seeking to ensure its application in bilateral and 
multilateral fora. Respect for this principle requires the Union and its international partners to apply 
domestic competition policy provisions to practices in breach of these rules which create obstacles to 
international trade. 
* Internationa! standardisation - The Commission and the European standards Oiganisationa will 
continue fo support the activities of international standardisation, and the strengthening of multilateral 
frameworfcs for reducing technical trade baniers (notably, the GATT Code on Technical Baniers to 
Trade). 
, Mutual recognition agreements - At present Mutual Recognition Agreements (MRAs), which 
constitute a potentially useful tool for facilitating trade with third countries, ere used almost exclusively 
in the areas of conformity assessment and Good Laboratory Practice. The Commission will extend the 
Use of Mutual Recognition Agreements to other areas. 
52 
Section E - Reviewing and adapting the Strategic Program­
me 
This programme represents the requirements for consolidating and developing the 
Intemal Market as seen by the Commission, following wide consultation, at the end of 
1993. 
As the Intemal Market itself is subject to an ongoing process of development and 
change, the programme will need to be reviewed and adapted on a regular basis to 
take account of developments. 
The Commission's Annual Report on the Intemal Market will include a review of 
progress with the implementation of the programme, and it can be used by the 
Commission to indicate any necessary adjustments. 
Interested parties, particularly those who contributed their views on the Commission's 
working document conceming the programme, are invited to develop their own 
systems for its regular re-evaluation in order to propose adaptations to the 
Commission. 
53-
Conclusions 
The Strategic Programme represents a complex package of measures, each of which 
will require detailed consideration in its own rights on the basis of individual proposals. 
Nevertheless the Commission considers it essential that the Council consider, as a 
matter of urgency, the priorities identified in the programme, particularly where 
proposals have already been made. The Commission invites the Council to send a 
clear political message that the completion and development of the Intemal Market 
remains one of its highest priorities. To give substance to this decision, the 
Commission proposes that the Strategic Programme be launched on the following 
basis: 
• an endorsement by the Council of the general orientation provided in the Strategic 
Programme; 
• a firm undertaking by the Council to accelerate discussion on the seventeen 
legislative proposals from the 1985 White Paper that are still before it, with a view 
to their final adoption before the end of 1994. 
-54 
Annex 1 - Approaches to the monitoring of the quality of 
transposition measures in certain sectors 
Foodstuffs - Although few complaints have been received with regard to 
transposition, this may reflect a lack of widespread knowledge of the measures as 
easily as a lack of problems. It has therefore been decided to call on specialist legal 
consultants to examine the transposition measures relating to the bulk of the 
foodstuffs directives. 
Financial services - Contacts with market participants to identify problems; 
discussion on transposition and interpretation in Banking Advisory Committee and 
Insurance Committee; use of external consultants. Transparency is assisted by 
requirement to include reference to relevant Community directive in transposition 
measures and by requiring Member States to forward transposition tables showing the 
correspondence between Community and national measures. 
Recognition of diplomas - Transposition is prepared by a "pre-group" of national 
coordinators who exchange drafts and discuss difficulties of interpretation; external 
consultants also used. 
Intellectual property - Technical meetings with Member State experts; use of external 
consultants to examine the jurisprudence of national courts. 
Veterinary and Phvtosanitarv legislation - As resources are extremely limited in 
relation to the scale of the task, it is necessary to concentrate on problems identified 
through the experience of operators or of national or Commission authorities. This 
task is facilitated by the existence of the regulatory committees in the veterinary and 
phytosanitary areas. 
A more systematic approach to monitoring transposition, while desirable, would 
require substantial additional staff resources. However, other avenues for improving 
the situation will also be explored, particularly by reinforcing the information networks 
through which problems can be identified. 
55 
Annex 2 - Trans-European networks (indicative time-table 
of adoption of network plans) 
Commission Council Parliament 
TRANSPORTS 
High Speed Trains 
Combined transport 
Roads 
Inland waterways 
Multimodal plan: 
- Rail conventionnel 
- Advanced Road 
telematics 
-Ports 
-VTS 
-Airports 
-Air traffic Update in the 
multimodal plan 
Update in the 
multimodal plan 
Update in the 
multimodal plan! 
Update in the 
multimodal plan 
June 1994 Favorably-received 
17.12.90 without 
formal adoption 
Adopted 29.10.93 
Adopted 29.10.93 
Adopted 29.10.93 
1st semester 1995 Adopted 15.5.92 
Adopted 26.10.93 
Adopted 26.10.93 
Adopted 26.10.93 
1st semester 1995 
Elaboration in the framework of the multimodal plan 
idem 
idem 
idem 
idem 
idem 
TELECOMMUNICATIONS 
Telematics between 
administrations 
ISDN 
IBC Adopted 12.3.93 
Adopted 1.9.93 
Elaboration 1st semester 1994 
1st semester 1994 
1er semester 1995 1st semester 1994 
1st semester 1994 
1er semester 1995 
ENERGY 
Electricity 
Natural gaz Finalization 
Finalization 2nd semester 1994 
2nd semester 1994 2nd semester 1994 
2nd semester 1994 
FINANCIAL MEMORANDUM 
THE STRATEGIC PROGRAMME FOR THE INTERNAL MARKET 
credits authorised in 1993 
Commitments 
1 
483.947.000 Payments 
2 credits sought in 1994 
Commitments 
3 
544.970.000 Payments 
4 variation in % 
Commitments 
5 
• 12.00% Payments 
6 
1. Title of operation 
The strategic programme for the Intemal Market 
2. Budget heading involved 
cf.point 7.2 below 
3. Legal basis 
Treaty establishing the European Economic Community and, in particular. Articles 
8A.30-36, 59.100A and 100B. 
Treaty on European Union, and, in particular, Articles 129 A-D, and Chapter VI 
4. Description of operation 
4.1. General objective 
• Completion of the basic legal framework; 
• Management of the Community Area through ensuring quality and 
transparency of community rules transposed in national law; ensuring quality 
in enforcement; 
• Setting in place a coherent system of administrative cooperation between the 
Member States, and between these and the Commission to ensure the 
effective application of community legisaltion; 
• Assuring redress by access to justice and the improvement of judicial 
cooperation; evaluation of the impact of community rules; 
• Development of the Internal market: to improve the environment for business 
and reinforce consumer protection; ensure proportionality and transparency 
in new community rules; developing communication and better targeting 
information; maintaining a dynamic and open external policy; 
-2-
Facilitating the development of trans-European networks in key sectors; 
stimulating private investment and facilitating the setting up of telematic 
networks between national administrations and their European counterparts. 
The actions proposed are based on the following communications and 
resolutions: 
a) Communications 
• Communication from the Commission of 2 December 1992, The functioning 
of the Intemal Market after 1992 - Follow-up to the Sutherland Report" 
(SEC(92)2277 final). 
• Communication from the Commission of 2 June 1993, "Reinforcing the 
Effectiveness of the Intemal Market - Towards a Strategic Programme for the 
Internal Marker (COM (93) 256 final). 
b) Resolutions 
• Council Resolution of 7 December 1992, on the means to ensure the 
effective functioning of the Intemal Market (OJ n°C334 18.12.1992, p.1). 
4.2. Duration 
Permanent action reaching beyond the 1993 deadline set down in Article 8A of the 
EEC Treaty, with a view to ensuring the proper functioning of the Internal Market and 
progress towards economic and monetary union. 
4.3. Population affected bv the action 
National administrations, commercial and industrial circles, judicial bodies, citizens 
and consumers. 
5. Classification of the expenditure 
5.1. Non-compulsory expenditure 
5.2. Differentiated appropriations 
5.3. n.a. 
6. Type of expenditure 
The operational expenditure essentially comprises: 
financial contributions and subventions (particularly those destined for 
European bodies with the task of administrative cooperation and advisory 
and managerial scientific instances responsible for monitoring of community 
rules); 
financial obligations stemming from contracts for preparatory, feasability or 
evaluation studies which contribute towards the functioning of the Intemal 
market, (particularly in the frame of the establishment of telematic networks 
between administrations) and to the achievement of allied political objectives; • 
-3 
• subventions destined for the support of projects of community interest 
undertaken by external bodies; 
• the financing of the exchange of national officials, training, and information 
and communication programmes. 
7. Financial impact 
7.1 Method of calculating total cost 
Going beyond the 1993 deadline, where the accent had been placed on the 
achievement of the legislative objectives of the White paper, implied a significant 
revision of the headings of the intemal Market line for the preparation of the 1994 
draft budget. This revision centerd on a modification of the normal actions in line with 
the political orientations contained in the Communications from the Commission to the 
Council and the Pariiament, of 2 December 1992 The functioning of the Intemal 
market after 1992 - Follow -up to the Sutherland report" (SEC (92)2277 final) and 
2 June 1993 "Reinforcing the effectiveness of the Intemal Market - Towards a 
strategic programme for the Intemal market (COM (92)256 final). The draft 
programme aims to develop these modified type actions in view of the qualitative 
changes in the nature of the work of the services responsible for monitoring the 
implementation of community legislation in the framework of reinforced administrative 
cooperation with the Member States. 
It is obvious that to a certain extent existing resources can be redeployed to face this 
new challenge. A detailed examination of current allocations will however be required 
to determine where such redeployment is possible. Furthermore it is clear that for 
certain tasks existing resources will be insufficient In other cases K is equally 
apparent that the implications in terms of resources cannot be calculated until the 
complementary tasks described in the programme have achieved, allowing for a 
precise estimate of requirements. The other services concemed have been asked to 
furnish all relevant information in this respect. By way of example ,as far as headings 
Bll, OUI and D are concerned, DG XXI has signalled the development of actions 
already envisaged in 1994 which will give rise to additional calls on resources in 1995: 
• "Monitoring groups" (representatives of administrations and industry to 
ensure that the Intemal Market keeps in step) - 4 Mio Ecus in 1995; 
• "A citizen's Europe" (to identify possible difficulties arising from the Intemal 
Market and to advise citizens) - 3MioEcus in 1995; 
• "Pilot projects" (adaptation of traditional mechanisms of control to ensure a 
better protection of the external frontiers) - 7 MioEcus in 1995. 
This having been said, this financial statement, as a first step, attempts to schedule 
those budget lines associated with Intemal Market policies and to establish the order 
of magnitude of the sums devoted to the achievement of those policies. The "pro-
memorias" may indicate where additional resources will be required. 
7.2 Itemised breakdown of costs 
The figures appearing hereafter represent the situation as it is appears in the 
preliminary draft budget for 1994; 
-4 
Breakdown by broad lines 
of the programme 
• (indicate* that the heading can also include 
new operations) 
A. Completing the basic legal frame­
work 
B. Managing the community area 
1. Quality and transparency in trans­
position 
II. Quality in implementation 
• administrative cooperation* 
- monitoring implementation* 
- preventing new barriers* 
- sanctions* 
III. Redress* 
Access to justice and judicial coo­
peration* 
IV. Evaluation of the impact of commu­
nity rules* 
C. Developing the single market* 
1. Proportionnality and transparency 
of new rules -communication and 
information policy* 
II. Improving the environment for busi­
ness* 
III. Improving the environment for 
consumers* 
IV. Trans-European networks* 
D. External policy -managing the 
frontiers* 
TOTALS Budget lines 
involved 
(in whole or in part) 
B5-3000 
B5-301 
B5-4020 
B5-4023 
B5-3000 
of A. B and C) 
B2-5101 
B2-5102 
B3-4015 
B5-108 
B6-302 
B6-3051 
B5-306 
B5-100 
B5-800 
B5-600 
B5-300 
B3-303 
B5-304 
B5-401 
B5-500 
B5-300 
B5-303 
B5-320 
B3-4111 
B5-102 
B5-105 
B2-702 to B2-706 
B5-700 
B5-720 
B5-7210 
B6-7211 
B5-7212 
B5-7213 
B3-440 
B5-600 
B5-7214 Budget 1993 
cf B. beiow 
p.m. 
17.800.000 
7.000.000 
34.000.000 
14.000.000 
4.000.000 
30.000.000 
1.000.000 
p.m. 
2.427.000 
p.m. 
2.100.000 
22.900.000 
Budget 1993 
cf B above 
6.800.000 
28.000.000 
8.000.000 
10.000.000 
cf B. above 
500.000 
24.800.000 
650.000 
6.000.000 
3.500.000 
12.770.000 
185.000.000 
7.000.000 
17.000.000 
9.800.000 
2.000.000 
3.300.000 
22.900.000 
700.000 
483.947.000 APB1994 
cf B. below 
750.000 
18.100.000 
5.000.000 
40.750.000 
19.000.000 
4.000.000 
p.m. 
1.000.000 
2.900.000 
7.500.000 
2.400.000 
p.m. 
23.700.000 
APB1994 
cf B. above 
7.820.000 
39.000.000 
10.000.000 
11.200.000 
cf B above 
700.000 
26.800.000 
650.000 
6.700.000 
3.500.000 
13.000.000 
200.000.000 
20.000.000 
26.200.000 
10.000.000 
12.900.000 
2.000.000 
4.800.000 
23.700.000 
900.000 
544.370.000 
* (indicates that the heading can also contain new operations). 
8. Fraud prevention measures 
The verification of subventions and the acceptance of services and the results of 
preparatory, feasability or evaluation studies requested is carried out by the 
Commission services before payments are effected, taking into account contractual 
-5-
obligations and the principles of economy and sound financial management; fraud 
prevention measures (surveillance, regular reports etc.) are included in all agreements 
or contracts concluded between the Commission and the beneficiaries of payments. 
The framework contract concluded in 1992 between the Commission and the 
European standardisation orgainsations provides, for example, a very clear 
presentation of the costs associated with the preparation of mandated European 
standards which allows for effective control of actual expenditure. 
In a general manner, all permanent actions are subject to regular follow-up by the 
services concemed, and for once-off actions there is an evaluation ex-post facto. 
Statistical and other information assists in the evaluation of the progress of 
Community actions and thus contributes to the consolidation of fraud prevention 
operations. 
In many regulations, specific measures are envisaged and intemal control measures 
are based on the verification by the responsible heads of unit that progress in relation 
to individual projects or programmes is in conformity with the facts. 
9. Elements of cost effectiveness analysis 
9.1. Specific and quantifiable objectives 
The specific objectives of this action relating to the strategic programme for the 
Intemal Market are set out hereafter. 
A. Completion of the basic legal framework 
The legislative programme set out in the White paper in 1985 has been realised by 
more than 95%, except for identity controls on persons at the intemal frontiers. There 
are, however, still a number of proposals from this programme where the Council has 
yet to reach a decision and other complementary proposals have been introduced 
since 1985. Furthermore, additional proposals have just been presented to the 
Council relating to the free movement of persons. These matters concern, in particular 
the following dossiers: 
coordination in company law; 
proposals relating to double taxation; 
intellectual property - biotechnological inventions; 
indirect taxation; 
precious metals; 
counterfeit goods; 
exports of dual-use goods; 
personal data protection; 
deposit guarantee systems; etc. 
Also envisaged are actions having a significant competition aspect, in the regulated 
sectors of energy, telecommunications and the postal services. 
S. Management of the Community area 
Involved here is the management of the application of community legislation which is 
achieved through: 
• monitoring of Member States' respect of their community obligations through 
checking the quality of transposition into national law, and updating of 
information in realation to this legislation; 
• ensuring the quality of implementation through a coherent framework for 
administrative cooperation with the necessary technical support, surveillance 
of the implementation of community rules and the means of resolving 
difficulties in this implementation, preventing the emergence of new barriers 
through transparency in national derogations, the notification procedure in 
the domain of services, the definitive harmonisation of tax régimes, and 
sanctions against Member states for infringements; 
• facilitating redress, improving access to justice and judicial cooperation, 
improving access to legislation, facilitating recourse to national courts, 
reinforcing the free movement of judgements (Brussels Convention), 
analysing the conflict of laws in the frame of private international law and the 
Intemal Market and modification of the Rome Convention; 
• evaluation of the impact of community rules, the operation in practice of 
community legislation in the intemal market and the economic impact on 
business, reinforcement of the INTRASTAT system for statistics on 
intracommunity trade. 
C. Development of the intemal mahet 
The development of the single market supposes that the Commission puts at the 
disposal of the Member States, business and consumers appropriate tools for the 
achievement of this objective; 
• proportionality and transparency in the preparation of new legislative 
measures, management of a coherent communications and information 
policy through the partnership with Member States, using where necessary as 
intermediaries, particularly the EICs, the industrial federations and 
professional organisations; 
• improving the environment for business, ensuring coherence between 
regional, national and community action relating to environmental protection, 
improving cross-border payments, liberalisation of the markets in transport 
services, elimination of obstacles to protection in the area of industrial and 
intellectual property, coordination in company law questions, establishing 
direct and indirect tax régimes that are favourable to business, strenghtening 
European standardisation, certification systems and promoting quality policy, 
treatment of the specific needs of small and medium sized enterprises, Green 
Paper on commercial communication and distribution services, and the 
follow-up of work in the domain of the media; 
• improving the environment for the consumer; 
• establishing trans-European networks, the promotion of a convergence of 
interests and coordination, stimulation of private investments, ensuring 
technical interoperability and the development of telematic networks between 
administrations; 
D. A Dynamic and open external policy 
The sound management of the external frontiers is indispensable to avoid trade 
distortions and prevent illegal practices which can damage the functioning and 
competitiveness of the single market: 
-7-
• reinforcement of the controls at the external frontiers and revamping the 
customs services in view of the objectives of "Customs 2000"; 
• completion and development of the common commercial policy, 
administrative cooperation to avoid infringements. 
9.2. Grounds for the operation 
The totality of this action springs from the principle of the attribution to the 
Commission of the powers of execution of rules adopted by the Council in the 
framework of the completion of the Intemal Market It should be be recalled that the 
Council in its' Resolution of 7 December 1992 on the means to ensure the functioning 
of the Intemal Market, invited the Member States and the Commission to examine the 
necessity to reinforce cooperation in order to resolve any practical problems which 
could arise. The Pariiament in its Resolution of 18 December 1992 also invited the 
Commission to take the necessary measures to meet the challenge which the proper 
functioning of the Internal Market represents. The Commission in responding to this 
objective by its decision of 23 December 1992 set up an advisory committee in the 
domain of the Internal Market. 
For those actions underway there is truly no alternative to a community action, for 
every oversight by the Commission in the area of the completion and functioning of 
the Internal Market risks the emergence of divergent national policies. 
The Commission, however, is permanently examining different possibilities to répond 
to the exigencies of economy and efficiency. 
In this respect in the domain of standardisation, the strategy, which was initially 
founded on a detailed harmonisation of the national laws, currently pursues two 
complementary orientations: 
• mutual recognition of national rules; 
• the limitation of the approximation of legislation at community level solely to 
those cases where the objectives of the national laws are not equivalent. 
Furthermore, the Commission, in the framework of the implementation of the Green 
Paper on standardisation, introduced significant changes to the system of financing 
European standardisation. 
As concerns the programme for exchanges of national officails between the 
administrations of the Member States, the contributions of administrations 
participating has been fixed at 50% for the daily allowances payable. This programme 
is complementary to the other exchange programmes adopted by the Council in 
specific sectors, i.e. MATTHAEUS, MATTHAEUS-TAX and in the veterinary domain. 
9.3. Monitoring and evaluation of the action 
Performance indicators selected 
a) percentage of proposals issued by the Commission on the basis of its work 
programme, and percentage of decisions adopted by the Council. 
b) number of texts codified per sector and adopted in this form by the Council. 
c) number of exchanges carried through in the framework of the 
KAROLUS,MATTHAEUS,MATTHAEUS-TAX and veterinary programmes. 
d) number of standards adopted and remaining to be adopted. 
e) establishment and functioning of telematic networks between administrations 
responsible for the monitoring of the Intemal Market and between these latter 
and the Commission. 
8-
f) modification and ratification of international agreements on the application of 
commercial law. 
g) start-up of large infrastructure projects coming within the frame of 
transeuropean network policies. 
Details and frequency of planned evaluations 
The evaluation of work relating to the functioning of the intemal market is done on an 
annual basis through the action and intervention of the committee responsable for the 
functioning of the Internal Market An annual report is foreseen in the Communication 
of the Commission of 2 December 1992, " The functioning of the Intemal Market after 
1992 - Follow-up to the Sutherland Report (SEC (92)2277 final). 
As regards the KAROLUS programme, Article 18 of the Commission decision 
(93/10/CEE) fixing the operational provisions for the programme, provides that the 
Commission establish an annual fiancial report on the execution of the programme, 
which is to be transmitted to the national coordinators to permit an evaluation of the 
programmes' implementation. 
10. Administrative expenditure (Part A of the Budget) 
Note: It must be recalled here that significant sums are already included in part A 
destined for specific surveillance tasks in certain sectors of the Intemal Market. 
This is the case, in particular, for the following lines: 
Line 
A 3531 (SG, VI, XXI) 
A 3532 (I.XXI) Entitled 
Fight against fraud 
TAFI Fraud suppres­
sion in the textile sector Budget 1993 
4.341.000 
500.000 APB 1994 
4.145.000 
500.000 
10.1. Will the proposed operation involve an increase in the number of Commission 
staff? If so. how many? 
Yes. cf point 7.2 above. It is probable that the development of certain actions in the 
frame of the strategic programme wiil generate additional administrative expenditure 
and requests for increases in the numbers of staff. Although some partial and 
preliminary evaluations have been furnished to DG XV by some services, at this 
stage, and before analysing these requirements in detail, in collaboration, where 
necessary with the Mmeber States, no reliable estimate is possible. The specific 
actions stemming from the strategic programme will themselves be the subject of 
financial memoranda when formally presented, giving all the elements necessary to 
determine the resource implications. 
It is clear that requests for additional statutory posts or recourse to external personnel 
must be presented having regard to the financial perspectives and the agreed 
envelopes for the budgetary exercises concerned. 
10.2. indicate the amount of staff and administrative expenditure involved in the 
proposed operation. Explain the method of calculation 
cf points 7.2 and 10.1 above. 
ISSN 0254-1475 
COM (93) 632 final 
DOCUMENTS 
EN 10 
Catalogue number : CB-CO-93-673-EN-C 
ISBN 92-77-62382-9 
Office for Official Publications of the European Communities 
1^2985 Luxembourg